Case No. 68 of Coram. Shri. I. M. Bohari, Member Shri. Mukesh Khullar, Member. M/s RattanIndia Nasik Power Ltd.

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1 Before the MAHARASHTRA ELECTRICITY REGULATORY COMMISSION World Trade Centre, Centre No.1, 13 th Floor, Cuffe Parade, Mumbai Tel /65/69 Fax Website: Case No. 68 of 2018 In the matter of Petition of RattanIndia Nasik Power Ltd. seeking directions of the Commission for change in consumer category from Commercial to Industrial for its Startup Power connection and refund / adjustment of additional tariff collected by MSEDCL under wrong category Coram Shri. I. M. Bohari, Member Shri. Mukesh Khullar, Member M/s RattanIndia Nasik Power Ltd. Petitioner V/s Maharashtra State Electricity Distribution Company Ltd. Respondent Appearance For the Petitioner: For the Respondent: : Shri. Sakya Singha Chaudhari (Adv.) : Shri. Rahul Sinha (Adv.) ORDER Dated: 01 August, M/s RattanIndia Nasik Power Ltd. (RNPL), Plot No.A-1, Additional MIDC area, Musalgaon, Sinnar, Nasik, has filed a Petition on 30 January, 2018 under Section 86 (1) (f) read with Section 129 and Section 62 (6) and other applicable provisions of the Electricity Act (EA), 2003 for seeking directions of the Commission for change in consumer category from HT II Commercial to HT I Industrial for its 12.5 MVA Start-up Power connection and refund / adjustment of additional tariff collected by Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL) under wrong category. Order Case No. 68 of 2018 Page 1 of 16

2 2. RNPL s main prayers are as follows: a) Declare that the Respondent has wrongly charged Petitioner at HT- Commercial rates for the start-up power supplied to the Petitioner from June 2015 onwards; also as per latest orders of this Hon ble Commission HT-I Industrial Rate will become effective since inception of Start Up power connection i.e from February, 2013; b) Declare that the Petitioner is entitled to the refund of Rs. 20,98,94,928/- (Rupees Twenty Crores Ninety Eight Lakhs Ninety Four Thousand Nine Hundred and Twenty Eight only) along with applicable interest from the Respondent being the differential tariff between HT-Commercial and HT-Industrial category, as set out in detail in Annexure Y; c) Direct the Respondent to raise revised / correct invoices on the Petitioner, for HT-I Industrial tariff from date of very first connection of Start-up power supply; d) Direct the Respondent to refund the sum of INR 20,98,94,928/- (Rupees Twenty Crores Ninety Eight Lakhs Ninety Four Thousand Nine Hundred and Twenty Eight only) being the excess amount payable by the Petitioner to the Respondent with accumulated interest as on date of filing the present petition, at par with current applicable bank interest rates;.. 3. The Petition states as follows: 3.1. RNPL has set up a 5 x 270 MW capacity coal-based power plant at Village Musalgaon Taluka Sinnar, District Nashik While RNPL was constructing and setting up the said power generation Plant at Nashik, for the purpose of the construction activities of the said Plant, it approached MSEDCL for obtaining its first electricity connection. MSEDCL accordingly had sanctioned the power supply connection of 1 MVA at 11 kv level vide its Sanction Letter dated 13 May, The said connection was sanctioned under usage category for construction purpose. Applicable tariff was HT-II Commercial. This connection was used by RNPL for the period from 27 July, 2010 to 5 July, Thereafter, as RNPL progressed with the construction of the Plant, requirement of power for construction purposes also increased and need was felt for up- gradation of the existing construction power quantum. RNPL therefore applied to MSEDCL to Order Case No. 68 of 2018 Page 2 of 16

