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Case Number
Attorney(S)
  • Shri Ved Prakash Rastogi, PGCIL ;
  • Ms. Nikita Choukse, Advocate, HPPTCL ;
  • Shri S. S. Raju, PGCIL
  • Shri D.K. Biswal, PGCIL
  • Shri A.K. Verma, PGCIL
Judges
  • P.K. Pujari
  • Chairperson
  • I.S. Jha, Member
  • Arun Goyal, Member
  • P.K. Singh, Member
Acts
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Cites
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Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
  • Shri Ved Prakash Rastogi, PGCIL ;
  • Ms. Nikita Choukse, Advocate, HPPTCL ;
  • Shri S. S. Raju, PGCIL
  • Shri D.K. Biswal, PGCIL
  • Shri A.K. Verma, PGCIL
Judges
  • P.K. Pujari
  • Chairperson
  • I.S. Jha, Member
  • Arun Goyal, Member
  • P.K. Singh, Member
Acts
See more information ...
Smart Summary

Concise Analytical Summary of the Order in Petition No. 404/TT/2020

Factual and Procedural Background

The Petitioner, Power Grid Corporation of India Limited, filed Petition No. 404/TT/2020 seeking: (a) truing-up of transmission tariff for the 2014-19 tariff block under the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2014 (the 2014 Tariff Regulations); and (b) determination of transmission tariff for the period 1.4.2019 to 31.3.2024 under the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019 (the 2019 Tariff Regulations).

The petition concerns seven transmission assets constructed as part of "Augmentation of Transformers in Northern Region-Part-B" (listed in the petition as Asset-I through Asset-VII, including 400/220 kV transformers and line bays at various substations). Investment Approval was accorded by the Petitioner's Board on 27.3.2014 and the project carried a scheduled COD within 24 months i.e., SCOD 27.3.2016 (the Commission observed an inadvertent discrepancy in earlier orders and revised SCOD for Asset-I, Asset-II and Asset-III to 27.3.2016).

The Commission had earlier approved tariffs for certain assets by orders dated 6.10.2017 (Petition No. 236/TT/2016) and 21.11.2019 (Petition No. 158/TT/2018). Time overruns occurred for various assets; some CODs were approved under proviso (ii) of Regulation 4(3) of the 2014 Tariff Regulations because downstream systems (under state transmission utilities) were not ready. The Respondents comprise distribution licensees, power departments and transmission licensees (mainly Northern Region beneficiaries). BRPL (Respondent No.12) and HPPTCL (Respondent No.18) filed replies raising specific issues; Petitioner filed rejoinders. The Commission heard parties by video conference on 6.4.2021, 3.8.2021 and 26.10.2021 and reserved the order.

Legal Issues Presented

  1. Whether the trued-up Annual Fixed Charges (AFC) for the 2014-19 tariff period for the assets covered should be approved as claimed by the Petitioner.
  2. Whether transmission tariff for the 2019-24 tariff period for the assets covered should be determined as claimed by the Petitioner (including combined tariff treatment for certain assets and separate treatment for assets whose downstream systems are not ready).
  3. Whether entities responsible for delayed downstream systems (HPPTCL/PSTCL) should bear transmission charges from the asset COD (approved under proviso (ii) to Regulation 4(3) of the 2014 Tariff Regulations) until the downstream systems are commissioned.
  4. Whether Asset-V and Asset-VI, which were put to COD under proviso (ii) to Regulation 4(3), are to be included in capital cost for tariff and if so on what basis.
  5. Permissibility and treatment of specific cost items and adjustments claimed by the Petitioner: initial spares, IDC/IEDC, Additional Capital Expenditure (ACE), interest on working capital (IWC), treatment of income tax / grossing up of Return on Equity (RoE) (MAT), depreciation methodology for IT equipment, debt-equity ratio for tariff purposes, and O&M norms.
  6. Whether the Petitioner may recover filing fee and publication expenses, license fee and RLDC charges, security expenses, GST (if levied in future) and whether the Petitioner may bill these separately to beneficiaries.

Arguments of the Parties

HPPTCL's Arguments

  • HPPTCL contends that the Commission's prior order (21.11.2019 in Petition No. 158/TT/2018) erroneously approved COD for Asset-V and that the factual basis relied on (minutes of various committee meetings and a letter dated 14.11.2017) does not establish an agreement whereby HPPTCL committed to match the Petitioner's commissioning or requested two additional 220 kV bays as asserted by the Petitioner.
  • HPPTCL emphasizes that minutes of the 30th SCM and subsequent TCC/NRPC meetings show that 220 kV bays would be provided as per STU requirement and that STUs must inform POWERGRID two years in advance; HPPTCL says it never made such a request and thus cannot be held responsible for non-commissioning of downstream works.
  • HPPTCL submits that correspondence relied upon (letter dated 14.11.2017) was only a response to Petitioner's request and merely indicated a tentative schedule (expected completion December 2019), and that no contractual/implementation agreement exists with POWERGRID that would render HPPTCL liable for transmission charges.
  • HPPTCL relied on APTEL precedent (the Patran Judgment) to support the proposition that transmission charges cannot be levied in the absence of a contractual arrangement making the downstream entity responsible.
  • HPPTCL requested reconsideration as true-up of Asset-V is pending and sought relief from bearing undue financial burden if the COD allocation stands.

BRPL's Arguments

  • BRPL objected to inclusion of Asset-V and Asset-VI in capital cost for tariff because those assets were not in use (per Regulation 9(6)(a) of the 2014 Tariff Regulations), given downstream systems were not commissioned; BRPL sought exclusion of these assets from capital cost.
  • BRPL raised multiple other issues (listed in its affidavit) including exclusion of Asset-V/VI from capital cost, treatment of initial spares, accrual IDC, tax on transmission business, RoE, Indian Accounting Standards, deferred tax liability, annual truing up for 2019-24, security expenses, capital spares, GST, filing fees and expenses.
  • BRPL had repeatedly raised similar contentions in other petitions, which the Commission had rejected in prior proceedings.

Petitioner's Arguments

  • The Petitioner stated the transmission project scope (including Asset-V) was entrusted to it and that the downstream Hamirpur-Dehan Line construction was HPPTCL's responsibility, which HPPTCL itself admitted had not yet been commissioned.
  • The Petitioner argued that minutes of TCC/NRPC (23–24 February 2012) and SCM (19 December 2011) recorded that the requirement of 2 nos. 220 kV line bays at Hamirpur was agreed and HPPTCL representatives accepted the requirement; thus HPPTCL's contention of non-agreement was incorrect.
  • The Petitioner asserted Asset-V was put into commercial operation at HPPTCL's request and that HPPTCL was aware and had been requested (letter dated 18.10.2017) to ready corresponding downstream lines; HPPTCL's later denial is a cover-up.
  • Petitioner relied on HPPTCL's letter dated 14.11.2017 (indicating tendering and projected December 2019 commissioning) and on NRPC/TCC minutes where HPPTCL accepted commissioning by April 2020; Petitioner relied on APTEL precedent in NPCIL matter to argue that, irrespective of a contractual arrangement, if an asset created at the behest of a respondent cannot be used due to delay by that respondent, that respondent must bear transmission charges.
  • Petitioner sought allowance of claimed IDC/IEDC on cash basis, allowance of ACE under the Tariff Regulations, allowance of initial spares subject to ceilings, appropriate gross-up of RoE for MAT, and reimbursement of filing/publication fees and separate recovery of licence fee and RLDC charges.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
APTEL — PSPCL v. Patran Transmission Company Limited (referred to as the "Patran Judgment"; Appeal No. 370 of 2017) Principle relied on by HPPTCL: transmission charges cannot be levied in absence of a contractual arrangement making a downstream entity responsible. The Commission recorded HPPTCL's reliance on the Patran Judgment but distinguished it: the Commission found documentary evidence (SCM/TCC/NRPC minutes and correspondence) showing responsibility for the downstream works lay with HPPTCL, and therefore HPPTCL's reliance on Patran was held to be misconceived in the instant factual matrix.
APTEL — NPCIL v. CERC (Appeal No. 332/2016; referred in the opinion as "the NPCIL matter") Examined the scope of Patran and related orders; cited by the Petitioner to support the proposition that even absent a contractual agreement, where an asset created at the behest of a respondent cannot be put to use due to the respondent's delay, the respondent should bear transmission charges. The Petitioner relied on the NPCIL matter. The Commission noted the NPCIL analysis of Patran but proceeded to decide based on the specific documents and minutes showing agreement and responsibility for downstream works; ultimately the Commission approved CODs and directed transmission charges for mismatch periods to be borne by HPPTCL/PSTCL (subject to outcome of appeals to APTEL).
APTEL — Appeal No. 74 of 2017 (judgment dated 14.9.2019) Principle concerning initial spares: Initial Spares are to be allowed as per the ceiling on overall project cost (as applied by the Commission in earlier matters). The Commission applied the APTEL principle that initial spares are to be considered on overall project cost, but observed that overall project cost can only be ascertained once all assets are combined; for 2014-19 the Commission allowed initial spares on an individual-asset basis and disallowed excess initial spares (with a direction that claims for excess spares will be considered when assets are combined).
CERC order dated 6.10.2017 in Petition No. 236/TT/2016 Prior approval of transmission tariff and aspects such as SCOD/COD/time-overrun and disallowances for certain items for Asset-I, Asset-II and Asset-III. The Commission reviewed that prior order, identified an inadvertent discrepancy in SCOD for Assets I–III, revised the SCOD to 27.3.2016, and used the earlier order as a baseline for truing-up items (retaining or adjusting figures where justified in the instant petition).
CERC order dated 21.11.2019 in Petition No. 158/TT/2018 Prior approval of transmission tariff and CODs (including approval under proviso (ii) of Regulation 4(3) where downstream systems were not ready) for Asset-IV, Asset-V, Asset-VI and Asset-VII; treatment of IEDC, IDC, initial spares, and direction that charges for assets whose downstream were not ready be borne by concerned state entities. The Commission relied on the findings in that order regarding the requirement and agreement for 220 kV bays at Hamirpur and Jalandhar, upheld approval of CODs under proviso (ii) for Asset-V/VI, and reiterated the direction that transmission charges for Asset-V/VI from their (provisional) CODs until commissioning of the downstream systems shall be borne by HPPTCL/PSTCL respectively (subject to appeals).
CERC order dated 27.4.2020 in Petition No. 274/TT/2019 This order established effective tax/MAT rates to be used for grossing up RoE for truing up the 2014-19 period (as referred by the Commission in the instant order). The Commission adopted the MAT rates and effective tax rates determined in that order for grossing-up RoE in the 2014-19 truing-up exercise in this petition.
CERC order dated 3.8.2021 in Petition No. 260/MP/2020 Approval of consolidated security expenses for Petitioner's transmission assets from 1.4.2019 to 31.3.2024 (used by the Commission in deciding security-expense claims). The Commission observed that security expenses for the Petitioner's transmission assets had been approved by the order dated 3.8.2021 and therefore the Petitioner's prayer in the instant petition to file a separate petition for security expenses became infructuous; security expenses will be shared as per that earlier order.
CERC — Petition No. 136/TT/2020 (Commission decision referred in the order) Previous Commission findings rejecting contentions similar to those raised by BRPL regarding certain issues. The Commission noted BRPL had repeatedly raised the same issues that had been rejected in Petition No. 136/TT/2020 and accordingly rejected such repeated contentions in the instant petition as having attained finality (since BRPL had not challenged the earlier findings).

Court's Reasoning and Analysis

The Commission's reasoning proceeds in a methodical, regulation-driven fashion and is reflected in the sequence below. The analysis is strictly based on the material and findings recorded in the order:

  1. SCOD / COD corrections:
    • The Board-approved date of Investment Approval (27.3.2014) yields a scheduled COD of 27.3.2016 (24 months). The Commission found an inadvertent discrepancy in an earlier order that had used different SCODs for Asset-I, -II and -III and accordingly revised their SCODs to 27.3.2016 to align with the rest of the project.
  2. Treatment of assets not in use and allocation of transmission charges when downstream is not ready:
    • BRPL argued under Regulation 9(6)(a) (2014 Regulations) that assets not in use cannot be included in capital cost. The Commission accepted the legal principle but distinguished the present factual matrix because COD of Asset-V and Asset-VI had been approved under proviso (ii) of Regulation 4(3) of the 2014 Tariff Regulations on the ground that the Petitioner was prevented from putting them to use for reasons not attributable to the Petitioner.
    • Consequently, the Commission held that transmission charges for the period of mismatch (from the COD approved under proviso (ii) to the COD of the downstream systems) shall be borne by the entities responsible for execution of those downstream systems (HPPTCL for Asset-V; PSTCL for Asset-VI), and beneficiaries (including BRPL) are not liable for charges during the mismatch period. This direction is subject to the outcome of appeals before APTEL by HPPTCL and PSTCL.
  3. Capital cost, ACE, IDC and IEDC:
    • The Commission examined Auditor's Certificates and the Petitioner's submissions. It allowed un-discharged IDC as ACE in the year of discharge and permitted ACE under Regulations 14(1)(i) and 14(1)(ii) of the 2014 Tariff Regulations (balance & retention payments and un-discharged liabilities within cut-off date), subject to prudence checks.
    • IEDC was routed through truing-up: certain amounts previously disallowed on account of time-overrun per prior orders were again addressed with figures adjusted as per Auditor's Certificates. The Commission disallowed excess IEDC/time-overrun related amounts where appropriate, consistent with prior orders.
  4. Initial Spares:
    • Applying Regulation 13(d) of the 2014 Tariff Regulations and following APTEL authority, the Commission allowed initial spares up to ceiling norms. Where the Petitioner had claimed excess initial spares for Asset-IV and Asset-VII, the Petitioner had already deducted certain excesses; the Commission disallowed remaining excesses for 2014-19 and stated that any claim for excess initial spares would be considered when all transmission assets are combined (overall project cost ascertainable then).
  5. Depreciation (2014-19 truing-up) and WAROD:
    • Petitioner's claimed depreciation for some assets exceeded allowed amounts in earlier orders; Petitioner separated IT equipment, seeking higher depreciation. The Commission applied the approach used in an earlier CERC order (9.5.2020 in Petition No. 19/TT/2020) to treat IT equipment as part of the substation (WAROD 5.28% up to 31.3.2019) for 2014-19 and used weighted-average rates of depreciation (WAROD) to compute trued-up depreciation for each asset in the 2014-19 period.
  6. Debt-equity ratio and financing:
    • The Commission applied the normative 70:30 debt-equity ratio as per Regulation 19 of the 2014 Tariff Regulations for capital cost on COD and ACE during 2014-19, and for 2019-24 period applied the 2019 Tariff Regulations' approach (70:30 for admitted capital unless actual equity above 30% treated as normative loan, etc.).
  7. Interest on Loan and IWC:
    • IoL was computed on a normative basis using weighted average rates of interest based on the Petitioner's loan portfolio and consistent with the 2014 Regulations for truing up and with Regulation 32 of the 2019 Regulations for the 2019-24 period. The Commission allowed IWC computed as per Regulations 28 (2014) for the truing-up period and Regulation 34 (2019) for 2019-24 (with receivables equivalent to 45 days for the 2019-24 period), applying the specified bank-rate proxies (SBI MCLR + 350 bps) on the dates mandated by the 2019 Regulations.
  8. Return on Equity (RoE) and tax gross-up:
    • The RoE was allowed at the base rate (15.5%) grossed up for applicable effective tax (MAT) rates. For 2014-19 the Commission used effective MAT rates as previously determined by the Commission's order dated 27.4.2020; for 2019-24 the Commission used MAT rate applicable in 2019-20 for grossing up but confirmed that the grossed-up RoE will be trued-up annually under Regulation 31(3) of the 2019 Tariff Regulations based on actual tax paid.
  9. O&M expenses and PLCC treatment:
    • O&M norms were applied in accordance with Regulation 29(4)(a) of the 2014 Regulations for 2014-19 and Regulation 35(3)(a) of the 2019 Regulations for 2019-24. The Commission rejected the Petitioner's claim to allow separate O&M for PLCC @2% under Regulation 35(4) (communication system) because prior Commission decisions had held PLCC is to be considered as part of the substation; thus separate PLCC O&M was not allowed.
  10. Combined asset treatment, E-COD and WAL for 2019-24:
    • The Petitioner proposed combining Asset-I, II, III, IV and VII as a Combined Asset for 2019-24 (with Asset-V and Asset-VI separately because of downstream mismatch). The Commission computed an Effective COD (E-COD) for the Combined Asset (28.10.2017 as computed on weighted cost/time basis), determined a Weighted Average Life (WAL) of 25 years for the Combined Asset (applying 2019 Regulations' life tables), and used WAL to compute depreciation prospectively for 2019-24.
  11. Allocation of transmission charges and appeals:
    • The Commission reaffirmed that transmission charges for Asset-V from 31.3.2019 until commissioning of the Hamirpur-Dehan Line (HPPTCL scope) are to be borne by HPPTCL and that charges for Asset-VI from 25.3.2019 until commissioning of the Jalandhar downstream system (PSTCL scope) are to be borne by PSTCL; thereafter charges to be shared under the 2020 Sharing Regulations. The Commission noted that HPPTCL and PSTCL have appealed to APTEL and that the sharing directions are subject to the outcome of those appeals.
  12. Ancillary claims:
    • Filing fee and publication expenses: the Commission allowed reimbursement directly from beneficiaries in accordance with Regulation 70(1) of the 2019 Tariff Regulations.
    • Licence fee and RLDC fees: the Commission allowed separate recovery as per Regulation 70(3) and (4) of the 2019 Tariff Regulations.
    • GST claim: the Commission held the Petitioner's prayer premature since GST is not levied on transmission service at present.
    • Security expenses: the Petitioner had indicated it would file a separate petition; the Commission observed and relied on its separate order (3.8.2021 in Petition No. 260/MP/2020) which had approved security expenses for the period 1.4.2019–31.3.2024 and therefore found the Petitioner's prayer in this petition to file a separate petition to be infructuous with respect to those matters.

Holding and Implications

Core Ruling:

DISPOSED OF. The Commission disposed of Petition No. 404/TT/2020 by (i) truing-up the Annual Fixed Charges for the 2014-19 tariff period for the transmission assets (specific trued-up AFC figures for each asset and year are recorded in the order); (ii) determining the Annual Fixed Charges for the 2019-24 tariff period for the Combined Asset (Assets I, II, III, IV and VII) and separately for Asset-V and Asset-VI (specific annual AFC schedules for 2019-24 are recorded in the order); and (iii) issuing directions on allocation of transmission charges, treatment of capital costs/ACE/IEDC/IDC/initial spares/IoL/IWC/DEP/ROE/O&M as described in the order.

Principal Consequences and Practical Effects:

  • The Commission corrected the SCOD for Asset-I, Asset-II and Asset-III to 27.3.2016 where earlier orders had inadvertently recorded different SCODs.
  • Trued-up AFCs for 2014-19 were approved and specific figures for each asset and year were set out (assets I–VII). Those trued-up AFC amounts will govern recovery for that period as per the order.
  • For the 2019-24 tariff period the Commission approved tariff for a Combined Asset (I, II, III, IV and VII) and separate tariffs for Asset-V and Asset-VI, including detailed computations for depreciation, IoL, RoE (grossed-up for MAT), O&M, IWC and ACE as recorded in the order.
  • Transmission charges for Asset-V (from 31.3.2019 until the COD of the downstream Hamirpur-Dehan line under HPPTCL) are to be borne by HPPTCL; transmission charges for Asset-VI (from 25.3.2019 until COD of downstream system under PSTCL) are to be borne by PSTCL. After those downstream CODs, sharing will be governed by the Sharing Regulations. The directions are, however, subject to the outcome of appeals filed by HPPTCL and PSTCL before APTEL.
  • Initial spares were allowed up to ceiling norms; excess initial spares for the 2014-19 period were not allowed and will be considered when all assets are combined.
  • ACE for 2014-19 and projected ACE for 2019-24 were allowed subject to the specific prudence adjustments and the applicable regulation provisions (2014 and 2019 Regulations respectively).
  • IDC/IEDC and un-discharged IDC were treated in line with Auditor's Certificates and regulations (allowance of IDC on cash basis and ACE on discharge where appropriate); certain IEDC amounts previously disallowed on account of time overrun remained treated as per prior orders and the instant adjustments recorded in the truing-up.
  • RoE was allowed on the admitted equity base, grossed up for MAT rates (with truing-up to actual tax paid to be done annually in respect of the 2019-24 period).
  • O&M norms were applied as per the 2014 and 2019 Regulations; the Petitioner's claim for separate PLCC O&M @2% was rejected (PLCC to be treated as part of the substation for O&M norms).
  • Filing fee and publication expenses are to be reimbursed by beneficiaries on pro-rata basis; licence fee and RLDC fees and charges may be billed separately to respondents in line with Regulation 70 of the 2019 Tariff Regulations.
  • GST-related prayer was held to be premature as GST is not levied on transmission service at present.
  • Security expenses will be shared in terms of the Commission's separate order (3.8.2021 in Petition No. 260/MP/2020); the Petitioner's separate petition request became infructuous in light of that order.

Final administrative note in the order: "This order disposes of Petition No. 404/TT/2020 in terms of the above discussions and findings." The sharing and billing of arrears and subsequent period transmission charges are to be done in accordance with the respective Tariff and Sharing Regulations and subject to the outcome of appeals where indicated.

Show full summary ...

    Power Grid Corpn. Of India Ltd. v. Rajasthan Rajya Vidyut Prasaran Nigam Ltd.

    1. The Petitioner, Power Grid Corporation of India Limited, has filed the instant petition for truing up of transmission tariff of 2014-19 tariff period under the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2014 (hereinafter referred to as “the 2014 Tariff Regulations”); and for determination of transmission tariff for the period from 1.4.2019 to 31.3.2024 under the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019 (hereinafter referred to as “the 2019 Tariff Regulations”) for the following assets (hereinafter collectively referred to as “the transmission assets”) covered under Augmentation of Transformers in Northern Region-Part-B in Northern Region (hereinafter referred to as “the transmission project”):

    Asset-I: 1 X 500 MVA, 400/220 kV Transformer at Panchkula Sub-station;

    Asset-II: 1 X 500 MVA, 400/220 kV Transformer at Jalandhar Sub-station;

    Asset-III: 1 X 315 MVA, 400/220 kV Transformer at Samba Sub-station;

    Asset-IV: 400/220 kV, 3 X 105 MVA ICT along with associated bays at Hamirpur Sub-station;

    Asset-V: 220 kV, 2 numbers Line bays at Hamirpur Sub-station;

    Asset-VI: 220 kV, 2 numbers Line bays at Jallandhar Sub-station; and

    Asset-VII: 1 X 500 MVA, 400/220 kV ICT-IV at GIS Gurgaon Sub-station.

