Appellate Tribunal For Electricity
Uttar Haryana Bijili Vitran Nigam Ltd vs Haryana Electricity Regulatory ... on 27 April, 2012
Judgment in Appeal No. 78 of 2011
Appellate Tribunal for Electricity
(Appellate Jurisdiction)
Appeal No.78 of 2011
Dated: 27th April, 2012
Present: HON'BLE MR. JUSTICE M KARPAGA VINAYAGAM,
CHAIRPERSON,
HON'BLE MR. V J TALWAR, TECHNICAL MEMBER
In the Matter of:
Uttar Haryana Bijili Vitran Nigam Ltd
Shakti Bhawan, Sector-6
Panchkula-134 109 ........Appellant
Versus
1. Haryana Electricity Regulatory Commission
Bays No.33-36, Sector-4,
Panchkula, Haryana-134 112
2. M/s. Bhoruka Power Corporation Limited
48, Lavelle Road,
Bangalore-560 001
3. Government of Haryana
Department of Power and Renewable Sources
Haryana Civil Secretariat,
Chandigarh-160 001
4. Government of Haryana
Department of Irrigation
Sinchai Bhawan, Sector-5,
Panchkula-134 109
5. Haryana Renewable Energy Development Agency
SCO No.48, Sector-26,
Chandigarh-160 019 Respondents
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Judgment in Appeal No. 78 of 2011
Counsel for the Appellant(s): Mr. Ramji Srinivasan,Sr Adv
Ms. Shweta Mishra
Ms. Ruchi Gour Narula
Mr. Vivek Kishore
Mr. P C Sharma
Ms. Nidhi Minocha
Counsel for the Respondent(s): Mr. Anand K Ganesan for R-1
Ms. Swapna Seshadri for R-1
Mr. Sanjeev Kr Saxena for R-2
Mr. G Joshi for R-2
Mr. Sridhar Prabhu for R-2
Mr. P C Sharma for R-5
PER HON'BLE MR. JUSTICE M. KARPAGA VINAYAGAM, CHAIRPERSON
1. Uttar Haryana Bijili Vitran Nigam Limited (UHBVNL) is the
Appellant herein.
2. Aggrieved over the impugned order dated 8.9.2010 passed
by the Haryana Electricity Regulatory Commission (State
Commission) revising the approved Tariff of the 2nd
Respondent, the Appellant has filed this Appeal.
3. The short facts are as follows:
(a) The Appellant is a Government of Haryana
undertaking.
(b) It is a Distribution Licensee, being responsible for the
distribution and retail supply of power in the Northern
parts of Haryana.
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Judgment in Appeal No. 78 of 2011
(c) State Regulatory Commission is the 1st Respondent.
M/s. Bhouruka Power Corporation Limited is a
generating company and is the Second Respondent.
(d) Haryana Renewable Energy Development Agency
(HAREDA), 5th Respondent, an autonomous body was
set-up by the Government of Haryana to implement
the Non-Conventional & Renewable Energy Projects
under the Haryana State Department of Non-
Conventional Energy Sources.
(e) HAREDA issued advertisements in 1998, inviting the
proposal for setting up mini hydro plants on canal
drops at Dadupur and other sites in Haryana.
(f) M/s. Bhouruka Power Corporation Limited, the 2nd
Respondent was one of the bidders for the Dadupur
site. Ultimately it became the successful bidder. A
Letter of Intent was issued on 30.4.1999 for the said
site.
(g) However, by the Memo dated 30.9.1999, the
HAREDA cancelled the allocation of the Dadupur site
made in favour of M/S. Bhouruka Power Corporation
(R-2).
(h) Challenging the same, M/s. Bhouruka Power
Corporation (R-2) preferred a Writ Petition before the
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Judgment in Appeal No. 78 of 2011
Punjab and Haryana High Court. The High Court
ultimately by the order dated 3.7.2000 allowed the
said Writ Petition setting aside the cancellation and
restored the order of allocation of Dadupur site made
in favour of M/s. Bhouruka Power Corporation (R-2).
(i) Thereafter, on 17.4.2006, a PPA was entered into
between the Appellant and M/s. Bhoruka Power
Corporation Limited (R-2). The said PPA was placed
before the State Commission for approval.
(j) On 10.7.2007, the Haryana Commission gave its
approval to the PPA with some modifications including
slight change in the tariff. Thereafter, the modified
PPA was signed by the parties on 3.3.2008.