3 upgrade and sanction new feeder of 4.5 MVA at 33 kv level. MSEDCL accordingly sanctioned the upgraded connection of 4.5 MVA, 33 kv level for construction purpose vide its Sanction Letter dated 15 February, The pre-condition for the sanctioning of this new 33 kv feeder was to surrender its existing connection of 1MVA. Accordingly, RNPL surrendered its existing 1 MVA, 11 kv connection and the same was permanently disconnected on 5 July, Power supply to the newly sanctioned 4.5MVA, 33 kv Construction Power feeder was applied HT-II Commercial Tariff rate. RNPL used the upgraded connection of 4.5MVA, 33 kv from 6 July, 2011 to 5 March, In the mid of year 2012, as substantial construction of installation works in Unit-1 and Balance of Plant ( BoP ) areas were nearing completion and systems were made ready for further commissioning, RNPL formally applied for Start-up Power for their thermal power station for a quantum of 12.5 MVA at 220 kv level. MSEDCL vide its letter dated 3 January, 2013, sanctioned Start Up Power for Thermal Power Plant of quantum 12.5 MVA on 220 kv level. Clause 15 of the said Sanction Letter dated 3 January, 2013 provided that the tariff applicable upon RNPL shall be HT-II A (HT Commercial Continuous). Accordingly, RNPL executed an Agreement on 22 February, 2013 with MSEDCL for release of 12.5 MVA, 220 kv Start-up Power connection Further, vide the letter dated 22 February, 2013, MSEDCL directed RNPL that the connection given for construction has to be made Permanently disconnected (PD) and arrears, if any, has to be recovered. It was the mandatory condition imposed on RNPL by MSEDCL to surrender their existing 33 kv construction power being used for construction, in order to effect release of the Start-up power supply. In lieu of the direction of MSEDCL, and post achieving the stabilization of the 220 kv power supply, RNPL permanently surrendered the 4.5MVA 33 kv construction power supply on 5 March, Although construction for Unit-1 of the Plant was complete and ready for commissioning, the other units namely, Unit 2 to 5 were still undergoing construction activities, for which the construction power feeder was required. However, owing to the precondition to surrender the 33 kv Construction Power connection, RNPL was left with no other alternative but to draw Construction Power from the connection provided for Start-up Power In the meantime, vide letter dated 27 September, 2013 the Chief Engineer (CE) (Project and Design), MSETCL informed MSEDCL that the CE State Transmission Utility (STU) has issued the grid connectivity for evacuation of power supply from the Plant. The evacuation of power was proposed by constructing 400 kv double circuit line from the Plant to MSETCL s existing 400 kv Babhleshwar sub-station. RNPL vide its letter dated 6 September, 2013 requested for drawl of start-up power on one circuit of Sinnar Order Case No. 68 of 2018 Page 3 of 16

4 Power Transmission Company Limited s 400 kv Babhleshwar - Sinnar line. MSEDCL then sanctioned start-up power to RNPL on 400 kv Babhleshwar - Sinnar circuit to the extent of 12.5MVA, vide its letter dated 12 December, The said Sanction Letter imposed inter alia the following conditions upon RNPL: a) Existing start-up power supply arrangement on 220 kv level is to be disconnected; and b) If EPA has been signed with MSEDCL for sale of power from the thermal power plant, only then will the HT-Industrial Tariff be applicable, otherwise HT- Commercial Tariff will be applicable as per the present MERC tariff order. Tariff category and rate applicable will be re-determined as and when tariff order is revised by the Commission. The aforesaid sanction letter also had a mandatory condition to surrender the existing 220 kv Start up Power connection for release of revised/upgraded power requirement. Accordingly, RNPL and MSEDCL entered into an Agreement on 21 December, 2013 for release of 12.5 MVA, 400 kv Start-up power connection Until that time MSEDCL was charging RNPL under Commercial tariff category. However, RNPL came across the Order dated 3 February, 2014 passed in Case No. 51 of 2013 ( paragraph 32), where the Commission held that electricity generation from power plants should be treated as industrial purpose only. In view of the Order passed by the Commission, RNPL requested MSEDCL to change the tariff category of start-up power connection of the Plant from existing HT-II Commercial to HT Industrial with retrospective effect vide its letter dated 12 April, Under the said letter, RNPL drew the attention of MSEDCL to the fact that on the basis of the reasoning provided by the Commission, RNPL s thermal power plant fell within the category of power industry ; hence tariff ought to be charged accordingly The Commission vide its Order dated 26 June, 2015 in Case No.121 of 2014, while approving the Multi Year Tariff for the Second Control Period for MSEDCL, categorized Start Up Power for generating stations under HT I: HT Industry Category. Based on this Tariff Order, MSEDCL issued Commercial Circular No. 243 on 3 July, 2015 revising inter alia the electricity tariff categories, with effect from 1 June, Vide letter dated 27 July, 2015, RNPL requested MSEDCL that as per the Commercial Circular dated 3 July, 2015 whereby start up power for generators are categorized under HT: I Industrial Tariff Category, the tariff category for RNPL also be modified from HT-Commercial to HT-Industrial category with retrospective effect from February, 2013 onwards i.e. the commencement of Start Up Power connection of RNPL and demanded refund of amount Rs.. 10,73,86,186 against bills till June, On receiving no response from MSEDCL, RNPL issued a reminder letter dated August 31, Order Case No. 68 of 2018 Page 4 of 16