    2. The Petitioner has made the following prayers in this petition:

    “1) Approve the trued-up Transmission Tariff for 2014-19 block and transmission tariff for 2019-24 block for the assets covered under this petition, as per para 8 and 9 above.

    2) Allow the petitioner to recover the shortfall or refund the excess Annual Fixed Charges, on account of Return on Equity due to change in applicable Minimum Alternate/Corporate Income Tax rate as per the Income Tax Act, 1961 (as amended from time to time) of the respective financial year directly without making any application before the Commission as provided in Tariff Regulation 2014 and Tariff regulations 2019 as per para 8 and 9 above for respective block.

    3) Approve the reimbursement of expenditure by the beneficiaries towards petition filing fee, and expenditure on publishing of notices in newspapers in terms of Regulation 70(1) Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019, and other expenditure (if any) in relation to the filing of petition.

    4) Allow the petitioner to bill and recover Licensee fee and RLDC fees and charges, separately from the respondents in terms of Regulation 70(3) and (4) Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019.

    5) Allow the petitioner to bill and adjust impact on Interest on Loan due to change in Interest rate on account of floating rate of interest applicable during 2019-24 period, if any, from the respondents.

    6) Allow the petitioner to file a separate petition before Hon'ble Commission for claiming the overall security expenses and consequential IOWC on that security expenses as mentioned at para 9.10 above.

    7) Allow the petitioner to claim the capital spares at the end of tariff block as per actual.

    8) Allow the Petitioner to bill and recover GST on Transmission Charges separately from the respondents, if GST on transmission is levied at any rate in future. Further, any taxes including GST and duties including cess etc. imposed by any statutory/Govt./municipal authorities shall be allowed to be recovered from the beneficiaries.

    and pass such other relief as Hon'ble Commission deems fit and appropriate under the circumstances of the case and in the interest of justice”

    Background

    3. The brief facts of the case are as follows:

    a) The Petitioner was entrusted with the implementation of the transmission project, that was discussed and agreed in 30 SCM and 25 NRPC meeting held on 19.12.2011 and 19.3.2012 respectively.

    b) Investment Approval (IA) for the transmission project was accorded by the Board of Directors of the Petitioner's company (in its 300 meeting held on 27.3.2014) vide Memorandum Ref. No. C/CP/Aug. of transformers in NR-Part B dated 16.5.2014 at an estimated cost of Rs. 15557.00 lakh, including IDC of Rs. 809.00 lakh (based on December, 2013 Price Level). Revised Cost Estimate of the transmission project was accorded approval by the Board of Directors of the Petitioner's company (in its 339 meeting held on 29.3.2017) vide Memorandum Ref. No. C/CP/Aug NR-B dated 31.3.2017 at an estimated cost of Rs. 20642.00 lakh, including IDC of Rs. 743.00 lakh (based on December, 2016 Price Level).

    c) The broad scope of work covered under the transmission project as per IA is as follows:

    Sub-stations Works:

    i. Samba (1 X 315 MVA, 400/220 kV Transformer);

    ii. Gurgaon (1 X 500 MVA, 400/220 kV Transformer);

    iii. Hamirpur (3 X 105 MVA, 400/220 kV Transformer along with 2 numbers of 220 kV Line bays);

    iv. Jallandhar (1 X 500 MVA, 400/220 kV Transformer along with 2 numbers of 220 kV Line bays); and

    v. Panchkula (1 X 500 MVA, 400/220 kV Transformer).

    d) The instant petition covers the following assets:

    Asset Particulars Asset-I 1 X 500 MVA, 400/220 kV Transformer at Panchkula Sub-station Asset-II 1 X 500 MVA, 400/220 kV Transformer at Jalandhar Sub-station Asset-III 1 X 315 MVA, 400/220 kV Transformer at Samba Sub-station Asset-IV 400/220 kV, 3 X 105 MVA ICT along with associated bays at Hamirpur Sub-station Asset-V 220 kV, 2 numbers Line bays at Hamirpur Sub-station Asset-VI 220 kV, 2 numbers Line bays at Jallandhar Sub-station Asset-VII 1 X 500 MVA, 400/220 kV ICT-IV at GIS Gurgaon Sub-station

    e) The transmission tariff of Asset-I, Asset-II and Asset-III from their respective COD to 31.3.2019 was approved by the Commission vide order dated 6.10.2017 in Petition No. 236/TT/2016 and the transmission tariff of Asset-IV, Asset-V, Asset-VI and Asset-VII from their respective COD to 31.3.2019 was approved vide order dated 21.11.2019 in Petition No. 158/TT/2018.

    f) The details of scheduled COD, COD and time over-run are as follows:

    Asset's nomenclature in the instant petition Previous order Asset nomenclature in previous order SCOD COD Time over-run Time over-run Condoned/Not condoned in previous order Asset-I Order dated 6.10.2017 in Petition No. 236/TT/2016 Asset-1 15.05.2016 02.04.2016 - - Asset-II Asset-2 02.07.2016 48 days Not condoned Asset-III Asset-3 29.10.2016 167 days Not condoned Asset-IV Order dated 21.11.2019 in Petition No. 158/TT/2018 Asset-1 27.03.2016 31.03.2019 1099 days 1095 days not condoned Asset-V* Asset-2 31.03.2019* 1099 days 1095 days not condoned Asset-VI* Asset-3 25.3.2019* 1093 days Not condoned Asset-VII Asset-4 31.12.2017 644 days Not condoned

    * COD approved under proviso (ii) of Regulation 4(3) in line with the 2014 Tariff Regulations.

    g) It has been observed from the above table that, there is a difference in scheduled COD in case of Asset-I, Asset-II and Asset-III allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 as compared to scheduled COD allowed in case of Asset-IV, Asset-V, Asset-VI and Asset-VII vide order dated 21.11.2019 in Petition No. 158/TT/2018.

    h) As per Regulation 3(36) of the 2014 Tariff Regulations, the date of Investment Approval shall be the date of approval of the Board of Directors. Regulation 3(36) of the 2014 Tariff Regulations provides as under:

    “(36) ‘Investment Approval’ means approval by the Board of the generating company or the transmission licensee or Cabinet Committee on Economic Affairs (CCEA) or any other competent authority conveying administrative sanction for the project including funding of the project and the timeline for the implementation of the project.

    Provided that the date of Investment Approval shall reckon from the date of the resolution/minutes of the Board/approval by competent authority.”

    i) The Investment Approval of the transmission system was approved the Petitioner's Board of Directors in its 300 meeting held on 27.3.2014 and the transmission system was scheduled to be put into commercial operation within 24 months from the date of Investment Approval. Thus, the scheduled COD of instant transmission system is 27.3.2016. We observe that vide order dated 6.10.17 in Petition No. 236/TT/2016, SCOD of Asset-I, Asset-II and Asset-III has been inadvertently considered incorrectly and it is expedient that SCOD of Asset-I, Asset-II and Asset-III be considered as 27.03.2016 in line with the remaining assets, namely, Asset-IV, Asset-V, Asset-VI and Asset-VII. Accordingly, we revise the scheduled COD of Asset-I, Asset-II and Asset-III in line with the remaining assets (Asset-IV, Asset-V, Asset-VI and Asset-VII) as 27.3.2016.

    j) Accordingly, scheduled COD, COD and time over-run of the transmission assets are as follows:

    Asset's nomenclature in the instant petition SCOD COD Time over-run (delay) Condoned/Not condoned in previous order Asset-I 27.3.2016 02.04.2016 7 days Not condoned Asset-II 02.07.2016 98 days Not condoned Asset-III 29.10.2016 217 days Not condoned Asset-IV 31.03.2019 1100 days 1095 days not condoned Asset-V 31.03.2019 1100 days 1095 days not condoned Asset-VI 25.03.2019 1094 days Not condoned Asset-VII 31.12.2017 645 days Not condoned

    k) In case of Asset-V, in order dated 21.11.2019 in Petition No. 158/TT/2018, the Commission approved COD under proviso (ii) of Regulation 4(3) of the 2014 Tariff Regulations and directed that the transmission charges from 31.3.2019 till commissioning of the associated downstream network 220 kV Hamirpur-Dehan line under the scope of HPPTCL shall be borne by HPPTCL and, thereafter, shall be governed by the provisions of the 2010 Sharing Regulations.

    l) Similarly, in case of Asset-VI, in order dated 21.11.2019 in Petition No. 158/TT/2018, the Commission approved COD under proviso (ii) of Regulation 4(3) of the 2014 Tariff Regulations and directed that the transmission charges from 25.3.2019 till commissioning of associated 220 kV downstream network of PSTCL shall be borne by PSTCL and thereafter, shall be shall be governed by the provisions of the 2010 Sharing Regulations.

    4. The Respondents are distribution licensees, power departments and transmission licensees, which are procuring transmission services from the Petitioner, mainly beneficiaries of Northern Region.

    5. The Petitioner has served the petition on the Respondents and notice regarding filing of this petition has been published in the newspapers in accordance with Section 64 of the Electricity Act, 2003. No comments or objections have been received from the general public in response to the aforesaid notices published in the newspapers. BSES Rajdhani Power Limited (BRPL), Respondent No. 12 has filed its reply vide affidavit dated 6.4.2021 and has raised issues of exclusion of Asset-V and Asset-VI from the capital cost, Initial Spares, accrual IDC, tax on transmission business, Return on Equity (RoE), Indian Accounting Standard, deferred tax liability, annual truing up during 2019-24 period, security expenses, capital spares, GST, filing fees and expenses. Himachal Pradesh Power Transmission Corporation Limited (HPPTCL), Respondent No. 18 has filed its reply vide affidavit dated 7.8.2021 and has raised issues of COD of Asset-V, components of Annual Fixed Charges (AFC), effective tax rate and deferred tax for 2014-19 period, O&M Expenses and estimated security expenses for 2019-24 period, status of downstream system and bilateral billing of transmission charges related to Asset-V. The Petitioner has filed its rejoinder to the reply filed by BRPL and HPPTCL vide affidavits dated 2.8.2021 and 27.8.2021 respectively.

    6. This order is issued considering the submissions made by the Petitioner in the petition vide affidavit dated 19.2.2020, the Petitioner's affidavits dated 2.12.2020 and 13.4.2021, replies filed by BRPL and HPPTCL vide affidavits dated 6.4.2021 and 7.8.2021 respectively and the Petitioner's rejoinders thereto filed vide affidavits dated 2.8.2021 and 27.8.2021. The issues raised by HPPTCL and clarifications given by the Petitioner thereto have been dealt in the relevant portions of this order.

    7. It has been placed before us that BRPL has been raising the same issues in several petitions despite clear findings of the Commission rejecting the contentions of BRPL. The aforesaid contentions of BRPL have been rejected by the Commission in several other petitions including Petition No. 136/TT/2020. As BRPL has not challenged the findings, the same have attained finality. In view of these, the above said pleas raised by BRPL are rejected. Therefore, in the instant petition we do not go into details of the contentions of BRPL, and the clarifications given by the Petitioner on issues where the Commission has already given its findings. The issues which are specific to the instant petition and not dealt by the Commission earlier are considered in the relevant portions of this order.

    8. The hearings in this matter were held on 6.4.2021, 3.8.2021 and 26.10.2021 through video conference and the order was reserved. Having heard the learned counsel for HPPTCL and representatives of the Petitioner and after perusal of the materials on record, we proceed to dispose of the petition.

    TRUING UP OF ANNUAL FIXED CHARGES FOR THE 2014-19 TARIFF PERIOD

    9. The details of the trued-up transmission charges claimed by the Petitioner for the transmission assets for the 2014-19 tariff period are as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Depreciation 93.23 99.52 113.46 Interest on Loan 104.95 92.32 95.32 Return on Equity 99.16 106.18 121.48 Interest on Working Capital 12.19 12.41 13.31 O&M Expenses 109.13 113.06 116.81 Total 418.66 423.49 460.38

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Depreciation 47.05 77.80 90.14 Interest on Loan 50.94 76.24 81.61 Return on Equity 52.67 87.10 101.19 Interest on Working Capital 7.57 11.17 12.06 O&M Expenses 81.85 113.06 116.81 Total 240.08 365.37 401.81

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Depreciation 26.55 83.31 96.62 Interest on Loan 26.71 76.95 83.07 Return on Equity 29.05 89.23 103.56 Interest on Working Capital 4.21 11.35 12.29 O&M Expenses 46.17 113.06 116.81 Total 132.69 373.90 412.35

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Depreciation 0.74 Interest on Loan 0.74 Return on Equity 0.81 Interest on Working Capital 0.06 O&M Expenses 0.29 Total 2.64

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Depreciation 0.08 Interest on Loan 0.09 Return on Equity 0.09 Interest on Working Capital 0.02 O&M Expenses 0.26 Total 0.54

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Depreciation 0.37 Interest on Loan 0.39 Return on Equity 0.41 Interest on working capital 0.12 O&M Expenses 1.84 Total 3.13

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Depreciation 43.28 175.16 Interest on Loan 41.96 162.89 Return on Equity 46.61 189.05 Interest on working capital 4.16 16.81 O&M Expenses 25.78 106.83 Total 161.79 650.74

    10. The details of the trued-up Interest on Working Capital (IWC) claimed by the Petitioner for the transmission assets for the 2014-19 tariff period are as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 O&M Expenses 9.12 9.42 9.73 Maintenance Spares 16.41 16.96 17.52 Receivables 69.97 70.58 76.73 Total 95.50 96.96 103.98 Rate of Interest (%) 12.80 12.80 12.80 Interest on Working Capital 12.19 12.41 13.31

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 O&M Expenses 9.12 9.42 9.73 Maintenance Spares 16.41 16.96 17.52 Receivables 53.50 60.90 66.97 Total 79.03 87.28 94.22 Rate of Interest (in %) 12.80 12.80 12.80 Interest on Working Capital 7.57 11.17 12.06

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 O&M Expenses 9.12 9.42 9.73 Maintenance Spares 16.41 16.96 17.52 Receivables 52.42 62.32 68.73 Total 77.95 88.70 95.98 Rate of Interest (in %) 12.80 12.80 12.80 Interest on Working Capital 4.21 11.35 12.29

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) O&M Expenses 8.90 Maintenance Spares 16.02 Receivables 160.89 Total 185.81 Rate of Interest (in %) 12.20 Interest on Working Capital 0.06

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) O&M Expenses 8.02 Maintenance Spares 14.43 Receivables 32.98 Total 55.43 Rate of Interest (in %) 12.20 Interest on Working Capital 0.02

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) O&M Expenses 8.02 Maintenance Spares 14.43 Receivables 27.21 Total 49.66 Rate of Interest (in %) 12.20 Interest on Working Capital 0.12

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 O&M Expenses 8.62 8.90 Maintenance Spares 15.51 16.02 Receivables 108.15 108.46 Total 132.28 133.38 Rate of Interest (in %) 12.60 12.60 Interest on Working Capital 4.16 16.81

    Date of Commercial Operation

    11. HPPTCL has made the following submissions:

    a) An appeal has been preferred before the Appellate Tribunal for Electricity (APTEL) bearing DFR No. 72 of 2020 (HPPTCL v. CERC) along with application for stay of the order dated 21.11.2019 in Petition No. 158/TT/2018 to the extent of erroneous approval of COD for Asset-V.

    b) In order to arrive at the conclusion on approval of COD, the Commission in order dated 21.11.2019 relied on 30 Standing Committee Meeting (SCM) held on 19.12.2011, 22 meeting of TCC and 25 meeting of NRPC held on 23.2.2012 and 24.2.2012 and letter of HPPTCL dated 14.11.2017. However, the Commission had not considered the relevant facts and some of the crucial facts have been reiterated as follows:

    i. 30th SCM held on 19.12.2011

    Referring the Commission's order dated 21.11.2019, HPPTCL has submitted as follows:

    • Even though HPPTCL had mentioned construction of 2 numbers additional bays for their proposed sub-station at Palampur (220 kV Sub-station Dehan) during the meeting, the Petitioner had not agreed to the request and had deferred the request stating that it would be considered later when required. From nowhere in the minutes of said SCM it can be concluded that an agreement or an understanding had been reached between HPPTCL and the Petitioner either to construct two numbers bays at Dehan Sub-station or HPPTCL to match the downstream works that of commissioning of bays by the Petitioner.

    • It was categorically stated in the minutes of the said SCM that the 220 kV bays would be provided as per the requirement of STU and it was decided that respective STU would inform its requirement of 220 kV bays to the Petitioner at least 2 years in advance.

    • HPPTCL has never requested or informed the Petitioner any such requirement of the above referred bays and the Commission also has not sought for such request during the tariff proceedings in Petition No. 158/TT/2018.

    ii. 22nd meeting of TCC and 25th meeting of NRPC held on 23.2.2012 and 24.2.2012

    • The Commission did not give cognizance to the fact that the 30 SCM was held on 19.12.2011 and the 22 meeting of TCC and 25 meeting of NRPC together were held on 23.2.2012 and 24.2.2012 and that no correspondence on this matter took place between the Petitioner and HPPTCL between 19.12.2011 and 24.2.2012 and neither anything was on record, thereby indicating that the status as on 19.12.2011 remained the same on 24.2.2012 that the two bays for Palampur (Dehan) would be considered when required.

    iii. Letter of HPPTCL dated 14.11.2017

    • The letter of HPPTCL dated 14.11.2017 is misconceived in as much as the said letter was sent to the Petitioner in response to its letter dated 18.10.2017 wherein HPPTCL was requested by the Petitioner to make the corresponding 220 kV Transmission Line ready to match the commissioning of ICT along with Line Bays. By way of letter dated 14.11.2017, HPPTCL merely responded to the letter of the Petitioner dated 18.10.2017 informing them about its tentative plan/under construction assets. The said letter dated 14.11.2017, accordingly, cannot be construed as a request of additional 2 numbers of 220 kV bays on behalf of HPPTCL for their use of having committed to match the schedule of the Petitioner. Even if it is allegedly assumed that the Petitioner relied on HPPTCL's letter dated 14.11.2017 then the Petitioner should have commissioned the Bays in December 2019 and not in March 2019.

    c) The Commission had ignored the submissions of affidavit dated 20.5.2019 which were also recorded in order dated 21.11.2019 wherein it was submitted that HPPTCL in the 40 SCM held on 22.6.2018 had already informed the Petitioner that the Bays were scheduled for commissioning in April 2020. Therefore, the Petitioner ought to have planned commissioning of its assets to match the commissioning of the Bays as planned by HPPTCL rather than the other way round.

    d) With respect to communication between the Petitioner and HPPTCL having been made the basis of order by the Commission, relevant extracts of the APTEL judgment in Appeal No. 370 of 2017 (PSPCL v. Patran Transmission Company Limited) [“the Patran Judgment”] have been submitted.

    e) The Commission has ignored the fact that there was no contractual/implementation agreement between HPPTCL and the Petitioner or HPSEBL. The contractual agreement has to be there between the parties for anyone of them to be held responsible for non-completion of the associated transmission system. In this regard, the Commission also overlooked the Central Electricity Regulatory Commission (Indian Electricity Grid Code) (Fourth Amendment) Regulations, which came in to force from 29.04.2016 vide which Clause 4(iii) was included with respect to the transmission.

    f) With regard to the above three documents, even if it is allegedly assumed that the Petitioner relied on communication with HPPTCL's letter dated 14.11.2017 then the Commission had not appreciated the fact that there was no correspondence on record on the matter between the Petitioner and HPPTCL from the date of 30 SCM i.e. 19.12.2011 to the Petitioner's letter dated 18.10.2017 (almost 6 years). The Petitioner never ever informed HPPTCL all these years either about their original schedule of construction, revised schedules of construction or the delays thereof or the reasons thereof or any communication asking HPPTCL to match their latest schedules of construction.

    g) Apart from the above stated three documentary evidence whose facts were ignored by the Commission, the Commission also ignored the following relevant facts which were also important:

    i. Minutes of 33rd SCM held on 23.12.2013

    • The Commission had ignored the submissions of affidavit dated 20.5.2019 which were also recorded in order dated 21.11.2019 wherein it was submitted that in 33 SCM held on 23.12.2013, the Petitioner had stated that their ISTS sub-station was for drawl of power by HP and that for injection of power into this sub-station, HPPTCL has to apply for long term access declaring quantum of power and the time frame of injection along with certification that the generation is already connected to the grid. HPPTCL has not signed LTA or TSA or any other agreement with the Petitioner. Relevant extracts of the said meeting have been submitted.

    h) The Commission also ignored to take note that before constructing two bays for Dehan Sub-station for injection of power, the Petitioner should have confirmed all the down-the-line details of not only the 220 kV connecting line but also the status of IPP's from whom HPPTCL had planned to inject power.

    12. In view of the above submissions and considering that true up of Asset-V is yet to be decided in this petition, HPPTCL has requested to reconsider the above facts and take measures so that it is relieved of its undue financial burden.