(k) Thereafter, due to escalation of prices in the changes
made in the tax regime, change in scope and other
relevant factors, heavy additional cost was incurred by
the Generator (R-2) for completion of its Dadupur site.
Due to heavy additional cost, M/s. Bhoruka Power
Corporation Limited (R-2) felt difficult to survive at the
tariff determined by the State Commission on the
basis of the PPA. Therefore, M/s. Bhoruka Power
Corporation Limited (R-2) sent a letter to the Appellant
requesting for the increase in the tariff. However, the
Appellant did not accede to the request of M/s.
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Judgment in Appeal No. 78 of 2011
Bhoruka Power Corporation Limited (R-2) to increase
the tariff.
(l) Hence, in April, 2010, M/s. Bhoruka Power
Corporation Limited (R-2) filed a Petition before the
State Commission for re-determination of the tariff of
the project on the grounds mentioned above.
(m) The State Commission, after hearing the parties
passed the impugned order dated 8.9.2010, allowed
some of the claims made by M/s. Bhoruka Power
Corporation Limited (R-2) and approved additional
capitalisation of Rs.4.12 Crores on completed cost
basis and re-determined the tariff.
(n) Aggrieved by the said order, the Appellant has
preferred the present Appeal.
4. The Learned Senior Counsel for the Appellant would urge
the following contentions:
(a) The HERC (Terms and Conditions for Generation of
Tariff) Regulations 2008 are only prospective.
Regulation 2 of the 2008 Regulations limits the scope
and extent of application of the said Regulations to
cases where the commission determines the tariff
under Section 62 and 64 of the Electricity Act, 2003. In
the present case, the tariff has been determined in
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Judgment in Appeal No. 78 of 2011
accordance with Section 63 of the Act through the
bidding process on the basis of mutually agreed tariff
by both the distribution licensee and the generator. As
such, the applicability of this Regulation is excluded.
Furthermore, the Regulations which have been
applied in the present case to over ride the PPA
provisions are only prospective in nature. Therefore,
the impugned order is erroneous.
(b) The State Commission has wrongly exercised its
jurisdiction and determined the tariff by complying with
its 2008 Regulations which would not apply to the
present case. As a matter of fact, the State
Commission by the order dated 10.7.2007 had finally
approved and fixed the tariff for a period of 15 years.
The State Commission reserved its right to review and
approve the fresh tariff only from the 16th year
onwards and not before. Therefore, the decision to
review the tariff before the expiry 15 years period is
wrong.
(c) Admittedly, M/s. Bhoruka Power Corporation (R-2)
conducted the detailed survey of the site and prepared
a DPR on the basis of which the project was awarded
to it. It was expected that the project developer, being
a prudent businessman, would factor in the
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Judgment in Appeal No. 78 of 2011
inflationary trends and the possible spill over of costs
in a project which was expected to extend over a
period of time.
(d) The Commission has wrongly allowed the claims in
respect of construction of cut-off wall, expenses on
account of dewatering and dewatering equipment,
purchase of diesel for dewatering, barrage gate and
repair of existing barrage gate even though the 2nd
Respondent is not entitled to the said claims.
5. In reply to the above submissions, the Learned Counsel for
the Respondents namely the Commission as well as
M/s.Bhoruka Power Corporation Limited (R-2) have made
the following submissions:
(a) On 19.12.2008, the Tariff Regulations, 2008 were
notified which provided that final tariff has to be
determined based on the actual competitive cost of
the project. Admittedly, the Appellant has not
challenged the said Regulations in the appropriate
forum. Therefore, the same are binding upon the
Appellant. Furthermore, it is a settled law that
Regulations framed under the Act can intervene and
override the existing contracts of the regulated
entities.
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Judgment in Appeal No. 78 of 2011
(b) The contention of the Appellant is that the tariff was
determined under section 63 of the Electricity Act,
2003 and therefore, the same cannot be reviewed is
wrong since in the Petition filed before the
Commission on 17.4.2006 it had not been mentioned
that the tariff may be fixed on the basis of the
competitive bidding process. The instant project falls
outside the purview of the Clause of National Tariff
Policy which mandates that all future requirements of
power should be procured competitively by the
distribution licensee. The tariff had been determined
by the Commission only under section 62 of the
Electricity Act, 2003 and not under Section 63 of the
Act.
(c) The State Commission has correctly held that the tariff
fixed by it at the time of approval of the PPA was
subject to the review and that Regulations have
overriding effect over the existing contracts including
the said PPA. Even assuming that the PPA did not
provide specific clause for revision of the project, the
Commission is empowered to re-determine the tariff
already fixed by it under section 62 of the Act.
