Appellate Tribunal For Electricity
Chhattisgarh State Electricity Board vs Central Electricity Regulatory ... on 17 May, 2007
Equivalent citations: 2007ELR(APTEL)149
ORDER Anil Dev Singh, Chairperson and H.L. Bajaj, Member (T)
1. By this application, Madhya Pradesh State Electricity Board ("MPSEB"/ Madhya Pradesh Power Trading Co. Ltd.) seeks direction to the Western Regional Electricity Board, now called Western Regional Power Committee to recalculate the Frequency Linked Energy Exchange (for short "FLEE") charges for the period from 1st December, 2000 to 30th June, 2002 in terms of the Judgment and Order of this Tribunal dated 14th November, 2006 and to deal with Western Regional Electricity Board appropriately for non-compliance of the aforesaid Order.
2. The prayer of the Applicant needs to be appreciated in the context of the Judgment and order of this Tribunal dated 14th November, 2006 and the factual matrix of the case on the basis of which the Judgment was rendered.
3. The FLEE charges were introduced in the Western Region from 1st June, 1992. These remained in force until 30th June, 2002. Thereafter, with effect from 1st July, 2002 the Availability Based Tariff (for short "ABT") was made applicable in the Western Region and FLEE charges were replaced by Unscheduled Interchange (for short "U.I.") charges.
4. The undivided State of Madhya Pradesh was bifurcated into two States namely Chhattisgarh and Madhya Pradesh by the Madhya Pradesh Reorganisation Act, 2000. While the State of Chattisgarh was formed on 1st November, 2000 as a result of the Reorganisation Act of 2000, the Chhattisgarh State Electricity Board was constituted in furtherance of Section 58 thereof, with effect from 15th November, 2000.
5. On 31st January, 2001, the Government of India, Ministry of Power made allocation of power to the successor States of the undivided State of Madhya Pradesh from the Central Sector Generating Stations in the following manner:
Central sector power station State in which located Installed capacity (MW) Allocation (MW) Undivided MP MP MW (%) Chhattisgarh MW (%) Korba STPS Chhattisgarh 2100 610 302 (14.38%) 308* (14.67%) Vindhyachal STPS MP 2260 658 552* (24.43%) 106 (4.69%) Kakrapar APS Gujarat 440 93 70 (15.91%) 23 (5.22%) Kawas-I GPS Gujarat 644 137 104 (16.15%) 33 (5.12%) Gandhar-I GPS Gujarat 648 116 88 (13.58%) 28 (4.32%) Total 6092 1614 * Includes home State allocation (10%)
6. The allocation was provisional in nature as provided in the Order of the Central Government. It was also provided in the Order that to the extent Chhattisgarh was unable to utilise its allocation, as indicated above in accordance with the existing sharing formula, the power would stand temporarily allocated to Madhya Pradesh. As per para-6 of the Order, the allocation was to come into operation with immediate effect.
7. Based on the inputs from the Central Electricity Authority and no objection of the Government of Chhattisgarh, the Government of India on 8th February, 2002, as a temporary arrangement, allocated 296 MW power from central sector generating stations to Madhya Pradesh out of 498 MW, earlier allocated to Chhattisgarh vide Ministry's letter dated 31st January, 2001, as per the following details:
Name of Power Station Provisional allocation to Chhattisgarh (MW) vide letter dated 31.01.2001 Temporary re-allocation upto 31.03.2002 Chhatisgarh (MW) MP(MW) Korba STPS 308 179 129 Vindhyachal STPS 106
-106
Kakrapar APS 23 23
-
Kawas-I GPS 33
-
33Gandhar-I GPS 28
-
28Total 498 202 296
8. Paragraph-3 of the Order of the Government of India, Ministry of Power dated 8th February, 2002 stipulated that the temporary allocation will be applicable with immediate effect and continue upto 31st March, 2002, where after allocation will be reviewed. It was further stipulated therein that the temporary allocation may continue beyond 31st March, 2002 or till such time, CEA or State of Chhattisgarh presents another proposal. In paragraph-4 of the Order dated 8th February, 2002, it was stated that Chhattisgarh will be free to utilize the re-allocated power as it desires and the allocation of 498 MW will continue to be the allocation of Chhattisgarh, which will also be free to absorb at a later stage against their future power requirements or outage of any generating unit.
