Madhya Pradesh High Court
Heg Limited vs M.P.State Electricity Board on 16 January, 2025
Author: Vishal Dhagat
Bench: Vishal Dhagat
NEUTRAL CITATION NO. 2025:MPHC-JBP:3346 1
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE VISHAL DHAGAT
ON THE 16th OF JANUARY, 2025
WRIT PETITION No. 17096 of 2007
HEG LIMITED
Versus
M.P.STATE ELECTRICITY BOARD AND OTHERS
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Appearance:
Shri Baswaprabhu Patil - Senior Advocate with Shri Jasneet Singh
Hora - Advocate for petitioner.
Shri Manoj Kumar Dubey - Advocate for respondent No.1.
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ORDER
Petitioner has filed this petition under Article 226 of Constitution
of India making a prayer to quash impugned order dated 22/11/2007
contained in Annexure P-1 and to issue writ of mandamus
commanding respondent to fix purchase price of surplus power
wheeled and generated by Tawa Hydel Captive Power Plants ad
valorem on overall realization rates in terms of clause 11(b) of
wheeling agreement dated 30/11/1996 for payment of dues towards
purchase of surplus power.
2. Chief General Manager, Commercial M.P. Power Trading
Company Ltd., Jabalpur wrote a letter to Superintendent Engineer of
Madhya Pradesh Madhya Kshetra Vidyut Vitaran Company Ltd. and
its Senior Accounts Officer and copy of same was supplied to
Signature Not Verified
Signed by: ANURAG SONI
Signing time: 25-01-2025
12:42:49
NEUTRAL CITATION NO. 2025:MPHC-JBP:3346 2
petitioner company. In said letter it is mentioned that petitioner
company is supplying surplus infirm power from Tawa Hydro Electric
Project to grid of Madhya Pradesh State Electricity Board in
accordance with provisions of Tawa agreement dated 30/11/1996.
Revision of rate for sale of surplus power was under consideration and
interim arrangement for purchase of power was made under
conventional fuel based captive power plant Regulation, 2006 dated
18/09/2006, which is notified in M.P. Gazette dated 26/09/2006. Rate
for purchase of infirm power during peak time was determined at
Rs.2.12 per KWH and during off peak time @ Rs.1.84 per KWH.
Purchase of surplus infirm power generated by M/s HEG Ltd. under
provision of Tawa agreement dated 30/11/1996 was determined @
1.84 per KWH till further orders.
3. Learned Senior Counsel appearing for petitioner submitted that
wheeling agreement dated 30/11/1996 was for period of 15 years.
Agreement is saved and subsisting in view of Section 61 of Madhya
Pradesh Vidyut Sudhar Adhiniyam, 2000 and Section 185 of
Electricity Act, 2003. It is submitted that agreement has not been
changed, altered or substituted in any manner. Power generated at
Tawa Hydro Captive Power Plant is regulated by said agreement and
respondents are obliged to make payment and purchase at ad valorem
purchase rate on overall realization rate. Regulation, 2006 has no
application to power generation and wheeled by Tawa Hydro Captive
Power Plant. It is submitted that Regulation, 2006 is applicable on
captive power plant using conventional fuels. It is submitted that
conventional fuels are primary fossils fuel, which are non renewable
energy sources like petroleum, coal and natural gas. Hydel Captive
Power Plants will not be covered under Regulation of 2006. There is
Signature Not Verified
Signed by: ANURAG SONI
Signing time: 25-01-2025
12:42:49
NEUTRAL CITATION NO. 2025:MPHC-JBP:3346 3
no regulation for purchase of surplus power from Hydel Captive Power
Plant. Wheeling agreement is saved under Madhya Pradesh Vidyut
Sudhar Adhiniyam, 2000 and also under Clause 4.1 of MPERC 2005.
4. Clause 4.1 of MPERC, 2005 is quoted as under:
“The distribution licensees and trading licensees using intra
state transmission system and the distribution system in the
State on the date of coming into force of these regulations
under an existing agreement or arrangement shall continue to
avail open access on such transmission and distribution system
on the same terms and conditions, for the term of the existing
agreement or arrangement on payment of transmission charges.
wheeling charges and other charges as may be determined by
the Commission from time to time.”
