THE HON'BLE SRI JUSTICE G.
BHAVANI PRASAD WRIT PETITION No.3267 OF 201.26.03.2013 M/s.
Balaji Energy Private Limited Southern Power Distribution Company Limited of Andhra Pradesh (APSPDCL) and others Counsel for the petitioner:Sri S.
Ravi Standing Counsel for 1st respondent: Sri O.
Manohar Reddy Standing Counsel for the 2nd respondent : Sri P.
Srinivasa Rao : : ?Citations: ORDER: Heard Sri S.Ravi, learned Senior Counsel for the writ petitioner, Sri O.Manohar Reddy, learned Standing Counsel for the 1st respondent, and Sri P.Srinivasa Rao, learned Standing Counsel for the 2nd respondent.
The writ petitioner sought for a direction to the 1st respondent to pay the electricity tariff to the petitioner in terms of the Power Purchase Agreement, dated 31.01.2005, and the guidelines issued by the Government of India and the State Government or in the alternative to permit them to sell the power by way of third party sale.
The petitioner also desired that non-payment of electricity tariff in accordance with the agreed tariff rate as per the said Power Purchase Agreement, dated 31.01.2005, and the letters of the 2nd respondent, dated 09.07.2008, 16.06.2009 and 09.07.2009, read with the policy guidelines of the Central and State Governments in relation to the payment of power tariff to non-conventional energy based power projects be declared as arbitrary and illegal.
Consequential direction for payment of tariff as claimed, with arrears and interest at 18% per annum was also sought for.
The petitioner stated that the tariff fixation for power generated from non-conventional energy sources shall be based on a base purchase price to be announced by the State Electricity Board every year and the rate which a promoter/developer shall be entitled to receive is the base price set out in the Power Purchase Agreement during duration of such agreement.
The rate to be escalated as per the guidelines after a period of ten years will be by the fixation of new purchase price at the end of the 10th year or the High Tension (HT) tariff prevalent in the State at that time, whichever is higher.
The guidelines of the Government of India led to the variation of the policy of the State Government of Andhra Pradesh under G.O.Ms.No.93, dated 18.11.1997, and it was later clarified by a letter, dated 20.10.1999, that the incentives/concessions under G.O.Ms.No.93 read with G.O.Ms.No.112, dated 22.12.1998, continued to be valid and operative.
While Mini Hydel Developer Schemes were categorized as those generating power for captive use, those generating power and selling to third parties and those generating power and supplying to Discoms, the Andhra Pradesh State Electricity Regulatory Commission (for short, 'the APSERC') constituted under the Andhra Pradesh Electricity Reform Act, 1998 suo motu reviewed the incentives given by the Government and passed orders, dated 20.06.2001 and 20.03.2004, reducing the tariff in contravention of the Government Policy and restricted payment of even the reduced tariff up to 35% of the Plant Load Factor and thereafter a nominal price.
Though all the Non- conventional Energy Projects are similar in nature, the developers generating power and supplying to Discoms were discriminated by not extending the policy directions of the Government of India and the State Government.
When the Small Hydro Power Developers Association filed W.P.Nos.7222 and 16621 of 2004, the writ petitions were later transferred to the Appellate Tribunal for Electricity and on their consideration, the Appellate Tribunal passed final orders on 02.06.2006 on merits stating that the APSERC has no power to alter the said policy direction issued by the State Government.
Aggrieved by the orders of the Appellate Tribunal, appeals were filed before the Hon'ble Supreme Court and they were pending.
The 1st respondent did not file any appeal against the judgment in Appeal No.52 of 2005 which was preferred by the petitioner and the 2nd respondent passed subsequent orders, dated 07.03.2007 and letters dt.
09.07.2008, 16.06.2009 and 09.07.2009, after the Appellate Tribunal's order, dated 02.06.2006, to pay the tariff as per the Appellate Tribunal's order, dated 02.06.2006.
The writ petitioner who was allotted 2 x 5 MW Mini Hydel Power Project at Somasila was later permitted to enhance its capacity to 2 x 6 MW and as per the standing instructions of the APSERC, the writ petitioner was not permitted to enter into Power Purchase Agreement with third parties for sale of power.