(d) The Respondent in its Petition has claimed 11 items
but the State Commission has allowed claim for only 5
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Judgment in Appeal No. 78 of 2011
items by giving valid reasons. As such, the impugned
order does not suffer from any illegality.
6. In the light of the above submissions, the following question
may arise for consideration:
(a) Whether the tariff could be re-determined by the State
Commission through the impugned order under
section 62 of the Electricity Act, 2003 when the basis
of allocation of the project to Bhouruka Power
Corporation Limited (R-2) was through the process of
competitive bidding under section 63 of the Act ?
(b) Whether the tariff could be re-determined by the State
Commission on the basis of escalated cost when
there was no escalation clause in the PPA entered
into between the Appellant and the Bhouruka Power
(R-2) under the garb of Regulations to re-determine
the tariff as prayed ?
(c) Whether the State Commission is empowered to
increase the tariff even before the expiry of the period
namely ceiling limit which was prescribed in the
approval order approving the Power Purchase
Agreement?
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Judgment in Appeal No. 78 of 2011
(d) Even assuming that the State Commission had the
jurisdiction, whether the same has been correctly
revised ?
7. Let us deal with these questions one by one.
8. According to the Appellant, the Generating Station was set-
up by the generator pursuant to a competitive bidding
process under section 63 of the Electricity Act, 2003 and
consequently the same was adopted by the State
Commission and therefore, the State Commission had no
jurisdiction to revise the tariff so discovered under the
competitive bidding process under section 62 of the
Electricity Act, 2003.
9. At the outset, it shall be stated that the contention of the
Appellant that the tariff had been earlier determined under
section 63 of the Act and that therefore, the same cannot be
re-determined under section 62 of the Electricity Act, 2003
is not tenable for the following reasons:
(a) As a matter of fact, in the present case even though
the competitive bidding process was held, such
bidding process cannot be said to be under section 63
of the 2003 Act as the bidding took place in 1998 i.e.
prior to enactment of Electricity Act, 2003. Section 63
of the Act provides that the Appropriate Commission
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Judgment in Appeal No. 78 of 2011
shall adopt the tariff if such tariff has been determined
through transparent process of bidding in accordance
with the guidelines issued by the Central Government.
The Central Government issued guide lines in the
year 2006. Thus, the bidding process which took place
in the year 1998 cannot be said to be held in
accordance with the said guidelines issued by the
Central Government under Section 63 of the 2003 Act.
(b) It is true that the State Commission has to adopt the
tariff determined through transparent process of
bidding under section 63. In this case the Appellant
merely prayed the State Commission on 17.4.2006 to
determine/approve the tariff. Furthermore, it has not
been mentioned in their petition that the tariff has be
fixed on the basis of the transparent competitive
bidding process as per the guidelines of the Central
Government. Rather, it has been mentioned in the
said Petition that the power to be procured " at the
rate to be decided by HERC as per the provisions of
the Electricity Act, 2003". The State Commission did
not adopt the mutually agreed tariff mentioned in the
petition and had modified the said tariff. Therefore, the
tariff fixed by the State Commission by the order dated
10.7.2007 on the petition filed on 17.4.2006 was not
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Judgment in Appeal No. 78 of 2011
under section 63 of the Act but under section 62 of the
Act.
(c) That apart, the instant project falls outside the purview
of the National Tariff Policy because this mandates
that only future requirement of power should be
procured competitively by the distribution licensee.
Therefore, the clauses of National Tariff Policy
providing for procurement of power on the basis of the
competitive bidding would not apply to the project in
question.
(d) The State Commission has rightly held in the
impugned order that the petition dated 17.4.2006 did
not mention any rate which was the outcome of any
competitive bidding process to be adopted by the
Commission under section 63 of the Act. Therefore,
the State Commission treated the Petition accordingly
and determined the tariff on the basis of the data
available in DPR determining the tariff as per the
provisions of the Act. The relevant finding of the State
Commission is as follows:
"Thus, the Commission finds it difficult to agree
with the contention of UHBVNL that tariff (as
different from project) was determined on the
basis of competitive bidding. Accordingly, the
issue framed at Sr No.B by the Commission is
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Judgment in Appeal No. 78 of 2011
answered that the tariff was determined by the
Commission under Section 62 of the Act and not
adopted under Section 63 of the Act as an
outcome of a competitive bidding as provided in
the National Tariff Policy"
10. In view of the above, the contention of the Appellant that
the first tariff order was passed under section 63 of the Act
and that therefore it cannot be revised under section 62 of
the Act is liable to be rejected.
