328 TT 2023

CENTRAL ELECTRICITY REGULATORY COMMISSION
NEW DELHI
Petition No. 328/TT/2023
Coram:
Shri Jishnu Barua, Chairperson

Shri Ramesh Babu V. Member
Shri Harish Dudani, Member
Date of Order: 23.09.2024
In the matter of:

Approval under Regulation 86 of the Central Electricity Regulatory Commission
(Conduct of Business) Regulations, 1999 and the Central Electricity Regulatory
Commission (Terms and Conditions of Tariff) Regulations, 2019 for the determination
of the transmission tariff from COD to 31.3.2024 for Asset-I: 220/66 kV New GIS Sub-
station at UT Chandigarh with 2x160 MVA ICTs along with associated bays and 220 kV
D/C Line from 220/66 kV Chandigarh Sub-station to 400/220 kV Panchkula (PG) Sub-
station along with associated GIS bays at Chandigarh and AIS Bays at Panchkula Sub-
station and Asset-II: 8 Nos. 66 kV Line Bays at Chandigarh GIS Sub-station under
“Establishment of 220/66 kV, 2x160 MVA GIS Sub-station at UT Chandigarh along with
220 kV D/C line from Chandigarh GIS to 400/220 kV Panchkula (PG) Sub-station” in the
Northern Region.
And in the matter of:
Power Grid Corporation of India Limited,

SAUDAMINI, Plot No-2,
Sector-29, Gurgaon-122001 (Haryana) ……Petitioner
Versus
1. Ajmer Vidyut Vitran Nigam Limited,

Corporate Office, Vidyut Bhawan,
Panchsheel Nagar, Makarwali Road
Ajmer-305004
2. Jaipur Vidyut Vitran Nigam Limited,

132 kV, GSS RVPNL Sub-station Building,
Caligiri Road, Malviya Nagar,
Jaipur-302017
3. Jodhpur Vidyut Vitran Nigam Limited,

New Power House, Industrial Area,
Jodhpur-342003
Page 1 of 75
Order in Petition No. 328/TT/2023
4. Himachal Pradesh State Electricity Board Limited,
Vidyut Bhawan, Kumar House Complex, Building II,
Shimla-171004
5. Punjab State Power Corporation Limited,

The Mall, PSEB Head Office,
Patiala-147001
6. Haryana Power Purchase Centre,

Shakti Bhawan, Sector-6,
Panchkula–134109
7. Jammu Kashmir Power Corporation Limited,

220/66/33 kV Gladni Sub-station, SLDC Building,
Narwal, Jammu
8. Uttar Pradesh Power Corporation Limited,

Shakti Bhawan, 14, Ashok Marg,
Lucknow-226001
9. BSES Yamuna Power Limited,

B-Block, Shakti Kiran Building,
Karkadooma, 2nd Floor,
New Delhi - 110092
10. BSES Rajdhani Power Limited,

BSES Bhawan, Nehru Place,
New Delhi
11. Tata Power Delhi Distribution Limited,

33 kV Sub-station, Building
Hudson Lane, Kingsway Camp,
North Delhi-110009
12. Uttarakhand Power Corporation Limited,

Urja Bhawan, Kanwali Road,
Dehradun
13. North Central Railway,

Allahabad, U.P.
14. New Delhi Municipal Council,

Palika Kendra, Sansad Marg,
New Delhi-110002
15. Chandigarh Electricity Department,

UT-Chandigarh, Divison-11,
Industrial Area Phase-I,
Chandigarh
…..Respondent(s)
Order in Petition No. 328/TT/2023 Page 2 of 75