It was insisted that the generated power should be sold only to the A.P.TRANSCO and having no other option, the writ petitioner agreed for the same.
A Power Purchase Agreement was executed on 28.10.2000, but on 07.07.2004, the A.P.
TRANSCO returned the Power Purchase Agreement as the APSERC did not give its consent and the writ petitioner was again coerced to enter into an agreement as per the standard format approved on 29.05.2001.
The writ petitioner was compelled to enter into such a Power Purchase Agreement on 31.01.2005 and in meanwhile all the powers of bulk supply undertaking and Power Purchase Agreements were transferred to A.P.
TRANSCO and DISCOMS by the State Government by a statutory notification.
The writ petitioner made the project ready for commissioning by May, 2005 and the Power Purchase Agreement was again sent to the APSERC on 03.02.2005 itself for approval.
The APSERC did not communicate its consent and ultimately it gave permission to connect the generating units to the power grid generation through letter, dated 30.12.2005, which made the writ petitioner suffer loss of production of about 20 million units for recovery of which separate action is being taken.
Though the writ petitioner delivered energy to the 1st respondent from 31.12.2005, no payment was released up to 11.12.2006 and the condition of the Power Purchase Agreement to pay within 30 days of the drawl of the power, was violated.
The writ petitioner is taking separate action for recovery of the loss with interest and the writ petitioner which landed into a financial crisis sought for the intervention of the APSERC for releasing payments.
Then, the Commission by letter, dated 08.09.2006, directed the 1st respondent to pay for the power drawn at a reasonable rate on adhoc basis.
The Commission later without giving consent to the Power Purchase Agreement of the writ petitioner, passed an order on 07.03.2007 in O.P.No.2 of 2007 directing that the writ petitioner be paid for the power supplied at a reasonable rate regarding which the 1st respondent herein may be guided by the findings of the Appellate Tribunal for Electricity in Appeal Nos.1 of 2005 and batch, dated 02.06.2006, until final disposal of the matter by the Hon'ble Supreme Court in Civil Appeal Nos.2926 of 2006 and batch.
The writ petitioner neither had the tariff fixed for the energy delivered nor is permitted to sell its power to third parties and the Commission gave a conditional consent to Power Purchase Agreement to the writ petitioner to enable the 1st respondent to get the power at a cheaper rate than the prevailing market rates at which the DISCOMS purchased.
Even after the communication of 09.07.2008, the 1st respondent did not make payment even according to the said conditional order.
The orders were reiterated by the Commission in its subsequent orders and the orders of the Appellate Tribunal are applicable to Small Hydro Power Projects whose Power Purchase Agreements are consented and who are supplying power only to DISCOMS, whereas the writ petitioner whose Power Purchase Agreement was not consented by the Commission cannot be governed by the same.
Even that order, dated 07.03.2007, was not implemented and permitting the 1st respondent to purchase power in the open market at higher prices and fixing a cheaper rate for the writ petitioner is colourable exercise of power.
The writ petitioner, therefore, was aggrieved by the non-payment of the price for the power supplied notwithstanding the directions of the APSERC and, hence, the writ petition.
The 1st respondent in its counter affidavit had claimed that the petitioner is a Mini-Hydel Power Developer under non-conventional energy sources and in pursuance of the tariff fixed by the APSERC in 2001, the existing non-conventional energy generators were paid tariff as such after 31.03.2004.
Subsequently, the APSERC revised the tariff vide orders, dated 20.03.2004 and 07.07.2004.
When the Non-conventional Energy Project Developers including Small Hydro Developers Association filed W.P.Nos.7222 and 16621 of 2004, this Court directed in June 2005 giving liberty to the petitioner therein to challenge the same before the Appellate Tribunal for Electricity.
The developers filed an appeal before the Appellate Tribunal including the writ petitioner who filed Appeal No.52 of 2005.
The High Court and the Appellate Tribunal gave interim orders in the meanwhile to pay the raised tariff and also 50% differential amount and the additional payment shall be subject to the ultimate orders in the appeal.
The appeals were allowed on 02.06.2006 and the matter was carried to the Hon'ble Supreme Court in Civil Appeal Nos.2926 of 2006 and batch.