11. That apart, during the proceedings before this Tribunal, the
Appellant was asked to submit the copy of the RFP and the
bid to show that the bidding was carried out in accordance
with the guidelines issued by the Central Government. At
that stage, the Appellant submitted that it will not press the
ground that the tariff was determined in the earlier order
under competitive bidding process under section 63 of the
Act, 2003.
12. We will now refer to the 2nd issue raised by the Appellant as
to whether the tariff could be re-determined by the State
Commission on the basis of escalated cost when there was
no escalation clause in the PPA entered into between the
Appellant and the Bhouruka Power (R-2) under the garb of
Regulations to re-determine the tariff as prayed.
13. On this issue, the State Commission has given the
following finding in the impugned order:
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Judgment in Appeal No. 78 of 2011
"It is an admitted fact that the PPA signed between the
parties has no specific clause providing for any
revision of project cost and hence re determination of
tariff. However, the HERC Regulations i.e. HERC
(Terms and Conditions for Determination of Tariff),
Regulations, 2008 at clause 12 (1) provides as under:
"The Actual expenditure incurred on the date of
completion of the project shall form the basis for
fixation of final tariff. Investments made prior to 1st
April, 2008 in the case of the existing generating
stations shall be accepted for reckoning capital
cost on the basis of audited accounts. The final
tariff shall be determined based on the capital
expenditure allowed by the commission and the
expenditure actually incurred upto the date of
commercial operation of the generating station
and shall include capitalised initial spares, subject
to ceiling norms mentioned below, as a
percentage of plant and equipment cost".
Thus, it is clear from the above Regulation that the
final tariff has to be determined based on the actual
completed cost of the project. Hence in order to
mitigate investments risk, encourage huge investment
requirement and ensure stipulated return on equity the
regulation provides for re-look at the project cost and
realign tariff. The basic principle enunciated in the
above Regulations is applicable in all cases except
where the Commission adopts tariff under Section 63
of the Act. The Commission also examined the
relevant Regulations of CERC as Section 61 (a) of the
Act provides that the methods and principles
enunciated by the Central Commission with regard to
Generation has to be the guiding factor for the
SERCs. The Commission observes that the CERC
Regulations on terms and conditions for determination
of generation tariff also provides for additional
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Judgment in Appeal No. 78 of 2011
capitalization including on account of change in law
any additional work/ service which has become
necessary in efficient and successful operation of
plant but not included in the original capital cost.
The Status of regulations vis-a-vis a concluded
commercial contract like PPA was examined in the
light of the Hon'ble Supreme Court judgment in the
matter of PTC Vs CERC (2010 AIR (SC) 1338, 2010
INDLAW SC 169). The relevant portion of the order is
re-produced below:
"A Regulation under Section 178 (181 in the case
of State Commission), as part of Regulatory
framework, intervenes and even overrides the
existing contracts between the regulated entities
in as much as it casts a statutory obligation on the
regulated entities to realign their existing and
future contracts with the said regulations". The
Hon'ble Court further observed that the validity of the
regulation may, however, be challenged by seeking
judicial review under Article 226 of the Constitution of
India.
It is clear from the above that the Regulations
framed under the enabling provisions of the Act
can intervene and override the existing contracts
of the regulated entities.
14. From the above, it is clear that there is a specific finding
that the tariff fixed by the State Commission at the time of
approval of the PPA was subject to the review and the
Regulations framed by the State Commission have an
overriding effect over the existing contracts over the PPA.
Therefore, even when the PPA did not provide for a specific
clause for revision of the project cost, the State
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Judgment in Appeal No. 78 of 2011
Commission under the Regulations was empowered to re-
determine the tariff fixed by it under section 62 of the Act.
15. As pointed out by the State Commission, as per the
Regulations framed by the State Commission, the final
tariff has to be determined based on the actual cost of the
completed project and the Regulations framed under the
enabling provisions of the Act will override the PPA of the
regulated entities.
16. As correctly submitted by the Learned Counsel for the
Respondent, the clauses of National Tariff Policy providing
for procurement of power on the basis of the competitive
bidding does not apply to this project and therefore, even
when the PPA did not provide any specific clause for
revision of the project cost, the State Commission under
section 62 of the Act, 2003 as well as under the
Regulations, was empowered to re-determine the tariff
fixed by it.