    13. In response, the Petitioner has made the submissions as follows:

    a) The Petitioner has been entrusted with implementation of the transmission project and the scope of work under the transmission project included work of Asset-V. As per the said scope for Asset-V, the work for construction of the associated downstream network i.e. the Hamirpur-Dehan Line, was within the scope of work awarded to HPPTCL and as per HPPTCL's own admission, the said Hamirpur-Dehan Line has still not been commissioned by it.

    b) HPPTCL has erroneously stated that there are no correspondences or agreements between it and the Petitioner regarding establishment of the Hamirpur-Dehan Line. The contention of HPPTCL is liable to be rejected as erroneous and misconceived and in this regard, the following has been submitted:

    i. On 23.2.2012 and 24.2.2012, the transmission project was discussed in the 22 meeting of TCC and the 25 meeting of NRPC, respectively. The relevant portion of the minutes of meeting dated 19.3.2012 for the meetings held on 23.2.2012 and 24.2.2012 have been submitted. It is evident from the said minutes that the requirement of 2 numbers 220 kV Line Bays at Hamirpur was, inter-alia, agreed in the TCC, and the NRPC. Further, the representatives of HPPTCL, who were present in the said meetings, agreed to the requirement of the said 2 numbers 220 kV Line Bays at the Hamirpur Sub-station.

    c) Asset-V was put into commercial operation only at the request of HPPTCL and HPPTCL was aware of the same. However, HPPTCL is now trying to cover its own shortcomings in commissioning the downstream system i.e. the Hamirpur-Dehan Line and in turn denying the Petitioner its legitimate transmission charges.

    d) On 18.10.2017, the Petitioner, vide its Letter, had informed HPPTCL that the construction work of Asset-V is in advance stages of completion. HPPTCL was also requested to make the corresponding downstream 220 kV transmission lines for evacuation of power from the 400/220 kV sub-station to match the COD of Asset-V. HPPTCL, at no stage has written to the Petitioner that it does not require or has never asked for Asset-V. Hence, clearly the principle contention of HPPTCL is merely a cover up as it was aware and conscious of the fact that Asset-V is being created by the Petitioner solely for HPPTCL. A copy of letter dated 18.10.2017 has been submitted.

    e) On 14.11.2017, HPPTCL vide its Letter, informed the Petitioner that Tenders for construction of the Hamirpur-Dehan Line of Asset-V had been invited and price evaluation was being carried out. HPPTCL further stated that the work was expected to be awarded by December 2017 and considering minimum construction period of 24 months, the Hamirpur-Dehan Line was scheduled to be completed in December 2019. A copy of letter dated 14.11.2017 has been submitted.

    f) In 45 meeting of NRPC held on 8.6.2019 and 42 meeting of TCC held on 7.6.2019, HPPTCL had itself accepted that the Hamirpur-Dehan Line was expected to be commissioned by April, 2020. The relevant portion of the said minutes has been submitted.

    g) In this case, all the decisions were taken after due deliberation and agreement between the participants, including HPPTCL. There is nothing on record to demonstrate that the decision was taken without the consent or concurrence of HPPTCL. Accordingly, the contention of HPPTCL that at no point of time they have agreed for additional bays at Hamirpur Sub-station is liable to be rejected.

    h) HPPTCL has relied upon the Patran Judgment to contend that transmission charges cannot be levied in the absence of a contractual arrangement. In this regard, the said contention of HPPTCL is liable to be rejected for the following reasons:

    i. The decision in the Patran Judgment for saddling the liability of transmission charges on PSPCL was made on the basis of a TSA which clearly provided that PSPCL is responsible for arranging the downstream system. Further, the APTEL, while deciding the matter, relied upon the principle that transmission charges have to be paid by the entity because of whom the asset could not be put to use.

    ii. However, in the present case, a perusal of the various minutes of SCM, TCC and NRPC as well as HPPTCL's letter dated 14.11.2017, show that the responsibility for execution of the Hamirpur-Dehan Line was of HPPTCL. Therefore, reliance placed by HPPTCL on the Patran Judgment is misconceived.

    i) The issue of liability of transmission charges in the absence of contractual arrangement was raised in the case of NPCIL v. CERC (Appeal No. 332/2016) [“the NPCIL matter”]. While deciding the issue, the APTEL analyzed the Patran Judgment and other related orders passed by the Commission.

    j) In the NPCIL matter, NPCIL contended that it was not liable to pay transmission charges as there was no agreement between the transmission licensee and NPCIL. Referring the relevant portion of the APTEL judgment in the NPCIL matter, the Petitioner in the instant petition has contended that irrespective of any contractual relationship, if the asset which was created at the behest of the Respondent cannot be put to use due to delay on its part, the Respondent has to bear the transmission charges from the date of commissioning of such asset.

    14. We have considered the submissions of the Petitioner and HPPTCL. The Commission vide order dated 21.11.2019 in Petition No. 158/TT/2018 had considered in detail all the correspondences submitted for Asset-V and Asset-VI. The relevant portion of the said order is as follows:

    “23. We note that the requirement of the 220 kV line bays was discussed in the Standing Committee of NR held on 19.12.2011. The relevant extract of the meeting is as under:

    “3. Augmentation of Transformation Capacity and provision of additional 220 kV bays in Northern Region

    d) Requirement of 400/220 kV ICTs at other locations as per 2016-17 studies

    In addition to above, studies have been carried out in the time frame of 2016-17 to work out the requirement of ICTs at other locations also. From the studies requirement of augmentation of ICTs has been observed at various locations in Northern region. After detailed deliberations following transformer augmentation capacity, in addition to above was agreed:

    400kV S/s Aug. proposed 220kV Line bays to be provided Samba 3x105MVA --- Gurgaon 1x500 MVA --- Mandaula 1x500 MVA --- Hamirpur 3x105 MVA 2 nos Jallandhar 1x500 MVA 2 nos Panchkula 1x500 MVA ---

    It was also agreed that 220 kV bays would be provided as per the requirement of STU. It was decided that respective STU would inform its requirement of 220 kV bays to POWERGRID at least 2 years in advance.

    Members agreed to the above proposal.

    24. The requirement of the 220 kV line bays also discussed in the 22nd TCC meeting and 25th NRPC meeting held on 23.2.2012 & 24.2.2012. The relevant extract of the meeting is as under:

    “xv) Augmentation of Transformation Capacity and provision of additional 220 kV bays in Northern Region

    Sl. No Substation Transformation capacity Existing Proposed Transformation Augmentation in Northern Region : Part-B 9 Samba 7x105 (1ph) 3x105 (1ph) 10 Gurgaon 2x315 1x500 11 Hamirpur 7x105 (1ph) 3x105 (1ph)** 12 Jallandhar 2x315 1x500** 13 Panchkula 2x315 1x500

    **With 220 kV Bays

    25. It is seen from the above that the requirement of 2 no 220 kV line bays at Hamirpur and Jallandhar was agreed in meetings of standing committee, TCC and NRPC. Further, it is observed that in the 22nd meeting of TCC and 25th meeting of NRPC held on 23rd and 24th February, 2012 the representative of PSTCL and HPPTCL were present and agreed for 220 kV line bays at Hamirpur and Jallandhar Sub-stations. Therefore, the contention of the HPPTCL and PSTCL is not justified that at no point of time they have agreed for additional bays at Hamirpur and Jallandhar Sub-stations, respectively. Based on the above, we approve COD of Asset-2 and Asset-3 as 31.3.2019 and 25.3.2019, respectively, under proviso (ii) of Regulation 4(3) of the 2014 Tariff Regulations, 2014.

    26. In view of the above, the transmission charges for Asset-2 from 31.3.2019 till commissioning of the associated 220 kV transmission system under the scope of HPPTCL shall be borne by HPPTCL and thereafter, shall be recovered under provisions of Sharing Regulations. Similarly, the transmission charges for Asset-3 from 25.3.2019 till commissioning of the associated 220 kV transmission system under the scope of PSTCL shall be borne by PSTCL and thereafter, shall be recovered under provisions of Sharing Regulations.”

    15. In view of the above, COD of Asset-V and VI was approved under proviso (ii) to Regulation 4(3) of the 2014 Tariff Regulations as the downstream systems under the scope of HPPTCL and PSTCL were not ready. It was held that the transmission charges in case of Asset-V from 31.3.2019 till commissioning of the associated 220 kV transmission system under the scope of HPPTCL shall be borne by HPPTCL and transmission charges in case of Asset-VI from 25.3.2019 till commissioning of the associated 220 kV transmission system under the scope of PSTCL shall be borne by PSTCL.

    16. HPPTCL and PSTCL, the transmission licensees with respect to Asset-V and Asset-VI respectively, have preferred appeals before the APTEL vide DFR Nos. 72/2020 and 128/2020 against the Commission's order dated 21.11.2019 in Petition No. 158/TT/2018 directing them to bear and pay the transmission charges as their downstream lines were not ready. Accordingly, the transmission charges shall be shared as per the findings in this order, subject to the outcome of the said Appeals preferred by HPPTCL and PSTCL before the APTEL.

    Capital Cost

    17. The Commission vide order dated 6.10.2017 in Petition No. 236/TT/2016 in respect of Asset-I, Asset-II and Asset-III and vide order dated 21.11.2019 in Petition No. 158/TT/2018 in respect of Asset-IV, Asset-V, Asset-VI and Asset-VII has approved the following capital cost and Additional Capital Expenditure (ACE) for the transmission assets covered in the instant petition which are as follows:

    (Rs. in lakh)

    Asset Apportioned Approved Cost (as per FR) Revised Apportioned Approved Cost Capital Cost allowed (as on COD) ACE Total Capital Cost (as on 31.3.2019) 2016-17 2017-18 2018-19 Asset-I 2463.52 2593.11 1669.59 274.99 342.19 114.06 2400.80 Asset-II 2271.59 2541.69 1085.65 640.05 255.42 85.14 2066.20 Asset-III 2205.76 2469.14 917.00 944.07 215.57 107.79 2184.40 Asset-IV 3425.67 6007.86 4776.23 0.00 0.00 0.00 4776.23 Asset-V 1071.63 1959.45 563.58 0.00 0.00 0.00 563.58 Asset-VI 536.77 502.07 346.59 0.00 0.00 33.15 379.74 Asset-VII 3581.82 4757.19 3139.55 0.00 275.14 600.00 4014.69 Total 15556.76 20830.51 12498.19 1859.11 1088.32 940.14 16385.64

    18. Based on the separate Auditor's Certificates dated 9.1.2020 in respect of Asset-I, Asset-II, Asset-III, Asset-IV, Asset-V and Asset-VI and Auditor's Certificate dated 7.2.2020 in respect of Asset-VII, details of the respective capital cost as on COD and as on 31.3.2019 (including actual ACE during 2014-19 period) claimed by the Petitioner are as follows:

    (Rs. in lakh)

    Asset Revised Apportioned Approved Cost Capital Cost (as on COD) ACE Total Cost (as on 31.3.2019) 2016-17 2017-18 2018-19 Asset-I 2593.11 1669.88 24.41 203.71 303.05 2201.05 Asset-II 2102.36 1118.72 205.35 353.56 108.49 1786.12 Asset-III 2349.14 955.44 493.13 180.12 279.72 1908.41 Asset-IV 7521.31 5953.37 0.00 0.00 0.00 5953.37 Asset-V 879.63 625.54 0.00 0.00 0.00 625.54 Asset-VI 439.33 393.25 0.00 0.00 33.15 426.40 Asset-VII 4757.19 3617.09 0.00 3.92 50.77 3671.78 Total 20642.07 14333.29 722.89 741.31 775.18 16572.67

    19. For the purpose of tariff, the Petitioner has adjusted time over-run for Asset-II, Asset-III, Asset-IV, Asset-V, Asset-VI and Asset-VII in line with order dated 6.10.2017 in Petition No. 236/TT/2016 and order dated 21.11.2019 in Petition No. 158/TT/2018. The Petitioner has also adjusted excess initial spares for Asset-IV and Asset-VII. Accordingly, the capital cost claimed as on 31.3.2019 after the adjustments is as follows:

    (Rs. in lakh)

    Asset RCE Capital Cost claimed (as on COD) Actual ACE claimed Total Cost (as on 31.3.2019) 2016-17 2017-18 2018-19 Asset-I 2593.11 1669.88 24.41 203.71 303.05 2201.05 Asset-II 2102.36 1088.54 205.41 358.92 108.49 1761.36 Asset-III 2349.14 918.14 493.36 195.80 279.72 1887.02 Asset-IV 7521.31 5013.67 0.00 0.00 0.00 5013.67 Asset-V 879.63 563.58 0.00 0.00 0.00 563.58 Asset-VI 439.33 346.60 0.00 0.00 33.15 379.75 Asset-VII 4757.19 3160.40 0.00 3.65 50.77 3214.82 Total 20642.07 12760.81 723.18 762.08 775.18 15021.25

    20. BRPL has submitted that Asset-V and Asset-VI have not attained the actual COD and the same was approved under the second proviso to Regulation 4(3) of the 2014 Tariff Regulations as there was delay in the commissioning of downstream network of HPPTCL and PSTCL. Owing to delay in commissioning of downstream assets of HPPTCL and PSTCL, Asset-V and Asset-VI could not be put to use. BRPL has submitted that as per Regulation 9(6)(a) of the 2014 Tariff Regulations, assets not in use cannot be included in the capital cost. Accordingly, BRPL has requested to exclude Asset-V and Asset-VI. In response, the Petitioner has prayed to allow the tariff as claimed in the petition.

    21. We have considered the submissions of the Petitioner and BRPL. As pointed out by BRPL, the assets which are ‘not-in-use’ should not be granted tariff as per Regulation 9(6)(a) of the 2014 Tariff Regulations. However, the COD of Asset-V and Asset-VI has been approved under the second proviso to Regulation 4(3) of the 2014 Tariff Regulations as the Petitioner was prevented from putting them into use for reasons not attributable to the Petitioner. Therefore, the transmission charges in the instant case shall be borne by the entity(ies) which is/are responsible for execution of the downstream assets. BRPL and other beneficiaries are not liable to pay any transmission charges for this period of mismatch and they shall be liable to pay the transmission charges only after the COD of the downstream assets and when Asset-V and Asset-VI are put to use. Therefore, apprehensions of BRPL in this regard are unfounded.

    Cost Over-run

    22. Based on the separate Auditor's Certificates dated 9.1.2020 in respect of Asset-I, Asset-II, Asset-III, Asset-IV, Asset-V and Asset-VI and Auditor's Certificate dated 7.2.2020 in respect of Asset-VII, the Petitioner has claimed capital cost as on COD of Rs. 1669.88 lakh, Rs. 1118.72 lakh, Rs. 955.44 lakh, Rs. 5953.37 lakh, Rs. 625.54 lakh, Rs. 393.25 lakh and Rs. 3617.09 lakh respectively.

    23. The total completion cost as on 31.3.2019 including ACE during the 2014-19 period in respect of the transmission assets is Rs. 16572.67 lakh and RCE cost is Rs. 20642.07 lakh. Further, the individual capital cost of the transmission assets is within RCE apportioned approved cost. Hence, the completion cost in respect of the transmission assets is within the approved RCE cost.

    24. We observe that as per the previous orders, the total RCE apportioned approved cost is Rs. 20830.51 lakh and the Petitioner in the instant true-up petition has revised the apportioned approved cost as per RCE to Rs. 20642.07 lakh. The Petitioner is directed to take due diligence at the time of preparing FR and RCE while apportioning costs between various elements of the transmission system/project.

    Time Over-run

    25. As per IA, the transmission assets were scheduled to be put under commercial operation within 24 months from the date of IA, which is 27.3.2014. Accordingly, the scheduled COD was 27.3.2016. Asset-I, Asset-II, Asset-III, Asset-IV, Asset-V, Asset-VI and Asset-VII were put into commercial operation on 2.4.2016, 2.7.2016, 29.10.2016, 31.3.2019, 31.3.2019, 25.3.2019 and 31.12.2017 respectively.

    26. There is a time over-run of 7 days, 98 days and 217 days in case of Asset-I, Asset-II and Asset-III respectively. The Commission vide order dated 6.10.2017 in Petition No 236/TT/2016 has not condoned the said time over-run in case of Asset-II and Asset-III. Further, there is a time over-run of 1100 days, 1100 days, 1094 days and 645 days in case of Asset-IV, Asset-V, Asset-VI and Asset-VII respectively of which 1095 days, 1095 days, 1094 days and 645 days were not condoned in case of Asset-IV, Asset-V, Asset-VI and Asset-VII respectively vide order dated 21.11.2019 in Petition No. 158/TT/2018.

    Interest During Construction (IDC) and Incidental Expenditure During Construction (IEDC)

    27. The Petitioner has claimed IDC in respect of the transmission assets and in support of the same has submitted separate Auditor's Certificates dated 9.1.2020 in case of Asset-I, Asset-II, Asset-III, Asset-IV, Asset-V and Asset-VI and Auditor's Certificate dated 7.2.2020 in case of Asset-VII. The Petitioner has submitted computation of IDC along with year-wise details of IDC discharged.

    28. The allowable IDC has been worked out considering the information submitted by the Petitioner in respect of the transmission assets separately on cash basis. The loan details submitted in Form-9C for the 2014-19 tariff period and IDC computation sheet have been considered for the purpose of IDC calculation on cash basis and accrued basis. The un-discharged IDC as on COD has been considered as ACE during the year in which it has been discharged.

    29. Accordingly, based on the information furnished by the Petitioner, IDC considered, is as follows:

    (Rs. in lakh)

    Asset IDC as per Auditor's Certificates IDC admissible IDC disallowed due to time over-run/computational difference IDC discharged as on COD IDC undischarged as on COD IDC 2016-17 discharge d 2017-18 uring 2018-19 A B C=(A-B) D E=(B-D) F G H Asset-I 28.06 26.23 1.83 26.23 - - - - Asset-II 19.63 5.34 14.29 5.34 - - - - Asset-III 19.30 0.70 18.60 0.70 - - - - Asset-IV 652.50 0.00 652.50 - - - - - Asset-V 29.43 0.00 29.43 - - - - - Asset-VI 30.37 0.00 30.37 - - - - - Asset-VII 168.15 0.13 168.02 0.13 - - - -

    30. The Petitioner has claimed IEDC for the transmission assets for the 2014-19 tariff period as per Auditor's Certificates as follows:

    (Rs. in lakh)

    Asset IEDC claimed as per Auditor's Certificates Asset-I 91.51 Asset-II 63.62 Asset-III 47.82 Asset-IV 479.98 Asset-V 54.36 Asset-VI 27.17 Asset-VII 29.16

    31. We have considered the submissions of the Petitioner. The Commission vide order dated 6.10.2017 in Petition No. 236/TT/2016 had dis-allowed IEDC of Rs. 21.88 lakh and Rs. 20.25 lakh in case of Asset-II and Asset-III respectively on account of time overrun. Similarly, vide order dated 21.11.2019 in Petition No. 158/TT/2018, the Commission had dis-allowed IEDC of Rs. 287.20 lakh, Rs. 32.53 lakh, Rs. 16.28 lakh and Rs. 13.66 lakh in case of Asset-IV, Asset-V, Asset-VI and Asset-VII respectively. Further, the Petitioner has submitted that entire IEDC has been discharged as on COD in respect of the transmission assets and IEDC claimed is within the percentage of the hard cost.

    32. Accordingly, IEDC details considered for the purpose of tariff calculation are as follows:

    (Rs. in lakh)

    Asset IEDC claimed as per Auditor's Certificates IEDC deducted on account of time over-run IEDC allowed Asset-I 91.51 0.87 90.64 Asset-II 63.62 7.53 56.09 Asset-III 47.82 10.96 36.86 Asset-IV 479.98 287.20 192.78 Asset-V 54.36 32.53 21.83 Asset-VI 27.17 16.30 10.87 Asset-VII 29.16 13.66 15.50

    Initial Spares

    33. Regulation 13(d) of the 2014 Tariff Regulations provides as follows:

    “Initial Spares : Initial spares shall be capitalized as a percentage of the Plant and machinery cost up to cut-off date, subject to the following ceiling norms:

    (d) Transmission system

    (i) Transmission line - 1.00%

    (ii) Transmission Sub-station (Green Field) - 4.00%

    (iii) Transmission Sub-station (Brown Field) - 6.00%

    (iv) Series Compensation devices and HVDC Station - 4.00%

    (v) Gas Insulated Sub-station (GIS) - 5.00%

    (vi) Communication system - 3.5%

    ……………………………………………………”

    34. The Petitioner has claimed Initial Spares in respect of the transmission assets as follows:

    (Rs. in lakh)

    Sub-station Asset Estimated Completion Cost (A) Initial Spares Claimed (B) Ceiling limit (in %) (C) Initial Spares worked Out Excess Initial Spares Excess Initial Spares deducted in Petitioner's claim Initial Spares claimed after deduction of excess spares D=[(A-B)*C/(100-C)] Asset-I 2106.85 94.76 6.00 128.43 0.00 0.00 94.76 Asset-II 1727.68 86.50 6.00 104.76 0.00 0.00 86.50 Asset-III 1861.51 106.08 6.00 112.05 0.00 0.00 106.08 Asset-IV 6175.08 466.61 5.00 300.45 166.16 45.87 420.74 Asset-V 738.13 0.00 5.00 38.85 0.00 0.00 0.00 Asset-VI 368.85 0.00 6.00 23.54 0.00 0.00 0.00 Asset-VII 3824.76 452.76 5.00 177.47 275.29 275.29 177.47

    35. The Petitioner has submitted that the Initial Spares has been re-calculated based on completion cost as per the Auditor's Certificates and has prayed to view Initial Spares on overall cost of all the transmission assets covered in the instant petition.

    36. The Petitioner has submitted the discharge of Initial Spares as follows:

    (Rs. in lakh)

    Asset Initial Spares claimed for sub-station before deduction of excess spares Expenditure on Initial Spares up to COD as per Auditor's Certificates Actual Expenditure on Initial Spares (ACE)* 2017-18 2018-19 2019-20 2020-21 Asset-I 94.76 0.00 59.99 34.77 0.00 0.00 Asset-II 86.50 0.00 58.04 28.46 0.00 0.00 Asset-III 106.08 0.00 73.79 32.29 0.00 0.00 Asset-IV 466.61 241.31 0.00 0.00 112.65 112.65 Asset V 0.00 0.00 0.00 0.00 0.00 0.00 Asset VI 0.00 0.00 0.00 0.00 0.00 0.00 Asset VII 452.76 437.5 0.27 0.00 14.29 0.00

    *The Petitioner in the instant petition has submitted that Initial Spares discharged up to COD are included in the capital cost claimed as on COD and discharge of balance Initial Spares have been considered in ACE of the respective year

    37. BRPL has submitted that the Petitioner has claimed Initial Spares beyond the ceiling limits amounting to Rs. 45.87 lakh in case of Asset-IV and 275.29 lakh in case of Asset-VII as specified under Regulation 13 of the 2014 Tariff Regulations. Initial Spares beyond the ceiling limit may be dis-allowed and strictly in accordance with Regulation 13 of the 2014 Tariff Regulations. In response, the Petitioner has prayed to allow Initial Spares as claimed in the petition.

    38. We have considered the submissions of the Petitioner and BRPL and observe that the Petitioner has deducted excess spares of Rs. 45.87 lakh in case of Asset-IV and Rs. 275.79 lakh in case of Asset-VII in its computations. Further, in terms of the APTEL's judgment dated 14.9.2019 in Appeal No. 74 of 2017, Initial Spares are to be allowed as per the ceiling on overall project cost. However, in the present case, even though the entire scope of the transmission project has been completed as on 31.3.2019, COD of Asset-V and Asset-VI was approved by the Commission under proviso (ii) to Regulation 4(3) of the 2014 Tariff Regulations as the downstream systems under the scope of HPPTCL and PSTCL were not ready. The status of the said downstream systems has been submitted vide affidavit dated 2.12.2020. The downstream systems have still not been put into commercial operation. Accordingly, transmission charges in case of Asset-V and Asset-VI would be borne by HPPTCL and PSTCL from COD approved under proviso (ii) to Regulation 4(3) of the 2014 Tariff Regulations to COD of respective downstream systems. Further, Asset-V and Asset-VI are not combined for tariff determination purposes during the 2019-24 period.

    39. The overall project cost of the transmission assets can be ascertained only when all the transmission assets are combined. Therefore, Initial Spares are allowed on the basis of cost of the individual asset during 2014-19 tariff period and excess Initial Spares are not allowed. However, the claim for excess Initial Spares, if any, will be considered when all the transmission assets are combined.

    40. The excess Initial Spares towards Asset-IV and Asset-VI is restricted to 5% as per the ceiling specified under Regulation 13(d) of the 2014 Tariff Regulations. Further, we also observe that in case of Asset-I, Asset-II, Asset-III and Asset-VII, the Petitioner has considered the entire Plant and Machinery cost as capital cost instead of Plant and Machinery cost as on cut-off date. The Initial Spares of Asset-I, Asset-II, Asset-III and Asset-VII has been worked out considering the Plant and Machinery cost as on cut-off date.

