{"id":28320,"date":"2006-01-14T00:00:00","date_gmt":"2006-01-13T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/power-grid-corporation-of-india-vs-bihar-state-electricity-board-and-on-14-january-2006"},"modified":"2016-03-26T07:06:56","modified_gmt":"2016-03-26T01:36:56","slug":"power-grid-corporation-of-india-vs-bihar-state-electricity-board-and-on-14-january-2006","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/power-grid-corporation-of-india-vs-bihar-state-electricity-board-and-on-14-january-2006","title":{"rendered":"Power Grid Corporation Of India … vs Bihar State Electricity Board And … on 14 January, 2006"},"content":{"rendered":"
Central Electricity Regulatory Commission<\/div>\n
Power Grid Corporation Of India … vs Bihar State Electricity Board And … on 14 January, 2006<\/div>\n
Bench: A Basu, K Sinha, B Bhushan, A Jung<\/div>\n<\/p>\n
<\/pre>\n
ORDER<\/p>\n
1. The petition has been filed for approval for transmission charges for the 400 kV  D\/C Malda-Bongaigaon transmission line (the transmission line) in Eastern Region for  the period from 1.4.2004 to 31.3.2009, based on the Central Electricity Regulatory  Commission (Terms and Conditions of Tariff) Regulations, 2004, (hereinafter referred  to as “the 2004 regulations”). The petitioner had also prayed that it be permitted to  continue the billing of transmission charges on the same basis as charged on  31.3.2004, pending determination of tariff in the present petition. No other specific  relief is prayed for.\n<\/p>\n
2. The revised cost estimates for the Kathalguri Transmission System, of which  the transmission line is a part, were approved by the Central Government in Ministry  of Power under letter dated 22.3.2001 at a total cost of Rs. 101010.00 lakh. The  apportioned approved cost of the transmission line, which was declared under  commercial operation on 1.4.2000, is stated to be Rs. 29743.00 lakh. The  transmission line is an inter-regional line between Eastern and North-eastern Regions.  However, in the present petition we are concerned with the transmission charges  payable by the beneficiaries in the Eastern Region as the transmission tariff applicable  to North-eastern region is payable @ 35 paise\/unit of the energy transmitted in the  region.\n<\/p>\n
3. The annual transmission charges for the period from 1.4.2001 to 31.3.2004  were decided by the Commission in its order dated 13.4.2004 in Petition No. 71\/2002  at a gross block of Rs. 29856.58 lakh, including additional capitalization from 1.4.2000  to 31.3.2001 on account of FERV of Rs. 113.56 lakh over the gross block of Rs.  29743.02 lakh earlier considered by the Commission for the period up to 31.3.2001.  The line length of the transmission line is 864 ckt-kms as claimed by the petitioner for  the purpose of claiming O&M expenses.\n<\/p>\n
4. The petitioner has claimed the total transmission charges as under:\n<\/p>\n
                                                      (Rs. in lakh)
\n                               2004-05    2005-06    2006-07   2007-08   2008-09
\nAdvance Against Depreciation as
\nper Order dated 13.4.2004
\nin  petition 71\/2002             441.42   1142.26    1142.26   1142.26   1025.67
\nLess: Adjustment of Excess
\nAdvance Against Depreciation
\ndue to refinancing of GoI Loan
\n325.82 —-\n<\/p>\n
Advance Against Depreciation     115.60    1142.26   1142.26   1142.26    1025.67\nDepreciation                     802.48     802.48    802.48    802.48     802.48\nInterest on Loan                1078.17     929.09    780.00    630.92     489.78\nReturn on Equity                1392.25    1392.25    392.25   1392.25    1392.25\nInterest on Working Capital      106.10     124.02    124.27    124.64     123.34\nO & M Expenses                   308.61     320.90    334.22    346.84     361.42\n\nTotal                           3803.21    4711.00   4575.48   4439.39    4194.94 \n \n\n<\/pre>\n
5. The details submitted by the petitioner in support of its claim for interest on  working capital are given hereunder:\n<\/p>\n
                                                                  (Rs. in lakh)
\n                     2004-05      2005-06      2006-07      2007-08     2008-09 <\/p>\n
Maintenance Spares   375.50      398.03        421.91       447.23     474.06