9. On 17th June, 2002, the Government of India, Ministry of Power issued another Order, whereby it temporarily made fresh allocation of power to Madhya Pradesh out of 498 MW, earlier allocated to Chhattisgarh vide its letter dated 31st January, 2001 as per the following details:
Temporary allocation (Figures in MW) April May, 2002 June, 2002 Name of Power Stations Provisional Allocation to Chhatisgarh vide Ministry's letter dated 31.1.2001 01.04.02 to 30.04.02 01.05.02 to 31.05.02 01.06.02 to 30.06.02 Chhatisgarh MP Chhatisgarh MP Chhatisgarh MP Korba STPS 308 275 33 308
-308
-
Vindhyachal STPS 106
-
106 47 59 106-
Kakrapar APS 23 23
-
23-
23-
Kawas GPS 33
-
33-
33-
33Gandhar GPS 28
-
28-
28-
28Total 498 298 200 378 120 437 61
10. The aforesaid temporary allocation was required to be continued upto 30th June, 2002 and with effect from 1st July, 2002, the entire share of Chhattisgarh to the extent of 498 MW was to be restored to it. It was also provided that in the event of Chhattisgarh being unable to consume power allocated to it, the same will be allocated to Madhya Pradesh. Similarly any allocation which Madhya Pradesh was unable to utilize was required to be allocated to Chhattisgarh.
11. By a clarificatory order dated 11th May, 2004, it was also directed by the Government of India that the payment of U.I. charges for drawal of power from the existing Central Generating Power Stations by Madhya Pradesh and Chhattisgarh would be accounted for in the following manner:
(i) On the basis of daily schedule the quantum of power which one State has not drawn from its allocated share will be added to the schedule of other state to the extent of overdrawal by it. (ii) On the basis of daily schedule as indicated in (i) above overdrawal by one State would be further offset from the underdrawal of other State, (iii) The State getting the benefit from (i) and (ii) above will pay capacity and energy charges for enhanced schedule.
The aforesaid arrangement was to remain operative for a period of five years after creation of the new States subject to review as considered necessary during this period.
12. The FLEE/U.I. charges were levied on the State of Madhya Pradesh from time to time by the Western Region Electricity Board for over-drawal of power from the Central Sector Generating stations. The State of Madhya Pradesh represented that the FLEE/U.I. charges were being levied on it without considering the decision of the Government of India to the effect that the under utilized power of one State will be available to the other State for consumption. At the direction of the Delhi High Court in a Writ Petition filed by the State of Madhya Pradesh, the issue was considered by the Government of India and by a clarificatory Order dated 3rd November, 2004, it was directed that the entitlement of the State of Chhattisgarh and Madhya Pradesh in the Central Sector Generating Stations of Western Region shall be in the following manner:
Undivided M.P. Madhya Pradesh Chhattisgarh Korba STPS 610 400 210 Vindhyachal 658 658
-
Kakrapara 93 93
-
Kawas CCGTI 139.2 139.2
-
Gandhar CCGTI 18 118
-
1618.2 1408.2 210
13. The aforesaid allocation was made in supersession of several letters/ Orders of the Ministry of Power including Orders dated 31st January, 2001, 8th February, 2002 and 17th June, 2002.
14. By another order dated 4th November, 2004, the Government of India apportioned the assets, rights and liabilities of the Madhya Pradesh Electricity Board of the undivided State of Madhya Pradesh between the successor Electricity Boards of Madhya Pradesh and Chhattisgarh. This order of the Central Government was challenged by the Madhya Pradesh State Electricity Board and the State of Madhya Pradesh in a Writ Petition, being Writ Petition No. 675 of 2004, before the Hon'ble Supreme Court. The Hon'ble Supreme Court by its Order dated 13th September, 2006 dismissed the Writ Petition.