The appeals were allowed on 08.07.2010 upholding the jurisdiction of the APSERC for determining the tariff and directing remand of the matter to the Commission to hear the generators afresh and pass appropriate orders.
After remand, Three Members of the APSERC passed three separate orders and the A.P.
TRANSCO entered into a new Power Purchase Agreement with the writ petitioner in the standard format on 31.01.2005 superseding the earlier agreement.
However, the agreement is subject to the consent of the APSERC.
The writ petitioner is also covered by a common order of the Appellate Tribunal, dated 02.06.2006, and was a party to the Hon'ble Supreme Court's order in Civil Appeal No.5958 of 2006.
The payment continued to be made to non-conventional energy generators as per the interim directions of the Hon'ble Supreme Court dated 14.07.2007 and the Power Purchase Agreement, dated 31.01.2005, was not approved by the APSERC in O.P.No.2 of 2007.
In the meanwhile by an adhoc arrangement, the Commission directed the 1st respondent to be guided by the findings in the Appellate Tribunal's, order dated 02.06.2006, until final disposal of the matter by the Hon'ble Supreme Court.
The tariff payable to the writ petitioner is the same as paid to other similarly placed developers (APSERC revised tariff + 50% differential tariff).
The APSERC asked the 1st respondent to comply with the directions, dated 09.07.2008, but it was informed that the orders of the Hon'ble Supreme Court were awaited.
The request for permission to go for third party sales can be only with the consent of the APSERC after the Power Purchase Agreement acquired legal sanctity and hence the 1st respondent desired the writ petition to fail.
The 2nd respondent - Andhra Pradesh State Electricity Regulatory Commission (APSERC) through its Secretary contended in the counter affidavit that the determination of tariff is within the exclusive domain of the Regulatory Commission as per the decisions of the Hon'ble Supreme Court to which the writ petitioner was also a party and the Commission determining fresh tariffs after hearing all the stake holders is well within its purview.
The action of the Commission in passing the earlier orders on 20.06.2001 and 20.03.2004 was upheld by the Hon'ble Supreme Court and after the directions of the Hon'ble Supreme Court to reconsider the tariffs, all the stake holders were called for hearing and an order was passed on 12.09.2011 by three different orders of the Members of the Commission.
This order is pending consideration before the Appellate Tribunal and the order of the Appellate Tribunal stood modified by the order of the Hon'ble Supreme Court.
The writ petitioner cannot insist on payment of tariffs in terms of the order of the Commission, dated 20.06.2001, now as on the disposal of the appeals by the Hon'ble Supreme Court, any order passed in the interregnum by the Commission stands modified in terms of the order of the Hon'ble Supreme Court.
Subsequent to the filing of this writ petition, the Hon'ble Supreme Court's order was passed and the petitioner cannot rely on the old orders for the incentives, which do not subsist any more.
Therefore, the 2nd respondent also desired the writ petition to fail.
In the reply affidavit of the writ petitioner to the counter affidavit of the 1st respondent, the writ petitioner raised the same contentions all over again about the inapplicability of the order of the Commission, dated 20.03.2004, and relied on the absence of any enforceable contract between the parties in the absence of any approval of the Power Purchase Agreement and order passed by the Appellate Tribunal was pleaded on the one hand to be inapplicable to the writ petitioner, while again it is being stated that the writ petitioner being a party to the cases before the Appellate Tribunal and the Supreme Court is bound by such orders.
The writ petitioner claimed that the implications of the order, dated 09.07.2008, were not brought to the notice of the Supreme Court and when the Power Purchase Agreement of the writ petitioner was not consented, it is not clear as to how third party sales can be prevented.
The writ petitioner also filed a reply affidavit to the counter affidavit of the 2nd respondent contending that no relief is sought for against the 2nd respondent, which is a proforma respondent, and when the relief sought to is for the implementation of the orders of the 2nd respondent, it is not known as to how there can be any counter affidavit on the facts of the case.
A close perusal of the pleadings of the parties and the material papers on record shows that the writ petitioner is a developer of a non-conventional energy based power project/a mini hydel project, who claims the benefit of the various policy guidelines of the Central and State Governments.