    41. Accordingly, the details of the Initial Spares allowed in respect of the transmission assets for the 2014-19 tariff period are as follows:

    (Rs. in lakh)

    Sub-stations Asset Plant and Machinery cost considered as on cut-off date (Rs. in lakh) Initial Spares allowed (Rs. in lakh) Norms as per the 2014 Tariff Regulations (in %) Initial Spares allowable as per the 2014 Tariff Regulations (Rs. in lakh) Initial Spares allowed (Rs. in lakh) Initial Spares discharged as on COD (Rs. in lakh) Asset-I 2081.48 94.76 6.00% 126.81 94.76 0.00 Asset-II 1702.86 86.50 6.00% 103.17 86.50 0.00 Asset-III 1861.51 106.08 6.00% 112.05 106.08 0.00 Asset-IV 6175.08 466.61 5.00% 300.45 300.45 241.31 Asset-V 738.13 0.00 5.00% 38.85 0.00 0.00 Asset-VI 368.85 0.00 5.00% 19.41 0.00 0.00 Asset-VII 3474.76 452.76 5.00% 159.05 159.05 159.05

    42. The allowed year wise discharge of Initial Spares is as follows:

    (Rs. in lakh)

    Asset Initial Spares claimed Allowed Expenditure on initial spares up to COD Allowed Expenditure on Initial Spares in (ACE) Total Initial Spares allowed 2017-18 2018-19 2019-20 Asset-I 94.76 0.00 59.99 34.77 0.00 94.76 Asset-II 86.50 0.00 58.04 28.46 0.00 86.50 Asset-III 106.08 0.00 73.79 32.29 0.00 106.08 Asset-IV 466.61 241.31 0.00 0.00 59.14* 300.45 Asset-V 0.00 0.00 0.00 0.00 0.00 0.00 Asset-VI 0.00 0.00 0.00 0.00 0.00 0.00 Asset-VII 452.76 159.05 0.00 0.00 0.00 159.05

    *Excess spares claimed in add cap of 2019-20 and 2020-21 is deducted in ACE

    Capital Cost allowed as on COD

    43. Accordingly, the capital cost allowed as on COD is summarized as follows:

    (Rs. in lakh)

    Asset Capital Cost as on COD as per Auditor's Certificates* Less : IDC as on COD due to Less : IEDC dis-allowed on account of time over-run Less : Excess Initial Spares dis-allowed Capital Cost as on COD IDC dis-allowed Undischarged IDC (on cash basis) Asset-I 1669.88 1.83 0.00 0.87 0.00 1667.185 Asset-II 1118.72 14.29 0.00 7.53 0.00 1096.90 Asset-III 955.44 18.60 0.00 10.86 0.00 925.89 Asset-IV 5953.37 652.50 0.00 287.20 0.00 5013.67 Asset-V 625.54 29.43 0.00 32.53 0.00 563.58 Asset-VI 393.25 30.37 0.00 16.30 0.00 346.58 Asset-VII 3617.09 168.02 0.00 13.66 275.29 3160.12

    *The Petitioner has submitted that Initial Spares discharged up to COD are included in the capital cost as on COD as claimed in the Auditor's Certificates and has been considered accordingly

    Additional Capital Expenditure

    44. The Commission vide order dated 6.10.2017 in Petition No. 236/TT/2016 in case of Asset-I, Asset-II and Asset-III and vide order dated 21.11.2019 in Petition No. 158/TT/2018 in case of Asset-IV, Asset-V, Asset-VI and Asset-VII had allowed ACE for the 2014-19 tariff period as follows:

    (Rs. in lakh)

    Asset 2016-17 2017-18 2018-19 Asset-I 274.99 342.19 114.06 Asset-II 640.05 255.42 85.14 Asset-III 944.07 215.57 107.79 Asset-IV 0.00 0.00 0.00 Asset-V 0.00 0.00 0.00 Asset-VI 0.00 0.00 33.15 Asset-VII 0.00 275.14 600.00

    45. The Petitioner has claimed ACE after adjustment of IDC/IEDC, Initial Spares and liability in respect of the transmission assets covered in the instant petition as follows:

    (Rs. in lakh)

    Asset 2016-17 2017-18 2018-19 Asset-I 24.41 203.71 303.05 Asset-II 205.35 353.56 108.49 Asset-III 493.13 180.12 279.72 Asset-IV 0.00 0.00 0.00 Asset-V 0.00 0.00 0.00 Asset-VI 0.00 0.00 33.15 Asset-VII 0.00 3.92 50.77

    46. The Petitioner has submitted that ACE during 2014-19 period has been claimed under Regulations 14(1)(i) and 14(1)(ii) of the 2014 Tariff Regulations and the same is within the cut-off date. The Petitioner has submitted Auditor's Certificates in support of the same. The Petitioner vide affidavit dated 2.12.2020 has submitted Liability Flow Statement.

    47. BRPL has submitted that the Petitioner has claimed accrual IDC in ACE which may dis-allowed, as there is no provision for such ACE in the 2014 Tariff Regulations. In response, the Petitioner has submitted that the accrued IDC discharged during the subsequent ACE has not been included in ACE for respective year for the transmission assets as per the Auditor's Certificates. Further, the transmission tariff has been calculated with the claim of IDC on cash basis and un-discharged IDC on COD has been reduced from the expenditure up to COD and has been claimed as ACE during the respective year.

    48. In view of the above, the Petitioner has prayed to allow IDC on actual discharge on cash basis.

    49. We have considered the submissions of the Petitioner and BRPL. The un-discharged IDC as on COD have been allowed as ACE during the year of discharge. ACE claimed by the Petitioner is allowed under Regulations 14(1)(i) and 14(1)(ii) of the 2014 Tariff Regulations which pertains to balance and retention payments and un-discharged liability for works executed prior to cut-off date.

    50. As per the directions of the Commission vide order dated 21.11.2019 in Petition No. 158/TT/2018, the cost due to time over-run shall be borne by the Petitioner and the Liquidated Damages (LD) on account of time over-run recovered shall be retained by the Petitioner. Accordingly vide Auditor's Certificate dated 9.1.2020, LD amounting to Rs. 33.07 lakh for 2018-19 in case of Asset-II and Rs. 38.44 lakh for 2018-19 in case of Asset-III has been retained by the Petitioner. Subsequently, IDC/IEDC dis-allowed to the extent of LD recovered has been added back as ACE during 2018-19.

    51. Accordingly, ACE allowed for 2014-19 tariff period is as follows:

    (Rs. in lakh)

    Asset Particulars 2016-17 2017-18 2018-19 Asset-I Balance & Retention Payment 24.40 203.71 303.05 Unexecuted Work 0.00 0.00 0.00 IDC Discharged 0.31 0.00 0.00 Asset-II Balance & Retention Payment 115.01 31.24 75.42 Unexecuted Work 90.34 322.32 33.07 IDC Discharged 0.00 2.34 0.00

    52. The capital cost approved as on 31.3.2019 after inclusion of ACE in respect of the transmission assets is as follows:

    (Rs. in lakh)

    Asset Particulars 2016-17 2017-18 2018-19 Asset-III Balance & Retention Payment 441.56 36.91 201.77 Unexecuted Work 51.57 143.21 77.95 IDC Discharged 0.00 0.00 0.00 Asset-IV Balance & Retention Payment 0.00 0.00 0.00 Unexecuted Work 0.00 0.00 0.00 Asset-V Balance & Retention Payment 0.00 0.00 0.00 Unexecuted Work 0.00 0.00 0.00 Asset-VI Balance & Retention Payment 0.00 0.00 33.15 Unexecuted Work 0.00 0.00 0.00 Asset-VII Balance & Retention Payment 0.00 3.65 50.77 Unexecuted Work 0.00 0.00 0.00
    Asset Particulars Capital cost as on COD on cash basis 2016-17 2017-18 2018-19 Total Capital cost including ACE as on 31.3.2019 Asset-I Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 1669.59 274.99 342.19 114.06 2400.80 Claimed by the Petitioner in the instant petition as per Auditor's Certificate 1669.88 24.41 203.71 303.05 2201.05 Approved after truing up in this order 1667.18 24.40 203.71 303.05 2198.34 Asset-II Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 1085.65 640.05 255.42 85.14 2066.20 Claimed by the Petitioner in the instant petition as per Auditor's Certificate 1118.72 205.35 353.56 108.49 1786.12 Approved after truing up in this order 1096.90 205.35 353.56 108.49 1764.30 Asset-III Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 917.00 944.07 215.57 107.79 2184.40 Claimed by the Petitioner in the instant petition as per Auditor's Certificate 955.44 493.13 180.12 279.72 1908.41 Approved after truing up in this order 925.89 493.13 180.12 279.72 1878.86 Asset-IV Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 4776.23 0.00 0.00 0.00 4776.23 Claimed by the Petitioner in the instant petition as per Auditor's Certificate 5953.37 0.00 0.00 0.00 5953.37 Approved after truing up in this order 5013.67 0.00 0.00 0.00 5013.67 Asset-V Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 563.58 0.00 0.00 0.00 563.58 Claimed by the Petitioner in the instant petition as per Auditor's Certificate 625.54 0.00 0.00 0.00 625.54 Approved after truing up in this order 563.58 0.00 0.00 0.00 563.58 Asset-VI Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 346.59 0.00 0.00 33.15 379.74 Claimed by the Petitioner in the instant petition as per Auditor's Certificate 393.25 0.00 0.00 33.15 426.40 Approved after truing up in this order 346.58 0.00 0.00 33.15 379.73 Asset-VII Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 3139.55 0.00 275.14 600 4014.69 Claimed by the Petitioner in the instant petition as per Auditor's Certificate 3617.09 0.00 3.92 50.77 3671.78 Approved after truing up in this order 3160.12 0.00 3.65 50.77 3214.54

    Debt-Equity Ratio

    53. The Petitioner has claimed debt-equity ratio of 70 : 30 as on COD and for ACE. The debt-equity ratio of 70 : 30 has been considered for capital cost as on COD and ACE during 2014-19 tariff period as provided under Regulation 19 of the 2014 Tariff Regulations. The details of debt-equity ratio in respect of the transmission assets as on COD and as on 31.3.2019 is as follows:

    Funding Amount as on COD (Rs. in lakh) (in %) Amount as on 31.3.2019 (Rs. in lakh) (in %) Asset-I Debt 1167.03 70.00 1538.85 70.00 Equity 500.15 30.00 659.48 30.00 Total 1667.18 100.00 2198.34 100.00 Asset-II Debt 767.83 70.00 1235.01 70.00 Equity 329.07 30.00 529.29 30.00 Total 1096.90 100.00 1764.30 100.00 Asset-III Debt 648.12 70.00 1315.21 70.00 Equity 277.76 30.00 563.65 30.00 Total 925.89 100.00 1878.86 100.00 Asset-IV Debt 3509.57 70.00 3509.57 70.00 Equity 1504.10 30.00 1504.10 30.00 Total 5013.67 100.00 5013.67 100.00 Asset-V Debt 394.51 70.00 394.51 70.00 Equity 169.07 30.00 169.07 30.00 Total 563.58 100.00 563.58 100.00 Asset-VI Debt 242.61 70.00 265.81 70.00 Equity 103.98 30.00 113.92 30.00 Total 346.58 100.00 379.73 100.00 Asset-VII Debt 2212.08 70.00 2250.18 70.00 Equity 948.04 30.00 964.36 30.00 Total 3160.12 100.00 3214.54 100.00

    Depreciation

    54. The Petitioner's claim towards depreciation in this petition for Asset-I, Asset-III, Asset-IV, Asset-V and Asset-VII was found to be higher than the depreciation allowed vide order dated 6.10.2017 and 21.11.2019 in Petition No. 236/TT/2016 and Petition No. 158/TT/2018. The Petitioner has neither given any justification for claiming higher depreciation than that allowed earlier nor made any specific prayer for allowing higher depreciation in this petition. While claiming depreciation for these assets, the Petitioner has segregated IT equipment from that of sub-station and claimed higher depreciation for IT equipment. A similar issue had come up in Petition No. 19/TT/2020 wherein the Commission vide order dated 9.5.2020 has dealt with the issue.

    55. In terms of the order dated 9.5.2020 in Petition No. 19/TT/2020, depreciation has been considered for IT equipment @ 5.28% as part of the sub-station up to 31.3.2019 while truing up the capital expenditure for 2014-19 period. However, for 2019-24 tariff period, IT equipment has been considered separately and depreciation has been allowed @15% for the balance depreciable value of IT equipment in accordance with Regulation 33 of the 2019 Tariff Regulations. The Gross Block during 2014-19 tariff period has been depreciated at Weighted Average Rate of Depreciation (WAROD) and working of WAROD is at Annexure-I, Annexure-II, Annexure-III, Annexure-IV, Annexure-V, Annexure-VI and Annexure-VII in respect of Asset-I, Asset-II, Asset-III, Asset-IV, Asset-V, Asset-VI and Asset-VII respectively. WAROD has been worked out after considering the depreciation rates of transmission assets as specified in the 2014 Tariff Regulations and the trued-up depreciation allowed for 2014-19 period in respect of transmission assets is as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Opening Gross Block 1667.18 1691.58 1895.29 ACE 24.40 203.71 303.05 Closing Gross Block 1691.58 1895.29 2198.34 Average Gross Block 1679.38 1793.43 2046.81 Gross Block (90% depreciable assets) 1631.27 1745.32 1992.97 Gross Block (100% depreciable assets) 48.11 48.11 53.84 Weighted average rate of Depreciation (WAROD) (in %) 5.28 5.28 5.28 Balance useful life of the asset (Year) 24.00 24.00 23.00 Lapsed life at the beginning of the year (Year) 0.00 0.00 1.00 Depreciable value (excluding IT equipment and software) 1468.14 1570.79 1793.67 Depreciable value of IT equipment and software 43.30 43.30 48.46 Remaining Depreciable Value at the beginning of the year 1511.44 1525.66 1659.01 Depreciation during the year 88.43 94.69 108.07 Cumulative Aggregate Depreciation at the end of the year 88.43 183.12 291.19 Remaining Aggregated Depreciable Value at the end of the year 1423.01 1430.97 1550.94

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Opening Gross Block 1096.90 1302.25 1655.81 ACE 205.35 353.56 108.49 Closing Gross Block 1302.25 1655.81 1764.30 Average Gross Block 1199.57 1479.03 1710.05 Weighted average rate of Depreciation (WAROD) (in %) 5.28 5.28 5.28 Balance useful life of the asset (Year) 25.00 25.00 24.00 Lapsed life at the beginning of the year (Year) 0.00 0.00 1.00 Aggregated Depreciable Value 1079.61 1331.12 1539.05 Remaining Depreciable Value at the beginning of the year 1079.61 1283.75 1413.58 Depreciation during the year 47.37 78.09 90.29 Cumulative Aggregate Depreciation at the end of the year 47.37 125.47 215.76 Remaining Aggregated Depreciable Value at the end of the year 1032.24 1205.66 1323.29

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Opening Gross Block 925.89 1419.02 1599.14 ACE 493.13 180.12 279.72 Closing Gross Block 1419.02 1599.14 1878.86 Average Gross Block 1172.45 1509.08 1739.00 Weighted average rate of Depreciation (WAROD) (in %) 5.28 5.28 5.28 Balance useful life of the asset (Year) 25.00 25.00 24.00 Lapsed life at the beginning of the year (Year) 0.00 0.00 1.00 Aggregated Depreciable Value 1055.21 1358.17 1565.10 Remaining Depreciable Value at the beginning of the year 1055.21 1332.05 1459.30 Depreciation during the year 26.12 79.68 91.82 Cumulative Aggregate Depreciation at the end of the year 26.12 105.80 197.62 Remaining Aggregated Depreciable Value at the end of the year 1029.09 1252.37 1367.48

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Opening Gross Block 5013.67 ACE 0.00 Closing Gross Block 5013.67 Average Gross Block 5013.67 Weighted average rate of Depreciation (WAROD) (in %) 5.28 Balance useful life of the asset (Year) 25.00 Lapsed life at the beginning of the year (Year) 0.00 Aggregated Depreciable Value 4512.30 Remaining Depreciable Value at the beginning of the year 4512.30 Depreciation during the year 0.73 Cumulative Aggregate Depreciation at the end of the year 0.73 Remaining Aggregated Depreciable Value at the end of the year 4511.58

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Opening Gross Block 563.58 ACE 0.00 Closing Gross Block 563.58 Average Gross Block 563.58 Weighted average rate of Depreciation (WAROD) (in %) 5.30 Balance useful life of the asset (Year) 25.00 Lapsed life at the beginning of the year (Year) 0.00 Aggregated Depreciable Value 507.22 Remaining Depreciable Value at the beginning of the year 507.22 Depreciation during the year 0.08 Cumulative Aggregate Depreciation at the end of the year 0.08 Remaining Aggregated Depreciable Value at the end of the year 507.14

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Opening Gross Block 346.58 ACE 33.15 Closing Gross Block 379.73 Average Gross Block 363.16 Weighted average rate of Depreciation (WAROD) (in %) 5.32 Balance useful life of the asset (Year) 25.00 Lapsed life at the beginning of the year (Year) 0.00 Aggregated Depreciable Value 326.84 Remaining Depreciable Value at the beginning of the year 326.84 Depreciation during the year 0.37 Cumulative Aggregate Depreciation at the end of the year 0.37 Remaining Aggregated Depreciable Value at the end of the year 326.47

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Opening Gross Block 3160.12 3163.77 ACE 3.65 50.77 Closing Gross Block 3163.77 3214.54 Average Gross Block 3161.95 3189.16 Weighted average rate of Depreciation (WAROD) (in %) 5.28 5.28 Balance useful life of the asset (Year) 25.00 25.00 Lapsed life at the beginning of the year (Year) 0.00 0.00 Aggregated Depreciable Value 2845.75 2870.24 Remaining Depreciable Value at the beginning of the year 2845.75 2828.62 Depreciation during the year 41.62 168.39 Cumulative Aggregate Depreciation at the end of the year 41.62 210.01 Remaining Aggregated Depreciable Value at the end of the year 2804.13 2660.23

    56. Depreciation allowed for Asset-I to Asset-III vide order dated 6.10.2017 in Petition No. 236/TT/2016 and Asset-IV to Asset-VII vide order dated 21.11.2019 in Petition No. 158/TT/2018, claimed by the Petitioner in the instant petition and trued-up in the instant order is as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 95.15 111.71 123.75 Claimed by the Petitioner in the instant petition 93.23 99.52 113.46 Approved after true-up in this order 88.43 94.69 108.07

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 55.51 97.86 106.85 Claimed by the Petitioner in the instant petition 47.05 77.80 90.14 Approved after true-up in this order 47.37 78.09 90.29

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 30.94 103.96 112.49 Claimed by the Petitioner in the instant petition 26.55 83.31 96.62 Approved after true-up in this order 26.12 79.68 91.82

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.69 Claimed by the Petitioner in the instant petition 0.74 Approved after true-up in this order 0.73

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.08 Claimed by the Petitioner in the instant petition 0.08 Approved after true-up in this order 0.08

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.37 Claimed by the Petitioner in the instant petition 0.37 Approved after true-up in this order 0.37

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 day) 2018-19 Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 43.14 196.14 Claimed by the Petitioner in the instant petition 43.28 175.16 Approved after true-up in this order 41.62 168.39

    Interest on Loan (IoL)

    57. The Petitioner has claimed Weighted Average Rate of Interest (WAROI) on loan based on its actual loan portfolio and rate of interest. Accordingly, IoL has been calculated based on actual interest rates in accordance with Regulation 26 of the 2014 Tariff Regulations. The trued-up IoL allowed for the transmission assets for the 2014-19 tariff period is as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Gross Normative Loan 1167.03 1184.11 1326.71 Cumulative Repayments up to Previous Year 0.00 88.43 183.12 Net Loan-Opening 1167.03 1095.69 1143.59 Addition due to ACE 17.09 142.60 212.14 Repayment during the year 88.43 94.69 108.07 Net Loan-Closing 1095.69 1143.59 1247.66 Average Loan 1131.36 1119.64 1195.63 Weighted Average Rate of Interest on Loan (in %) 9.307 8.285 8.043 Interest on Loan 105.01 92.76 96.16

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Gross Normative Loan 767.83 911.57 1159.06 Cumulative Repayments up to Previous Year 0.00 47.37 125.47 Net Loan-Opening 767.83 864.20 1033.60 Addition due to ACE 143.75 247.49 75.94 Repayment during the year 47.37 78.09 90.29 Net Loan-Closing 864.20 1033.60 1019.25 Average Loan 816.01 948.90 1026.42 Weighted Average Rate of Interest on Loan (in %) 8.405 8.064 7.961 Interest on Loan 51.30 76.52 81.72

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Gross Normative Loan 648.12 993.32 1119.41 Cumulative Repayments up to Previous Year 0.00 26.12 105.80 Net Loan-Opening 648.12 967.20 1013.61 Addition due to ACE 345.19 126.09 195.80 Repayment during the year 26.12 79.68 91.82 Net Loan-Closing 967.20 1013.61 1117.59 Average Loan 807.66 990.40 1065.60 Weighted Average Rate of Interest on Loan (in %) 7.892 7.785 7.801 Interest on Loan 26.89 77.11 83.13

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Gross Normative Loan 3509.57 Cumulative Repayments up to Previous Year 0.00 Net Loan-Opening 3509.57 Addition due to ACE 0.00 Repayment during the year 0.73 Net Loan-Closing 3508.84 Average Loan 3509.21 Weighted Average Rate of Interest on Loan (in %) 7.726 Interest on Loan 0.74

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Gross Normative Loan 394.51 Cumulative Repayments up to Previous Year 0.00 Net Loan-Opening 394.51 Addition due to ACE 0.00 Repayment during the year 0.08 Net Loan-Closing 394.43 Average Loan 394.47 Weighted Average Rate of Interest on Loan (in %) 7.966 Interest on Loan 0.09

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Gross Normative Loan 242.61 Cumulative Repayments up to Previous Year 0.00 Net Loan-Opening 242.61 Addition due to ACE 23.21 Repayment during the year 0.37 Net Loan-Closing 265.44 Average Loan 254.03 Weighted Average Rate of Interest on Loan (in %) 7.945 Interest on Loan 0.39

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Gross Normative Loan 2212.08 2214.64 Cumulative Repayments up to Previous Year 0.00 41.62 Net Loan-Opening 2212.08 2173.02 Addition due to ACE 2.56 35.54 Repayment during the year 41.62 168.39 Net Loan-Closing 2173.02 2040.17 Average Loan 2192.55 2106.60 Weighted Average Rate of Interest on Loan (in %) 7.687 7.750 Interest on Loan 42.02 163.26