Parties Present: Shri Vivek Kumar Singh, PGCIL
Shri V.C. Shekhar, PGCIL
Shri Nitish Kumar, PGCIL
ORDER
The instant Petition has been filed by Power Grid Corporation of India Limited
for the determination of transmission tariff under the Central Electricity Regulatory
Commission (Terms and Conditions of Tariff) Regulations, 2019 (hereinafter
referred to as “the 2019 Tariff Regulations”) from the date of commercial operation
(COD) to 31.3.2024 in respect of Asset-I: 220/66 kV New GIS Sub-station at UT
Chandigarh with 2x160 MVA ICTs along with associated bays and 220 kV Double
Circuit (“D/C”) Line from 220/66 kV Chandigarh Sub-station to 400/220 kV
Panchkula (PG) Sub-station along with associated GIS bays at Chandigarh and AIS
bays at Panchkula Sub-station and Asset-II: 8 Nos. 66 kV line bays at Chandigarh
GIS Sub-station (hereinafter referred to as the “transmission assets”) under
“Establishment of 220/66 kV, 2x160 MVA GIS Sub-station at UT Chandigarh along
with 220 kV D/C line from Chandigarh GIS to 400/220 kV Panchkula (PG) Sub-
station” (hereinafter referred to as “transmission project”) in the Northern Region.
2. The Petitioner has made the following prayers:
“1) Admit the capital cost as claimed in the Petition and approve the Additional
Capitalisation incurred / projected to be incurred.
2) Approve the Transmission Tariff for the tariff block 2019-24 block for the asset
covered under this petition, as per para – 8.3 above.
3) Approve the DOCO of the asset under clause 5 (2) of Tariff Regulation’2019.
4) Condone the delay and allow IDC/IEDC as claimed in the petition.
5) Allow the petitioner to submit the Revised Cost estimation for the assets under
instant petition.
6) 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 2019 as per para 8 above for respective block.
7) 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.
8) 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.
9) Allow the Petitioner to claim the overall security expenses and consequential
IOWC on that security expenses separately.
10) Allow the petitioner to claim the capital spares at the end of tariff block as per
actual.
11) 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.
12) Allow interim tariff in accordance with Regulation 10 (3) of Central Electricity
Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2019
for purpose of inclusion in the PoC charges.
and pass such other relief as the 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. Investment Approval (IA) of the transmission project was accorded by the
Board of Directors of the Petitioner in its 337th meeting held on 9.2.2017
and communicated vide Memorandum No. C/CP/Chandigarh GIS dated
13.2.2017 with an estimated cost of ₹32230.00 lakhs, including an IDC of
₹1923.00 lakhs based on the October 2016 price level.
b. The brief scope of work covered under the transmission project as per the
IA broadly includes:
• Transmission Line:

i. 220 kV D/C Line from UT Chandigarh Sub-station to
400/220 kV Panchkula (PG) Sub-station.
Note: Part of the line (about 10 km) shall be through underground cable
within Chandigarh, and stringing on the multi-circuit portion of the line
will be carried out later by HVPNL to take the line to the 220 kV sub-
station.
• Sub-station:
i. 2x160 MVA, 220/66 kV GIS Sub-station at UT Chandigarh.
ii. Bays extension at 400/220 kV Panchkula Sub-station.
c. The scheme was discussed and agreed upon in the 31st, 34th & 36th
Standing Committee meetings of the Transmission Planning for Northern
Region held on 2.1.2013, 8.8.2014, and 13.7.2015, respectively. The
scheme was also discussed and agreed upon in the 28th, 33rd & 36th
meetings of the Northern Regional Power Committee (NRPC) held on
26.4.2013, 11.11.2014, and 24.12.2015, respectively. During the 33rd
Empowered Committee Meeting dated 30.9.2014, the Petitioner
recommended the implementation of the scheme under a Regulated
Tariff Mechanism (RTM) with a compressed time schedule. The Ministry
of Power (MoP), vide letter dated 10.12.2014, approved the scheme for
implementation to the Petitioner under a compressed schedule through
RTM.
d. The Revised Cost Estimate (RCE) of the transmission project was
accorded vide Memorandum No. C/CP/PA2324-11-0AL-RCE010 dated
5.2.2024, at an estimated cost of ₹38078.00 lakhs, including IDC of
₹5437.00 lakhs based on the October 2023 price level. The
commissioning of the transmission assets under the transmission project
has been completed. The details of the scheduled date of commercial