\nO & M expenses        25.72       26.74         27.85        28.90      30.12
\nReceivables          633.87      785.17        762.58       739.90     699.16
\nTotal               1035.08     1209.94       1212.34      1216.03    1203.33
\nRate of Interest      10.25%      10.25%        10.25%       10.25%     10.25%
\nInterest             106.10      124.02        124.27       124.64     123.34 <\/p>\n
6. The respondents have not filed any reply to the petition. Neither has any  objection been received in response to the public notices published by the petitioner in  accordance with the procedure specified by the Commission in terms of Section 64 of  the Electricity Act, 2003.\n<\/p>\n
CAPITAL COST <\/p>\n
7. As per Clause (2) of Regulation 52 of the 2004 regulations in case of the  projects existing up to 31.3.2004, the project cost admitted by the Commission for  determination of tariff prior to 1.4.2004 shall form the basis for determination of tariff.\n<\/p>\n
8. The petitioner has considered the capital expenditure of Rs. 29856.59 up to  31.3.2004. The petitioner has not claimed additional capitalisation on works. The  petitioner has considered de-capitalisation of Rs. 97.93 lakh on account of FERV for  the period 1.4.2001 to 31.3.2004. Accordingly, gross block of Rs. 29758.66 lakh has  been claimed for the purpose of tariff.  Extra Rupee Liability during the years 2001-04 <\/p>\n
9. Regulation 1.13 (a) of the Central Electricity Regulatory Commission (Terms  and Conditions of Tariff) Regulations, 2001 provided as under:\n<\/p>\n
(a) Extra rupee liability towards interest payment and loan repayment  actually incurred, in the relevant year shall be admissible; provided it  directly arises out of foreign exchange rate variation and is not  attributable to Utility or its suppliers or contractors. Every utility shall  follow the method as per the Accounting Standard-11 (Eleven) as issued  by the Institute of Chartered Accountants of India to calculate the impact  of exchange rate variation on loan repayment <\/p>\n
(b) Any foreign exchange rate variation to the extent of the dividend paid out  on the permissible equity contributed in foreign currency, subject to the  ceiling of permissible return shall be admissible. This as and when paid,  may be spread over the twelve-month period in arrears <\/p>\n
10. Regulation 1.7 of the 2001 further provided that recovery of foreign exchange  rate variation would be done directly by the utilities from the beneficiaries without filing  a petition before the Commission. In case of any objections by the beneficiaries to the  amounts claimed on these counts, they may file an appropriate petition before the  Commission.\n<\/p>\n
11. As no objections are raised by the beneficiaries to the petitioner’s claim for de-  capitalization of Rs.97.93 lakh on account of FERV and also, FERV worked out is  matching with calculations submitted by the petitioner, the claim has accordingly been  considered for tariff calculations.\n<\/p>\n
12. Based on the above, gross block of Rs. 29758.64 lakh, including decapitalisation  of FERV of Rs. 97.93 lakh claimed, as on 1.4.2004 over gross block of  Rs.29856.58 lakh considered by the Commission in its order dated 13.4.2004 ibid,  with marginal adjustment on account of rounding off has been considered for the  purpose of tariff:\n<\/p>\n
DEBT- EQUITY RATIO <\/p>\n
13. Regulation 54 of the 2004 regulations inter alia provides that in case of the  existing project, debt-equity ratio considered by the Commission for fixation of tariff  for the period ending 31.3.2004 shall be considered for determination of tariff. It further  provides that the debt and equity amount arrived at in the above manner shall be used  for calculation of interest on loan, return on equity, advance against depreciation and  foreign exchange rate variation.\n<\/p>\n
14. The petitioner has claimed tariff based on debt-equity of 66.58:33.42 as considered by  the Commission in its order dated 13.4.2004 ibid, including de-capitalisation of an amount of  Rs. 97.93 lakh on account of FERV, against the approved debt-equity of 58.8:41.2. The petitioner  has not submitted any evidence in support of the approved debt equity ratio stated in the  petition. Therefore, the entire amount of de-capitalisation of Rs. 97.93 lakh has been  adjusted against the equity to bring it closer to standard debt-equity ratio of 70:30.  Based on this, Rs.9879.41 lakh has been considered as the equity for the purpose of  determination of tariff in the present petition against equity of Rs. 9977.35 lakh  considered in the order dated 13.4.2004 ibid.\n<\/p>\n