15. Earlier, while the matter was pending before the Supreme Court in Writ Petition No. 675 of 2004, the Maharashtra State Electricity Board (for short "MSEB") filed a Petition No. 43 of 2005 before the Central Electricity Regulatory Commission (CERC) for direction to the MPSEB to pay a sum of Rs. 114 crores to the MSEB. The CERC assigned the dispute pertaining to determination of FLEE charges and liability of the beneficiaries in the Western Region to a single Member Bench. The single Member Bench submitted its report to the CERC, whereupon the CERC required the parties to file their objections to the report. After considering the objections, the CERC accepted the report of the single Member Bench on 8th December, 2005.
16. In the appeal filed by the Chhattisgarh State Electricity Board against the aforesaid Order of the CERC before the Tribunal, the following points arose for consideration:
(a) Whether the MPSEB is liable to pay the FLEE charges for the period 1st June, 1992 to 30th November, 2000 to the beneficiaries as advised by WREB?
(b) Who is liable to pay FLEE charges to the beneficiaries for the period subsequent to 1st December, 2000 and till the introduction of ABT and UI system?
(c) To what relief the Appellant is entitled to?
17. On 14th November, 2006, the appeal was decided by a Bench of this Tribunal comprising of Mr. Justice E. Padmanabhan, Judicial Member and one of us (Shri H.L. Bajaj, Technical Member). In so far as point (a) was concerned, the parties agreed before the Bench that the same was covered by the decision of the Supreme Court rendered in Writ Petition No. 675 of 2004. Accordingly, the Bench answered the first point by holding that it is the Madhya Pradesh State Electricity Board who is responsible to pay FLEE charges for the period 1st June, 1992 to 30th November, 2000.
18. As regards point (b), it was held, that the liability has to be worked out in terms of the Notification of the Government of India dated 3rd November, 2004.
19. In so far as point (c) is concerned, it was directed that WREB will give effect to the Judgment of this Tribunal and it will not be necessary for parties to move either CERC or any other authority.
20. Pursuant to the directions contained in the Order dated 14th November, 2006, Western Regional Power Committee worked out the liability of the respective beneficiaries for payment of FLEE charges for the post reorganisation period and intimated the same through its communication dated 8th December, 2006.
21. The MPSEB feeling aggrieved by the letter of the WREB, has filed the instant application on the ground that the Order of this Tribunal dated 14th November, 2006 has been disregarded and the FLEE charges have not been calculated in accordance with the Order of the Government of India dated 3rd November, 2004.
22. We have heard the learned Counsel for the parties.
23. The controversy revolves around the question whether as per directions of this Tribunal contained in the Order dated 14th November, 2006, the FLEE charges have been calculated in accordance with the Order of the Government of India dated 3rd November, 2004. There is no dispute that FLEE charges have not been computed on real time basis and penalty for perceived overdrawl of power by the MPSEB has been imposed without off setting the same against the under drawl of power by the CSEB. It is significant to note that as per the Order of the Government of India dated 3rd November, 2004, the entitlement of the State of Madhya Pradesh in the Central Sector Generating Stations of Western Region was 1408.2 MW while that of the Chhattisgarh was 210 MW. The WREB has not implemented the Order of the Government of India dated 3rd November, 2004 on real time basis.
