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“Supreme Court Rejects “Technicality”: Adani Power Loses Bid for Additional Payment from Rajasthan Discoms”
Bysclaw
Mar 23, 2024By sclaw
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Andhra Pradesh Electricity Regulatory Commission (Distribution Licence) Regulations, 2013 – Special Economic Zones Act, 2005 – Sections 3 and 4 – Electricity Act – Section 14(b) – Whether a Special Economic Zone (SEZ) developer, deemed to be a distribution licensee under the Electricity Act, is required to make an application for a distribution license and comply with the conditions set out in the Electricity Rules and Regulations. – The appeal challenges the Appellate Tribunal for Electricity’s decision to require an appellant to infuse additional capital as a condition for being identified as a deemed distribution licensee – The court questioned whether a SEZ developer is ipso facto a deemed distribution licensee, obviating the need for an application under section 14 of the Electricity Act – The appellant argued that they are automatically a deemed distribution licensee by virtue of the 2010 Notification and that the conditions imposed by TSERC were in excess of jurisdiction – The respondents argued that the appellant must comply with the 2005 and 2013 Regulations and that TSERC is empowered to impose conditions to assess credit-worthiness – The Supreme Court partially allowed the appeal, setting aside the condition of additional capital infusion imposed by TSERC – The court reasoned that the appellant must apply to be recognized as a deemed licensee but is not subject to the additional capital requirements of regulation 12 and rule 3(2) – The court concluded that the appellant is required to make an application as per the 2013 Regulations, and the condition to infuse additional capital is not justified.
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Electricity Act, 2003 – Sections 62(3) and 111 – Levy of reliability charge – Maharashtra State Electricity Distribution Co. Ltd. imposed a reliability charge for uninterrupted power supply, which was challenged by JSW Steel Ltd – The appellant argued that non-participation in the public hearing by JSW Steel Ltd. amounted to consent to pay the charge – JSW Steel Ltd. argued that they were already paying a higher tariff and should not be subjected to the charge – The Tribunal set aside the Commission’s order imposing the charge, and the Supreme Court dismissed the appeal – The Court found no statutory basis for the charge and noted that JSW Steel Ltd. had already paid a higher tariff for continuous supply – The Supreme Court concluded that the appellant was not entitled to impose a reliability charge on customers like JSW Steel Ltd. and found no merit in the appeal.
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Electricity Act, 2003 – Section 86(1)(a) read with Section 62 – Recovery of deductions of monthly tariff – Dispute inter se the parties is in the nature of a contractual dispute – Normally, costs must go with the succeeding party in case of a contractual dispute – This is more so where one party repeatedly seeks to evade the rigors of the orders
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