5 MSEDCL thereafter issued a letter dated 28 September, 2015 to the CE (Commercial), MSEDCL informing about RNPL s request for a change of tariff from HT: II Commercial category to HT: I Industrial category, in accordance with the Commission s Tariff Order and the Commercial Circular CE (Commercial),MSEDCL issued a letter dated 5 October, 2015 to the Superintending Engineer (SE), MSEDCL whereby the CE (Commercial) asked the latter to apply appropriate tariff as per the Commission s Tariff Order Despite the approval from the CE (Commercial), MSEDCL, the local MSEDCL officers refused to implement the revised tariff category and RNPL continued to receive the monthly bill of September, 2015 as per old tariff category i.e. HT II Commercial instead of HT-I Industrial. Vide letter dated 15 October, 2015, RNPL once again requested MSEDCL to implement the revised HT-I Industrial for their Start-up power connection On 29 October, 2015, the SE of MSEDCL sent a letter to the CE (Commercial) of MSEDCL, mentioning a brief history of the matter and requested guidance about the change of tariff category CE (Commercial), MSEDCL thereafter directed the Office of SE, Nashik to visit site of the Plant and submit an internal report justifying change in tariff category of RNPL. MSEDCL s team visited the Plant site on 9 November, 2015 and conducted an inspection. The team thereafter submitted its internal report to the CE (Commercial) of MSEDCL on 11 December, The Inspection Report, however, contained misleading reference regarding the Project. It shall be relevant to note that, at the time of inspection, RNPL had duly explained to MSEDCL s team about the cement plant being totally separate company and premises and its construction being taken up with their own local DG sets CE (Commercial) vide its letter dated 11 January, 2016 addressed to the SE, MSEDCL, inter alia mentioned the following points: i) SE office to verify that correct tariff as per rules and prevailing tariff Orders be applied to RNPL from the date of connection of the Start Up power connection; ii) As per the Commission s Order in Case No. 121 of 2014 and MSEDCL s Commercial Circular, HT Industrial tariff is applicable for Start-up power connections with effect from 1 June, 2015 with prospective effect RNPL therefore issued a reminder letter on 12 January, 2016 and once again requested MSEDCL to change the tariff category, as per the observations of the CE (Commercial) Order Case No. 68 of 2018 Page 5 of 16

6 recorded in the letter dated 11 January, However, MSEDCL expressed inability to propose any change in tariff and was of view that there are no clear directives in letter from CE Commercial for HT-Industrial tariff. During oral discussions held with MSEDCL in this regard, MSEDCL intimated RNPL to take a separate connection for Construction activities which was not prima facie agreeable to RNPL especially since they were made to surrender the existing Construction Power feeder earlier in Even though RNPL was not in agreement to apply for separate feeder at this later stage of the project, however in order to resolve the delayed issue of Tariff category change, RNPL decided to resolve the issue by applying for a separate connection for Construction Power purpose Pursuant to the various discussions with MSEDL towards taking separate connection for construction power purpose, RNPL vide letter dated 22 February, 2016 requested MSEDCL to restore their earlier disconnected 33 kv 4.5 MVA Construction feeder. However, the same was rejected on a technical ground that reconnection was possible within six (6) months from the date of Permanent Disconnection ( PD) and since the 33 kv Construction power feeder was made PD in March, 2013, any request made in 2016 would be time barred hence reconnection was not possible Since MSEDCL was delaying change in tariff category from HT Commercial to HT Industrial, RNPL made three attempts on different occasions to draw the required 5 MW power through Short Term Open Access (STOA) from RNPL s own plant at Amravati and later through an energy trader. However, on every occasion, the application of RNPL was declared invalid with some or other causes On 21 September, 2016 a meeting was held with MSEDCL s representatives and RNPL, with regard to RNPL s application for separate 2 MVA Construction power feeder at 33 kv. In the meeting RNPL explained the entire background of the matter, along with status of Start Up power and prevailing tariff Orders issued by the Commission and it's applicability to RNPL s connection. On the basis of this explanation, RNPL requested MSEDCL to sanction separate feeder for construction power and apply HT-Industrial tariff for existing Start Up power connection. However, MSEDCL here again changed their stance and formally rejected RNPL s application for separate 33 kv Construction power feeder vide their letter dated 21 September, 2016, on the alleged ground that, as per MSEDCL s internal Circular No dated 6 July, 2013, MSEDCL does not permit any applicant/consumer to have two or more independent power supply connection for an identical purpose in one common premises and that as a safety measure two power supply connections in same premises are not processed for sanction. RNPL promptly brought to the notice of MSEDCL that the connection applied will not be for the same purpose but has a totally different purpose for Construction power. Order Case No. 68 of 2018 Page 6 of 16