RETURN ON EQUITY <\/p>\n
15. As per Clause (iii) of Regulation 56 of the 2004 regulations, return on equity  shall be computed on the equity base determined in accordance with regulation 54 @  14% per annum. Equity invested in foreign currency is to be allowed a return in the  same currency and the payment on this account is made in Indian Rupees based on  the exchange rate prevailing on the due date of billing.\n<\/p>\n
16. The petitioner has claimed return on equity of Rs. 9944.62 lakh, after  adjustment of amount of Rs 32.73 lakh for de-capitalisation of FERV from 1.4.2001 to  31.3.2004, being 33.42% of the total amount of Rs. 97.93 lakh de-capitalised.\n<\/p>\n
17. For the reasons already discussed under the head “Debt-Equity Ratio”, equity  of Rs.9879.41 lakh has been considered. Accordingly, the petitioner shall be entitled  to return on equity @ Rs. 1383.12 lakh each year during the tariff period.\n<\/p>\n
INTEREST ON LOAN <\/p>\n
18. As per Clause (i) of Regulation 56 of the 2004 regulations, interest on loan  capital is to be computed loan wise on the loans arrived at in the manner indicated in  regulation 54. Further, the loan outstanding as on 1.4.2004 is worked out as the gross  loan as per regulation 54 minus cumulative repayment as admitted by the  Commission up to 31.3.2004. The repayment for the period 2004-09 needs to be  worked out on normative basis.\n<\/p>\n
19. The petitioner has claimed interest on loan in the following manner:\n<\/p>\n
(i) Gross loans, cumulative loan repayment up to previous year as admitted  by the Commission in the order dated 13.4.2004 have been taken as the  opening balance as on 1.4.2004.\n<\/p>\n
(ii) The loan figures on account of replacement of GOI loan with Bond-XIV  have been adjusted.\n<\/p>\n
(iii) On the basis of actual rate of interest on actual average loan, the  weighted average rate of interest on loan is worked out for various  years.\n<\/p>\n
(iv) Gross loans as admitted by the Commission in the order dated 5.3.2003  ibid has been considered as notional loan and the weighted average rate  of interest on loan for respective years as per above has been has been  multiplied to arrive at interest on loan.\n<\/p>\n
(v) Notional loan component of FERV up to 31.3.2001 has been considered  separately and actual applicable rate of interest on Foreign Loan has  been considered to workout the interest on this component.\n<\/p>\n
20. In our calculation, the interest on loan has been worked out as detailed below:\n<\/p>\n
(i) Details of net outstanding loan as on 31.3.2004, repayment schedule for  the period 2004-09, rate of interest as on 1.4.2004 etc. have been taken  as per the loan details submitted by the petitioner, for working out  weighted average rate of interest.\n<\/p>\n
(ii) Repayment for the years 2004-05 to 2008-09 of the total notional loan  has been worked out in accordance with the following formula:  Maximum of depreciation or (Notional net loan at the beginning of the  year x (actual repayment of the respective loan \/ actual net respective  loan at the beginning of the year)).\n<\/p>\n
(iii) Weighted average rate of interest on actual loan worked as above has  been applied on the notional average loan during the year to arrive at  the interest on loan.\n<\/p>\n
(iv) PNB-I, Corporation Bank, IOB-II and Bank of India Foreign Currency  loans carry the floating rate of interest. The rate of interest as applicable  as on 1.4.2004 has been considered in the calculation. This is subject to  mutual settlement between the parties in case of any change\/resetting of  the interest rate during the tariff period.\n<\/p>\n
(v) Repayment of loan up to 31.3.2004 has been considered.\n<\/p>\n
