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2.0
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Procedural History
On examination of both the applications of WESCO, it was noticed that information and
analysis with regard to a number of items which are extremely relevant for the
Determination of Tariff & Revenue Requirement had not been furnished. The Commission
forwarded its comments/queries to WESCO calling for clarifications as well as additional
informations.
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2.1
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Subsequently, the licensee furnished the same and thereafter the filing of
both the applications was treated as complete and both the applications were admitted for
hearing. Ever since its inception, Commission has essayed to render transparent,
participatory and consultative approach to the entire process of Utility’s Revenue
Requirement and Tariff setting. In order to invite objections from the public, the
licensee was directed to publish public notices on the proposed Retail Supply Tariff as
well as on the proposed Revenue Requirement in the format approved by the Commission.
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2.1.1
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Notices were published in different leading English and Oriya daily
newspapers having wide circulation in the licensee’s area of supply on two
consecutive days and also in the Commissions’ website : www.orierc.org indicating the
broad features of licensee’s proposed Tariff & Revenue Requirement and also the
procedure for filing of objections.
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2.1.2
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The intending objectors had right to inspect/peruse licensee’s
applications and to obtain the salient feature of the applications/full set of
applications on payment of prescribed fees from the specified offices of the licensee.
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2.1.3
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In response to the above notices, objections were received from different
quarters. In respect of the Tariff Application for 2001-2002, the Commission received as
many as 29 objections from the following objectors :- (1) Sambalpur Petrolium Dealers
Association, Sambalpur, (2) Orissa Consumers’ Association, Cuttack, (3) IDCOL Cement
Ltd., Bardol, Baragarh, (4) Ferro Chrome Plant, Jajpur, (4) Sundargarh Municipality,
Sundargarh, (5) Mahanadi Coalfields Ltd., Burla, Sambalpur, (6) G.P. Sarangi, Jharsuguda,
(7) Rourkela Steel Plant(SAIL), Bhubaneswar, (8) Sundargarh District Employers
Association, Rourkela, (9) District Magistrate & Collector, Sundargarh, and
Administrator, Rourkela Municipality, (10) Orissa Cement Ltd., Rajgangpur (11) Rourkela
Steel Plant Retired Employers Association, Rourkela, (12) Tata Refractories Ltd.,
Belpahar, Jharsuguda, (13) Larsen & Toubro Ltd., Kansbahal, Sundargarh, (14) Shrishti
Ispat Ltd., Rajgangpur, (15) Scan Steels Ltd., Rajgangpur, (16) Biramitrapur Municiplaity,
Biramitrapur, (17) District Consumer Association, Baragarh, (18) Rourkela Chamber of
Commerce and Industry, Rourkela, (19) Orissa Grahak Mahasangha, Bhubaneswar, (20) Akhil
Bharatiya Grahak Panchayat, Bhubaneswar, (21) Aditya Aluminium Project, HINDALCO,
Bhubaneswar, (22) Jharsuguda District Industries Association, Jharsuguda, (23) R.P.
Mohapatra, Jaydev Vihar, Bhubaneswar, (24) Utkal Chamber of Commerce & Industry,
Cuttack, (25) Orissa Small Scale Industries Association, Cuttack, (26) Indian Aluminium
Company Ltd., Hirakud, Sambalpur, (27) Scan Sponge Iron Ltd., Kuarmunda, Sundargarh, (28)
Sasanka Goel, Goibhanga, Kalunga, Sundargarh, (29) M/s Refulgent Ispat(P) Ltd., Rourkela. |
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2.1.4
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All the above objections were scrutinised. Twenty three objections were
admitted for hearing whereas objections at Sl. No.4, 6, 8, 9, 11 & 17 were not
admitted for hearing due to their non-compliance with the terms and conditions as laid
down in the aforesaid public notice. However, the relevant issues raised by them in their
objections have been taken into consideration.
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2.1.5
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In respect of licensee’s application for Revenue Requirement for
2002-2003, the Commission received three objections from the following objectors :- (1)
Indian Aluminium Company Ltd., Hirakud, Sambalpur, (2) M/s Utkal Chamber of Commerce &
Industry, Cuttack, (3) Shri R.P. Mohapatra, Jayadev Vihar, Bhubaneswar. All the three
objections were scrutinised and admitted for hearing. |
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2.1.6
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The licensee was given chance to file rejoinder, if any, to the objections
filed by the objectors and accordingly, the licensee filed its rejoinder serving copy to
the objectors in both the cases.