The Power Purchase Agreement submitted by it is entered into with the A.P.
TRANSCO on 28.10.2000.
It was not consented by the APSERC and the order of the Commission in O.P.No.2 of 2007, dated 07.03.2007, was on the petition filed by the writ petitioner for grant of consent by the Commission for the Power Purchase Agreement, dated 31.01.2005.
The Commission in its order stated that the purchase falls within the jurisdiction of the 1st respondent herein and the Commission did not consider the petitioner to be entitled for approval of the Power Purchase Agreement as its stand is inconsistent with and contrary to the general orders which are applicable to all the non-conventional energy projects.
The Commission also observed that until the consent is given by it, there is no independent contract between the parties and the Commission then considered the impact of the order, dated 02.06.2006, of the Appellate Tribunal for Electricity in Appeal Nos.1 of 2005 and batch and concluded that the 1st respondent which is paying all Mini Hydel Projects as per the interim orders of the Appellate Tribunal for Electricity was not making such payments only to the writ petitioner.
The Commission further observed that the order of the Appellate Tribunal for Electricity was pending consideration before the Hon'ble Supreme Court and in the absence of any deemed consent from the Commission, the Commission concluded that the process of grant of consent was not yet completed.
However, it observed that power supplied has to be paid at a reasonable rate on adhoc basis and the Commission, taking into account the hardship caused to the writ petitioner due to non-payment, directed that in order to ensure that the price is paid for the power supplied to the 1st respondent at a reasonable rate, the 1st respondent herein may be guided by the findings in the order of the Appellate Tribunal for Electricity in Appeal Nos.1 of 2005 and batch, dated 02.06.2006, until final disposal of the matter by the Hon'ble Supreme Court of India in Civil Appeal Nos.2926 of 2009 and batch.
The same was also reiterated by the Commission later in its letters, dated 09.07.2008, 16.06.2009 and 09.07.2009.
While noting no Power Purchase Agreement to have been finalized between the parties in the meanwhile, the payment for the power supplied to the 1st respondent herein by the writ petitioner still remains assessable on an adhoc basis at a reasonable rate and the order, dated 02.06.2006, of the Appellate Tribunal for Electricity was made the basis for assessing such a reasonable rate on adhoc basis, until final disposal of the matter by the Hon'ble Supreme Court of India.
Subsequently, the Supreme Court of India set aside the order of the Appellate Tribunal for Electricity in Civil Appeal Nos.2926 of 2006 and batch on 08.07.2010 and the Supreme Court held the APSERC to have the jurisdiction to determine the tariff for procurement of the electricity generated by the non-conventional energy developers/generators and remanded the matter to the Commission for re-examination.
It also observed that the order of the Commission, dated 20.06.2001, had become final and remained unaffected by the judgment of the Supreme Court.
The order, dated 02.06.2006, therefore, exists no longer and whether the said order is directly applicable to the writ petitioner or not, it can no longer operate as the bench mark for determining a reasonable rate on adhoc basis for the power supplied by the writ petitioner to the 1st respondent herein.
When the findings of the Appellate Tribunal for Electricity by the said order, dated 02.06.2008, were set aside by the Supreme Court, they cannot be construed as still operable between the writ petitioner and the 1st respondent.
After the order of remand by the Supreme Court, the Commission passed three different orders through three different Members which again became the subject of appeals before the Appellate Tribunal for Electricity.
In the said Appeal Nos.150 of 2011 and batch, the Appellate Tribunal for Electricity delivered its judgment on 20.12.2012 and the writ petitioner is a party to Appeal No.18 of 2012 among the batch.
The Appellate Tribunal, after going into the factual background and the directions of the Hon'ble Supreme Court in this regard, while referring to the three different orders passed by the Members of the Commission which are the subject of the appeals, ultimately concluded that the APSERC has to carry a scientific study and frame its tariff regulations for purchase of power by distribution licencees from non-conventional energy sources after considering the study report of the Central Commission and other relevant Central Commission Regulations.
It also laid down the norms for determination of the tariff for the various non-conventional energy projects and also directed the Commission to specify the time within which the payment of price and interests can be made.
