Andhra Pradesh High Court gives AP a power punch

By S A Ishaqui

Hyderabad, Jan 21 : In a judgement that will have far-reaching consequences, the AP High Court on Friday held that the AP Electricity Regulatory Commission could not entertain applications from the power distribution companies (Discoms) to determine Fuel Surcharge Adjustment beyond the time stipulated for the recovery. While allowing a batch of writ appeals filed by High-Tension power consumers, a division bench comprising Chief Justice Madan B. Lokur and Justice P.V. Sanjay Kumar ruled that the claims of the Discoms to recover FAS from HT consumers for the year 2008-09 are time-barred.

This verdict will be welcomed by domestic consumers as the Discoms shocked them with their decision on Tuesday, by deciding to recover fuel surcharge for the financial years 2008-09 and 2009- 2010. APERC, the regulatory body, had allowed the Discoms to do so, even though they had filed their applications after the stipulated time of 30 days for every quarter in a year. However, the state government said it was prepared to bear the cost of FSA for domestic consumers for the year 2008-09, but not for 2009-10.

The High Court observed that being an independent body, APERC must balance the interests of consumers with that of Discoms, and recover the costs in a reasonable manner. The commission cannot favour one side as it has chosen to do in the present case, the court observed. The bench made it clear that the commission has no power to extend the time period stipulated in the amended Regulation 45-B (4) of the Business Regulations for recovery of the surcharge. A single judge had earlier found that the commission has the power to extend the time period if it has sufficient reason to do so. But the present bench refuted this finding, and said that the amended Regulation makes it explicit that failure to abide by the time stipulation enjoins forfeiture of future claims by Discoms in that regard.