operation (SCOD), COD, and time over-run of the transmission assets
claimed by the Petitioner are as follows:
Time
Asset SCOD COD
Over- run
24.3.2023 49 months
Asset-I 13.2.2019 and 29
Under Regulation 5(2) of the 2019 Tariff days
Asset-II 13.2.2019 Regulations
4. The Respondents are Railways, Distribution Licensees, and Power
Departments procuring the transmission service from the Petitioner, which are
mainly beneficiaries of the Northern Region.
5. The Petitioner has served a copy of the Petition on the Respondents and
notice regarding the filing of this Petition has also been published in newspapers in
accordance with Section 64 of the Electricity Act, 2003 (the Act). No comments or
suggestions have been received from the general public in response to the
aforesaid notice. None of the Respondents have filed any reply to the Petition.
6. This order is issued considering the submissions of the Petitioner in the
Petition dated 7.7.2023 and its subsequent affidavits dated 16.1.2024 and
12.3.2024.
7. The hearing in the matter was held on 29.4.2024, and the order was reserved.
However, the order in the matter could not be issued prior to Shri Arun Goyal, Member,
who formed part of the coram, demitting the office. Accordingly, the matter was listed
for hearing on 28.8.2024, and the order was reserved.
8. Having heard the representatives of the Petitioner as well as the Respondent,
Chandigarh Electricity Department UT-Chandigarh (EDUTC), and after perusing the
material on record, we proceed to dispose of the Petition.

Determination of Annual Fixed Charges for the 2019-24 Tariff Period
9. The Petitioner has claimed the following transmission charges in respect of
the transmission assets for the 2019-24 tariff period:
Asset-I
(₹ in lakh)
2022-23
Particulars (pro-rata 8 2023-24
days)
Depreciation 35.09 1704.41
Interest on Loan 36.24 1691.49
Return on Equity 37.31 1813.41
Interest on Working Capital 1.64 78.11
O&M Expenses 5.58 263.29
Total 115.86 5550.71
Asset- II
(₹ in lakh)
2022-23
days)
Depreciation 2.03 96.21
Interest on Loan 2.26 103.63
Return on Equity 2.26 107.37
Total 8.91 418.53
10. The Petitioner has claimed the following Interest on Working Capital (IWC)
in respect of the transmission assets for the 2019-24 tariff period:
Asset-I
(₹ in lakh)
2022-23
days)
Maintenance Spares 38.13 39.49
Receivables 651.64 682.46
Total Working Capital 710.95 743.89
Rate of Interest (in %) 10.50 10.50

Asset-II
(₹ in lakh)
2022-23
days)
Maintenance Spares 14.98 15.51
Receivables 50.10 51.46
Total Working Capital 73.40 75.59
Rate of Interest (in %) 7.71 10.50
Date of Commercial Operation (“COD”)
11. The Petitioner has claimed the COD of A s s e t s -I and II as 24.3.2023
under Regulation 5(2) of the 2019 Tariff Regulations as power flow in its scope of
work could not be achieved due to the non-readiness of the downstream system at
Chandigarh Sub-station being implemented by the EDUTC. The Petitioner has
further submitted that it completed its scope of the transmission system, but it was
not able to put the same into regular service due to a delay on the part of the
distribution utility (i.e., the execution of inter-connected downstream transmission
systems).
12. The Petitioner has submitted that the Chandigarh Sub-station, along with the
associated transmission system and bays, were planned for evacuation of power to
Chandigarh. Accordingly, Assets-I and II have been idle charged on 12.1.2023/
22.3.2023 and 22.1.2023, respectively. The Petitioner has prayed for the COD of
Assets-I and II as 24.3.2023 as it complied with the provisions of Regulation 5(2)
of the 2019 Tariff Regulations.
13. EDUTC did not file its reply despite opportunities granted to it. Accordingly,
we deal with the Petitioner’s plea for approval of the COD of Assets- I and II on the

