TATA POWER COMPANY LIMITED Vs. GOVERNMENT OF MAHARASHTRA

JUDGEMENT

(1.) Rule, by consent returnable forthwith. With the consent of Counsel and at their request the Petition is taken up for hearing and final disposal.

(2.) On diverse dates between 1907 and 1953 licenses were granted to the Petitioner to generate and supply electric power. On 10 June 2003 the Electricity Act 2003 came into force. The Act delicensed generation activity and allowed generating companies a measure of freedom to supply electric power to consumers and licensees of their choice. Following the enactment of the law the generation and distribution businesses of the Petitioner were separated and, the Court is informed ring fenced pursuant to the delicensing of generation.'' The Statement of Objects and Reasons appended to the Bill introduced in Parliament specifically adverted to the policy of the state of encouraging private sector participation in generation, transmission and distribution and the objective of distancing the regulatory responsibilities from government to Regulatory Commissions. The Act also brought into being a legislative framework for implementing the regime of power trading and open'' access. Among the main features of the Bill was that generation was being delicensed. In order to facilitate free movement of electricity, the Act introduced the mechanism of open access by which generating companies were enabled to sell electricity to consumers and to licensees.

(3.) In August 2005 the Maharashtra Energy Regulatory Commission (Terms and Conditions of Tariff) Regulations 2005 were notified under which it is mandatory for a distribution licensee to plan its procurement for meeting future demand and to enter into long term power purchase agreements for the procurement of power with the approval of the State Commission (MERC). On 12 July and 27 December 2006 the Petitioner entered into power purchase agreements (PPAS) for the supply of power to the Bombay Electric Supply and Transport Undertaking and to Tata Power Company -Distribution respectively, which were filed before the MERC for approval. Reliance Infrastructure Limited, the Second Respondent filed its objections and independently filed a separate application claiming equitable allocation of power from the generation facility of the Petitioner. On 6 November 2007 MERC approved the PPA between the Petitioner and the BEST and the arrangement between the generation business of the Petitioner and TPC Distribution from 1 April 2008. The Appellate Tribunal for Electricity set aside by its decision dated 6 May 2008 the approval of the PP As and remanded the matter to MERC for reconsideration. In an appeal filed by the Petitioner before the Supreme Court a final judgment and order was rendered on 6 May 2009.