    58. IoL allowed for Asset-I to Asset-III vide order dated 6.10.2017 in Petition No. 236/TT/2016 and Asset-IV to Asset-VII vide order dated 21.11.2019 in Petition No. 158/TT/2018, claimed by the Petitioner in the instant petition and trued-up in this order is as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 115.94 127.01 131.02 Claimed by the Petitioner in the instant petition 104.95 92.32 95.32 Approved after true-up in this order 105.01 92.76 96.16

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 61.25 102.17 103.61 Claimed by the Petitioner in the instant petition 50.94 76.24 81.61 Approved after true-up in this order 51.30 76.52 81.72

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 32.56 104.45 104.84 Claimed by the Petitioner in the instant petition 26.71 76.95 83.07 Approved after true-up in this order 26.89 77.11 83.13

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.73 Claimed by the Petitioner in the instant petition 0.74 Approved after true-up in this order 0.74

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.09 Claimed by the Petitioner in the instant petition 0.09 Approved after true-up in this order 0.09

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.39 Claimed by the Petitioner in the instant petition 0.39 Approved after true-up in this order 0.39

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 45.17 195.82 Claimed by the Petitioner in the instant petition 41.96 162.89 Approved after true-up in this order 42.02 163.26

    Return on Equity (RoE)

    59. The Petitioner has claimed RoE for the transmission assets in terms of Regulations 24 and 25 of the 2014 Tariff Regulations. The Petitioner has submitted that it is liable to pay income tax at Minimum Alternate Tax (MAT) rates and has claimed the effective tax rates for the 2014-19 tariff period as follows:

    Year Claimed effective tax (in %) Grossed-up RoE (in %) [(Base Rate)/(1-t)] 2014-15 21.018 19.625 2015-16 21.382 19.716 2016-17 21.338 19.705 2017-18 21.337 19.704 2018-19 21.549 19.758

    60. The Commission vide order dated 27.4.2020 in Petition No. 274/TT/2019 had arrived at the effective tax rates based on the notified MAT rates for the Petitioner which are as follows:

    Year Notified MAT rates (in %) (inclusive of surcharge & cess) Effective tax (in %) 2014-15 20.961 20.961 2015-16 21.342 21.342 2016-17 21.342 21.342 2017-18 21.342 21.342 2018-19 21.549 21.549

    61. MAT rates considered in order dated 27.4.2020 for the purpose of grossing up of rate of RoE for truing up of the tariff of the 2014-19 period, in terms of the provisions of the 2014 Tariff Regulations, have been considered in the instant case which are as follows:

    Year Notified MAT rates (in %) (inclusive of surcharge & cess) Grossed-up RoE (in %) [(Base Rate)/(1-t)] 2014-15 20.961 19.610 2015-16 21.342 19.705 2016-17 21.342 19.705 2017-18 21.342 19.705 2018-19 21.549 19.758

    62. Accordingly, RoE allowed in respect of the transmission assets is as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Opening Equity 500.15 507.46 568.57 Addition due to ACE 7.31 61.11 90.91 Closing Equity 507.46 568.57 659.48 Average Equity 503.81 538.02 614.03 Return on Equity (Base Rate) (in %) 15.500 15.500 15.500 Tax Rate applicable (in %) 21.342 21.342 21.549 Rate of Return on Equity (Pre-tax) 19.705 19.705 19.758 Return on Equity (Pre-tax) 99.00 106.02 121.32

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Opening Equity 329.07 390.67 496.74 Addition due to ACE 61.61 106.07 32.55 Closing Equity 390.67 496.74 529.29 Average Equity 359.87 443.71 513.02 Return on Equity (Base Rate) (in %) 15.500 15.500 15.500 Tax Rate applicable (in %) 21.342 21.342 21.549 Rate of Return on Equity (Pre-tax) 19.705 19.705 19.758 Return on Equity (Pre-tax) 53.04 87.43 101.36

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Opening Equity 277.76 425.70 479.73 Addition due to ACE 147.94 54.03 83.92 Closing Equity 425.70 479.73 563.65 Average Equity 351.73 452.72 521.69 Return on Equity (Base Rate) (in %) 15.500 15.500 15.500 Tax Rate applicable (in %) 21.342 21.342 21.549 Rate of Return on Equity (Pre-tax) 19.705 19.705 19.758 Return on Equity (Pre-tax) 29.24 89.21 103.08

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Opening Equity 1504.10 Addition due to ACE 0.00 Closing Equity 1504.10 Average Equity 1504.10 Return on Equity (Base Rate) (in %) 15.500 Tax Rate applicable (in %) 21.549 Rate of Return on Equity (Pre-tax) 19.758 Return on Equity (Pre-tax) 0.81

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Opening Equity 169.07 Addition due to ACE 0.00 Closing Equity 169.07 Average Equity 169.07 Return on Equity (Base Rate) (in %) 15.500 Tax Rate applicable (in %) 21.549 Rate of Return on Equity (Pre-tax) 19.758 Return on Equity (Pre-tax) 0.09

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Opening Equity 103.98 Addition due to ACE 9.95 Closing Equity 113.93 Average Equity 108.95 Return on Equity (Base Rate) (in %) 15.500 Tax Rate applicable (in %) 21.549 Rate of Return on Equity (Pre-tax) 19.758 Return on Equity (Pre-tax) 0.41

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Opening Equity 948.04 949.13 Addition due to ACE 1.09 15.23 Closing Equity 949.13 964.36 Average Equity 948.58 956.74 Return on Equity (Base Rate) (in %) 15.500 15.500 Tax Rate applicable (in %) 21.342 21.549 Rate of Return on Equity (Pre-tax) 19.705 19.758 Return on Equity (Pre-tax) 46.60 189.03

    63. RoE allowed for Asset-I to Asset-III vide order dated 6.10.2017 in Petition No. 236/TT/2016 and Asset-IV to Asset-VII vide order dated 21.11.2019 in Petition No. 158/TT/2018, claimed by the Petitioner in the instant petition and trued-up in the instant order is as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 106.02 124.47 137.89 Claimed by the Petitioner in the instant petition 99.16 106.18 121.48 Approved after true-up in this order 99.00 106.02 121.32

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 61.85 109.04 119.05 Claimed by the Petitioner in the instant petition 52.67 87.10 101.19 Approved after true-up in this order 53.04 87.43 101.36

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 34.48 115.83 125.34 Claimed by the Petitioner in the instant petition 29.05 89.23 103.56 Approved after true-up in this order 29.24 89.21 103.08

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.73 Claimed by the Petitioner in the instant petition 0.81 Approved after true-up in this order 0.81

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.09 Claimed by the Petitioner in the instant petition 0.09 Approved after true-up in this order 0.09

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.39 Claimed by the Petitioner in the instant petition 0.41 Approved after true-up in this order 0.41

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 46.39 211.79 Claimed by the Petitioner in the instant petition 46.61 189.05 Approved after true-up in this order 46.60 189.03

    Operation & Maintenance Expenses (O&M Expenses)

    64. The details of the O&M Expenses claimed by the Petitioner for the transmission assets and allowed under Regulation 29(4)(a) of the 2014 Tariff Regulations for the purpose of tariff are as follows:

    (Rs. in lakh)

    Asset-I Particulars 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Sub-station Panchkula : ICT III Bay (400/220 kV) Panchkula 1 1 1 Panchkula : ICT III Bay (400/220kV) Panchkula 1 1 1 Norm (Rs. lakh/bay) 400 kV 64.37 66.51 68.71 220 kV 45.06 46.55 48.10 Total Sub-station O&M Expenses 109.13 113.06 116.81

    (Rs. in lakh)

    Asset-II Particulars 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Sub-station Jallandhar : ICT III Bay (400/220 kV) Jallandhar 1 1 1 Jallandhar : ICT III Bay (400/220 kV) Jallandhar 1 1 1 Norm (Rs. lakh/bay) 400 kV 64.37 66.51 68.71 220 kV 45.06 46.55 48.10 Total Sub-station O&M Expenses 81.85 113.06 116.81

    (Rs. in lakh)

    Asset-III Particulars 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Sub-station Samba : ICT III Bay (400/220 kV) Samba 1 1 1 Samba : ICT III Bay (400/220 kV) Samba 1 1 1 Norm (Rs. lakh/bay) 400 kV 64.37 66.51 68.71 220 kV 45.06 46.55 48.10 Total Sub-station O&M Expenses 46.17 113.06 116.81

    (Rs. in lakh)

    Asset-IV Particulars 2018-19 (Pro-rata for 1 day) Sub-station Hamirpur : Hamirpur 1 Hamirpur : ICT III Bay (400/220 kV) Hamirpur 1 Norm (Rs. lakh/bay) 400 kV GIS 58.73 220 kV GIS 48.10 Total Sub-station O&M Expenses 0.29

    (Rs. in lakh)

    Asset-V Particulars 2018-19 (Pro-rata for 1 day) Sub-station Hamirpur : Future-III (Dehan) 1 Hamirpur : Future-IV (Dehan) 1 Norm (Rs. lakh/bay) 220 kV GIS 48.10 Total Sub-station O&M Expenses 0.26

    (Rs. in lakh)

    Asset-VI Particulars 2018-19 (Pro-rata for 7 days) Sub-station Jallandhar : PSEB-V 1 Jallandhar : PSEB-VI 1 Norm (Rs. lakh/bay) 220 kV GIS 48.1 Total Sub-station O&M Expenses 1.84

    (Rs. in lakh)

    Asset-VII Particulars 2017-18 (Pro-rata for 91 days) 2018-19 Sub-station Gurgaon : ICT-IV Gurgaon (GIS) 1 1 Gurgaon : ICT-4 Gurgaon (GIS) 1 1 Norm (Rs. lakh/bay) 400 kV GIS 56.84 58.73 220 kV GIS 46.55 48.10 Total Sub-station O&M Expenses 25.78 106.83

    65. O&M Expenses allowed for Asset-I to Asset-III vide order dated 6.10.2017 in Petition No. 236/TT/2016 and Asset-IV to Asset-VII vide order dated 21.11.2019 in Petition No. 158/TT/2018, claimed by the Petitioner in the instant petition and trued-up in the instant order are as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 109.13 113.06 116.81 Claimed by the Petitioner in the instant petition 109.13 113.06 116.81 Approved after true-up in this order 109.13 113.06 116.81

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 81.85 113.06 116.81 Claimed by the Petitioner in the instant petition 81.85 113.06 116.81 Approved after true-up in this order 81.85 113.06 116.81

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 46.17 113.06 116.81 Claimed by the Petitioner in the instant petition 46.17 113.06 116.81 Approved after true-up in this order 46.17 113.06 116.81

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.29 Claimed by the Petitioner in the instant petition 0.29 Approved after true-up in this order 0.29

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.26 Claimed by the Petitioner in the instant petition 0.26 Approved after true-up in this order 0.26

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 1.81 Claimed by the Petitioner in the instant petition 1.84 Approved after true-up in this order 1.84

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 25.78 106.83 Claimed by the Petitioner in the instant petition 25.78 106.83 Approved after true-up in this order 25.78 106.83

    Interest on Working Capital

    66. IWC has been worked out as per the methodology provided in Regulation 28 of the 2014 Tariff Regulations and the trued-up IWL allowed for the transmission assets are as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Working Capital for O&M Expenses (O&M Expenses for one month) 9.12 9.42 9.73 Working Capital for Maintenance Spares (15% of O&M Expenses) 16.41 16.96 17.52 Working Capital for Receivables (Equivalent to Two months of annual fixed cost/annual transmission charges) 69.13 69.81 75.93 Total Working Capital 94.67 96.19 103.19 Rate of Interest (in %) 12.80 12.80 12.80 Interest on Working Capital 12.08 12.31 13.21

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Working Capital for O&M Expenses (O&M Expenses for one month) 9.12 9.42 9.73 Working Capital for Maintenance Spares (15% of O&M Expenses) 16.41 16.96 17.52 Working Capital for Receivables (Equivalent to Two months of annual fixed cost/annual transmission charges) 53.74 61.05 67.04 Total Working Capital 79.27 87.43 94.30 Rate of Interest (in %) 12.80 12.80 12.80 Interest on Working Capital 7.59 11.19 12.07

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Working Capital for O&M Expenses (O&M Expenses for one month) 9.12 9.42 9.73 Working Capital for Maintenance Spares (15% of O&M Expenses) 16.41 16.96 17.52 Working Capital for Receivables (Equivalent to Two months of annual fixed cost/annual transmission charges) 52.39 61.72 67.83 Total Working Capital 77.93 88.10 95.09 Rate of Interest (in %) 12.80 12.80 12.80 Interest on Working Capital 4.21 11.28 12.17

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Working Capital for O&M Expenses (O&M Expenses for one month) 8.90 Working Capital for Maintenance Spares (15% of O&M Expenses) 16.02 Working Capital for Receivables (Equivalent to Two months of annual fixed cost/annual transmission charges) 160.41 Total Working Capital 185.34 Rate of Interest (in %) 12.20 Interest on Working Capital 0.06

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Working Capital for O&M Expenses (O&M Expenses for one month) 8.02 Working Capital for Maintenance Spares (15% of O&M Expenses) 14.43 Working Capital for Receivables (Equivalent to Two months of annual fixed cost/annual transmission charges) 32.95 Total Working Capital 55.39 Rate of Interest (in %) 12.20 Interest on Working Capital 0.02

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Working Capital for O&M Expenses (O&M Expenses for one month) 8.02 Working Capital for Maintenance Spares (15% of O&M Expenses) 14.43 Working Capital for Receivables (Equivalent to Two months of annual fixed cost/annual transmission charges) 27.22 Total Working Capital 49.66 Rate of Interest (in %) 12.20 Interest on Working Capital 0.12

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Working Capital for O&M Expenses (O&M Expenses for one month) 8.62 8.90 Working Capital for Maintenance Spares (15% of O&M Expenses) 15.51 16.02 Working Capital for Receivables (Equivalent to Two months of annual fixed cost/annual transmission charges) 107.06 107.36 Total Working Capital 131.18 132.29 Rate of Interest (in %) 12.60 12.60 Interest on Working Capital 4.12 16.67

    67. IWC allowed for Asset-I to Asset-III vide order dated 6.10.2017 in Petition No. 236/TT/2016 and Asset-IV to Asset-VII vide order dated 21.11.2019 in Petition No. 158/TT/2018, claimed by the Petitioner and trued-up in the instant order is as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 12.62 13.83 14.67 Claimed by the Petitioner in the instant petition 12.19 12.41 13.31 Approved after true-up in this order 12.08 12.31 13.21

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 8.18 12.65 13.29 Claimed by the Petitioner in the instant petition 7.57 11.17 12.06 Approved after true-up in this order 7.59 11.19 12.07

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 4.55 12.98 13.58 Claimed by the Petitioner in the instant petition 4.21 11.35 12.29 Approved after true-up in this order 4.21 11.28 12.17

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.06 Claimed by the Petitioner in the instant petition 0.06 Approved after true-up in this order 0.06

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.02 Claimed by the Petitioner in the instant petition 0.02 Approved after true-up in this order 0.02

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.11 Claimed by the Petitioner in the instant petition 0.12

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 4.22 18.45 Claimed by the Petitioner in the instant petition 4.16 16.81 Approved after true-up in this order 4.12 16.67

    Approved Annual Fixed Charges for the 2014-19 Tariff Period

    68. The trued-up Annual Fixed Charges (AFC) approved for the transmission assets for the 2014-19 tariff period are as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Depreciation 88.43 94.69 108.07 Interest on Loan 105.01 92.76 96.16 Return on Equity 99.00 106.02 121.32 O&M Expenses 109.13 113.06 116.81 Interest on Working Capital 12.08 12.31 13.21 Total 413.66 418.84 455.57

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Depreciation 47.37 78.09 90.29 Interest on Loan 51.30 76.52 81.72 Return on Equity 53.04 87.43 101.36 O&M Expenses 81.85 113.06 116.81 Interest on Working Capital 7.59 11.19 12.07 Total 241.14 366.30 402.25

    (Rs. in lakh)

    Particulars Asset-III 2016-17(Pro-rata for 154 days) 2017-18 2018-19 Depreciation 25.93 79.24 90.36 Interest on Loan 26.69 76.68 81.73 Return on Equity 29.03 88.71 101.44 O&M Expenses 46.17 113.06 116.81 Interest on Working Capital 4.21 11.28 12.17 Total 132.63 370.33 407.01

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Depreciation 0.73 Interest on Loan 0.74 Return on Equity 0.81 O&M Expenses 0.29 Interest on Working Capital 0.06 Total 2.64

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Depreciation 0.08 Interest on Loan 0.09 Return on Equity 0.09 O&M Expenses 0.26 Interest on Working Capital 0.02 Total 0.54

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Depreciation 0.37 Interest on Loan 0.39 Return on Equity 0.41 O&M Expenses 1.84 Interest on Working Capital 0.12 Total 3.13

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Depreciation 41.62 168.39 Interest on Loan 42.02 163.26 Return on Equity 46.60 189.03 O&M Expenses 25.78 106.83 Interest on Working Capital 4.12 16.67 Total 160.14 644.18

    69. Accordingly, the Annual Transmission Charges allowed for Asset-I to Asset-III vide order dated 6.10.2017 in Petition No. 236/TT/2016 and Asset-IV to Asset-VII vide order dated 21.11.2019 in Petition No. 158/TT/2018, claimed by the Petitioner in the instant petition and trued-up in the instant order are as follows:

    (Rs. in lakh)

    Particulars Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 438.87 490.07 524.14 Claimed by the Petitioner in the instant petition 418.66 423.49 460.38 Approved after true-up in this order 413.66 418.84 455.57

    (Rs. in lakh)

    Particulars Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 268.64 434.78 459.62 Claimed by the Petitioner in the instant petition 240.08 365.37 401.81 Approved after true-up in this order 241.14 366.30 402.25

    (Rs. in lakh)

    Particulars Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 Allowed vide order dated 6.10.2017 in Petition No. 236/TT/2016 148.70 450.27 473.06 Claimed by the Petitioner in the instant petition 132.69 373.90 412.35 Approved after true-up in this order 132.63 370.33 407.01

    (Rs. in lakh)

    Particulars Asset-IV 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 2.51 Claimed by the Petitioner in the instant petition 2.64 Approved after true-up in this order 2.64

    (Rs. in lakh)

    Particulars Asset-V 2018-19 (Pro-rata for 1 day) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 0.54 Claimed by the Petitioner in the instant petition 0.54 Approved after true-up in this order 0.54

    (Rs. in lakh)

    Particulars Asset-VI 2018-19 (Pro-rata for 7 days) Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 3.09 Claimed by the Petitioner in the instant petition 3.13 Approved after true-up in this order 3.13

    (Rs. in lakh)

    Particulars Asset-VII 2017-18 (Pro-rata for 91 days) 2018-19 Allowed vide order dated 21.11.2019 in Petition No. 158/TT/2018 164.69 729.03 Claimed by the Petitioner in the instant petition 161.79 650.74 Approved after true-up in this order 160.14 644.18

    DETERMINATION OF ANNUAL FIXED CHARGES FOR THE 2019-24 TARIFF PERIOD

    70. The Petitioner has submitted tariff forms for the 2019-24 tariff period combining Asset-I, Asset-II, Asset-III, Asset-IV and Asset-VII into a single asset and Asset-V and Asset-VI separately. The Petitioner has submitted that Asset-V and Asset-VI have not been clubbed as downstream are not yet ready and bilateral billing is being done as per order dated 21.11.2019 in Petition No. 158/TT/2018. Accordingly, as per proviso (i) of Regulation 8(1) of the 2019 Tariff Regulations, single tariff for Combined Asset and separate tariff for Asset-V and Asset-VI has been worked out for the 2019-24 tariff period.

    71. The Petitioner has claimed the transmission charges for Combined Asset (Asset-I, Asset-II, Asset-III, Asset-IV and Asset-VII), Asset-V and Asset-VI for the 2019-24 tariff period as follows:

    (Rs. in lakh)

    Combined Asset Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Depreciation 786.78 833.15 857.72 857.72 857.72 Interest on Loan 692.91 675.73 638.79 576.34 506.78 Return on Equity 815.98 864.69 890.65 890.65 890.65 Interest on Working Capital 78.23 81.12 82.92 83.67 84.10 O&M Expenses 1003.06 1039.20 1075.63 1114.46 1151.55 Total 3376.96 3493.89 3545.71 3522.84 3490.80

    (Rs. in lakh)

    Asset-V Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Depreciation 34.12 39.31 41.26 41.26 41.26 Interest on Loan 34.42 37.04 36.06 32.87 29.43 Return on Equity 35.21 40.74 42.82 42.82 42.82 Interest on Working Capital 2.95 3.20 3.30 3.30 3.30 O&M Expenses 31.78 32.88 34.02 35.20 36.44 Total 138.48 153.17 157.46 155.45 153.25

    (Rs. in lakh)

    Asset-VI Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Depreciation 20.20 20.20 20.20 20.20 20.20 Interest on Loan 20.33 18.72 17.33 15.99 14.33 Return on Equity 21.40 21.40 21.40 21.40 21.40 Interest on Working Capital 2.91 2.95 3.01 3.06 3.11 O&M Expenses 45.30 46.88 48.52 50.20 51.96 Total 110.14 110.15 110.46 110.85 111.00

    72. The Petitioner has claimed the IWC for Combined Asset, Asset-V and Asset-VI for the 2019-24 tariff period as follows:

    (Rs. in lakh)

    Combined Asset Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Working Capital for O&M Expenses (O&M Expenses for one month) 83.59 86.60 89.64 92.87 95.96 Working Capital for Maintenance Spares (15% of O&M Expenses) 150.46 155.88 161.34 167.17 172.73 Working Capital for Receivables (Equivalent to Two months of annual fixed cost/annual transmission charges) 415.20 430.75 437.14 434.32 429.20 Total Working Capital 649.25 673.23 688.12 694.36 697.89 Rate of Interest (in %) 12.05 12.05 12.05 12.05 12.05 Interest on Working Capital 78.23 81.12 82.92 83.67 84.10

    (Rs. in lakh)

    Asset-V Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Working Capital for O&M Expenses (O&M Expenses for one month) 2.65 2.74 2.84 2.93 3.04 Working Capital for Maintenance Spares (15% of O&M Expenses) 4.77 4.93 5.10 5.28 5.47 Working Capital for Receivables (Equivalent to Two months of annual fixed cost/annual transmission charges) 17.03 18.88 19.41 19.17 18.84 Total Working Capital 24.45 26.55 27.35 27.38 27.35 Rate of Interest (in %) 12.05 12.05 12.05 12.05 12.05 Interest on Working Capital 2.95 3.20 3.30 3.30 3.30

    (Rs. in lakh)

    Asset-VI Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Working Capital for O&M Expenses (O&M Expenses for one month) 3.78 3.91 4.04 4.18 4.33 Working Capital for Maintenance Spares (15% of O&M Expenses) 6.80 7.03 7.28 7.53 7.79 Working Capital for Receivables (Equivalent to Two months of annual fixed cost/annual transmission charges) 13.54 13.58 13.62 13.67 13.65 Total Working Capital 24.12 24.52 24.94 25.38 25.77 Rate of Interest (in %) 12.05 12.05 12.05 12.05 12.05 Interest on Working Capital 2.91 2.95 3.01 3.06 3.11

    Effective Date of Commercial Operation (E-COD)

    73. The Petitioner has claimed E-COD of Combined Asset as 28.10.2017 based on the trued-up admitted capital cost and actual COD of Asset-I, Asset-II, Asset-III, Asset-IV and Asset-VII, E-COD has been worked out as follows:

    Computation of E-COD Asset Actual COD Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Weight of the cost (in %) Number of days from last COD Weighted Days Asset-I 2.4.2016 2198.34 15.62 1093.00 170.78 Asset-II 2.7.2016 1764.30 12.54 1002.00 125.65 Asset-III 29.10.2016 1878.86 13.35 883.00 117.92 Asset-IV 31.3.2019 5013.67 35.63 0.00 0.00 Asset-VII 31.12.2017 3214.54 22.85 455.00 103.96 Total 31.3.2019 14069.70 100.00 518.29 E-COD (Latest COD - Total Weighted Days) 28.10.2017

    74. E-COD is used to determine the lapsed life of the project as a whole, which works out as 1 year as on 1.4.2019 (i.e. the number of completed years as on 1.4.2019 from E-COD).

