ISLAMABAD: The Supreme Court dismissed K-Electric’s appeal against the Sindh High Court (SHC)’s judgment to quash the corrigendum for recovery of subsidy from industrial consumers, which was withdrawn through SRO 810(I)/2019.
A three-judge bench, headed by Chief Justice Umar Bandial, on Thursday, heard the K-Electric’s appeal against the SHC’s judgment, wherein, the corrigendum dated 22 January 2020 related to tariff policy was quashed.
The SHC on 28 September 2020 had declared the corrigendum illegal, void, issued in excess of authority hence quashed. The K-Electric was asked to charge the tariff from its industrial consumers as per the left hand column (K-Electric Tariff of SRO 575(I)/2019 dated 22 May 2019 as determined vide determination dated 05-07-2018 in respect of variable “off-peak hours” charges, and right-hand column (Uniform Tariff) in respect of variable “peak hours” charges as long as subsidy for “peak hours” provided through SRO 12(I/2019 dated 01-01-2019.
The Pakistan Tehreek-e-Insaf(PTI) government through SRO 12(I) of 2019 on 01.01.2019 decided to continue Rs3/- per kWh subsidy, known as Industrial Support Package (ISPA). The Pakistan Muslim League-Nawaz in 2016 had granted subsidy, but withdrew it throughout Pakistan vide SRO 810(I)/2019 in respect of off-peak hours and other categories of industrial consumers.
The chief justice questioned why the K-Electric did not comply with the SRO 810 to withdraw the subsidy in electricity bills of industrial consumers. He rejected the K-Electric counsel’s arguments that they did not comply with the SRO 810 because it was issued by the federal government, while it should have been issued by the NEPRA.
Advocate Abid S Zuberi, representing K-Electric, said there was no table of tariff in SRO 810; therefore, did not stop the subsidy. However, he said that his client wrote letters to the government and NEPRA. Upon that Justice Ayesha observed there was no table in SRO 12, but the K-Electric gave subsidy. She asked why the K-Electric waited for table of tariff after the SRO 810.
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The chief justice said that the burden of K-Electric negligence could not be shifted to the consumers; therefore, dismissed the appeal.
During the proceeding, the court said the government should not perform regulators’ functions, adding the regulators should be allowed to work as they have expertise and skills.
Justice Bandial said it was intent of the Parliament that the regulators should perform their function independently. “All regulators must be empowered and their jurisdiction must be respected,” he added.
Director General Tariff, NEPRA Sajid said the Regulator process was bypassed; adding even if the process was done by the NEPRA the result would have been the same.
Justice Ayesha Malik inquired from secretary Ministry of Energy Asif Hyder Shah how the government decided to dole out favour. The secretary responded that tariff is determined by the NEPRA while the volume and extent of relief (subsidy) is decided by the federal cabinet and then for its approval it goes to the parliament. The subsidy is given through the budget of the parliament, he added.
The secretary admitted that the NEPRA should have carried out the process; however, he said the SRO 810 was never challenged.
Haider Waheed, counsel for the industrial consumers, said only NEPRA can amend the tariff and not the government. The government cannot withdraw subsidy given to the industrial consumers earlier. He further submitted that K-Electric is not sending them bills in accordance with the SHC’s judgment. He further submitted that first bill without the subsidy was issued in March 2020, which they challenged in the High Court.
Abid S Zuberi submitted that the impugned judgment in itself is contradictory as on the one hand SRO No 810(I)/2019 has been upheld whereas, the corrigendum dated 22.01.2020, which is a ministerial act that merely implements SRO No 810(I)/2019 has been set-aside.
The petitioner K-Electric further stated that the SHC directions are totally against the policy of the Ministry of Energy (Respondent No 1) to keep and maintain a uniform tariff across the country. The impugned judgement is; therefore, against well-settled principles of law and interferes in the policy domain of the government and has created an entirely new tariff that has never been approved/ determined by the NEPRA (Respondent No 2).
The subsidy in respect of off-peak hours and other categories of industrial consumers was withdrawn throughout Pakistan vide SRO 810(I)/2019.
The petitioner submitted that though Ministry of Energy issued SRO 810(I)/2019 whereby, Paragraph 2 of the January 2019 SRO was substituted, it however did not immediately amend the Schedule of Tariff of K-Electric issued vide SRO No 575(I)/2019.
The petitioner continued to charge its industrial consumers as per the SRO No 575(I)/2019 till December 2019 with the view of charging the amount accrued during that period by the consumers in view of SRO 810(I)/2019.
After issuance of several letters by the petitioner, the Respondent No.1 took cognisance of the matter and issued corrigendum dated 22.01.2020 during the same fiscal year, incorporating the changes made vide SRO 810(I)/2019 in SRO 575(I)/2019 by modifying the right-side column of off peak rates and other categories of industrial consumers.
The corrigendum merely reflected the amendments made by SRO 810(I)/2019 throughout Pakistan and was reflected in the bills issued by all DISCOS to their respective consumers and also upheld in the Impugned Judgement.
The counsel submitted that the said corrigendum has been issued after following the same procedure as was followed in notifying / issuing the uniform / applicable tariff notified on the right-side column of the SRO 575(I)/2019.
Copyright Business Recorder, 2022
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