17. In respect of the 3rd issue, the Appellant has contended that
the review of the tariff can be made only after completion of
15 years of operation of generating stations and not before
that as provided in the approval of the PPA. While dealing
with this issue, it would be appropriate to refer to the
relevant clause of the PPA which is approved by the order
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Judgment in Appeal No. 78 of 2011
dated 10.7.2007. The State Commission in the order dated
10.7.2007 has held as under:
"The Tariff from 1-12 years shall be Rs.2.80/unit and
Rs.1.70/unit for 13 to 15 years from the date of
commissioning and shall continue to be in force till
such time it is reviewed and approved by the
Commission. In the light of this para No.3.2 & 3.3 of
the PPA shall be appropriately worded".
18. The above order dated 10.7.2007 passed by the State
Commission was on the basis of the Petition filed by the
Appellant for determination of the tariff and approval of the
PPA. Let us quote the plea and prayer made by the
Appellant in the said Petition dated 17.4.2006. The relevant
portion is as under:
"In the meanwhile, Haryana Government has notified
the 'Policy for promoting generation of electricity
through renewable energy sources 'on 6.12.2005 and
circulated vide No.DRE/2005/3943-47 dated
20.12.2005. The Section 10- Purchase Price provides
as follows:
i) "New Projects: Licensee / Utilities will
purchase electricity offered by the power
producers in case of new projects set up
after the notification of the present policy at
the rate to be decided by the Haryana
Electricity Regulatory Commission as per
provisions in the New Electricity Act, 2003".
.....................................................................
In view of the above, the Hon'ble Commission is requested to fix / determine / approve the cost of Page 17 of 24 Judgment in Appeal No. 78 of 2011 power to be purchased from M/S. Bhoruka Power Corporation Limited from their proposed 6 MW Hydro Power Plant at Dadupur, Disttt. Yamuna Nagar, Haryana".
19. Thus, on the basis of this Petition and the PPA, the State Commission passed the 1st Tariff Order dated 10.7.2007 holding that the tariff for 1-12 years shall be Rs.2.80/ unit and Rs.1.70/ unit for 13th year to 15th year from the date of commissioning and shall continue to be in force till such time it is reviewed and approved by the State Commission.
20. It is evident from the plea in the Petition as well as from the order dated 10.7.2007 passed by the State Commission that the State Commission had retained with itself the power to review the tariff in future. In other words, the tariff that was approved by the State Commission for the first 15 years of operation from the date of commissioning was subject to the power of the State Commission to review and re-examine the tariff at any point of time. There was no restriction placed in the above order passed on 10.7.2007 with regard to the timings for review of the tariff so approved.
21. The expression "shall continue to be in force till such time it is reviewed and approved by the Commission" cannot be applied in a restricted manner for the period after the expiry of 15 years of the commissioning of the generating station.
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22. The State Commission in the impugned order has given the correct interpretation of the earlier order dated 10.7.2007 to the effect that it had retained the power to review or revise the tariff at any point of time. The said findings is given as under:
"While deliberating on issue at Sr.No.B framed by us, we referred to Memo No.793/HERC/SV/07 dated 10.7.2007 vide which PPA was approved by the Commission. Point No.1 of the approval reads as under:
"The Tariff from 1-12 years shall be Rs.2.80/unit and Rs.1.70/unit from 13 to 15 years from the date of commissioning and shall continue to be in force till such time it is reviewed and approved by the Commission. In the light of this Para No.3.2 & 3.3 of the PPA shall be appropriately reworded".
It is quite clear from the above paragraph that the tariff was worked out / approved by the Commission subject to being reviewed by itself if the situation so warranted.".
23. It is not a case where the State Commission has simply approved the tariff for a particular period of time. It cannot be argued that once the tariff having been approved for a particular period, the same cannot be reviewed at subsequent stage. This is evident from the first order dated 10.7.2007 by which the State Commission had retained its right to review the tariff even during the period of 15 years.
24. Let us go to the last issue.
Page 19 of 24Judgment in Appeal No. 78 of 2011
25. Once it is held that the State Commission has retained its right to review the tariff even during the period of 15 years, the only question that arises is as to whether the power has been correctly exercised by the State Commission?