    Weighted Average Life (WAL)

    75. The life as defined in Regulation 33 of the 2019 Tariff Regulations has been considered for determination of WAL. The Combined Asset may have multiple elements such as land, building, transmission line, sub-station and PLCC and each element may have different span of life. Therefore, the concept of WAL has been used as the useful life of the transmission project as a whole.

    76. WAL has been determined based on the admitted capital cost of individual elements as on 31.3.2019 and their respective life as stipulated in the 2019 Tariff Regulations. The element-wise life as defined in the 2014 Tariff Regulations prevailing at the time of actual COD of individual assets has been ignored for this purpose. The life as defined in the 2019 Tariff Regulations has been considered for determination of WAL. Accordingly, WAL of Combined Asset has been worked out as 25 years as follows:

    Admitted Capital Cost as on 31.3.2019 Particulars Capital Cost as on 31.3.2019 (Rs. in lakh) (1) Life (in Years) (2) Weighted Cost (Rs. in lakh) (3) = [(1) × (2)] WAL (in years) (4) = [(3)/(1)] Sub-station Equipment 13862.27 25 346556.85 24.73 years (rounded off to 25 years) IT Equipment and Software 207.43 7 1382.83 Total 14069.70 347939.69

    77. WAL as on 1.4.2019 as determined above is applicable prospectively (i.e. for 2019-24 tariff period onwards) and no retrospective adjustment of depreciation in previous tariff period is required to be done. As discussed, E-COD of Combined Asset is 28.10.2017 and the lapsed life of the transmission project as a whole works out as 1 year as on 1.4.2019 (i.e. the number of completed years as on 1.4.2019 from E-COD). Accordingly, WAL has been used to determine the remaining useful life as on 31.3.2019 to be 24 years.

    Capital Cost

    78. Regulation 19 of the 2019 Tariff Regulations provides as follows:

    “19. Capital Cost: (1) The Capital cost of the generating station or the transmission system, as the case may be, as determined by the Commission after prudence check in accordance with these regulations shall form the basis for determination of tariff for existing and new projects.

    (2) The Capital Cost of a new project shall include the following:

    (a) The expenditure incurred or projected to be incurred up to the date of commercial operation of the project;

    (b) Interest during construction and financing charges, on the loans (i) being equal to 70% of the funds deployed, in the event of the actual equity in excess of 30% of the funds deployed, by treating the excess equity as normative loan, or (ii) being equal to the actual amount of loan in the event of the actual equity less than 30% of the funds deployed;

    (c) Any gain or loss on account of foreign exchange risk variation pertaining to the loan amount availed during the construction period;

    (d) Interest during construction and incidental expenditure during construction as computed in accordance with these regulations;

    (e) Capitalised Initial Spares subject to the ceiling rates in accordance with these regulations;

    (f) Expenditure on account of additional capitalisation and de-capitalisation determined in accordance with these regulations;

    (g) Adjustment of revenue due to sale of infirm power in excess of fuel cost prior to the date of commercial operation as specified under Regulation 7 of these regulations;

    (h) Adjustment of revenue earned by the transmission licensee by using the Asset-before the date of commercial operation;

    (i) Capital expenditure on account of ash disposal and utilisation including handling and transportation facility;

    (j) Capital expenditure incurred towards railway infrastructure and its augmentation for transportation of coal up to the receiving end of the generating station but does not include the transportation cost and any other appurtenant cost paid to the railway;

    (k) Capital expenditure on account of biomass handling equipment and facilities, for co-firing;

    (l) Capital expenditure on account of emission control system necessary to meet the revised emission standards and sewage treatment plant;

    (m) Expenditure on account of fulfillment of any conditions for obtaining environment clearance for the project;

    (n) Expenditure on account of change in law and force majeure events; and

    (o) Capital cost incurred or projected to be incurred by a thermal generating station, on account of implementation of the norms under Perform, Achieve and Trade (PAT) scheme of Government of India shall be considered by the Commission subject to sharing of benefits accrued under the PAT scheme with the beneficiaries.

    (3) The Capital cost of an existing project shall include the following:

    (a) Capital cost admitted by the Commission prior to 1.4.2019 duly trued up by excluding liability, if any, as on 1.4.2019;

    (b) Additional capitalisation and de-capitalisation for the respective year of tariff as determined in accordance with these regulations;

    (c) Capital expenditure on account of ash disposal and utilisation including handling and transportation facility;

    (d) Capital expenditure on account of ash disposal and utilisation including handling and transportation facility;

    (e) Capital expenditure incurred towards railway infrastructure and its augmentation for transportation of coal up to the receiving end of generating station but does not include the transportation cost and any other appurtenant cost paid to the railway; and

    (f) Capital cost incurred or projected to be incurred by a thermal generating station, on account of implementation of the norms under Perform, Achieve and Trade (PAT) scheme of Government of India shall be considered by the Commission subject to sharing of benefits accrued under the PAT scheme with the beneficiaries.

    (4) The capital cost in case of existing or new hydro generating station shall also include:

    (a) cost of approved rehabilitation and resettlement (R&R) plan of the project in conformity with National R&R Policy and R&R package as approved; and

    (b) cost of the developer's 10% contribution towards Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) and Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) project in the affected area.

    (5) The following shall be excluded from the capital cost of the existing and new projects:

    (a) The Asset-forming part of the project, but not in use, as declared in the tariff petition;

    (b) De-capitalised Asset-after the date of commercial operation on account of replacement or removal on account of obsolescence or shifting from one project to another project:

    Provided that in case replacement of transmission Asset-is recommended by Regional Power Committee, such Asset-shall be decapitalised only after its redeployment;

    Provided further that unless shifting of an Asset-from one project to another is of permanent nature, there shall be no de-capitalisation of the concerned asset.

    (c) In case of hydro generating stations, any expenditure incurred or committed to be incurred by a project developer for getting the project site allotted by the State Government by following a transparent process;

    (d) Proportionate cost of land of the existing project which is being used for generating power from generating station based on renewable energy; and

    (e) Any grant received from the Central or State Government or any statutory body or authority for the execution of the project which does not carry any liability of repayment.”

    79. The Petitioner has claimed the capital cost of individual assets which has been added to arrive at the capital cost claimed during 2019-24 period in respect of the Combined Asset as per the following details:

    (Rs. in lakh)

    Asset Apportioned Approved Capital Cost Capital Cost claimed as on 31.3.2019 ACE Estimated Completion Cost as on 31.3.2024 2019-20 2020-21 Combined Asset 19323.11 14077.91 807.39 921.64 15806.94 Asset-V 879.63 563.58 122.57 73.81 759.96 Asset-VI 439.33 379.75 0.00 0.00 379.75 Total 20642.07 15021.25 929.96 995.45 16946.66

    80. Against the overall apportioned approved capital cost (as per RCE) of Rs. 20642.07 lakh, the estimated completion cost is Rs. 16946.66 lakh. The individual capital cost of the transmission assets is also within the respective RCE. Therefore, there is no cost overrun in respect of Combined Asset, Asset-V and Asset-VI.

    81. The capital cost has been dealt in line with Regulation 19(3) of the 2019 Tariff Regulations. The element-wise capital cost (i.e. land, building, transmission line, sub-station and PLCC) admitted by the Commission as on 31.3.2019 in respect of the transmission assets are clubbed together and has been considered as capital cost of Combined Asset and separately for Asset-V and Asset-VI as on 1.4.2019 as follows:

    (Rs. in lakh)

    Particulars Asset-I Asset-II Asset-III Asset-IV Asset-VII Capital Cost for Combined Asset as on 1.4.2019 Sub-station Equipment 2138.76 1764.30 1849.36 4966.21 3143.64 13862.27 IT Equipment and Software 59.57 0.00 29.50 47.46 70.90 207.43 Total 2198.34 1764.30 1878.86 5013.67 3214.54 14069.70

    (Rs. in lakh)

    Particulars Capital Cost for Asset-V as on 1.4.2019 Sub-station Equipment 540.29 PLCC 13.12 IT Equipment and Software 10.17 Total 563.58

    (Rs. in lakh)

    Particulars Capital Cost for Asset-V as on 31.3.2019 Sub-station Equipment 365.54 PLCC 14.20 IT Equipment and Software 0.00 Total 379.73

    82. The trued-up capital cost of Rs. 14069.79 lakh, Rs. 563.58 lakh and Rs. 379.73 lakh for Combined Asset, Assets-V and VI respectively is considered as admitted capital cost as on 31.3.2019 for working out tariff for 2019-24 tariff period.

    Additional Capital Expenditure

    83. Regulation 24 of the 2019 Tariff Regulations provides as follows:

    “24. Additional Capitalisation within the original scope and up to the cut-off date:

    (1) The Additional Capital Expenditure in respect of a new project or an existing project incurred or projected to be incurred, on the following counts within the original scope of work, after the date of commercial operation and up to the cut-off date may be admitted by the Commission, subject to prudence check:

    (a) Undischarged liabilities recognized to be payable at a future date;

    (b) Works deferred for execution;

    (c) Procurement of initial capital spares within the original scope of work, in accordance with the provisions of Regulation 23 of these regulations;

    (d) Liabilities to meet award of arbitration or for compliance of the directions or order of any statutory authority or order or decree of any court of law;

    (e) Change in law or compliance of any existing law; and

    (f) Force Majeure events:

    Provided that in case of any replacement of the assets, the additional capitalisation shall be worked out after adjusting the gross fixed assets and cumulative depreciation of the assets replaced on account of de-capitalisation.

    (2) The generating company or the transmission licensee, as the case may be shall submit the details of works asset wise/work wise included in the original scope of work along with estimates of expenditure, liabilities recognized to be payable at a future date and the works deferred for execution.”

    84. The Petitioner has claimed projected ACE of Rs. 807.39 lakh and Rs. 122.57 lakh in 2019-20 for Combined Asset and Rs. 921.64 lakh and Rs. 73.81 lakh in 2020-21 for Asset-V on account of Balance and Retention payments due to un-discharged liability for works executed after cut-off date/work deferred for execution. No ACE has been claimed for Asset-VI in the 2019-24 tariff period.

    85. We have considered the submissions of the Petitioner. ACE claimed on account of Balance and Retention payments due to un-discharged liability for works executed after cut-off date/work deferred for execution is allowed under Regulation 24(1)(a) of the 2019 Tariff Regulations.

    86. Further, excess initial spares of Rs. 53.51 lakh in 2019-20 and Rs. 66.78 lakh in 2020-21 for Asset-IV is adjusted in ACE of Combined Asset for 2019-24 tariff period, as mentioned in the relevant portion of this order.

    87. ACE allowed in respect of Combined Asset, Asset-V and Asset-VI is as follows:

    (Rs. in lakh)

    Particulars Claimed Allowed 2019-20 2020-21 2019-20 2020-21 Combined Asset 807.39 921.64 753.88* 854.86* Asset-V 122.57 73.81 122.57 73.81 Asset-VI 0.00 0.00 0.00 0.00 Total ACE 929.96 995.45 876.45 928.67

    *Excess initial spares of Rs. 53.51 lakh in 2019-20 and Rs. 66.78 lakh in 2020-21 for Asset-IV adjusted in ACE of Combined Asset for 2019-24 tariff period

    Capital Cost for the 2019-24 Tariff Period

    88. Accordingly, capital cost of Combined Asset, Asset-V and Asset-VI considered for the 2019-24 tariff period is as follows:

    (Rs. in lakh)

    Asset Capital Cost as on 1.4.2019 Admitted ACE Capital Cost as on 31.3.2024 2019-24 Combined Asset 14069.70 1608.74 15678.44 Asset-V 563.58 196.38 759.96 Asset-VI 379.73 0.00 379.73

    Debt-Equity Ratio

    89. Regulations 18 of the 2019 Tariff Regulations provides as follows:

    “18. Debt-Equity Ratio: (1) For new projects, the debt-equity ratio of 70 : 30 as on date of commercial operation shall be considered. If the equity actually deployed is more than 30% of the capital cost, equity in excess of 30% shall be treated as normative loan:

    Provided that:

    i. where equity actually deployed is less than 30% of the capital cost, actual equity shall be considered for determination of tariff:

    ii. the equity invested in foreign currency shall be designated in Indian rupees on the date of each investment:

    iii. any grant obtained for the execution of the project shall not be considered as a part of capital structure for the purpose of debt : equity ratio.

    Explanation.- The premium, if any, raised by the generating company or the transmission licensee, as the case may be, while issuing share capital and investment of internal resources created out of its free reserve, for the funding of the project, shall be reckoned as paid up capital for the purpose of computing return on equity, only if such premium amount and internal resources are actually utilised for meeting the capital expenditure of the generating station or the transmission system.

    (2) The generating company or the transmission licensee, as the case may be, shall submit the resolution of the Board of the company or approval of the competent authority in other cases regarding infusion of funds from internal resources in support of the utilisation made or proposed to be made to meet the capital expenditure of the generating station or the transmission system including communication system, as the case may be.

    (3) In case of the generating station and the transmission system including communication system declared under commercial operation prior to 1.4.2019, debt : equity ratio allowed by the Commission for determination of tariff for the period ending 31.3.2019 shall be considered:

    Provided that in case of a generating station or a transmission system including communication system which has completed its useful life as on or after 1.4.2019, if the equity actually deployed as on 1.4.2019 is more than 30% of the capital cost, equity in excess of 30% shall not be taken into account for tariff computation;

    Provided further that in case of projects owned by Damodar Valley Corporation, the debt : equity ratio shall be governed as per sub-clause (ii) of clause (2) of Regulation 72 of these regulations.

    (4) In case of the generating station and the transmission system including communication system declared under commercial operation prior to 1.4.2019, but where debt : equity ratio has not been determined by the Commission for determination of tariff for the period ending 31.3.2019, the Commission shall approve the debt : equity ratio in accordance with clause (1) of this Regulation.

    (5) Any expenditure incurred or projected to be incurred on or after 1.4.2019 as may be admitted by the Commission as additional capital expenditure for determination of tariff, and renovation and modernisation expenditure for life extension shall be serviced in the manner specified in clause (1) of this Regulation.

    (6) Any expenditure incurred for the emission control system during the tariff period as may be admitted by the Commission as additional capital expenditure for determination of supplementary tariff, shall be serviced in the manner specified in clause (1) of this Regulation.”

    90. The debt-equity considered for the purpose of computation of tariff for the 2019-24 period for Combined Asset, Asset-V and Asset-VI is as follows:

    Combined Asset Funding Capital Cost (as on 1.4.2019) (Rs. in lakh) (in %) Total Capital Cost (as on 31.3.2024) (Rs. in lakh) (in %) Debt 9848.83 70.00 10974.95 70.00 Equity 4220.87 30.00 4703.49 30.00 Total 14069.70 100.00 15678.44 100.00 Asset-V Debt 394.51 70.00 531.98 70.00 Equity 169.07 30.00 227.98 30.00 Total 563.58 100.00 759.96 100.00 Asset-VI Debt 265.81 70.00 265.81 70.00 Equity 113.92 30.00 113.92 30.00 Total 379.73 100.00 379.73 100.00

    Depreciation

    91. Regulation 33 of the 2019 Tariff Regulations provides as follows:

    “33. Depreciation : (1) Depreciation shall be computed from the date of commercial operation of a generating station or unit thereof or a transmission system or element thereof including communication system. In case of the tariff of all the units of a generating station or all elements of a transmission system including communication system for which a single tariff needs to be determined, the depreciation shall be computed from the effective date of commercial operation of the generating station or the transmission system taking into consideration the depreciation of individual units:

    Provided that effective date of commercial operation shall be worked out by considering the actual date of commercial operation and installed capacity of all the units of the generating station or capital cost of all elements of the transmission system, for which single tariff needs to be determined.

    (2) The value base for the purpose of depreciation shall be the capital cost of the Asset-admitted by the Commission. In case of multiple units of a generating station or multiple elements of a transmission system, weighted average life for the generating station of the transmission system shall be applied. Depreciation shall be chargeable from the first year of commercial operation. In case of commercial operation of the Asset-for part of the year, depreciation shall be charged on pro rata basis.

    (3) The salvage value of the asset shall be considered as 10% and depreciation shall be allowed up to maximum of 90% of the capital cost of the asset:

    Provided that the salvage value for IT equipment and software shall be considered as NIL and 100% value of the assets shall be considered depreciable;

    Provided further that in case of hydro generating stations, the salvage value shall be as provided in the agreement, if any, signed by the developers with the State Government for development of the generating station

    Provided also that the capital cost of the assets of the hydro generating station for the purpose of computation of depreciated value shall correspond to the percentage of sale of electricity under long-term power purchase agreement at regulated tariff:

    Provided also that any depreciation disallowed on account of lower availability of the generating station or unit or transmission system as the case may be, shall not be allowed to be recovered at a later stage during the useful life or the extended life.

    (4) Land other than the land held under lease and the land for reservoir in case of hydro generating station shall not be a depreciable asset andits cost shall be excluded from the capital cost while computing depreciable value of the asset.

    (5) Depreciation shall be calculated annually based on Straight Line Method and at rates specified in Appendix-I to these regulations for the Asset-of the generating station and transmission system:

    Provided that the remaining depreciable value as on 31st March of the year closing after a period of 12 years from the effective date of commercial operation of the station shall be spread over the balance useful life of the assets.

    (6) In case of the existing projects, the balance depreciable value as on 1.4.2019 shall be worked out by deducting the cumulative depreciation as admitted by the Commission up to 31.3.2019 from the gross depreciable value of the assets.

    (7) The generating company or the transmission licensee, as the case may be, shall submit the details of proposed capital expenditure five years before the completion of useful life of the project along with justification and proposed life extension. The Commission based on prudence check of such submissions shall approve the depreciation on capital expenditure.

    (8) In case of de-capitalisation of assets in respect of generating station or unit thereof or transmission system or element thereof, the cumulative depreciation shall be adjusted by taking into account the depreciation recovered in tariff by the de-capitalized asset during its useful services.

    (9) Where the emission control system is implemented within the original scope of the generating station and the date of commercial operation of the generating station or unit thereof and the date of operation of the emission control system are the same, depreciation of the generating station or unit thereof including the emission control system shall be computed in accordance with Clauses (1) to (8) of this Regulation.

    (10) Depreciation of the emission control system of an existing or a new generating station or unit thereof where the date of operation of the emission control system is subsequent to the date of commercial operation of the generating station or unit thereof, shall be computed annually from the date of operation of such emission control system based on straight line method, with salvage value of 10%, over a period of-

    a) twenty five years, in case the generating station or unit thereof is in operation for fifteen years or less as on the date of operation of the emission control system; or

    b) balance useful life of the generating station or unit thereof plus fifteen years, in case the generating station or unit thereof is in operation for more than fifteen years as on the date of operation of the emission control system; or

    c) ten years or a period mutually agreed by the generating company and the beneficiaries, whichever is higher, in case the generating station or unit thereof has completed its useful life.”

    92. WAROD has been worked out after taking into account the depreciation rates as specified in the 2019 Tariff Regulations at Annexure-VIII, Annexure-IX and Annexure-X in case of Combined Asset, Asset-V and Asset-VI respectively. The depreciation has been worked out considering the admitted capital expenditure as on 31.3.2019 an accumulated depreciation up to 31.3.2019. The depreciation allowed for Combined Asset, Asset-V and Asset-VI is as follows:

    (Rs. in lakh)

    Combined Asset Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Opening Gross Block 14069.70 14823.58 15678.44 15678.44 15678.44 Addition during the year 2019-24 due to projected ACE 753.88 854.86 0.00 0.00 0.00 Closing Gross Block 14823.58 15678.44 15678.44 15678.44 15678.44 Average Gross Block 14446.64 15251.01 15678.44 15678.44 15678.44 Average Gross Block (90% depreciable) 14234.26 15031.17 15456.10 15456.10 15456.10 Average Gross Block (100% depreciable) 212.38 219.84 222.34 222.34 222.34 Weighted average rate of Depreciation (WAROD) (in %) 5.42 5.42 5.42 5.42 5.42 Lapsed useful life at the beginning of the year (Year) 1.00 2.00 3.00 4.00 5.00 Balance useful life at the beginning of the year (Year) 24 23 22 21 20 Aggregated Depreciable Value (excluding IT equipment and software) 12810.83 13528.06 13910.49 13910.49 13910.49 Aggregated Depreciable Value (IT equipment and software) 212.38 219.84 222.34 222.34 222.34 Remaining Depreciable Value at the beginning of the year 12107.91 12049.16 11607.48 10758.05 9908.61 Combined Depreciation during the year 783.43 826.62 849.43 849.43 849.43 Aggregate Cumulative Depreciation at the end of the year 1698.73 2525.35 3374.78 4224.21 5073.65 Remaining Aggregate Depreciable value at the end of the year 11324.48 11222.54 10758.05 9908.61 9059.18

    (Rs. in lakh)

    Asset-V Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Opening Gross Block 563.58 686.15 759.96 759.96 759.96 Addition during the year 2019-24 due to projected ACE 122.57 73.81 0.00 0.00 0.00 Closing Gross Block 686.15 759.96 759.96 759.96 759.96 Average Gross Block 624.87 723.06 759.96 759.96 759.96 Weighted average rate of Depreciation (WAROD) (in %) 5.46 5.44 5.43 5.43 5.43 Lapsed useful life at the beginning of the year (Year) 0.00 1.00 2.00 3.00 4.00 Balance useful life at the beginning of the year (Year) 24 23 22 21 20 Aggregated Depreciable Value 563.40 651.77 684.98 684.98 684.98 Remaining depreciable value at the beginning of the year 563.31 617.57 611.48 570.22 528.97 Combined Depreciation during the year 34.12 39.30 41.25 41.25 41.25 Aggregate Cumulative Depreciation at the end of the year 34.20 73.50 114.76 156.01 197.26 Remaining Aggregate Depreciable Value at the end of the year 529.19 578.26 570.22 528.97 487.72

    (Rs. in lakh)

    Asset-VI Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Opening Gross Block 379.73 379.73 379.73 379.73 379.73 Addition during the year 2019-24 due to projected ACE 0.00 0.00 0.00 0.00 0.00 Closing Gross Block 379.73 379.73 379.73 379.73 379.73 Average Gross Block 379.73 379.73 379.73 379.73 379.73 Weighted average rate of Depreciation (WAROD) (%) 5.32 5.32 5.32 5.32 5.32 Lapsed useful life at the beginning of the year (Year) 0.00 1.00 2.00 3.00 4.00 Balance useful life at the beginning of the year (Year) 25 24 23 22 21 Aggregated Depreciable Value 341.76 341.76 341.76 341.76 341.76 Combined Depreciation during the year 20.20 20.20 20.20 20.20 20.20 Aggregate Cumulative Depreciation at the end of the year 20.57 40.77 60.97 81.17 101.37 Remaining Aggregate Depreciable Value at the end of the year 321.19 300.99 280.79 260.59 240.39

    Interest on Loan (IoL)

    93. Regulation 32 of the 2019 Tariff Regulations provides as follows:

    “32. Interest on loan capital: (1) The loans arrived at in the manner indicated in Regulation 18 of these regulations shall be considered as gross normative loan for calculation of interest on loan.