(vi) The order dated 13.4.2004 ibid was based on SBI-II loan & GOI loan  which have been refinanced from Bond XIII Option II on 31.7.2002 in the  year 2002-03 and Bond XIV on 17.7.2003 in the year 2003-04  respectively. This refinancing has the impact in the annual transmission  charges (mainly in Advance Against Depreciation and interest on loan)  for the tariff period 2001-04 and also the current tariff. Therefore to work  out the annual transmission charges for the current tariff period annual  transmission charges for the tariff period 2001-04 have been notionally  revised, and the revised transmission charges have been taken as the  base for working out annual transmission charges for the current tariff  period. The revised transmission charges are given below:\n<\/p>\n
                                                            (Rs. in lakh)
\nRevised Transmission Charges            2001-02         2002-03         2003-04
\nInterest on Loan                        2465.94         2266.46         1644.00
\nInterest on Working  Capital             162.73          152.77          154.58
\nDepreciation                             805.12          805.12          805.12
\nAdvance against  Depreciation            488.20            0.00          525.66
\nReturn on Equity                        1596.38         1596.38         1596.38
\nO & M Expenses                           757.18          802.61          850.77
\nTOTAL                                   6275.54         5623.34         5576.50
\nInterest on Working  Capital
\nMaintenance Spares                       306.00          324.36          343.83
\nO & M expenses                            63.10           66.88           70.90
\nReceivables                             1045.92          937.22          929.42
\nTotal                                   1415.03         1328.47         1344.14
\nRate of Interest                          11.50%          11.50%          11.50%
\nInterest                                 162.73          152.77          154.58 <\/p>\n
21. Based on the above, the year-wise details of interest worked out are given  hereunder:\n<\/p>\n
                                                        (Rs in lakh)
\nUp to 31.3.2004              2004-05    2005-06     2006-07    2007-08    2008-09
\nGross Loan as per last
\nOrder
\n19879.24
\nAddition due to  Additional
\nCapitalisation  0.00
\nAddition due to FERV 0.00
\nGross Normative Loan         19879.24    19879.24     19879.24   19879.24    19879.24
\n19879.24
\nCumulative  Repayment up to
\nPrevious Year                 3375.98     5328.09      7280.21    9232.32    11184.43
\nNet Loan-Opening             16503.26    14551.15     12599.04   10646.93     8694.82
\nRepayment during the
\nyear                          1952.11     1952.11      1952.11    1952.11     1835.09
\nNet Loan-Closing             14551.15    12599.04     10646.93    8694.82     6859.72
\nAverage Loan                 15527.21    13575.09     11622.98    9670.87     7777.27
\nWeighted Average
\nRate of Interest on  Loan       6.97%       6.87%        6.74%      6.55%        6.32%
\nInterest                     1082.24      932.61       782.97     633.34       491.68<\/p>\n
DEPRECIATION <\/p>\n
22. Sub-clause (a) of Clause (ii) of Regulation 56 of the 2004 regulations provides  for computation of depreciation in the following manner, namely:\n<\/p>\n
(i) The value base for the purpose of depreciation shall be the historical  cost of the asset.\n<\/p>\n
(ii) Depreciation shall be calculated annually based on straight line method  over the useful life of the asset and at the rates prescribed in Appendix II  to these regulations. The residual value of the asset shall be considered  as 10% and depreciation shall be allowed up to maximum of 90% of the  historical capital cost of the asset. Land is not a depreciable asset and  its cost shall be excluded from the capital cost while computing 90% of  the historical cost of the asset. The historical capital cost of the asset  shall include additional capitalisation on account of Foreign Exchange  Rate Variation up to 31.3.2004 already allowed by the Central  Government\/Commission.\n<\/p>\n
(iii) On repayment of entire loan, the remaining depreciable value shall be  spread over the balance useful life of the asset.\n<\/p>\n
(iv) Depreciation shall be chargeable from the first year of operation. In case  of operation of the asset for part of the year, depreciation shall be  charged on pro rata basis.\n<\/p>\n