basis of the information available on record.
14. We have considered the submissions of the parties. Regulation 5 of the
2019 Tariff Regulations provides as under:
“5. Date of Commercial Operation: (1) The date of commercial operation of a

generating station or unit thereof or a transmission system or element thereof and
associated communication system shall be determined in accordance with
the
provisions of the Grid Code.
(2) In case the transmission system or element thereof executed by a transmission
licensee is ready for commercial operation but the interconnected generating station
or the transmission system of other transmission licensee as per the agreed project
implementation schedule is not ready for commercial operation, the transmission
licensee may file petition before the Commission for approval of the date of
commercial operation of such transmission system or element thereof:
Provided that the transmission licensee seeking the approval of the date of
commercial operation under this clause shall give prior notice of at least one month,
to the generating company or the other transmission licensee and the long term
customers of its transmission system, as the case may be, regarding the date of
commercial operation:
Provided further that the transmission licensee seeking the approval of the date of
commercial operation of the transmission system under this clause shall be required
to submit the following documents along with the petition:
(a) Energisation certificate issued by the Regional Electrical Inspector

under Central Electricity Authority;
(b) Trial operation certificate issued by the concerned RLDC for
charging element with or without electrical load;
(c) Implementation Agreement, if any, executed by the parties;
(d) Minutes of the coordination meetings or related correspondences
regarding the monitoring of the progress of the generating station and
transmission systems;
(e) Notice issued by the transmission licensee as per the first proviso under
this clause and the response;
(f) Certificate of the CEO or MD of the company regarding the completion of
the transmission system including associated communication system in all
respects.
(3) The date of commercial operation in case of integrated mine(s), shall mean the
earliest of ―
a) the first date of the year succeeding the year in which 25% of the Peak
Rated Capacity as per the Mining Plan is achieved; or
b) the first date of the year succeeding the year in which the value of
production estimated in accordance with Regulation 7A of these regulations,
exceeds total expenditure in that year; or
c) the date of two years from the date of commencement of production:
Provided that on earliest occurrence of any of the events under sub-clauses (a) to (c)

of Clause (3) of this Regulation, the generating company shall declare the date of
commercial operation of the integrated mine(s) under the relevant sub-clause with
one week prior intimation to the beneficiaries of the end-use or associated generating
station(s);
Provided further that in case the integrated mine(s) is ready for commercial operation
but is prevented from declaration of the date of commercial operation for reasons not
attributable to the generating company or its suppliers or contractors or the Mine
Developer and Operator, the Commission, on an application made by the generating
company, may approve such other date as the date of commercial operation as may
be considered appropriate after considering the relevant reasons that prevented the
declaration of the date of commercial operation under any of the sub-clauses of
Clause
(3) of this Regulation;
Provided also that the generating company seeking the approval of the date of
commercial operation under the preceding proviso shall give prior notice of one month
to the beneficiaries of the end-use or associated generating station(s) of the
integrated mine(s) regarding the date of commercial operation.”
15. Regulation 5(2) of the 2019 Tariff Regulations is invoked in case the
transmission system or element thereof executed by a transmission licensee is ready
for commercial operation but the interconnected generating station or the
transmission system of another transmission licensee, as per the agreed project
implementation schedule is not ready for commercial operation, the transmission
licensee who is ready may file a Petition before the Commission for approval of the
COD of such transmission system or element thereof subject to other provisions of
Regulation 5(2) of the 2019 Tariff Regulations. The first proviso to Regulation 5(2) of
the 2019 Tariff Regulations provides that the transmission licensee seeking the
approval of COD shall give prior notice of at least one month to the generating
company or the other transmission licensee and the long term customers of its
transmission system, as the case may be, regarding the COD while the second
proviso to Regulation 5(2) of the 2019 Tariff Regulations contemplates certain
requirements for the transmission licensee seeking the approval of COD of its
transmission system or element such as (a) Energization certificate issued by
Regional Electrical Inspector under Central Electricity Authority, (b) Trial operation