5. Learned senior counsel further submitted that Clause 11.B of
agreement has full application. Unilateral change and adherence to
Regulation, 2006 is without jurisdiction and arbitrary. It is submitted
that petitioner company is subjected to hostile discrimination and is
denied equality before law and equal protection of law. Impugned
order violates fundamental rights guaranteed in Article 14 and 19.1(a)
of Constitution of India. It is prayed that petition be allowed and
impugned order be set aside.
6. Learned counsel appearing for respondent submitted that
Government of M.P. has amended Captive Power Policy by
notification dated 24/01/2003 for installation of Captive Power Plants
in State. As per Clause 5(iii) of Policy power purchased by MPSEB
from CPP shall be on such rates not exceeding average cost of
generation of MPSEB. Rate shall be subject to conditions approved by
MPERC. Regulatory Commission has also framed Regulation known
as MPERC (Grant of Consent to CPP regulation, 2003) published in
M.P. Gazette on 07/03/2003, which provides that power purchased by
utility from CPP shall be on such rates not exceeding average cost of
Signature Not Verified
Signed by: ANURAG SONI
Signing time: 25-01-2025
12:42:49
NEUTRAL CITATION NO. 2025:MPHC-JBP:3346 4
generation of utility. Rates, terms and condition for sale of excess
power of CPP owner to utility shall be subject to approval by
Commission. Captive power policy issued by State Government vide
notification dated 24/01/2023 is binding on Government Company. As
per said provision petitioner shall be paid for supply of surplus power
by MPSEB. It is submitted that Commission has not specified any rate
for procurement of power from Captive Power Plants. It is submitted
that MPERC has issued orders dated 10/12/2004 and 25/01/2006, in
which average cost of generation has been approved. By letter which is
impugned in this petition rates were decided temporarily as per
Regulation of 2006. Arrangement was provisional subject to revision
and change. It is submitted that contention of petitioner is incorrect that
Regulation specified by MPERC towards Captive Power Plants is not
applicable. Commission is empowered to frame Regulation.
Respondent further denied that agreement is saved by Section 61 of
Madhya Pradesh Vidyut Sudhar Adhiniyam read with Section 185 of
Electricity Act, 2003 and respondent is bound to purchase electricity ad
valorem on overall realization rate. It is further submitted that non-
framing of regulation for Hydel based CPP does not curtail the power
of Commission to lay down general principles. Decision which has
been taken by respondent is in accordance with policy of State
Government and same is not discriminatory, hostile or violates any
rights of equality. It is prayed that petition filed by petitioner be
dismissed.
7. Heard learned counsel for the parties.
8. Section 185 of Electricity Act, 2003 is reproduced as under :-
185. Repeal and Saving.
Signature Not Verified
Signed by: ANURAG SONI
Signing time: 25-01-2025
12:42:49
NEUTRAL CITATION NO. 2025:MPHC-JBP:3346 5
(1) Save as otherwise provided in this Act, the Indian
Electricity Act, 1910 (9 of 1910), the Electricity (Supply)
Act, 1948 (54 of 1948) and the Electricity Regulatory
Commissions Act, 1998 (14 of 998) are hereby repealed.
(2) Notwithstanding such repeal,-
(a) anything done or any action taken or purported to
have been done or taken including any rule,
notification, inspection, order or notice made or
issued or any appointment, confirmation or
declaration made or any licence, permission,
authorisation or exemption granted or any
document or instrument executed or any direction
given under the repealed laws shall, in so far as it
is not inconsistent with the provisions of this Act,
be deemed to have been done or taken under the
corresponding provisions of this Act.