23. Land cost included in the capital cost of the asset is Rs. 95.62 lakh. Thus, the  gross depreciable value of the asset, as per (ii) above, is 0.9 x (Rs.29758.64 lakh – Rs. 95.62 lakh)= Rs.26697.00 lakh. Cumulative depreciation and AAD recovered in  tariff up to 31.3.2004 is Rs.5088.88 lakh. Remaining depreciable value as on  1.4.2004 is thus Rs. 21606.32 lakh.\n<\/p>\n
24. The depreciation recoverable works out to Rs 802.48 lakh each year during the  tariff period by applying the depreciation rate of 2.697% as shown below:\n<\/p>\n
                                                        (Rs. in lakh)
\nUp to
\n31.3.2004                2004-05      2005-06    2006-07    2007-08    2008-09
\nGross Block
\nAs per Order dated
\n13.4.2004
\n29856.58
\nAddition during 2001-04
\ndue to Additional
\nCapitalisation  0.00
\nAddition during 2001-04
\ndue to FERV (-)97.93
\nGross Block as on
\n31.3.2004                29758.64     29758.64   29758.64   29758.64   29758.64
\n29758.64
\nRate of Depreciation
\n2.697%  Depreciable
\nValue 90%                26697.00     26697.00   26697.00    26697.00   26697.00
\nBalance Useful life of
\nthe asset —–<\/p>\n
\nRemaining Depreciable\nValue                    21606.32     20803.84   19416.79    17464.68   15512.57\nDepreciation               802.48       802.48     802.48      802.48     802.48\n\n \n\nADVANCE AGAINST DEPRECIATION \n \n\n<\/pre>\n
25. As per Sub-clause (b) of clause (ii) of Regulation 56 of the 2004 regulations, in  addition to allowable depreciation, the transmission licensee is entitled to Advance  Against Depreciation, computed in the manner given hereunder:  AAD = Loan repayment amount as per regulation 56 (i) subject to a ceiling of  1\/10th of loan amount as per regulation 54 minus depreciation as per schedule.\n<\/p>\n
26. It is provided that Advance Against Depreciation shall be permitted only if the  cumulative repayment up to a particular year exceeds the cumulative depreciation up  to that year. It is further provided that Advance Against Depreciation in a year shall  be restricted to the extent of difference between cumulative repayment and cumulative  depreciation up to that year.\n<\/p>\n
27. The petitioner has claimed Advance Against Depreciation in the following  manner:\n<\/p>\n
(i) 1\/10th of gross loan is worked out from the gross loan admitted by the  Commission in the order dated 16.3.2005 ibid.\n<\/p>\n
(ii) Cumulative loan as well as repayment of notional loan during the year  have been considered.\n<\/p>\n
(iii) Depreciation as claimed in the petition.\n<\/p>\n
(iv) In cumulative depreciation, Advance Against Depreciation allowed up to  2003-04 as per order dated 16.3.2005 ibid has not been considered.  28. In our calculation, the Advance Against Depreciation has been worked as  under:\n<\/p>\n
(i) 1\/10th of gross loan has been worked out from the gross notional loan  as per para 21 above.\n<\/p>\n
(ii) Cumulative loan as well as repayment of notional loan during the year  has been considered as per para 21 above.\n<\/p>\n
(iii) Depreciation as worked out as per para 24 has been taken into account.\n<\/p>\n
(iv) In cumulative depreciation recovered up to 2003-04, Advance Against  Depreciation has been included as per order dated 21.2.2005 ibid.  29. The details of Advance Against Depreciation allowed for the transmission  system, is given hereunder:\n<\/p>\n
                                          (Rs in lakh)
\n                            2004-05    2005-06    2006-07    2007-08     2008-09
\n1\/10th of Gross Loan(s)     1987.92    1987.92    1987.92    1987.92     1987.92
\nRepayment of the Loan       1952.11    1952.11    1952.11    1952.11     1835.09
\nMinimum of the above        1952.11    1952.11    1952.11    1952.11     1835.09
\nDepreciation during
\nthe  year                    802.48     802.48     802.48     802.48      802.48
\n(A) Difference              1149.63    1149.63    1149.63    1149.63     1032.61
\nCumulative Repayment of
\nthe Loan                    5328.09    7280.21    9232.32   11184.43    13019.52
\nCumulative Depreciation\/
\nAdvance against
\nDepreciation                5893.16    6695.64    8082.69   10034.80    11986.91
\n(B) Difference              -565.06     584.57    1149.63    1149.63     1032.61
\nAdvance against
\nDepreciation Minimum of
