Pay Rs 15 crore late charge to Tata, Madras HC tells Tangedco
A division bench of Justices SM Subramaniam and K Rajasekar directed Tangedco to pay 50% of the penalty amount claimed by Tata Power as late payment surcharge within two weeks, as the State electricity corporation has an alternate remedy under section 86 (1) (F) of the Electricity Act, 2003, while disposing of a petition challenging the single judge order.
Madras High Court (File)
CHENNAI: The Madras High Court made it clear that the Union Ministry of Power should not cut off the power supply to Tamil Nadu for the alleged late payment surcharge amount to the Tata Power Company Limited and allowed Tangedco to approach the competent forum to adjudicate the power supply dispute between the private power supplier.
A division bench of Justices SM Subramaniam and K Rajasekar directed Tangedco to pay 50% of the penalty amount claimed by Tata Power as late payment surcharge within two weeks, as the State electricity corporation has an alternate remedy under section 86 (1) (F) of the Electricity Act, 2003, while disposing of a petition challenging the single judge order.
The Tangedco moved the petition assailing the order of a single judge issued on January 29, dismissing the corporation’s plea to reject the invoices uploaded by Tata Power in the PRAAPTI portal of the Centre to enhance the transparency in the power transactions.
Advocate General (AG) PS Raman, on behalf of Tangedco, submitted that Tata Power uploaded certain tampered invoices claiming penalty for the late payment of surcharge and sought the court to reject those invoices as the Centre may cut off the power supply to the State as per the standard operating procedure.
The AG submitted that as per the power purchase agreement between Tangedco and Tata Power, only 19% of the capacity utilisation factor (CUF) should be supplied to Tangedco, and if the power supply exceeds the stipulated percentage, the corporation is not liable to pay the amount for the excess power supply.
Despite that, Tata Power moved before the Tamil Nadu Electricity Regulation Commission (TNERC) in 2019, claiming an amount for the excess power supply, which TNERC rejected. Challenging the order, Tata Power moved the Appellate Tribunal for Electricity (APTEL) to hear the matter, which directed Tangedco to make an additional payment for the excess energy supplied by the generators at the rate of 75% of the tariff amount (Rs 81.33 crore). Tangedco moved the Supreme Court in retaliation, which the Apex Court did not entertain.
On May 12, 2023, Tangedco made a payment to Tata Power for the excess power supply. However, the private player claimed that the payment was belated as per the court order and raised invoices to Rs 31.13 crore on PRAAPTI for the late payment surcharge. AG objected to the invoices and claimed it was tampered with to claim the amount from Tangedco.
Senior counsels CS Vaidyanathan and Satish Parasaran appeared on behalf of Tata Power and submitted that the writ court could not adjudicate the commercial dispute. However, Tangedco has an alternate remedy before TNERC under 86 (1) (F) of the Electricity Act, 2003. The counsels also accepted the 50% payment (Rs 15 crore) from the private player’s total surcharge claim and dealt with the matter before the competent forum. Accepting the submission, the bench disposed of the petition.