(b) the provisions contained in sections 12 to 18 of the
Indian Electricity Act, 1910 (9 of 1910) and rules
made thereunder shall have effect until the rules
under section 67 to 69 of this Act are made;
(c) the Indian Electricity Rules, 1956 made under
section 37 of the Indian Electricity Act, 1910 (9 of
1910) as it stood before such repeal shall continue
to be in force till the regulations under section 53
of this Act are made;
(d) all rules made under sub-section (1) of section 69
of the Electricity (Supply) Act, 1948 (54 of 1948)
shall continue to have effect until such rules are
rescinded or modified, as the case may be;
(e) all directives issued, before the commencement of
this Act, by a State Government under the
enactments specified in the Schedule shall continue
to apply for the period for which such directions
were issued by the State Government.
(3) The provisions of the enactments specified in the
Schedule, not inconsistent with the provisions of this Act,
shall apply to the States in which such enactments are
applicable.
(4) The Central Government may, as and when considered
necessary, by notification, amend the Schedule.
(5) Save as otherwise provided in sub-section (2), the
mention of particular matters in that section, shall not be
held to prejudice or affect the general application ofSignature Not Verified
Signed by: ANURAG SONI
Signing time: 25-01-2025
12:42:49
NEUTRAL CITATION NO. 2025:MPHC-JBP:3346 6section 6 of the General Clauses Act, 1897 (10 of 1897),
with regard to the effect of repeals.
9. Section 61 of Madhya Pradesh Vidyut Sudhar Adhiniyam, 2000
is reproduced as under :
61. Savings :
(1) Notwithstanding anything contained in this Act the
powers, rights and functions of the Central Commission,
Regional Electricity Board, the Central Electricity
Authority, the Central Government and authorities under
the Central Government under the Indian Electricity Act,
1910 (No.9 of 1910) or the Electricity (Supply) Act, 1948
(No. 54 of 1948) or rules framed thereunder shall remain
unaffected and shall continue to be in force.
(2) Nothing contained in this Act will apply to the Power
Grid Corporation of India Limited or other bodies or
licensees in relation to the inter-state transmission of the
electricity or generating companies owned or controlled
by the Central Government or undertakings owned by
the Central Government.
(3) All actions taken by any person or authority including
the Board under the Indian Electricity Act, 1910 (No.9 of
1910) or the Electricity (Supply) Act, 1948 (No.54 of
1948) prior to the commencement of this Act shall be
valid and enforceable notwithstanding the modifications
to the said Acts made by this Act.
10. Section 3.8 of Madhya Pradesh Electricity Regulatory
Commission (Power Purchase and Other Matters with Respect to
Conventional Fuel Based Captive Power Plants Regulation, 2006 is
reproduced as under :
The rate of purchase of in-firm power shall be 80% of the rate
specified for firm power, for both peak and off-peak times.
Therefore, for FY07, in-firm power rate during peak time shall
be Rs.2.12 per unit (80% of 2.65 per unit), and during off-peak
time, it shall be Rs.1.84 per unit (80% of 2.30 per unit).
11. On going through arguments made by counsel appearing for the
parties and after perusing return which has been filed by the
respondents it is found that Government of India, Ministry of Power
has written a letter to all Secretaries of the State to promote generation
Signature Not Verified
Signed by: ANURAG SONI
Signing time: 25-01-2025
12:42:49
NEUTRAL CITATION NO. 2025:MPHC-JBP:3346 7
of electricity by Private Power Promotion through Captive Power / Co-
generation Route. Thereafter, Government of Madhya Pradesh,
Department of Energy has written a letter to Secretary, Madhya
Pradesh Electricity Board, Jabalpur for Captive Power Policy of
Madhya Pradesh and State Government set up a policy regarding
setting up of Captive Power Plaints by electricity consumers in State.
Rate of electricity purchased was also laid down in the said letter.
Electricity is to be taken by Board from private sector in accordance
with contract entered between themselves, but broad parameters were
fixed, which are mentioned as under :-
i. For monthly PLF of 70% and above : One and half times
of the average realization rate for the sale of electricity by
the board.
ii. For PLF below 70% : At the average realization rate for
the sale of electricity by the board.