\n(A) and (B)                    0.00     584.57    1149.63    1149.63     1032.61 <\/p>\n
OPERATION & MAINTENANCE EXPENSES <\/p>\n
30. In accordance with Clause (iv) of Regulation 56 the 2004 regulations, the  following norms are prescribed for O & M expenses:\n<\/p>\n
    Year
\n                         2004-05      2005-06    2006-07    2007-08    2008-09
\nO&M expenses
\n(Rs in lakh per ckt-km)   0.227        0.236      0.246      0.255      0.266
\nO&M expenses
\n(Rs in lakh per bay)     28.12        29.25      30.42      31.63      32.90 <\/p>\n
31. The petitioner has claimed O & M expenses for 864 ckt-km of line length and 4  bays (2 each at Malda and Bongaigaon sub-stations), which has been allowed.  Accordingly, the petitioner’s entitlement to O & M expenses has been worked out as  given hereunder:\n<\/p>\n
                              (Rs. in lakh)
\n                                          Year
\n                     2004-05     2005-06     2006-07      2007-08     2008-09
\nO&M expenses for
\nline length          196.13      203.90      212.54       220.32      229.82
\nO&M expenses
\nfor bays             112.48      117.00      121.68       126.52      131.60
\nTotal                308.61      320.90      334.22       346.84      361.42<\/p>\n<\/blockquote>\n
32. The petitioner has submitted that the wage revision of its employees is due with  effect from 1.1.2007. Therefore, according to the petitioner, O & M expenses should  be subject to revision on account of revision of employee cost from that date. In the  alternative, it has been prayed that the increase in employee cost due to wage  revision be allowed as per actuals for extra cost to be incurred consequent to wage  revision. We are not expressing any view, as this issue does not arise for  consideration at this stage. The petitioner may approach for a relief in this regard at an  appropriate stage in accordance with law.\n<\/p>\n
INTEREST ON WORKING CAPITAL <\/p>\n
33. The components of the working capital and the interest thereon are discussed  hereunder:\n<\/p>\n
(i) Maintenance spares  Regulation 56(v)(1)(b) of the 2004 regulations provides for maintenance  spares @ 1% of the historical cost escalated @ 6% per annum from the date of  commercial operation. In the present case, the capital expenditure on the date  of commercial operation is Rs 297.43 crore, which has been considered as the  historical cost for the purpose of the present petition and maintenance spares  have been worked out accordingly by escalating 1% of the historical cost @ 6%  per annum. The value of maintenance spares as on 1.4.2004 works out to Rs.  375.50 lakh.\n<\/p>\n
(ii) O & M expenses  Regulation 56(v)(1)(a) of the 2004 regulations provides for operation and  maintenance expenses for one month as a component of working capital. The  petitioner has claimed O&M expenses for 1 month of O&M expenses of the respective  year as claimed in the petition. This has been considered in the working capital.\n<\/p>\n
(iii) Receivables  As per Regulation 56(v)(1)(c) of the 2004 regulations, receivables will be  equivalent to two months average billing calculated on target availability level. The  petitioner has claimed the receivables on the basis 2 months’ transmission charges  claimed in the petition. In the tariff being allowed, receivables have been worked out  on the basis 2 months’ transmission charges.\n<\/p>\n
(iv) Rate of interest on working capital  As per Regulation 56(v) (2) of the 2004 regulations, rate of interest on working  capital shall be on normative basis and shall be equal to the short-term Prime Lending  Rate of State Bank of India as on 1.4.2004 or on 1st April of the year in which the  project or part thereof (as the case may be) is declared under commercial operation,  whichever is later. The interest on working capital is payable on normative basis  notwithstanding that the transmission licensee has not taken working capital loan from  any outside agency. The petitioner has claimed interest on working capital @ 10.25%  based on SBI PLR as on 1.4.2004, which is in accordance with the 2004 regulations  and has been allowed.\n<\/p>\n
34. The necessary computations in support of interest on working capital are appended  hereinbelow. <\/p>\n
