CASE NO. 6 of 1999
Present:
Shri S. C. Mahalik, Chairman
Shri A. R. Mohanty, Member
Shri D. K. Roy, Member
Federation of Consumer
Organisations, Orissa, Budha Nagar, Bhubaneswar. - Petitioner |
Vrs.
|
M/s. Grid Corporation of
Orissa Ltd., Janpath, Bhubaneswar-Affected Party |
For Petitioners:
Shri Debabrata Jena, Joint Secretary, FOCO
For Affected Party:
1) B.M.M. Rao, Director (Dist.)
2) Shri B.P. Rekhani, General Manager (RAU), GRIDCO.
Date of argument: 05.03.99
Date of Order : 30.03.99
ORDER
An application under Section
31(1) of the Orissa Electricity Reform Act, 1995 has been filed by the Federation of
Consumer Organisations, Budhanagar, Kalpana Square, Bhubaneswar through its Joint
Secretary, challenging the legality of a circular issued by the Director(Distribution),
Gridco on the billing of consumers. In the impugned circular letter addressed to all the
Managing Directors of the Distribution Zones the said Director (Distribution) has
instructed that bills be raised on load factor basis in a situation of "house
locked". It is alleged that the said instructions of the Director (Distribution)
purposefully violates the Commission's order dt.21.11.98 relating to Retail Tariff
effective from 01.12.98. It has been prayed that Gridco should be restrained from
presentation of illegal bills on the basis of the aforesaid circular letter.
It is further alleged that Director (Distribution) revised the said
instruction later vide his letter No.917(4)/D(D)/dated 11.12.98 whereunder the Managing
Directors of the Distribution Zone were asked to raise bills on the consumers on the basis
of meter readings of the preceding three months if the house was found locked with a
further direction that if such meter readings were not available, the bills could be
raised on load factor basis provisionally, to be revised when meter reading would become
available.
The complainant has requested that since two allegedly illegal
instructions have been issued by the Director (Dist.), Gridco be penalised u/s 31(1) of the OER Act,1995 for willful violation of the
Commission's tariff order made effective from 1.12.98. It is prayed that the load factor
be revised downwards as the Gridco is utilising the method of load factor billing to
enhance their energy sales and to present an artificial reduction of Transmission &
Distribution losses.
2. The Commission issued a Fax message to M/s Gridco. vide its letter
No. Secy/053/98/164 dt. 15.01.99 to obtain a report within 10 days as to under what
circumstances the instruction under its letter dated 11.12.98 was issued to the Managing
Director's of the four Distribution Zones.
2.1 M/s Gridco filed a report vide its letter No.Com-VIII-
12/97(V.3)/27/D(D)/dated 23.1.99 which is as follows :
The circumstances leading to the issue of Gridco Circular No.917(4)D(D)
dated 11.12.98 are summarised below :
The mode of preparing bills in the event the meter is not accessible
and hence cannot be read is dealt with in Regulation 17 of OSEB (General Conditions of
Supply) Regulations 1995 which is as follows :
"If for any reason whatsoever, the consumer's premises containing the meter is not
accessible and meter reading cannot be taken, the bills shall be raised on the basis of
minimum charge subject to subsequent verification and revision on the basis of actual
meter reading.
If the Engineer apprehends that the consumer is deliberately avoiding the inspection of
meter and meter reading, he may give notice by registered post to the consumer to remain
present in the premises on the date and time as mentioned in the notice and if the
consumer defaults he may take steps for disconnection of supply after giving appropriate
notice to the consumer and considering his explanation, if any".
However, the Commission in their Retail Tariff Order dated 21.11.98 did away with the
concept of minimum energy charges (as used in Regulation 17) and hence Regulation 17
became inoperative from 01.12.98.
Regulation 63 of the Orissa Electricity
Regulatory Commission Distribution (Conditions of Supply) Code, 1998 approved by the
Commission on 7 September 1998 also deals with the same matter, but this Code has not yet
come into force.
It will be clear that when the Gridco circular in question was issued
on 11.12.98, there was no valid Regulation or Codal provision governing the mode of
billing consumers in a situation of "house locked". At the same time it was
necessary to issue some guidelines to the field on how billing was to be done in a
"house locked" situation so that the process of billing and collection can
continue without interruption till the OERC Code comes into force. Load factor billing as
an interim measure was preferred over two other alternatives which were considered, namely
(a) average of the preceding three months bills (b) bill based on the last meter reading.
In many cases of reported "house locked" the last meter reading may have been
taken several months ago and would have no relation to present consumption. There are also
cases of last recorded consumption being below the minimum charge level (which was 44
units/kilowatt of connected load for domestic consumers). Changing such consumers on the
basis of meter as last read or on the basis of three months average consumption would not
give the consumer any incentive to insist on his meter being read, nor would it discourage
the nexus between the dishonest consumers and conniving meter readers.
It is always open to Gridco to issue a notice to a consumer to allow
access to his meter and to disconnect him in the event of persistent failure to allow
access to the meter. But disconnection often leads to litigation and stay orders from
Courts whereas load factor billing, especially as an interim measure is seldom stayed by
Courts.
2.2 Gridco prayed that in the circumstances pointed out above, the
circular in question authorising load factor billing as an interim measure pending the
preparing of a revised bill based on meter reading may be allowed to stand till the OERC Distribution (Conditions of Supply) Code 1998 comes into force.