12. Madhya Pradesh Electricity Board has issued a circular dated
27/12/1996 for installment of Captive Power Plaints in the State vide
letter dated 11/06/1996 and certain modifications were made in the
policy of State Government. Relevant Clauses of circular i.e. Clause –
4.1, 4.2 and 4.4 are quoted as under :-
4.1 वैद्यानिक एवं अन्य स्वीकृतियॉं:-
कैप्टिव पावर उपभोक्ता को भारत शासन/मध्य प्रदे श शासन से परिशिष्ट द में
दर्शायी सभी वैद्यानिक एवं अन्य स्वीकृतियो ं स्वयं प्राप्त करनी होगी। कैप्टिव
पावर उपभोक्ता को भूमि, ईधन, जल प्रदाय आदि की सभी व्यवस्थायें भी स्वयं
करनी होगी।
4.2 अन्य उपभोक्ता को कैप्टिव पावर का व्हीलिंग:-
कैप्टिव पावर उपभोक्ता को निर्धारित व्हीलिंग चार्जेज की वसूली की शर्त पर,
मध्य प्रदे श विद्युत मण्डल की पारे पण एवं उप पारे पण लाईनों द्वारा या स्वयं
की व्यवस्था से अन्य ओद्योगिक ईकाई को विद्युत प्रदाय करने हे तु प्रोत्साहित
किया जावेगाबशर्ते व्हीलिंग हे त ु मध्य प्रदे श विद्युत मण्डल की ट्र ां समीशन
प्रणाली में उचित क्षमता उपलब्ध हो। व्हीलिंग चार्जेज जिनमें व्हीलिंग हानि
भीसम्मिलित है , निम्नानुसार है :-
Signature Not Verified
Signed by: ANURAG SONI
Signing time: 25-01-2025
12:42:49
NEUTRAL CITATION NO. 2025:MPHC-JBP:3346 8
क्रमां क दू री का विवरण 15 15 मेगावाट
मेगावाटतक से अधिक
अ 40 किलोमीटर दू री तक के लिय े विद्युत 7% 10%
प्रदाय का प्रतिशत
ब 60 किलोमीटर दू री तक के लिय े विद्युत 9% 12 %
प्रदाय का प्रतिशत
स 100 किलोमीटर दू री तक के लिये विद्युत 11 % 17 %
प्रदाय का प्रतिशत
द 100 किलोमीटर स े अधिक दू री के लिये 13 % 20 %
विद्युत प्रदाय का प्रतिशत
4.4 मध्य प्रदे श विद्युत मण्डल द्वारा विद्युत क्रम की दरे :-
अगर कोई कैप्टिव पावर उपभोक्ता पावर प्लां ट से उत्पादित सरप्लस
विद्युत मण्डल को विक्रय करना चाहता है , तो मण्डल को प्रदाय करने के
लिये सरप्लस पावर की निश्चित क्षमता बताना होगी। जिसके अनुसार कैप्टिव
पावर प्लां ट से दिन (6 बजे प्रात: से 10 बजे रात्रि) तथा रात (10 बजे राशि से
दू सरे दिन प्रात: 6 बजे तक) दोनो में विद्युत प्रदाय किया जाना आवश्यक
होगा। मध्य प्रदे श विद्युत मण्डल द्वारा प्रति वर्ष क्रय के लिये दर का निर्धारण
किया जावेगा। दर के निर्धारण का आधार निम्नानुसार होगा:
क्रमां क गारिक प्लां ट लोड फैक्टर विद्युत क्रय की दर
1 70 प्रतिशत एवं अधिक के गत वर्ष में मण्डल द्वारा विद्युत विक्रय से कुल
लिये मिलाकर औसत वसूली दर का डे ढ गु ना।
2 70 प्रतिशत से कम के लिये गत वर्ष में मण्डल द्वारा विद्युत विक्रय से कुल
मिलाकर औसत वसूली दर के बराबर
टिप्पणी:-
1. उपरोक्त दरो ं के निर्धारण में इस बात का ध्यान रखा जाएगा कि किसी
निर्धारित अवधि में यह दर मण्डल द्वारा निजी क्षेत्र के पावर प्लां ट से ली जा रही
विद्युत के टू . पार्ट टै रिफ से अधिक न हो।
2. मासिक प्लां ट लोड फैक्टर की गणना कैप्टिव पावर प्लां ट द्वारा मध्य
प्रदे श विद्युत मण्डल को माह में विकित यूनिटों तथा मध्य प्रदे श विद्युत मण्
डल को आधिक्रय (SURPLUS) बतायी क्षमता या माह की रिकार्ड की गयी
उच्चतम मेगावाट प्रदाय जो भी अधिक हो के आधार पर की जावेगी।
13. On going through aforesaid documents it is found that
establishment of Captive Power Plaint in State is not dependent upon
the fuel. Generation of power in Captive Power Plant may be by any
type of fuel, but broad guidelines for tariff rate was given in Clause-
4.4, which is one and half times of previous years of average recoverySignature Not Verified
Signed by: ANURAG SONI
Signing time: 25-01-2025
12:42:49
NEUTRAL CITATION NO. 2025:MPHC-JBP:3346 9for sale of electricity. If monthly plant load factor is 70% or more and
if monthly load factor is less than 70%, than rates will be average
recovery of previous year sale of electricity.