7 3.21. As per MSEDCL Circular No , the bar on grant of two or more connections was applicable for identical purpose in same premises, whereas MSEDCL was well aware that the purpose of usage of newly applied connection was for Construction activities which are different from existing available connection of Start-up Power. The said Circular from MSEDCL s office clearly states that two or more connections are possible but for different purpose of usage. The said Circular also talks about sub-metering in the same premises, which could have been applied for the drawl of construction power from single source i.e. Start-up power. It appears that MSEDCL has purposely decided to overlook the reason put forth by RNPL in order to reject the application The Commission, vide its Order dated 3 November, 2016, approved the MYT Tariff for MSEDCL in the Case No. 48 of 2016, where Start-up power for generating plants i.e. the power required for trial run of a power plant during commissioning of Unit and it's auxiliaries, and for its start up after planned or forced outage (but not for construction) was included under HT-I Industrial category. Further, HT-II Commercial was applied to "Construction of all types of structures/infrastructure such as buildings, bridges, flyovers, dams, power stations, roads, aerodromes, tunnels for laying of pipelines for all purposes, and which is not covered under the HT-temporary category". Therefore, the Commission has clearly made out a distinction between construction activities and startup or commissioning activities. MSEDCL is bound to give effect to the Order of the Commission and apply the HT-Industrial tariff to RNPL Owing to MSEDCL s actions and failure to acknowledge the legal position on the applicability of Industrial tariff, RNPL on 11 November, 2016 formally lodged complaint with Internal Grievances Redressal Cell ( IGRC ) of MSEDCL, Nashik pleading to make effective tariff category change from HT-Commercial to HT Industrial. The IGRC however vide its letter dated 28 November, 2016, intimated their decision with rejection of RNPL s claim for HT-Industrial Tariff Being aggrieved by the Order passed by the IGRC, RNPL approached the Consumer Grievances Redressal Forum ( CGRF ) Nashik for the change in Tariff category on 14 December, The CGRF allowed the application of RNPL vide their Order dated 31 January, 2017 holding that, 1) MSEDCL should apply HT-I (Industrial Tariff) to RNPL w.e.f. 01 June, 2015 till 31 October, 2016 and refund the difference in the ensuing bill, and for consumption after 01 November, 2016 the HT Industrial tariff for the Start Up power portion will be applied based on verification of load/actual consumption Thereafter, RNPL vide its letter dated 20 February, 2017 approached MSEDCL for refund of differential amount for the period from June, 2015 to October, 2016 amounting to Rs. 7,49,78,947. Order Case No. 68 of 2018 Page 7 of 16