While directing the State Commission to pass consequential orders within 45 days of the communication of the judgment, the Appellate Tribunal directed that till the passing of the final orders by the State Commission, the tariff as per the order of the Chairman, dated 19.11.2011, is to be continued subject to adjustment after determination of the tariff by the State Commission.
At least in so far as those parties to the proceedings before the APSERC, the Appellate Tribunal and the Supreme Court on whom the orders are binding, there can be no doubt about the interim arrangement directed by the Appellate Tribunal having to be followed till the passing of a final order by the State Commission and when even according to the order dated 07.03.2007 the direction to the 1st respondent herein to be guided by the findings of the Appellate Tribunal dated 02.06.2006 was until the final disposal of the matter by the Supreme Court, the final orders of the Supreme Court and the consequential orders of the Appellate Tribunal after the Three Members of the Commission delivered the separate orders cannot be said to be not forming a reasonable basis for arriving at a reasonable rate payable to the petitioner on adhoc basis, when the APSERC in the order dated 07.03.2007 and letters dated 09.07.2008, 16.06.2009 and 09.07.2009, required compliance with the order dated 02.06.2006 of the Appellate Tribunal until the final disposal of the Appeals by the Supreme Court.
The continued availability of the order dated 02.06.2006 even after it was set aside by the Supreme Court for the benefit of the writ petitioner cannot be upheld.
Learned Standing Counsel for the 1st respondent has represented that pending finalization of the tariff, the 1st respondent was paying to the writ petitioner in accordance with the order of the Chairman of the APSERC dated 19.11.2011 as indicated at Page No.298 of the order of the Chairman and a comparative statement furnished by the writ petitioner also corroborates the tariff being paid to it being in accordance with the tariff rates of the Mini Hydel rates indicated in the Chairman's order at Page No.298.
Payment of any higher sum towards a reasonable rate on adhoc basis also may not be called for when the APSERC in its letter dated 24.04.2010 refused to modify the directions in the order dated 09.07.2008 only on the ground of awaiting the orders of the Supreme Court in the appeals pending before it.
Even on fact, in the absence of any interim directions in this writ petition, the 1st respondent continued to pay to the petitioner for the power supplied to it only at the rates indicated in the order of the Chairman of the APSERC at Page No.298 of the order dated 19.11.2010 and the judgment of the Appellate Tribunal in the Appeals dated 20.12.2012 directed the APSERC to pass consequential orders within 45 days of communication of the judgment.
It can be believed that the APSERC must be already taking positive action for compliance of the orders of the Appellate Tribunal for Electricity and under the circumstances and without any further deeper probe into the question as to whether the orders of the Commission, the Appellate Tribunal and the Supreme Court do not apply to the petitioner in the absence of finalization of any Power Purchase Agreement, the 2nd respondent can be directed to fix the tariff payable by the 1st respondent to the petitioner for the power supplied to it based on the directions of the Appellate Tribunal for Electricity at the earliest within the time fixed by the Appellate Tribunal for such compliance or at any rate within 30 days from the date of communication of this order.
This order, however, does not preclude the continuance of payment being made by the 1st respondent for the power supplied as is being done now.
In so far as the request of the petitioner for allowing third party sales is concerned, the findings in the judgment of the Hon'ble Supreme Court and the conclusions in the judgment of the Appellate Tribunal for Electricity in this regard shall be kept in view and such a request shall be considered by the APSERC in accordance with law while considering the issue of fixation of tariff vis--vis the existence or non-existence of any consented Power Purchase Agreement between the petitioner and the 1st respondent.
Therefore, the 2nd respondent shall, in compliance with the orders of the Hon'ble Supreme Court in Civil Appeal Nos.2926 of 2006 and batch dated 08.07.2010 and the judgment of the Appellate Tribunal for Electricity in Appeal Nos.150 of 2011 and batch dated 20.12.2012, fix the tariff payable to the petitioner for the power supplied to the 1st respondent, as expeditiously as possible, at any rate within the time limit fixed by the Appellate Tribunal for Electricity in its judgment dated 20.12.2012, which shall not be beyond 30 days from the date of communication of this order to the 2nd respondent.
The writ petition is ordered accordingly without costs.
_________________________ G.
BHAVANI PRASAD, J 26.03.2013