26. Let us deal with this question now.
27. Though the Petition by the generator was filed for revision on tariff on various counts including increase in costs, inflationary factors, change in scope etc., the State Commission has only allowed the increase in tariff after prudence check on each claim of the Generator and has permitted additional capitalisation primarily for factors beyond the control of the Generator. In this regard, the State Commission has rejected various other claims made by the Generator for tariff increase. The State Commission has in the impugned order while allowing some of the claims as passed has given various reasons. They are as follows:
"21. Specific Claims of M/s. BPCL:
The Commission has examined the details of the additional work expenses submitted by the Petitioner amounting to Rs.8,25,17,918 (rounded off to Rs.8.25 Crores) including the comments on the same filed by the Respondent i.e. UHBVNL and Haryana Irrigation Department. It is also noted that the Respondents have not disputed the amount of claims filed under Page 20 of 24 Judgment in Appeal No. 78 of 2011 different head by the petitioner with reference to the parties who actually did the work and bills raised by them.
At the outset, it needs to be clearly understood the implementation of any long term project which would remain operational for more than 35 years or so as in the instant case is all about balancing risk and reward. Hence, normally the inflationary impact on the cost of the project which may take up to about three years or so is anticipated by the project developer and built in to the cost of project. In case the project is implemented through an EPC contractor the agreement between the two provides sufficient cushion to the expected increase in different project components including steel, cement etc. Thus, the Commission agrees with UHBVNL that the same cannot be passed on as additional capital work. Accordingly, the petitioner's claim of Rs.1.65 Crore on account of value difference in TMT and ST Steel is not admissible. Implementation of projects which is staggered for more than a year is always fraught with some risk, such risks gets compounded if the project is delayed. Hence in a developing economy like Indian which is prone to moderate to high levels of inflation this acts like a deterrent delaying early financial closure and completion of project. Any time and cost overrun due to rise is general price a level in the Economy has to be absorbed by the developers. As far as Operation & maintenance (O&M) is concerned which impacts the financial performance of the project over the entire fruitful life of the project spanning more than thirty years and hence the rise in costs cannot be reasonably projected the risk is mitigated in building in an escalation factor. In the instant case, the same was done by the petitioner by considering 5% YOY escalation in the O&M cost from 2nd year of operation Page 21 of 24 Judgment in Appeal No. 78 of 2011 of the project. Consequently, the claim on account of price rise is dismissed".
28. So from the above findings given with the valid reasons it is clear that the State Commission has disallowed many of the claims of the Respondent Generator M/s. Bhoruka Power Corporation Limited (R-2) and has allowed only some of the claims. It is noticed that out of the total claim of Rs.8.25 Crores, the State Commission has only allowed Rs.4 Crores for the purpose of tariff. Consequently we hold that the impugned order does not suffer from any infirmity whatsoever.
29. Summary of Our Findings:
(i). The site allocation was made in this case through the competitive bidding process. But, such bidding process cannot be said to be under section 63 of the 2003 Act as the bidding took place in 1998 prior to enactment of Electricity Act, 2003. Section 63 of the 2003 Act provides that the Appropriate Commission shall adopt the tariff if such tariff has been determined through transparent process of bidding in accordance with the guidelines issued by the Central Government. The Central Government issued guide lines only in the year 2006. Thus, the Page 22 of 24 Judgment in Appeal No. 78 of 2011 bidding process which took place in the year 1998 cannot be said to be held in accordance with the said guidelines issued by the Central Government under Section 63 of the 2003 Act.
(ii). As per the Tariff Regulations 2008 framed by the State Commission final tariff has to be determined based on the actual cost of the completed project and the Regulations framed under the enabling provisions of the Act will override the PPA of the regulated entities.
(iii). It is evident from the State Commission's order dated 10.7.2007 that the State Commission had retained in itself the power to review the tariff in future. In other words, the tariff that was approved by the State Commission for the first 15 years of operation from the date of commissioning was subject to the power of the State Commission to review and re-examine the tariff at any point of time. There was no restriction placed in the above order passed on 10.7.2007 with regard to the timings for review of the tariff so approved.
(iv). The State Commission has disallowed many of the claims of the Respondent Generator M/s. Bhoruka Power Corporation Limited (R-2) and has allowed Page 23 of 24 Judgment in Appeal No. 78 of 2011 only some of the claims. It is noticed that out of the total claim of Rs.8.25 Crores, the State Commission has only allowed Rs.4 Crores for the purpose of tariff along with detailed valid reasons for the same. As such, jurisdiction has been rightly exercised by the State Commission.
Consequently we hold that the impugned order does not suffer from any infirmity whatsoever.
30. In view of our above findings, we do not find any merit in this Appeal. Hence, the Appeal is dismissed.
31. However, there is no order as to costs.
(V J Talwar) (Justice M. Karpaga Vinayagam)
Technical Member Chairperson
Dated: 27th April, 2012
√REPORTABLE/NON-REPORTABALE
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