8 3.26. MSEDCL vide its letter dated 30 March, 2017 intimated RNPL that, 1) MSEDCL will follow CGRF Order para (2) i.e. application of Industrial tariff for Start up purpose w.e.f. 01 November, 2016; and 2) In regard of para (1) of CGRF Order to refund the difference amount from 01 June, 2015 till 31 October, 2016 from MSEDCL, that they had challenged the same by way of a Writ Petition (WP) in the High Court, Mumbai. Immediately thereafter vide letter dated 18 May, 2017 MSEDCL formally intimated RNPL that they had challenged the entire Order of the CGRF before the High Court Mumbai Further, MSEDCL vide letter dated 21 June, 2017 pointed out that as per their Joint Spot Verification conducted on 10 March, 2017, it was allegedly observed that RNPL was not carrying out any generation activity and power was used for construction of plant and office works only and not for start up purpose. RNPL submits that, MSEDCL s allegation is baseless and arbitrary in as much as, in the Joint Inspection Report it was mentioned that part of the power is in use for preservation and trial run of Unit 1 and 2 and the installation work of Units 3, 4 and 5 was in progress. Moreover, it shall be relevant to note that, contrary to the observations made by MSEDCL the Plant commissioning and start-up activities on Units 3, 4 and 5 were in full swing from January, 2017 and construction of all units was complete by May, All other BoP areas were already fully commissioned, operational and have been under routine operation, maintenance and preservation even before January, In such situation, at the stage of commissioning, it was impossible for any fully fledged construction work being carried out. Thus, MSEDCL s observations were clearly erroneous and are merely an attempt to avoid applying the HT-Industrial tariff to RNPL. Therefore, the said inspection cannot and ought not to be relied upon as the same is perverse and illegal Since all the units were complete and commissioned, RNPL vide letter dated 3 July, 2017 issued to MSEDCL once again reminded for effecting tariff change and intimating completion of all construction activities and full load operation of all five Units which meant that all power drawn from MSEDCL was now being used for start-up purposes The Commission in its Order dated 31 July, 2017 in Case No. 141 of 2015 for Amravati plant on Start-up power tariff category of RNPL, where the Commission has made tariff change effective from date of sanction of power connection and refunded the differential amount, while accepting the back dated HT Industrial tariff applicability for Start Up power connection Based on the above Orders, RNPL once again vide letter dated 29 August, 2017, intimated concern over undue delays in implementing CGRF tariff change order RNPL is required to pay tariff under the category of HT: I Industrial from the date of Order Case No. 68 of 2018 Page 8 of 16

9 connection of the Start-up power supply, i.e. 1 February, 2013, and the excess sum of Rs. 20, 98, 94,928, being the sum paid by RNPL due to the wrongful categorization of its tariff category by MSEDCL is required to be refunded by MSEDCL. Such amounts paid by RNPL, include the accumulated interest as on date of filing of the present Petition at par with current applicable bank interest rates MSEDCL had filed a Civil Writ Petition bearing No of 2017 before the Bombay High Court, for reliefs claimed therein including inter alia, setting aside the CGRF Order. On 16 January, 2018, the High Court has passed necessary Orders in the Writ Petition allowing RNPL to file an application before the Commission within two (2) weeks from date of disposal of the matter. In view of the aforesaid direction, RNPL has filed the present Petition before the Commission, within the timeframe as prescribed by the High Court at Bombay Section 62(6) of the EA, 2003 provides that if any licensee or a generating company recovers a price or charge exceeding the tariff determined by the Commission, the excess amount shall be recoverable by the person who has paid such price or charge along with interest equivalent to the bank rate. 4. In its Reply dated 6 July, 2018, MSEDCL stated as follows: 4.1. The Supreme Court vide its Judgment dated 16 October, 2015 in the matter of Andhra Pradesh Power Coordination Committee and Others Versus Lanco Kondapalli Power Limited and Others has categorically held that principles underlying the Limitation Act, 1963 are applicable to State Commissions when it functions as Statutory adjudicatory quasi-judicial /judicial authority in determining all claims or disputes, including those arising out of contract between licensees and generating companies. Hence wherever any claim/dispute is raised before the Commission under Section 86 (1) (f) then limitation act strictly applies and any claim barred by limitation i.e a period of three (3) years cannot be adjudicated unless the principles underlying Section 5 and Section 14 of the Limitation Act, 1963 are satisfied In the present case RNPL has not made out any case under the said provisions of Limitation Act. The present Petition was filed by RNPL on 30 January, 2018 before the Commission. Hence any claim prior to the period 29 January, 2015 would be barred by limitation and cannot be allowed in the adjudicatory process set in motion under the provisions of Section 86 (1) (f) of the EA, Claim after the period 30 January,2015 till date: 4.3. Bare perusal of submissions made in the Petition would clearly reveal that the connection for Start-up Power was being utilized by RNPL for construction purposes. It is a matter of record that till date RNPL has not entered into an EPA with MSEDCL for Order Case No. 68 of 2018 Page 9 of 16