14. Thereafter, Madhya Pradesh Vidyut Sudhar Adhiniyam, 2000
was enacted and brought into force on 12/02/2001 and as per Section
61 of Madhya Pradesh Vidyut Sudhar Adhiniyam, 2000 action taken
prior to commencement of this Act are saved and are valid and
enforceable.
15. Even after coming into force of Madhya Pradesh Electricity
Reforms First Transfer Scheme Rules, 2003 earlier Acts of the Board
were saved. Government of Madhya Pradesh, Energy Department
issued notification dated 24/01/2003. As per Clause – 5 MPSEB may
purchase power from Captive Power Plaints on such rates not
exceeding average cost of generation of MPSEB. Rate shall be subject
to condition approved by Madhya Pradesh Electricity Regulatory
Commission.
16. Respondents vide its letter dated 22/11/2007 has fixed rate
temporarily on the basis of Regulation of 2006. Said letter is arbitrary
in nature as there cannot be same rates for Conventional Fuel Based
Captive Power Plant Hydel Based C.P.P. Petitioner is not producing
electricity through conventional fuel. Regulation, 2006 is not
applicable on petitioner. Agreement which has been done by petitioner
by erstwhile Board is saved by Section 61 of Madhya Pradesh Vidyut
Sudhar Adhiniyam, 2000 and Section 185 of Electricity Act, 2003 and
Regulation of 2006 is not applicable on petitioner Company, but
however, notification which has been issued by Government of
Madhya Pradesh, Energy Department dated 24/01/2003 is applicable to
Electricity Generating Companies as well as on Companies which areSignature Not Verified
Signed by: ANURAG SONI
Signing time: 25-01-2025
12:42:49
NEUTRAL CITATION NO. 2025:MPHC-JBP:3346 10generating Captive Power in State of Madhya Pradesh. In said
notification it has been stated that power purchased by MPSEB from
Captive Power Plaint shall be on such rates not exceeding average cost
of generation of MPSEB.
17. In view of aforesaid, letter dated 22/11/2007 contained in
Annexure P-1 is arbitrary as same is contrary to Regulation, 2006.
Accordingly, letter dated 22/11/2007 is quashed. Respondents have not
framed any policy regarding rates to be given to energy purchased
from captive power plaints based on Hydel Energy.
18. In view of same, rates will be governed by notification dated
24/01/2003 contained in Annexure P-16 and same shall not exceed
average cost of generation of MPSEB. If agreement entered between
the parties i.e. dated 30/11/1996 contains rates which are not excessive
to rates mentioned in clause 5(iii), then same rate shall continue, but if
rates mentioned in agreement dated 30/11/1996 is more than average
cost of generation, then petitioner be paid rates for purchase of
electricity as defined in notification dated 24/01/2003 i.e. equivalent to
average cost of generating company.
19. With the aforesaid direction, petition is disposed off.
(VISHAL DHAGAT)
JUDGE
as.
Signature Not Verified
Signed by: ANURAG SONI
Signing time: 25-01-2025
12:42:49
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