\n                                                  (Rs. in lakh)\n                        2004-05       2005-06      2006-07     2007-08    2008-09\nMaintenance Spares       375.50        398.03       421.91      447.23     474.06\nO & M expenses            25.72         26.74        27.85       28.90      30.12\nReceivables              613.41        689.65       762.78      740.01     699.11\nTotal                  1,014.62      1,114.42     1,212.55    1,216.14   1,203.28\nRate of Interest          10.25%        10.25%       10.25%      10.25%     10.25%\nInterest                 104.00        114.23       124.29      124.65     123.34\n\n \n\nTRANSMISSION CHARGES \n \n\n<\/pre>\n
35. A summary sheet showing basic details of capital cost and other related aspects is  annexed to this order. The transmission charges being allowed for the transmission system  are summarised below. <\/p>\n
\n                                                              (Rs. in lakh) \n                          2004-05     2005-06     2006-07      2007-08     2008-09 \nDepreciation               802.48      802.48      802.48       802.48      802.48 \nInterest on Loan          1082.24      932.61      782.97       633.34      491.68 \nReturn on Equity          1383.12     1383.12     1383.12      1383.12     1383.12 \nAdvance against\nDepreciation                 0.00      584.57     1149.63      1149.63     1032.61 \nInterest on Working\nCapital                    104.00      114.23      124.29       124.65      123.34 \nO & M Expenses             308.61      320.90      334.22       346.84      361.42 \nTotal                     3680.45     4137.90     4576.71      4440.06     4194.65\n\n \n\n<\/pre>\n
36. In addition to the transmission charges, the petitioner shall be entitled to other  charges like income-tax, incentive, surcharge and other cess and taxes in accordance  with the 2004 regulations. 50% of these transmission charges shall be included in the  regional transmission tariff for Eastern Region and shall be shared by the regional  beneficiaries in accordance with the 2004 regulations.\n<\/p>\n
37. The main reasons for difference in the annual transmission charges allowed  and those claimed by the petitioner are because of <\/p>\n
(a) Lower amount of return on equity due to de-capitalisation of FERV for the  years 2001-04 has been adjusted against equity to bring debt-equity ratio  nearer to the approved debt-equity ratio as possible.\n<\/p>\n
(b) Lower amount of Advance Against Depreciation allowed because FERV decapitalisation  for the years 2001-04 has been adjusted against equity as  discussed above.\n<\/p>\n
(c) The petitioner did not include Advance Against Depreciation up to 31.3.2004  towards cumulative depreciation recovered up to that date.\n<\/p>\n
(d) Higher amount of interest on loan because weighted average rate of Interest  has been worked out on the basis of actual average loan based on exchange  rate as on 31.3.2004 and FERV for the years 2001-04 has been considered as  equity.\n<\/p>\n
38. The petitioner is already billing the respondents on provisional basis in  accordance with the Commission’s interim directions. The provisional billing of tariff  shall be adjusted in the light of final tariff now approved by us.\n<\/p>\n
39. This order disposes of Petition No.121\/2004.<\/p>\n","protected":false},"excerpt":{"rendered":"
Central Electricity Regulatory Commission Power Grid Corporation Of India … vs Bihar State Electricity Board And … on 14 January, 2006 Bench: A Basu, K Sinha, B Bhushan, A Jung ORDER 1. The petition has been filed for approval for transmission charges for the 400 kV D\/C Malda-Bongaigaon transmission line (the transmission line) in Eastern […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-28320","post","type-post","status-publish","format-standard","hentry","category-judgements"],"yoast_head":"\nPower Grid Corporation Of India ... vs Bihar State Electricity Board And ... on 14 January, 2006 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/power-grid-corporation-of-india-vs-bihar-state-electricity-board-and-on-14-january-2006\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Power Grid Corporation Of India ... vs Bihar State Electricity Board And ... on 14 January, 2006 - 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