    (2) The normative loan outstanding as on 1.4.2019 shall be worked out by deducting the cumulative repayment as admitted by the Commission up to 31.3.2019 from the gross normative loan.

    (3) The repayment for each of the year of the tariff period 2019-24 shall be deemed to be equal to the depreciation allowed for the corresponding year/period. In case of de-capitalisation of asset, the repayment shall be adjusted by taking into account cumulative repayment on a pro rata basis and the adjustment should not exceed cumulative depreciation recovered upto the date of de-capitalisation of such asset.

    (4) Notwithstanding any moratorium period availed by the generating company or the transmission licensee, as the case may be, the repayment of loan shall be considered from the first year of commercial operation of the project and shall be equal to the depreciation allowed for the year or part of the year.

    (5) The rate of interest shall be the weighted average rate of interest calculated on the basis of the actual loan portfolio after providing appropriate accounting adjustment for interest capitalized:

    Provided that if there is no actual loan for a particular year but normative loan is still outstanding, the last available weighted average rate of interest shall be considered;

    Provided further that if the generating station or the transmission system, as the case may be, does not have actual loan, then the weighted average rate of interest of the generating company or the transmission licensee as a whole shall be considered.

    (5a) The rate of interest on loan for installation of emission control system shall be the weighted average rate of interest of actual loan portfolio of the emission control system or in the absence of actual loan portfolio, the weighted average rate of interest of the generating company as a whole shall be considered.

    (6) The interest on loan shall be calculated on the normative average loan of the year by applying the weighted average rate of interest.

    (7) The changes to the terms and conditions of the loans shall be reflected from the date of such re-financing.”

    94. WAROI on loan has been considered on the basis of the rates prevailing as on 1.4.2019. The Petitioner has prayed that the change in interest rate due to floating rate of interest applicable, if any, during the 2019-24 tariff period will be adjusted. Accordingly, the floating rate of interest, if any, shall be considered at the time of true-up. In view of above, IoL has been worked out in accordance with Regulation 32 of the 2019 Tariff Regulations. IoL considered for Combined Asset, Asset-V and Asset-VI is as follows:

    (Rs. in lakh)

    Combined Asset Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Gross Normative Loan 9848.83 10376.54 10974.95 10974.95 10974.95 Cumulative Repayments up to Previous Year 915.30 1698.73 2525.35 3374.78 4224.21 Net Loan-Opening 8933.52 8677.81 8449.60 7600.16 6750.73 Addition due to ACE 527.72 598.40 0.00 0.00 0.00 Repayment during the year 783.43 826.62 849.43 849.43 849.43 Net Loan-Closing 8677.81 8449.60 7600.16 6750.73 5901.30 Average Loan 8805.67 8563.70 8024.88 7175.45 6326.01 Weighted Average Rate of Interest on Loan (in %) 7.877 7.865 7.916 7.992 7.976 Interest on Loan 693.60 673.49 635.27 573.45 504.56

    (Rs. in lakh)

    Asset-V Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Gross Normative Loan 394.51 480.31 531.98 531.98 531.98 Cumulative Repayments up to Previous Year 0.08 34.20 73.51 114.76 156.01 Net Loan-Opening 394.43 446.11 458.48 417.22 375.97 Addition due to ACE 85.80 51.67 0.00 0.00 0.00 Repayment during the year 34.12 39.30 41.25 41.25 41.25 Net Loan-Closing 446.11 458.48 417.22 375.97 334.72 Average Loan 420.27 452.29 437.85 396.60 355.35 Weighted Average Rate of Interest on Loan (in %) 8.189 8.189 8.237 8.288 8.283 Interest on Loan 34.42 37.04 36.06 32.87 29.43

    (Rs. in lakh)

    Asset-VI Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Gross Normative Loan 265.81 265.81 265.81 265.81 265.81 Cumulative Repayments up to Previous Year 0.37 20.57 40.77 60.97 81.17 Net Loan-Opening 265.44 245.24 225.05 204.85 184.65 Addition due to ACE 0.00 0.00 0.00 0.00 0.00 Repayment during the year 20.20 20.20 20.20 20.20 20.20 Net Loan-Closing 245.24 225.05 204.85 184.65 164.45 Average Loan 255.34 235.14 214.95 194.75 174.55 Weighted Average Rate of Interest on Loan (in %) 7.963 7.963 8.062 8.212 8.210 Interest on Loan 20.33 18.72 17.33 15.99 14.33

    Return on Equity (RoE)

    95. Regulations 30 and 31 of the 2019 Tariff Regulations provides as follows:

    “30. Return on Equity: (1) Return on equity shall be computed in rupee terms, on the equity base determined in accordance with Regulation 18 of these regulations.

    (2) Return on equity shall be computed at the base rate of 15.50% for thermal generating station, transmission system including communication system and run-of-river hydro generating station, and at the base rate of 16.50% for the storage type hydro generating stations including pumped storage hydro generating stations and run-of-river generating station with pondage:

    Provided that return on equity in respect of additional capitalization after cut-off date beyond the original scope, excluding additional capitalization on account of emission control system, shall be computed at the weighted average rate of interest on actual loan portfolio of the generating station or the transmission system or in the absence of actual loan portfolio of the generating station or the transmission system, the weighted average rate of interest of the generating company or the transmission licensee, as the case may be, as a whole shall be considered, subject to ceiling of 14%;

    Provided further that:

    i. In case of a new project, the rate of return on equity shall be reduced by 1.00% for such period as may be decided by the Commission, if the generating station or transmission system is found to be declared under commercial operation without commissioning of any of the Restricted Governor Mode Operation (RGMO) or Free Governor Mode Operation (FGMO), data telemetry, communication system up to load dispatch centre or protection system based on the report submitted by the respective RLDC;

    ii. In case of existing generating station, as and when any of the requirements under (i) above of this Regulation are found lacking based on the report submitted by the concerned RLDC, rate of return on equity shall be reduced by 1.00% for the period for which the deficiency continues;

    iii. In case of a thermal generating station, with effect from 1.4.2020:

    a) rate of return on equity shall be reduced by 0.25% in case of failure to achieve the ramp rate of 1% per minute;

    b) an additional rate of return on equity of 0.25% shall be allowed for every incremental ramp rate of 1% per minute achieved over and above the ramp rate of 1% per minute, subject to ceiling of additional rate of return on equity of 1.00%:

    Provided that the detailed guidelines in this regard shall be issued by National Load Dispatch Centre by 30.6.2019.

    (3) The return on equity in respect of additional capitalization on account of emission control system shall be computed at the base rate of one year marginal cost of lending rate (MCLR) of the State Bank of India as on 1st April of the year in which the date of operation (ODe) occurs plus 350 basis point, subject to ceiling of 14%;”

    “31. Tax on Return on Equity:(1) The base rate of return on equity as allowed by the Commission under Regulation 30 of these regulations shall be grossed up with the effective tax rate of the respective financial year. For this purpose, the effective tax rate shall be considered on the basis of actual tax paid in respect of the financial year in line with the provisions of the relevant Finance Acts by the concerned generating company or the transmission licensee, as the case may be. The actual tax paid on income from other businesses including deferred tax liability (i.e. income from business other than business of generation or transmission, as the case may be) shall be excluded for the calculation of effective tax rate.

    (2) Rate of return on equity shall be rounded off to three decimal places and shall be computed as per the formula given below:

    Rate of pre-tax return on equity = Base rate/(1-t)

    Where “t” is the effective tax rate in accordance with clause (1) of this Regulation and shall be calculated at the beginning of every financial year based on the estimated profit and tax to be paid estimated in line with the provisions of the relevant Finance Act applicable for that financial year to the company on pro-rata basis by excluding the income of non-generation or non-transmission business, as the case may be, and the corresponding tax thereon. In case of generating company or transmission licensee paying Minimum Alternate Tax (MAT), “t” shall be considered as MAT rate including surcharge and cess.

    Illustration-

    (i) In case of a generating company or a transmission licensee paying Minimum Alternate Tax (MAT) @ 21.55% including surcharge and cess:

    Rate of return on equity = 15.50/(1-0.2155) = 19.758%

    (ii) In case of a generating company or a transmission licensee paying normal corporate tax including surcharge and cess:

    (a) Estimated Gross Income from generation or transmission business for FY 2019-20 is Rs. 1,000 crore;

    (b) Estimated Advance Tax for the year on above is Rs. 240 crore;

    (c) Effective Tax Rate for the year 2019-20 = Rs. 240 Crore/Rs. 1000 Crore = 24%;

    (d) Rate of return on equity = 15.50/(1-0.24) = 20.395%.

    (3) The generating company or the transmission licensee, as the case may be, shall true up the grossed up rate of return on equity at the end of every financial year based on actual tax paid together with any additional tax demand including interest thereon, duly adjusted for any refund of tax including interest received from the income tax authorities pertaining to the tariff period 2019-24 on actual gross income of any financial year. However, penalty, if any, arising on account of delay in deposit or short deposit of tax amount shall not be claimed by the generating company or the transmission licensee, as the case may be. Any under-recovery or over-recovery of grossed up rate on return on equity after truing up, shall be recovered or refunded to beneficiaries or the long-term customers, as the case may be, on year-to-year basis.”

    96. The Petitioner has submitted that it is liable to pay income tax at MAT rate applicable to the Petitioner Company. RoE has been calculated @18.782% after grossing up RoE with MAT rate of 17.472% (Base Rate 15% + Surcharge 12% + Cess 4%) based on the formula given in Regulation 31(2) of the 2019 Tariff Regulations for 2019-24 tariff period. As per Regulation 31(3) of the 2019 Tariff Regulations, grossed-up rate of RoE at the end of every financial year shall be trued-up based on actual tax paid together with any additional tax demand including interest thereon duly adjusted for any refund of tax including interest received from the IT authorities pertaining to 2019-24 tariff period on actual gross income. However, if any penalty arising on account of delay in deposit or short deposit of tax amount shall not be claimed by the Petitioner. Any under-recovery or over-recovery of grossed-up rate on RoE after truing up shall be recovered or refunded to beneficiaries or the long term customers on yearly basis. The Petitioner has further submitted that any adjustment due to additional tax demand including interest duly adjusted for any refund of tax including interest received from IT authorities shall be recoverable/adjustable during 2019-24 tariff period on yearly basis on receipt of Income Tax assessment order.

    97. We have considered the submissions of the Petitioner. MAT rate applicable in 2019-20 has been considered for the purpose of RoE which will be trued-up with actual tax rate in accordance with Regulation 31(3) of the 2019 Tariff Regulations. RoE allowed for Combined Asset, Asset-V and Asset-VI for the 2019-24 tariff period is as follows:

    (Rs. in lakh)

    Combined Asset Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Opening Equity 4220.87 4447.04 4703.49 4703.49 4703.49 Addition due to ACE 226.16 256.46 0.00 0.00 0.00 Closing Equity 4447.04 4703.49 4703.49 4703.49 4703.49 Average Equity 4333.96 4575.27 4703.49 4703.49 4703.49 Return on Equity (Base Rate) (in %) 15.5 15.5 15.5 15.5 15.5 Tax Rate applicable (in %) 17.472 17.472 17.472 17.472 17.472 Rate of Return on Equity (Pre-tax) (in %) 18.782 18.782 18.782 18.782 18.782 Return on Equity (Pre-tax) 814.00 859.33 883.41 883.41 883.41

    (Rs. in lakh)

    Asset-V Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Opening Equity 169.07 205.84 227.98 227.98 227.98 Addition due to ACE 36.77 22.14 0.00 0.00 0.00 Closing Equity 205.84 227.98 227.98 227.98 227.98 Average Equity 187.46 216.91 227.98 227.98 227.98 Return on Equity (Base Rate) (in %) 15.50 15.50 15.50 15.50 15.50 Tax Rate applicable (in %) 17.47 17.47 17.47 17.47 17.47 Rate of Return on Equity (Pre-tax) 18.78 18.78 18.78 18.78 18.78 Return on Equity (Pre-tax) 35.21 40.74 42.82 42.82 42.82

    (Rs. in lakh)

    Asset-VI Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Opening Equity 113.92 113.92 113.92 113.92 113.92 Addition due to ACE 0.00 0.00 0.00 0.00 0.00 Closing Equity 113.92 113.92 113.92 113.92 113.92 Average Equity 113.92 113.92 113.92 113.92 113.92 Return on Equity (Base Rate) (in %) 15.50 15.50 15.50 15.50 15.50 Tax Rate applicable (in %) 17.47 17.47 17.47 17.47 17.47 Rate of Return on Equity (Pre-tax) 18.78 18.78 18.78 18.78 18.78 Return on Equity (Pre-tax) 21.40 21.40 21.40 21.40 21.40

    Operation & Maintenance Expenses

    98. Regulations 35(3)(a) and 35(4) of the 2019 Tariff Regulations provide as follows:

    “35. Operation and Maintenance Expenses : (3) Transmission system : (a) The following normative operation and maintenance expenses shall be admissible for the combined transmission system:

    Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Norms for sub-station Bays (Rs. Lakh per bay) 765 kV 45.01 46.60 48.23 49.93 51.68 400 kV 32.15 33.28 34.45 35.66 36.91 220 kV 22.51 23.30 24.12 24.96 25.84 132 kV and below 16.08 16.64 17.23 17.83 18.46 Norms for Transformers (Rs. Lakh per MVA) 765 kV 0.491 0.508 0.526 0.545 0.564 400 kV 0.358 0.371 0.384 0.398 0.411 220 kV 0.245 0.254 0.263 0.272 0.282 132 kV and below 0.245 0.254 0.263 0.272 0.282 Norms for AC and HVDC lines (Rs. Lakh per km) Single Circuit (Bundled Conductor with six or more sub-conductors) 0.881 0.912 0.944 0.977 1.011 Single Circuit (Bundled conductor with four sub-conductors) 0.755 0.781 0.809 0.837 0.867 Single Circuit (Twin & Triple Conductor) 0.503 0.521 0.539 0.558 0.578 Single Circuit (Single Conductor) 0.252 0.260 0.270 0.279 0.289 Double Circuit (Bundled conductor with four or more sub-conductors) 1.322 1.368 1.416 1.466 1.517 Double Circuit (Twin & Triple Conductor) 0.881 0.912 0.944 0.977 1.011 Double Circuit (Single Conductor) 0.377 0.391 0.404 0.419 0.433 Multi Circuit (Bundled Conductor with four or more sub-conductor) 2.319 2.401 2.485 2.572 2.662 Multi Circuit (Twin & Triple Conductor) 1.544 1.598 1.654 1.713 1.773 Norms for HVDC stations HVDC Back-to-Back stations (Rs. Lakh per 500 MW) (Except Gazuwaka BTB) 834 864 894 925 958 Gazuwaka HVDC Back-to-Back station (Rs. Lakh per 500 MW) 1,666 1,725 1,785 1,848 1,913 500 kV Rihand-Dadri HVDC bipole scheme (Rs. Lakh) (1500 MW) 2,252 2,331 2,413 2,498 2,586 ±500 kV Talcher-Kolar HVDC bipole scheme (Rs. Lakh) (2000 MW) 2,468 2,555 2,645 2,738 2,834 ±500 kV Bhiwadi-Balia HVDC bipole scheme (Rs. Lakh) (2500 MW) 1,696 1,756 1,817 1,881 1,947 ±800 kV, Bishwanath-Agra HVDC bipole scheme (Rs. Lakh) (3000 MW) 2,563 2,653 2,746 2,842 2,942

    Provided that the O&M expenses for the GIS bays shall be allowed as worked out by multiplying 0.70 of the O&M expenses of the normative O&M expenses for bays; Provided further that:

    i. the operation and maintenance expenses for new HVDC bi-pole schemes commissioned after 1.4.2019 for a particular year shall be allowed pro-rata on the basis of normative rate of operation and maintenance expenses of similar HVDC bi-pole scheme for the corresponding year of the tariff period;

    ii. the O&M expenses norms for HVDC bi-pole line shall be considered as Double Circuit quad AC line;

    iii. the O&M expenses of ±500 kV Mundra-Mohindergarh HVDC bipole scheme (2000 MW) shall be allowed as worked out by multiplying 0.80 of the normative O&M expenses for ±500 kV Talchar-Kolar HVDC bi-pole scheme (2000 MW);

    iv. the O&M expenses of ±800 kV Champa-Kurukshetra HVDC bi-pole scheme (3000 MW) shall be on the basis of the normative O&M expenses for ±800 kV, Bishwanath-Agra HVDC bi-pole scheme;

    v. the O&M expenses of ±800 kV, Alipurduar-Agra HVDC bi-pole scheme (3000 MW) shall be allowed as worked out by multiplying 0.80 of the normative O&M expenses for ±800 kV, Bishwanath-Agra HVDC bi-pole scheme; and

    vi. the O&M expenses of Static Synchronous Compensator and Static Var Compensator shall be worked at 1.5% of original project cost as on commercial operation which shall be escalated at the rate of 3.51% to work out the O&M expenses during the tariff period. The O&M expenses of Static Synchronous Compensator and Static Var Compensator, if required, may be reviewed after three years.

    (b) The total allowable operation and maintenance expenses for the transmission system shall be calculated by multiplying the number of sub-station bays, transformer capacity of the transformer (in MVA) and km of line length with the applicable norms for the operation and maintenance expenses per bay, per MVA and per km respectively.

    (c) The Security Expenses and Capital Spares for transmission system shall be allowed separately after prudence check:

    Provided that the transmission licensee shall submit the assessment of the security requirement and estimated security expenses, the details of year-wise actual capital spares consumed at the time of truing up with appropriate justification.”

    “35(4) Communication system : The operation and maintenance expenses for the communication system shall be worked out at 2.0% of the original project cost related to such communication system. The transmission licensee shall submit the actual operation and maintenance expenses for truing up.”

    99. The O&M Expenses claimed by the Petitioner for the various elements covered under Combined Asset, Asset-V and Asset-VI are as follows:

    (Rs. in lakh)

    Combined Asset Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Sub-station Bays 400 kV (Numbers) 3 3 3 3 3 220 kV (Numbers) 3 3 3 3 3 Norm (Rs. lakh/bay) 400 kV 32.15 33.28 34.45 35.66 36.91 220 kV 22.51 23.30 24.12 24.96 25.84 Sub-station GIS Bays 400 kV GIS (Numbers) 2 2 2 2 2 220 kV GIS (Numbers) 2 2 2 2 2 Norm (Rs. lakh/bay) 400 kV GIS 22.505 23.296 24.115 24.962 25.837 220 kV GIS 15.757 16.31 16.884 17.472 18.088 Total Sub-station O&M Expenses 240.50 248.95 257.71 266.73 276.10 Transformer (ICT) MVA 2130 2130 2130 2130 2130 Norm (Rs. lakh/MVA) 0.358 0.371 0.384 0.398 0.411 Total Transformer Expenses 762.54 790.23 817.92 847.74 875.43 Total O&M Expenses 1003.04 1039.18 1075.63 1114.47 1151.53

    (Rs. in lakh)

    Asset-V Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Substation Hamirpur : Future-III (Dehan) 1 1 1 1 1 Hamirpur : Future-IV (Dehan) 1 1 1 1 1 Norm (Rs. lakh/bay) 220 kV GIS 15.757 16.31 16.884 17.472 18.088 Total Sub-station Expenses 31.52 32.62 33.76 34.94 36.18 PLCC Norms (% of total project cost) 2 2 2 2 2 Original Project cost (Rs. lakh) 13.12 13.12 13.12 13.12 13.12 PLCC O&M Expenses 0.26 0.26 0.26 0.26 0.26 Total O&M Expenses 31.78 32.88 34.03 35.21 36.44

    (Rs. in lakh)

    Asset-VI Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Sub-station Jallandhar : PSEB-V 1 1 1 1 1 Jallandhar : PSEB-VI 1 1 1 1 1 Norm (Rs. lakh/bay) 220 kV 22.51 23.30 24.12 24.96 25.84 Total Sub-station Expenses 45.02 46.60 48.24 49.92 51.68 PLCC Norms (% of total project cost) 2 2 2 2 2 Original Project cost (Rs. lakh) 14.2 14.2 14.2 14.2 14.2 PLCC O&M Expenses 0.28 0.28 0.28 0.28 0.28 Total O&M Expenses 45.30 46.88 48.52 50.20 51.96

    100. We have considered the submissions of the Petitioner. The Petitioner has claimed O&M Expenses separately for PLCC in case of Asset-V and Asset-VI under Regulation 35(4) of the 2019 Tariff Regulations @2% of its original project cost in the instant petition. The Petitioner has made similar claim in other petitions as well. Though PLCC is a communication system, it has been considered as part of the sub-station in the 2014 Tariff Regulations and the 2019 Tariff Regulations and the norms for substation have been specified accordingly. Accordingly, the Commission vide order dated 24.1.2021 in Petition No. 126/TT/2020 has already concluded that no separate O&M Expenses can be allowed for PLCC under Regulation 35(4) of the 2019 Tariff Regulations even though PLCC is a communication system. Therefore, the Petitioner's claim for separate O&M Expenses for PLCC @2% is not allowed.