10 sale of power from its generating units The load sanction letter dated 12 December, 2013 clearly states that HT-I (Industrial) tariff shall be made applicable to start-up power if PPA/EPA is signed with MSEDCL otherwise HT-II (Commercial) tariff shall be made applicable The Commission in its Tariff Order dated 3 November, 2016 in Case No. 48 of has categorically held that: the power required for trial run of a Power Plant during commissioning of the Unit and its Auxiliaries, and for its start-up after planned or forced outage (but not for construction); 4.6. RNPL has miserably failed to show the occasions/instances as to when such trial run had in fact occasioned. The onus to prove such facts is on RNPL which cannot just make blanket statements without proof RNPL cannot probate and approbate at the same time. It is an admitted position that RNPL has utilized start-up power for construction purposes as is evident from its own pleadings in the Petition Also till date the Commercial Operation Date (COD) of the power plants have not been achieved including but not limited to execution of PPA, meaning thereby that start-up power used for commissioning of units and its auxiliaries during trial run before commissioning has to be proved by RNPL itself The reliance placed by RNPL on the Order dated 3 February, 2014 passed in Case No. 51 of 2013 by the Commission is also misplaced as in those cases there were specific PPAs entered which had a clause governing start-up power. In the present case, there is no PPA. The only thing governing the supply of power to RNPL is the sanction letter dated 12 December, 2013 which clearly states that HT-I (Industrial) tariff shall be made applicable to start-up power if PPA/EPA is signed with MSEDCL otherwise HT-II (Commercial) tariff shall be made applicable Further a joint inspection was also carried out on 10 March, 2017 to find the real situation on the ground. It is important to note that the said joint inspection report was signed, agreed and acknowledged by RNPL. During the said joint inspection, it was found that: i) Construction, installation, commissioning & synchronization if Unit-I has been completed but there is no generation of power at all. ii) Construction, Installation work of Unit 3, 4, 5 not yet been commissioned and is in progress. Order Case No. 68 of 2018 Page 10 of 16

11 iii) Construction work of cooling towers is going on & work is in progress, yet not completed. iv) It has been observed that no generating activity is in progress. v) Power is used for administrative office & constructions activities. vi) As per RattanIndia representatives, power is tapped from coal handling plant for constructions On 31 March, 2017, MSEDCL wrote a letter to RNPL requesting it to bifurcate the load into Commercial, construction and generation which was also not done In view of the above, it is prayed that the Commission may dismiss the present Petition filed by RNPL. 5. At the hearing held on 16 July, 2018, Advocates of both the parties have re-iterated their submissions as made in their Petition / Reply. 6. In its submission dated 30 July, 2018, RNPL has stated as follows: Usage of start-up power for construction purposes : 6.1. During the hearing, the Commission s attention was drawn to the letter dated 22 February, 2013 placed at Page 52 of the Petition. Vide the said letter MSEDCL intimated to RNPL of its prior requirement of permanent disconnection of construction power to issue fresh power connection for Start up Power Since certain Units of the plant were incomplete, Construction Power was required for the purposes of fulfilling the power requirements of the plant. Accordingly, RNPL requested for a separate connection for Construction Power for the remaining units. However, MSEDCL vide its letter dated 21 September, 2016 denied giving a separate connection at the same premises for different level of supply Owing to MSEDCL s own actions, RNPL had no other alternative but to use power from the Start up connection for construction purposes. Claim barred by limitation 6.4. As per Section 62(6) of the EA, 2003, tariff determination is a regulatory function and not adjudicatory as provided under Section 86 of the Act. In the matter of Andhra Pradesh Power Coordination Committee & Anr. Vs. Lanco Kondapalli Power Limited & Ors., the Supreme Court has clarified that Section 5 and Section 14 of the Limitation Act, 1963 shall be excluded. Hence, limitation is not applicable in the present case. Order Case No. 68 of 2018 Page 11 of 16

