Power tariff can include discom employees salaries, allowances, pension: HC

The Delhi High Court has held that the cost incurred by power distribution companies (discoms) can be considered while fixing tariff and it would include salaries, allowances and pension of their employees.

The ruling by a bench of Chief Justice D N Patel and Justice C Hari Shankar came while dismissing a PIL which had alleged that power regulator DERC had allowed collection of more than Rs 3,000 crore since 2011 towards a government pension fund from consumers through their electricity bills without informing them.

It also dismissed a PIL initiated by the court on its own based on a letter by a Federation of the Resident Welfare Associations (RWAs) of Yamuna Vihar in north-east Delhi, opposing a 3.8 per cent surcharge added to the power bills of BSES and BYPL consumers towards pension of erstwhile Delhi Vidyut Board (DVB) employees.

"The cost incurred by discoms can always be taken into consideration while fixing tariff. The cost would include salaries and allowances to be paid to employees and by that logic pension can also be included," the bench said and dismissed the plea by one Sudhanshu M Kumar.

"In view of the above, we see no further reason to monitor writ petition 747/2019 (initiated by the court). So, it is also dismissed," the bench said.

Kumar had challenged implementation of a DERC tariff order for the financial year 2017-18, claiming it intends to collect Rs 694 crore more towards the pension fund from consumers.

He had alleged that of the Rs 694 crore, Rs 270.33 crore had already been recovered by making it a part of the discoms Annual Revenue Requirement (ARR) which is then set off against the revenue received from the consumers.

The petition had claimed that including the pension trust fund contribution in the ARR was illegal.

It had said that the remaining Rs 423.67 crore was proposed to be recovered by levying a surcharge of 3.7 per cent on the consumers from September 2017 to March 2018.

Kumar had contended that the levy was an "enforced contribution" as consumers have no knowledge about it as it is not reflected in the electricity bills and the consumers have not received any benefit for it.

Disagreeing with his contentions, the bench said, "By no stretch of imagination it can be said that without any power, jurisdiction or authority tariff orders were passed by the Delhi Electricity Regulatory Commission (DERC). It is not as if DERC decided a labour matter or criminal case. We do not agree with the petitioner's contention that DERC does not have the power to impose surcharge."

The court further said that there was an alternate efficacious remedy available under the Electricity Act which provides that DERC's tariff order can be challenged before the Appellate Tribunal for Electricity (APTEL).

The bench said as and when the petitioner prefers an appeal before APTEL, the tribunal shall decide it in accordance with the law and without being influenced by the observations of the high court.