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2.1.7
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The date of hearing in both the cases was fixed on 21.3.2002. Notices were
published in leading English and Oriya daily newspapers requiring the licensee and the
objectors to appear personally or through their authorised representatives or duly
constituted attorney to take part in the hearing. The Commission also issued notice to the
State Government to appear as an interested party. The Commission has received no response
from the Government nor any representative on behalf of the State Government was present
during the hearing.
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2.1.8
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Both the cases were heard analogously on 21.3.2002. The Managing Director,
WESCO supported both the applications and prayed for approval of the Tariff proposal as
well as Revenue Requirement. Objectors present were heard in person or through their
authorised representatives or duly constituted attorneys. The Director (Tariff) of the
Commission raised certain queries to the licensee by way of clarification. Subsequently,
the licensee submitted required clarifications to the queries of the Director (Tariff).
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2.1.9
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In its consultative process, Commission convened Commission Advisory
Committee (CAC) meeting on 30.3.2002 and consulted with its constituent members about the
proposed tariff and revenue requirement of the licensee.
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2.2
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Legal Objections as to the maintainability of the Cases. During
hearing, the following objections were raised regarding the maintainability of the cases
by some objectors. |
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2.2.1
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The Commission has not prescribed any methodology and procedure for
calculating the expected revenue from charges which the licensee may be permitted to
recover pursuant to the terms of its licence and for determination of tariff to collect
those revenues.
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2.2.2
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As per the provisions of Sec.57 and 57 A read with sixth Schedule of
Electricity (Supply) Act, 1948, no application of revision of tariff can be made within
three years.
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2.2.3
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As the Commission is going to pass final orders in both the cases without
following the procedures laid down in Sec.29 of the Reform Act, 1995, the proceedings are
vitiated.
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2.2.4
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The licensee has filed its tariff application for the financial year
2001-2002. Since the said financial year is going to expire after a few days and before
passing of the tariff order, the application has become infructuous.
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2.2.5
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Issues at paras 2.2.1 and 2.2.2 were raised during the tariff proceedings
in Case No.24/1999 and had been dealt with by the Commission giving clear findings that
such objections were not at all valid. The Hon’ble High Court of Orissa were pleased
to deal with these objections and did not find validity in any of them in their order dtd.
22.12.2000 passed in M.A. No.51/2000. The Commission finds no reason to depart from its
earlier findings and hence, such objections are to be over-ruled.
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2.2.6
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Now, we propose to deal with the objection raised in para 2.2.3 above.
Sub-Section (1) of Section 28 of Reform Act, 1995 contemplates that where the Commission
is satisfied that a licensee is contravening, or is likely to contravene any relevant
conditions or requirement of its licence, it shall by final order under Section 29 and, if
it thinks it appropriate in accordance with Sub-Section (2) by interim order under this
Section, issue such directions as it deems proper for securing compliance. Final order as
envisaged u/s 29 of Reform Act, 1995 must relate to the contravention of a condition of
licence by the licensee. But the present proceedings relate to the determination of tariff
and revenue requirement and not to the contravention of any condition of licence by the
licensee. Therefore, we are of the considered opinion that Section 29 of Reform Act, 1995
has no relevance to the present proceedings and the contention raised on this score is not
tenable in the eye of law.
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2.2.7
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As regards the objection raised in para 2.2.4 above, it has to be stated
that the licensee has submitted at the time of hearing that tariff may be enhanced from
the date of the order or from a future date to be fixed by the Commission in its order and
its application should not be rejected merely because the financial year 2001-2002 is
going to expire after a few days. It is a well-established convention that a tariff order
can be made effective prospectively. As such, the tariff application filed by the licensee
can not be said to be infructuous.
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2.2.8
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We, therefore, note that none of the legal objections raised by various
objectors has any force in the eye of law and that we have to proceed according to the
procedure and principles established by Commission in the last four sets of tariff orders
namely in March, 1997, November, 1998, December, 1999 and January, 2001.
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2.2.9
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We now proceed to examine the present tariff filing and give our findings
on the same.
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