24. According to the Order of the Government of India dated 31st January, 2001, it is clear that the allocation of Madhya Pradesh from the Western Region was to the tune of 1116 MW and that of Chhattisgarh was to the extent of 498 MW. In Para-3 of the Order of the Government of India, it was clarified that to the extent Chhattisgarh is unable to utilize its allocation; the power would stand temporarily allocated to Madhya Pradesh. Similarly the Orders of the Government of India dated 8th February, 2002 and 17th June, 2002 made further provisional allocations to Madhya Pradesh out of allocation of 498MW to Chhattisgarh. Again by Order dated 11th May, 2004, the Government of India directed, inter alia, that on the basis of daily schedule the quantum of power which one State has not drawn from its allocated share will be added to the schedule of other state to the extent of overdrawal by it. It was also directed that on the daily schedule overdrawal by one State would be offset against the underdrawal of the other State. This arrangement was made operative for a period of five years after creation of the new States subject to being reviewed as considered necessary. This clearly shows that overdrawals by one State was required to be off set against underdrawal of the other state while calculating the FLEE charges. This significant arrangement ought to have been taken into consideration by the WREB. The learned Counsel for the Chhattisgarh State Electricity Board however, submitted that WREB was not required to apply the Order of the Government of India dated 3rd November, 2004 retrospectively and the FLEE charges could not be calculated on real time basis. It needs to be pointed out that while the State of Chhattisgarh was created on 1st November, 2000, the Chhattisgarh State Electricity Board came into existence on 15th November, 2000. The first provisional Order of the Government of India specifying the shares of the successor States in the entitlement of the central sector generating stations of the Western Region was issued on 31st January, 2001. Thus, there was a hiatus between the formation of the new States and the allocation of shares. This being so, the Chhattisgarh State Electricity Board, which was constituted only on 15th November, 2000, undisputedly drew power, even though at that point of time there was no allocation for it. Obviously, the drawal of power stood regularised to the extent of its share fixed by the Government by its order dated 31st January, 2001. Therefore, to say that the allocation cannot be applied retrospectively is to ignore the Order of this Tribunal dated 14th November, 2006, such an approach will lead to difficulties as the drawal of power by Chhattisgarh would be rendered unauthorised. It is hard to understand as to why WREB did not implement the earlier directive of the Government of India that in case Chhattisgarh is unable to utilise its allocation in accordance with the sharing formula, the power would temporarily be allocated to Madhya Pradesh.
25. In the Order of the Tribunal dated 14th November, 2006, it has been specifically directed that the liability of the respective Boards, subsequent to bifurcation, has to be worked out in terms of the Government of India Notification dated 3rd November, 2004. In case the interpretation placed by the WREB is accepted, it would mean that direction given by this Tribunal would be rendered meaningless. In para-19 of the aforesaid Order, the second point namely "who is liable to pay FLEE charges to the beneficiaries for the period subsequent to 1st December, 2000 and till the introduction of ABT and UI system" has been considered. FLEE charges were applicable only upto 30th June, 2002. Orders dated 31st January, 2001, 8th February, 2002, 17th June, 2002 etc. of the Government of India related to the period when the FLEE charges were in vogue. The letter of the Government of India dated 3rd November, 2004 was issued pursuant to the Order of the Delhi High Court dated 10th August, 2004, whereby the Government of India was directed to pass final orders relating to allocation of power to the successor States. Thus the temporary allocation made by letters of the Government of India dated 31st January, 2001, 8th February, 2002, 17th June, 2002 etc. was replaced by the aforesaid final allocation. Obviously the Order in so far as calculation of FLEE charges are concerned, needs to be worked out on real time basis as otherwise the final allocation will have no meaning since the FLEE charges ceased to be applicable in July, 2002. The letter of the Government of India dated 3rd November, 2004 has to be read in the context of the earlier letters of the Government of India dated 31st January, 2001, 8th February, 2002, 17th June, 2002 etc. It will be absolutely unjust not to give effect to the final allocation of power and to calculate FLEE charges without taking into consideration the fact that even in the earlier Orders of the Government of India dated 31st January, 2001, 17th June, 2002 etc., there was a clear stipulation that in case Chhattisgarh is unable to consume the power allocated to it, the same will be allocated to Madhya Pradesh. It seems WREB did not understand the true import of the Order of this Tribunal dated 14th November, 2006.
26. Therefore, in the light of the aforesaid observations, we direct the WREB to re-calculate the FLEE charges in accordance with the Order of this Tribunal dated 14th November, 2006.
27. With the aforesaid direction, the application is disposed of.