12 6.5. Without prejudice to the aforesaid, it is further stated that, various proceedings had been filed before IGRF of MSEDCL and CGRF in the year After the CGRF s Order, which was in favour of RNPL, MSEDCL had filed an appeal before the Bombay High Court. On hearing the matter, the Bombay High Court remanded the matter back to this Commission. Therefore, since claims have already been filed from 2016 onwards, limitation is not applicable on the present proceedings The Advocate of MSEDCL, however pointed out that during the Joint Inspection conducted at RNPL s plant, discrepancies were observed in the power supplied being used for trial run of units and further stated that no such demarcation was set out in their Petition as well. It shall be pertinent to note that, the inspection was conducted sometime in March 2017 whereas the commissioning of RNPL s units happened only in May Thus, the inspection was pre-mature RNPL states that with regard to the aforesaid issue raised by the Advocate of MSEDCL, the charts relating to the break-up of the billing and consumption for the period from November 2016 to May 2017 are provided with this submission Hence, in view of the aforesaid, it is therefore prayed that the Commission may be pleased to take on record the calculations annexed along with this letter and grant the prayers pleaded in the Petition so that, no harm, loss and prejudice would be caused to the Petitioner. Commission s Analysis and Ruling 7. The Petition has been filed for applying Industrial Tariff for start-up power connection of RNPL s generating station at Nashik. RNPL has stated that initially it had taken electricity connection from MSEDCL on 11/33 kv for construction purpose which was categorised under Commercial tariff category. Subsequently, in February, 2013, RNPL took start-up power connection which was also categorised under Commercial tariff category. While, taking start-up power connections, as directed by MSEDCL, RNPL surrendered its connections taken for the construction purpose. As the connection for construction purpose was surrendered, RNPL has used power from start-up connection for construction activities. Subsequently, RNPL has upgraded its start-up power connection. At each such time, as directed by MSEDCL, it has to surrender the existing connection. From January, 2017, the Plant commissioning and start-up activities on Units 3, 4 and 5 were in full swing. In May, 2017 construction of all 5 units were completed. 8. Based on the Commission s Order dated 3 February, 2014 passed in Case No. 51 of 2013, RNPL vide its letter dated 12 April, 2014 requested MSEDCL to change the Order Case No. 68 of 2018 Page 12 of 16

13 tariff category of start-up power connection of the Plant from HT-II Commercial to HT Industrial with retrospective effect. Subsequently, the Commission in its Tariff Order dated 26 June, 2015 has categorised start-up power requirement of generating station under Industrial tariff category. Accordingly, based on this Tariff Order and subsequent Commercial Circular of MSEDCL, RNPL vide its letter dated 27, July, 2015 once again requested MSEDCL to apply Industrial category tariff to its start-up power connection with retrospective effect from February, RNPL thereafter repeatedly followed up the matter with MSEDCL, but it has not granted any relief to RNPL. Due to inaction of MSEDCL, on 11 November, 2016 RNPL filed a complaint before Internal Grievance Redressal Cell (IGRC) at Nashik, which was rejected. Hence, RNPL approached CGRF, Nashik which vide its Order dated 31 January, 2017 directed MSEDCL to apply Industrial tariff for start-up power connection of RNPL from 1 June, This Order of CGRF was challenged by MSEDCL before the Bombay High Court. Vide Its Judgment dated 16 January, 2018, Bombay High Court allowed RNPL to approach before this Commission. RNPL contends that Section 62(6) of the EA, 2003 provides that if any licensee recovers a price or charge exceeding the tariff determined by the Commission, the excess amount shall be recoverable with interest by the person who has paid such price or charge. 9. MSEDCL has opposed this Petition by stating that reliance placed on the Order dated 3 February, 2014 passed in Case No. 51 of 2013 by the Commission is misplaced as in those cases there were specific PPA s entered which had a clause governing start-up power. MSEDCL also contended that as per joint inspection report dated 10 March, 2017, start-up power was being used for construction activities which is not permissible as per Commission s Tariff Order. 10. The Commission notes that in its Order dated 31 July, 2017 in Case No. 141 of 2015 it has ruled on date of applicability of Industrial Tariff to start-up consumption of generating station as follows: 6.4. In Case No. 51 of 2013 concerning APML, the Commission noted that the PPA in that matter expressly provided that start-up power be charged at the tariff applicable to Industry. However, in its Order dated , which has achieved finality, the Commission set out the general principle that the requirement of startup power should be treated as being for an Industrial purpose: 32. The power plant is an industrial premise wherein fuel and water are used as an input to generate electricity. Further, power plants are basic element of the electricity supply chain where electricity is generated. Thus, the start-up power consumption by such power plants which is used for Order Case No. 68 of 2018 Page 13 of 16