3. Upon consideration of the above stated report dt. 23.01.99, the
Commission decided to resolve the issue through a hearing; and accordingly hearing was
fixed for 05.03.99.
3.1 The Chairman-cum-Managing Director, Gridco was directed to file his
reply to the original application of the Joint Secretary. Federation of Consumer
Organisations on or before 1.3.99 complying with Regulations 43 and 44 of the OERC (Conduct of Business) Regulations,1996. In response to the
notice dt.18.02.99, Director (Distribution/Gridco, filed a formal reply on 01.03.99.
4. Substantially denying the averments in the application filed by the
Federation, it was stated that the spirit of the impugned letter dt. 8.12.98 was to ensure
that no bill was served without making all possible attempts to take meter reading. It is
also averred that this instruction was subsequently revised in another impugned letter
dated 11.12.98 which provided that in cases of "house locked" condition, the
energy bill is to be prepared on the basis of previous meter readings provided such
readings have been taken in the preceding three months and if no such readings are
available, the consumer could be provisionally billed on load factor basis.
4.1 It further reiterated its stand taken under para (iii) of the
letter dt.23.01.99 that there was no valid Regulations or codal provision governing the
billing procedure of the consumers in a "house locked" condition. It also
mentioned that though OERC Distribution (Condition of Supply) Code,
1998 has been published in an extraordinary Gazette dated 5.1.99 yet it came to their
notice in the 2nd week of Feb. 1999 and having been cognizant of this Regulation, all
field officers have been intimated vide its letter No.47 dt. 10.02.99 (Annex-A) that
Regulation 63 will be followed in cases of "house locked" condition.
4.2 The Director (Distribution) at para 5 of his reply dated 01.03.99
apparently took exception to OERC forwarding a copy of the Gridco's letter dt.23.01.99 to
the Joint Secretary, Federation of Consumer Organisations. In this connection, the
Commission would like to observe that the language and pleadings at para 5 of the reply
betray the inadequacy of Gridco officials in understanding the quasi-judicial process of a
regulatory authority. Such pleadings must be avoided in future.
5. Mr. Jena appearing for the petitioner submitted that it is
abundantly clear from the letter dt. 23.01.99 and the reply of the Gridco that it has
issued both the impugned letters dated 8.12.98 and 11.12.98 to its field officers and that
the instructions under these two letters were repugnant to the Retail Supply Tariff order
of the Commission, if not, the OERC Distribution (Conditions of
Supply) Code, 1998. He further submitted that the so called underlying noble spirit of
those two impugned letters is only a matter of defence. The reasoning behind the defence
is only an afterthought and cannot be sustained on the wordings of the specific
instruction of the Director (Distribution) to his field officers. He contended that all
the three prayers made by him should be allowed in the interest of justice & fair
play.
6. Mr. B.P. Rekhani, General Manager (RAU), Gridco submitted that the
licensee had no intention to act contrary to the orders of the Commission issued for
Retail Supply Tariff as well as the provisions of the Orissa
Electricity Regulatory Commission Distribution (Conditions of Supply) Code, 1998.
According to him those instructions were issued in the best interest of the Gridco without
any malafide intention and as soon as it came to know that Orissa
Electricity Distribution (Conditions of Supply) Code, 1998 had been gazetted, revised
instruction under letter No.47 (4)/D(D)/ dated 10.02.99 (Annex-A) was issued to the
Managing Director of the four Distribution Zones to raise bills in accordance with Reg.63
of the above Code, 1998, in supersession of the instruction issued under the letter dated
11.12.98.
7. In the facts and circumstances of the case as discussed above, there
is no need to strike down the impugned order dt.11.12.98 in as much as the licensee has
already superseded the same in its letter dt.10.02.99.
7.1 With regard to the prayer for penalty on the charge of wilful
violation of the order of the Commission, we are inclined to accept the submissions made
by Mr Rekhani that the letters dt.8.12.98 & 11.12.98 were issued without any malafide
intention to upstage the orders of the Commission. While we hold that the instructions
were unwarranted and had perhaps been issued to take advantage of the outdated provision
of the erstwhile OSEB's (General Conditions of Supply) Regulation, 1995, Gridco may be
given the benefit of doubt of wrong interpretation. In the circumstances the Commission
does not consider it proper to take any penal action under Section
31(1) of the OER Act, 1995.
7.2 The third specific prayer that the load factor should be revised
downwards is not quite relevant. The method of billing and determination of load factor
percentage are issues which can be decided during tariff proceeding and during
finalisation of Distribution (Condition of Supply) Code. The issue
in this case is whether the licensee is justified in law to raise bills on load factor
basis in "house locked" situation. The answer is a clear "no".
7.3 In the facts and circumstances, we order that all the bills raised
on load factor basis in "house locked" conditions for the period 01.12.98 to
04.01.99 must be revised in conformity with the terms of Retail Tariff order and report of
compliance should be submitted to the Commission within thirty days of receipt of this
order. The Commission would like to observe that the issue of any instruction which is not
in conformity with the tariff order as authorised by the Commission should not recur.
The case is disposed accordingly.
(S.C. MAHALIK)
CHAIRMAN
(A.R. MOHANTY)
MEMBER
(D.K. ROY)
MEMBER
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