    101. The O&M Expenses have been worked out for Combined Asset, Asset-V and Asset-VI in accordance with Regulation 35(3)(a) of the 2019 Tariff Regulations and the same are as follows:

    (Rs. in lakh)

    Combined Asset Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Sub-station Bays 400 kV (Numbers) 3 3 3 3 3 220 kV (Numbers) 3 3 3 3 3 Norm (Rs. lakh/bay) 400 kV 32.15 33.28 34.45 35.66 36.91 220 kV 22.51 23.30 24.12 24.96 25.84 Sub-station GIS Bays 400 kV GIS (Numbers) 2 2 2 2 2 220 kV GIS (Numbers) 2 2 2 2 2 Norm (Rs. lakh/bay) 400 kV GIS 22.505 23.296 24.115 24.962 25.837 220 kV GIS 15.757 16.31 16.884 17.472 18.088 Total Sub-station O&M Expenses 240.50 248.95 257.71 266.73 276.10 Transformer (ICT) MVA 2130 2130 2130 2130 2130 Norm (Rs. lakh/MVA) 0.358 0.371 0.384 0.398 0.411 Total Transformer Expenses 762.54 790.23 817.92 847.74 875.43 Total O&M Expenses 1003.04 1039.18 1075.63 1114.47 1151.53

    (Rs. in lakh)

    Asset-V Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Sub-station Hamirpur : Future-III (Dehan) 1 1 1 1 1 Hamirpur : Future-IV (Dehan) 1 1 1 1 1 Norm (Rs. lakh/bay) 220 kV GIS 15.757 16.31 16.884 17.472 18.088 Total Sub-station Expenses 31.52 32.62 33.76 34.94 36.18 Total O&M Expenses 31.52 32.62 33.76 34.94 36.18

    (Rs. in lakh)

    Asset-VI Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Sub-station Jallandhar : PSEB-V 1 1 1 1 1 Jallandhar : PSEB-VI 1 1 1 1 1 Norm (Rs. lakh/bay) 220 kV 22.51 23.30 24.12 24.96 25.84 Total Sub-station Expenses 45.02 46.60 48.24 49.92 51.68 Total O&M Expenses 45.02 46.60 48.24 49.92 51.68

    *O&M expenses of GIS bays shall be allowed by multiplying 0.70 of normative O&M expenses for bays.

    Interest on Working Capital (IWC)

    102. Regulations 34(1)(c), 34(3), 34(4) and 3(7) of the 2019 Tariff Regulations provide as follows:

    “34. Interest on Working Capital : (1) The working capital shall cover:

    (c) For Hydro Generating Station (including Pumped Storage Hydro Generating Station) and Transmission System:

    (i) Receivables equivalent to 45 days of annual fixed cost;

    (ii) Maintenance spares @ 15% of operation and maintenance expenses including security expenses; and

    (iii) Operation and maintenance expenses, including security expenses for one month.”

    “(3) Rate of interest on working capital shall be on normative basis and shall be considered as the bank rate as on 1.4.2019 or as on 1st April of the year during the tariff period 2019-24 in which the generating station or a unit thereof or the transmission system including communication system or element thereof, as the case may be, is declared under commercial operation, whichever is later:

    Provided that in case of truing-up, the rate of interest on working capital shall be considered at bank rate as on 1st April of each of the financial year during the tariff period 2019-24.”

    “(4) Interest on working capital shall be payable on normative basis notwithstanding that the generating company or the transmission licensee has not taken loan for working capital from any outside agency.”

    “3. Definitions …

    (8) ‘Bank Rate’ means the one-year marginal cost of lending rate (MCLR) of the State Bank of India issued from time to time plus 350 basis points;”

    103. The Petitioner has submitted that it has computed IWC for the 2019-24 tariff period considering the SBI Base Rate plus 350 basis points as on 1.4.2019. The Petitioner has considered the rate of IWC as 12.05%. IWC is worked out in accordance with Regulation 34 of the 2019 Tariff Regulations. The rate of interest considered is 12.05% (SBI 1 year MCLR applicable as on 1.4.2019 of 8.55% plus 350 basis points) for 2019-20, 11.25% (SBI 1 year MCLR applicable as on 1.4.2020 of 7.75% plus 350 basis points) for 2020-21 and 10.50% (SBI 1 year MCLR applicable as on 1.4.2021 of 7.00% plus 350 basis point) from 2021-22 onwards. The components of the working capital and interest allowed thereon for Combined Asset, Asset-V and Asset-VI for the 2019-24 tariff period are as follows:

    (Rs. in lakh)

    Combined Asset Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Working Capital for O&M Expenses (O&M expenses for one month) 83.59 86.60 89.64 92.87 95.96 Working Capital for Maintenance Spares (15% of O&M expenses) 150.46 155.88 161.34 167.17 172.73 Working Capital for Receivables (Equivalent to 45 days of annual fixed cost/annual transmission charges) 414.62 428.31 433.43 430.68 425.64 Total Working Capital 648.66 670.79 684.41 690.72 694.33 Rate of Interest (in %) 12.05 11.25 10.50 10.50 10.50 Interest on Working Capital 78.16 75.46 71.86 72.53 72.90

    (Rs. in lakh)

    Asset-V Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Working Capital for O&M Expenses (O&M expenses for one month) 2.63 2.72 2.81 2.91 3.01 Working Capital for Maintenance Spares (15% of O&M expenses) 4.73 4.89 5.07 5.24 5.43 Working Capital for Receivables (Equivalent to 45 days of annual fixed cost/annual transmission charges) 16.99 18.82 19.33 19.08 18.75 Total Working Capital 24.34 26.43 27.21 27.23 27.20 Rate of Interest (in %) 12.05 11.25 10.50 10.50 10.50 Interest on Working Capital 2.93 2.97 2.86 2.86 2.86

    (Rs. in lakh)

    Asset-VI Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Working Capital for O&M Expenses (O&M expenses for one month) 3.75 3.88 4.02 4.16 4.31 Working Capital for Maintenance Spares (15% of O&M expenses) 6.75 6.99 7.24 7.49 7.75 Working Capital for Receivables (Equivalent to 45 days of annual fixed cost/annual transmission charges) 13.50 13.52 13.53 13.58 13.56 Total Working Capital 24.01 24.39 24.79 25.23 25.62 Rate of Interest (in %) 12.05 11.25 10.50 10.50 10.50 Interest on Working Capital 2.89 2.74 2.60 2.65 2.69

    Annual Fixed Charges for the 2019-24 Tariff Period

    104. The transmission charges allowed for Combined Asset, Asset-V and Asset-VI for the 2019-24 tariff period are as follows:

    (Rs. in lakh)

    Combined Asset Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Depreciation 783.43 826.62 849.43 849.43 849.43 Interest on Loan 693.60 673.49 635.27 573.45 504.56 Return on Equity 814.00 859.33 883.41 883.41 883.41 Interest on Working Capital 78.16 75.46 71.86 72.53 72.90 O&M Expenses 1003.04 1039.18 1075.63 1114.47 1151.53 Total 3372.23 3474.09 3515.61 3493.29 3461.84

    (Rs. in lakh)

    Asset-V Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Depreciation 34.12 39.30 41.25 41.25 41.25 Interest on Loan 34.42 37.04 36.06 32.87 29.43 Return on Equity 35.21 40.74 42.82 42.82 42.82 O&M Expenses 31.51 32.62 33.77 34.94 36.18 Interest on Working Capital 2.93 2.97 2.86 2.86 2.86 Total 138.19 152.67 156.76 154.74 152.54

    (Rs. in lakh)

    Asset-VI Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Depreciation 20.20 20.20 20.20 20.20 20.20 Interest on Loan 20.33 18.72 17.33 15.99 14.33 Return on Equity 21.40 21.40 21.40 21.40 21.40 O&M Expenses 45.02 46.60 48.24 49.92 51.68 Interest on Working Capital 2.89 2.74 2.60 2.65 2.69 Total 109.84 109.66 109.77 110.16 110.30

    Filing Fee and Publication Expenses

    105. The Petitioner has sought reimbursement of fee paid by it for filing the petition and publication expenses. The Petitioner shall be entitled for reimbursement of the filing fees and publication expenses in connection with the present petition, directly from the beneficiaries on pro-rata basis in accordance with Regulation 70(1) of the 2019 Tariff Regulations.

    Licence Fee and RLDC Fees and Charges

    106. The Petitioner shall be entitled for reimbursement of licence fee in accordance with Regulation 70(4) of the 2019 Tariff Regulations for the 2019-24 tariff period. The Petitioner shall also be entitled for recovery of RLDC fee and charges in accordance with Regulations 70(3) of the 2019 Tariff Regulations for the 2019-24 tariff period.

    Goods and Services Tax

    107. The Petitioner has submitted that, if GST is levied at any rate and at any point of time in future on Charges of Transmission of Electricity, the same shall be borne and additionally paid by the Respondent(s) to the Petitioner and the same shall be charged and billed separately by the Petitioner. Further additional taxes, if any, are to be paid by the Petitioner on account of demand from Government/Statutory authorities, the same may be allowed to be recovered from the beneficiaries.

    108. BRPL has submitted that the Petitioner's prayer for GST is not tenable.

    109. We have considered the submissions of Petitioner and BRPL. Since, GST is not levied on transmission service at present, we are of the view that the Petitioner's prayer is pre-mature.

    Security Expenses

    110. The Petitioner has submitted that security expenses for the transmission assets are not claimed in the instant petition and it would file a separate petition for claiming the overall security expenses and consequential IWC.

    111. BRPL has submitted that security expenses should be allowed after prudence check and if a separate petition is being filed by the Petitioner for claiming security expenses, then there is no need for the same to be claimed in advance.

    112. We have considered the above submissions of Petitioner and BRPL. The Petitioner has claimed consolidated security expenses for all the transmission assets owned by it on projected basis for the 2019-24 tariff period on the basis of actual security expenses incurred in 2018-19 in Petition No. 260/MP/2020. The Commission vide order dated 3.8.2021 in Petition No. 260/MP/2020 approved security expenses from 1.4.2019 to 31.3.2024. Therefore, security expenses will be shared in terms of the order dated 3.8.2021 in Petition No. 260/MP/2020. Accordingly, the Petitioner's prayer in the instant petition for allowing it to file a separate petition for claiming the overall security expenses and consequential IWC has become infructuous.

    Capital Spares

    113. The Petitioner has sought reimbursement of capital spares at the end of tariff period. The Petitioner's claim, if any, shall be dealt with in accordance with the provisions of the 2019 Tariff Regulations.

    Sharing of Transmission Charges

    114. The Petitioner vide affidavit dated 2.12.2020 has submitted the status of associated downstream transmission network of Asset-V and Asset-VI, which is as follows:

    Asset Associated Downstream Network DIC Status Asset-V 2 number of 220 kV Bays at Hamirpur Sub-station HPPTCL (HP) Construction of transmission line for these bays is not yet started Asset-VI 2 number of 220 kV line Bays at Jallandhar Sub-station PSTCL (Punjab) Construction of transmission line for these bays is not yet started

    115. The COD of the Asset-V and Asset-VI were approved as 31.3.2019 and 25.3.2019 respectively under proviso (ii) of Regulation 4(3) of the 2014 Tariff Regulations as the associated downstream transmission network under the scope of HPPTCL and PSSTCL were not ready. As submitted by the Petitioner in the table in paragraph 114 above, the associated downstream transmission network under the scope of HPPTCL and PSSTCL have not yet been put into commercial operation.

    116. Therefore, the transmission charges of Asset-V from 31.3.2019 till the COD of the associated downstream transmission network of 220 kV Hamirpur-Dehan Line under the scope of HPPTCL shall be borne by HPPTCL and thereafter, transmission charges shall be shared as per provisions of the 2020 Sharing Regulations. Similarly, in case of Asset-VI, transmission charges from 25.3.2019 till the COD of the associated downstream transmission network of 220 kV line Bays at Jallandhar Sub-station under the scope of PSTCL shall be borne by PSTCL and thereafter, transmission charges shall be shared as per provisions of the 2020 Sharing Regulations. The sharing of transmission charges of Asset-V and Asset-VI shall be subject to the outcome of the Appeals preferred by HPPTCL and PSTCL before the APTEL, as mentioned in paragraph 16 above.

    117. The transmission charges of remaining Assets i.e. Asset-I, Asset-II, Asset-III and Asset-IV shall be included in the common PoC pool.

    118. With effect from 1.7.2011, sharing of transmission charges for inter-State transmission systems was governed by the provisions of 2010 Sharing Regulations and with effect from 1.11.2020 (after repeal of the 2010 Sharing Regulations), sharing of transmission charges is governed by the 2020 Sharing Regulations. Accordingly, the liabilities of DICs for arrears of transmission charges determined through this order shall be computed DIC-wise in accordance with the provisions of respective Tariff Regulations and Sharing Regulations and shall be recovered from the concerned DICs through Bills under Regulation 15(2) (b) of the 2020 Sharing Regulations. Billing, collection and disbursement of the transmission charges for subsequent period shall be recovered in terms of provisions of the 2020 Sharing Regulations as provided in Regulation 57 of the 2019 Tariff Regulations.

    119. To summarise:

    a) The trued-up AFC approved for the transmission assets for the 2014-19 tariff period are as follows:

    (Rs. in lakh)

    Asset-I 2016-17 (Pro-rata for 364 days) 2017-18 2018-19 413.66 418.84 455.57

    (Rs. in lakh)

    Asset-II 2016-17 (Pro-rata for 273 days) 2017-18 2018-19 241.14 366.30 402.25

    (Rs. in lakh)

    Asset-III 2016-17 (Pro-rata for 154 days) 2017-18 2018-19 132.63 370.33 407.01

    (Rs. in lakh)

    Asset-IV 2018-19 (Pro-rata for 1 day) 2.64

    (Rs. in lakh)

    Asset-V 2018-19 (Pro-rata for 1 day) 0.54

    (Rs. in lakh)

    Asset-VI 2018-19 (Pro-rata for 7 days) 3.13

    (Rs. in lakh)

    Asset-VII 2017-18(Pro-rata for 91 days) 2018-19 160.14 644.18

    b) AFC allowed for Combined Asset, Asset-V and Asset-VI for the 2019-24 tariff period in this order are as follows:

    (Rs. in lakh)

    Asset 2019-20 2020-21 2021-22 2022-23 2023-24 Combined Asset 3372.23 3474.09 3515.61 3493.29 3461.84 Asset-V 138.19 152.67 156.76 154.74 152.54 Asset-VI 109.84 109.67 109.77 110.16 110.30

    120. Annexure-I to Annexure-X given hereinafter form part of the order.

    121. This order disposes of Petition No. 404/TT/2020 in terms of the above discussions and findings.

    Annexure-I

    Asset-I

    2014-19 Admitted Capital Cost as on COD (Rs. in lakh) ACE (Rs. in lakh) Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Rate of Depreciation (in %) Annual Depreciation as per the 2014 Regulations Capital Expenditure as on COD 2018-19 2016-17 (Rs. in lakh) 2017-18 (Rs. in lakh) 2018-19 (Rs. in lakh) Sub-station 1619.07 519.69 2138.77 5.28 86.13 92.15 105.23 IT Equipment & Software 48.10 11.47 59.57 5.28 2.54 2.544 2.84 TOTAL 1667.18 531.16 2198.34 88.67 94.69 108.07 Average Gross Block (Rs. in lakh) 1679.38 1793.43 2046.81 Weighted Average Rate of Depreciation (in %) 5.28 5.28 5.28

    Annexure-II

    Asset-II

    2014-19 Admitted Capital Cost as on COD (Rs. in lakh) ACE (Rs. in lakh) Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Rate of Depreciation (in %) Annual Depreciation as per the 2014 Tariff Regulations Capital Expenditure as on COD 2018-19 2016-17 (Rs. in lakh) 2017-18 (Rs. in lakh) 2018-19 (Rs. in lakh) Sub-station 1096.90 667.40 1764.30 5.28 63.33 78.09 90.29 IT Equipment & Software - - 5.28 TOTAL 1096.90 667.40 1764.30 63.33 78.09 90.29 Average Gross Block (Rs. in lakh) 1199.57 1479.03 1710.05 Weighted Average Rate of Depreciation (in %) 5.28 5.28 5.28

    Annexure-III

    Asset-III

    2014-19 Admitted Capital Cost as on COD (Rs. in lakh) ACE (Rs. in lakh) Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Rate of Depreciation (in %) Annual Depreciation as per the 2014 Tariff Regulations Capital Expenditure as on COD 2016-17 (Rs. in lakh) 2017-18 (Rs. in lakh) 2018-19 (Rs. in lakh) Sub-station 925.89 885.53 5.28 61.13 78.12 90.26 IT Equipment & Software - 29.50 5.28 0.78 1.56 1.56 TOTAL 925.89 1832.03 61.91 79.68 91.82 Average Gross Block (Rs. in lakh) 1172.45 1509.08 1739.00 Weighted Average Rate of Depreciation (in %) 5.28 5.28 5.28

    Annexure-IV

    Asset-IV

    2014-19 Admitted Capital Cost as on COD (Rs. in lakh) ACE (Rs. in lakh) Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Rate of Depreciation (in %) Annual Depreciation as per the 2014 tariff Regulations Capital Expenditure as on COD 2018-19 (Rs. in lakh) Sub-station 4966.21 - 4966.21 5.28 262.22 IT Equipment & Software 47.46 - 47.46 5.28 2.51 TOTAL 5013.67 - 5013.67 264.72 Average Gross Block (Rs. in lakh) 5013.67 Weighted Average Rate of Depreciation (in %) 5.28

    Annexure-V

    Asset-V

    2014-19 Admitted Capital Cost as on COD (Rs. in lakh) ACE (Rs. in lakh) Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Rate of Depreciation (in %) Annual Depreciation as per Regulations Capital Expenditure as on COD 2018-19 (Rs. in lakh) Sub-station 540.29 - 540.29 5.28 28.53 PLCC 13.12 - 13.12 6.33 0.83 IT Equipment & Software 10.17 - 10.17 5.28 0.54 TOTAL 563.58 - 563.58 29.89 Average Gross Block (Rs. in lakh) 563.58 Weighted Average Rate of Depreciation (in %) 5.30

    Annexure-VI

    Asset-VI

    2014-19 Admitted Capital Cost as on COD (Rs. in lakh) ACE (Rs. in lakh) Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Rate of Depreciation (in %) Annual Depreciation as per the 2014 Tariff Regulations Capital Expenditure as on COD 2018-19 (Rs. in lakh) Sub-station 332.40 33.15 365.54 5.28 18.43 PLCC 14.20 14.20 6.33 0.90 IT Equipment & Software - 5.28 0.00 TOTAL 346.60 33.15 379.73 19.32 Average Gross Block (Rs. in lakh) 363.18 Weighted Average Rate of Depreciation (%) 5.32

    Annexure-VII

    Asset-VII

    2014-19 Admitted Capital Cost as on COD (Rs. in lakh) ACE (Rs. in lakh) Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Rate of Depreciation (in %) Annual Depreciation as per the 2014 Tariff Regulations Capital Expenditure as on COD 2014-15 (Rs. in lakh) 2015-16 (Rs. in lakh) 2016-17 (Rs. in lakh) 2017-18 (Rs. in lakh) 2018-19 (Rs. in lakh) Sub-station 3092.00 51.64 3143.64 5.28 - - - 163.35 164.72 IT Equipment & Software 68.12 2.78 70.90 5.28 - - - 3.60 3.67 TOTAL 3160.12 54.42 3214.54 - - - 166.95 168.39 Average Gross Block (Rs. in lakh) - - - 3161.95 3189.16 Weighted Average Rate of Depreciation (in %) - - - 5.28 5.28

    Annexure-VIII

    Combined Asset 2019-24 Admitted Capital Cost as on 1.4.2019 (Rs. in lakh) ACE Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Rate of Depreciation (in %) Annual Depreciation as per the 2019 Tariff Regulations Capital Expenditure as on 1.4.2019 2019-20 (Rs. in lakh) 2020-21 (Rs. in lakh) 2021-22 (Rs. in lakh) 2022-23 (Rs. in lakh) 2023-24 (Rs. in lakh) Sub-station 13862.27 1593.83 15456.10 5.28 751.56 793.65 816.08 816.08 816.08 IT Equipment & Software 207.43 14.91 222.34 15.00 31.86 32.98 33.35 33.35 33.35 TOTAL 14069.70 1608.74 15678.44 783.42 826.63 849.43 849.43 849.43 Average Gross Block (Rs. in lakh) 14446.64 15251.01 15678.44 15678.44 15678.544 Weighted Average Rate of Depreciation (in %) 5.42 5.42 5.42 5.42 5.42

    Annexure-IX

    Asset-V

    2019-24 Admitted Capital Cost as on 1.4.2019 (Rs. in lakh) ACE Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Rate of Depreciation (in %) Annual Depreciation as per the 2019 Tariff Regulations Capital Expenditure as on 1.4.2019 2019-20 (Rs. in lakh) 2020-21 (Rs. in lakh) 2021-22 (Rs. in lakh) 2022-23 (Rs. in lakh) 2023-24 (Rs. in lakh) Sub-station 540.29 196.38 736.67 5.28 31.76 36.95 38.90 38.90 38.90 PLCC 13.12 - 13.12 6.33 0.83 0.83 0.83 0.83 0.83 IT Equipment & Software 10.17 - 10.17 15 1.53 1.53 1.53 1.53 1.53 TOTAL 563.58 196.38 759.96 34.12 39.30 41.25 41.25 41.25 Average Gross Block (Rs. in lakh) 624.87 723.06 759.96 759.96 759.96 Weighted Average Rate of Depreciation (in %) 5.46 5.44 5.43 5.43 5.43

    Annexure-X

    Asset-VI

    2019-24 Admitted Capital Cost as on 1.4.2019 (Rs. in lakh) ACE Admitted Capital Cost as on 31.3.2019 (Rs. in lakh) Rate of Depreciation (in %) Annual Depreciation as per the 2019 Tariff Regulations Capital Expenditure as on 1.4.2019 2019-20 (Rs. in lakh) 2020-21 (Rs. in lakh) 2021-22 (Rs. in lakh) 2022-23 (Rs. in lakh) 2023-24 (Rs. in lakh) Sub-station 365.55 - 365.55 5.28 19.30 19.30 19.30 19.30 19.30 PLCC 14.20 - 14.20 6.33 0.90 0.90 0.90 0.90 0.90 IT Equipment & Software - - - 15.00 - - - - - TOTAL 379.75 - 379.75 20.20 20.20 20.20 20.20 20.20 Average Gross Block (Rs. in lakh) 379.75 379.75 379.75 379.75 379.75 Weighted Average Rate of Depreciation (in %) 5.32 5.32 5.32 5.32 5.32

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    Power Grid Corpn. Of India Ltd. v. Rajasthan Rajya Vidyut Prasaran Nigam Ltd.
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