Regulatory Commissions, Not Courts To Determine Electricity Tariff: SC [Read Judgment]

The Supreme Court, in Waryam Steel Castings Pvt Ltd vs Punjab State Power Corporation, has reiterated its stand that it would not be proper for the court to examine the fixation of electricity tariff rates or its revision, while dismissing appeals preferred by arc furnace industries in Punjab.

A bench comprising Justice Ranjan Gogoi and Justice Navin Sinha was considering pleas against the high court order, whereby it dismissed the challenge questioning the correctness of the quantum/rate of surcharge as determined by the regulatory commission and upheld by the appellate tribunal.

The court reiterated the observations made in Transmission Corporation of Andhra Pradesh Ltd and Anr v. Sai Renewable Power Private Ltd, wherein it was observed: “The only explanation for judicial intervention in tariff fixation/revision is where the person aggrieved can show that the tariff fixation was illegal, arbitrary or ultra vires the Act. It would be termed as illegal if statutorily prescribed procedure is not followed or it is so perverse and arbitrary that it hurts the judicial conscience of the court making it necessary for the court to intervene. Even in these cases the scope of jurisdiction is a very limited one.”

The court further observed that the nature of power exercised in determining tariff under the Electricity Act 2003, is statutory, and it is required to be exercised within the four corners of the relevant provisions of the 2003 Act i.e. Sections 62 to 64 and in accordance with the principles laid down in Section 61 thereof.