14 starting of the power plant auxiliaries so that the electricity generation can be started should be treated as Industrial purpose only The issue of the applicable tariff category in the present matter and in Case No. 51 of 2013 is identical in nature as far as the principle is concerned even though, unlike the APML PPAs, the PPAs between RPL and MSEDCL do not address the tariff applicable for start-up power. The Commission notes that the subsequent MYT Orders dated and expressly provide that the Industrial tariff category be applied to start-up power This principle having been settled by its Order dated in Case No. 51 of 2013, the HT Industrial tariff will be applicable to the start-up power availed by RPL for its Generating Units from the date of that Order till , when the MYT Order dated came into effect and following which there is no dispute The amount of refund arising from this dispensation may be adjusted over the next 3 months bills of RPL, with interest in accordance with the provisions of Section 62 (6) of the EA, 2003 which reads as follows: 62(6) If any licensee or a generating company recovers a price or charge exceeding the tariff determined under this section, the excess amount shall be recoverable by the person who has paid such price or charge along with interest equivalent to the bank rate without prejudice to any other liability incurred by the licensee... (underline added) Thus, the Commission in its above Order has stipulated that from 3 February, 2014 onwards, Industrial Tariff will be applicable to the start-up power consumption of RPL. This ruling on Tariff applicability is generic in nature and is applicable to similarly placed other consumers. In fact, MSEDCL in its submission in Case No. 67 of 2018 (Dhariwal Infrastructure Ltd. Vs MSEDCL) has agreed to apply Industrial tariff to start-up power consumption of Dhariwal Infrastructure Ltd from 3 February, 2014 onward. Hence, MSEDCL s submission in present matter that Order dated 3 February, 2014 is applicable only for the Generators having PPA with MSEDCL is not tenable and is liable to be rejected. 11. As far as, RNPL s request of applying Industrial tariff for its start-up connection with effect from February, 2013 is concerned, the Commission notes that Tariff Order applicable at that time ( February, 2013 to 2 February, 2014) was Order dated 16 August, 2012 issued in Case No. 19 of In that Tariff Order, start-up power consumption of generating station was not categorised under any of tariff Order Case No. 68 of 2018 Page 14 of 16

15 category. The Commission first time in its Order dated 3 February, 2014 in Case No. 51 of 2013 has ruled that start-up power consumption of generating station should be treated under Industrial Category. Therefore, it cannot be said that Industrial tariff category was applicable for start-up power consumption of generating station prior to 3 February, 2014 and hence RNPL s request of allowing Industrial tariff to its start-up power connection from February, 2013 cannot be allowed. 12. The Commission notes that MSEDCL has objected to the applicability of Industrial tariff to start-up power consumption on account of use of such power for construction activities. RNPL in its submission has also agreed that power was being used for construction activities as MSEDCL had compelled it to surrender separate connection taken for construction purpose. The Commission notes that in its Order dated 3 November, 2016 it has stipulated purpose for which start-up power can be used as follows: the power required for trial run of a Power Plant during commissioning of the Unit and its Auxiliaries, and for its start-up after planned or forced outage (but not for construction); Thus, use of start-up power for construction activities is not permissible. 13. In present case, MSEDCL has compelled RNPL to surrender separate connection taken for construction purpose before availing start-up connection. Therefore, RNPL did not have any other option but to use power from start-up connection for construction activities. In view of circumstances in present case, the Commission is of the opinion that although RNPL is not eligible for Industrial tariff for construction activities, relief needs to be provided for power which has been consumed for start-up activities of generating station. It would be RNPL s responsibility to provide segregation of its power consumption into activities related to start-up of generating station and others activities. 14. Accordingly, the Commission directs that with effect from 3 February, 2014, Industrial Tariff should be made applicable for power consumed for start-up related activities of RNPL s generating station at Nashik. It would be RNPL s responsibility to provide segregation of its power consumption to the satisfaction of MSEDCL. Tariff differential amount, if any, should thereafter be refunded with interest as per Section 62 (6) of the EA, Hence following Order: Order Case No. 68 of 2018 Page 15 of 16

16 ORDER 1. The Petition of RattanIndia Nasik Power Ltd. in Case No. 68 of 2018 is partly allowed. 2. MSEDCL to apply Industrial Tariff with effect from 3 February, 2014 for startup power consumption (excluding the power consumption for construction) of RNPL s generating station at Nasik. 3. RNPL to provide segregation of its power consumption for startup consumption and for construction purpose to the satisfaction of MSEDCL. Tariff differential amount, if any, to be refunded with interest as per Section 62(6) of the Electricity Act, Sd/- (Mukesh Khullar) Member Sd/- (I. M. Bohari) Member Order Case No. 68 of 2018 Page 16 of 16