certificate issued by the concerned RLDC for charging element with or without
electrical load; (c) Implementation Agreement, if any, executed by the parties; (d)
Minutes of the coordination meetings or related correspondences regarding the
monitoring of the progress of the generating station and transmission systems;
Notice issued by the transmission licensee as per the first proviso to Regulation 5(2)
of the 2019 Tariff Regulations, and (f) Certificate of the CEO or MD of the Company
regarding the completion of the transmission system including associated
communication system in all respects.
16. We have considered the Petitioner’s and EDUTC’s submissions and have
perused the documents available on record.
17. The Petitioner has placed on record a copy of the letter dated 4.1.2023 in
compliance with Regulation 5(2) of the 2019 Tariff Regulations informing EDUTC
and all the beneficiaries, transmission licensee/long-term consumers that 220/66
kV, 2x160 MVA Chandigarh Sub-station (GIS) of the Petitioner along with 220 kV
D/C Chandigarh-Panchkula Transmission Line and 2 nos. 220 kV line bays (AIS) at
400/200 kV Panchkula Sub-station of the Petitioner associated with the
transmission project was scheduled to be commissioned on 5.1.2023. The
Petitioner has also placed on record a copy of the Central Electricity Authority (CEA)
Energization Certificates dated 2.1.2023 and 24.1.2023 in terms of Regulation 43
of the Central Electricity Authority (Measures relating to Safety and Electric Supply)
Regulations, 2010, ‘No-load’ RLDC Charging Certificates dated 3.2.2023,
14.3.2023 and 30.3.2023, and CMD Certificate as required under the Grid Code.
18. On the other hand, EDUTC’s representative, during the course of hearing the
matter on 29.4.2024, orally submitted that actual power flow started from 29.3.2024,

and prior to 29.3.2024, it regularly complained about the high voltage to NRLDC.
On 28.3.2024, NRLDC changed the track of the Petitioner, resultantly, EDUTC
started evacuating the power from 29.3.2024. The EDUTC’s submissions have not
been substantiated by any documentary evidence, nor was any reply filed by it
despite opportunities granted.
19. Taking into consideration the CEA Energization Certificates, ‘No load’ RLDC
Charging Certificate, the Petitioner’s CMD Certificate, as well as the Petitioner’s and
EDUTC’s submissions during the hearing dated 29.4.2024, the COD of Assets- I
and II is approved as 24.3.2023 in terms of Regulation 5(2) of the 2019 Tariff
Regulations.
Capital Cost
20. 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 capitalization 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
assets before the date of commercial operation;

(i) Capital expenditure on account of ash disposal and utilization including
handling and transportation facility;
(j) Capital expenditure incurred towards railway infrastructure and its
augmentation for transportation of coal upto 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 fulfilment 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 capitalization and de-capitalization for the respective year of
tariff as determined in accordance with these regulations;
(c) Capital expenditure on account of renovation and modernisation as
admitted by this Commission in accordance with these regulations;
(d) Capital expenditure on account of ash disposal and utilization including
handling and transportation facility;
(e) Capital expenditure incurred towards railway infrastructure and its
augmentation for transportation of coal upto 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 assets forming part of the project, but not in use, as declared in the
tariff petition;
(b) De-capitalised Assets 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 de-capitalised 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-capitalization of the
concerned assets.
(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.”
21. The Petitioner, vide Auditor’s Certificates dated 30.6.2023, has claimed the
capital cost incurred as on the COD and the projected Additional Capital
Expenditure (ACE) in respect of the transmission assets as follows:
(₹ in lakh)
FR RCE Projected ACE
Apportioned Apportioned Estimated
Asset Approved Expenditure 2022-23 2023-24 2024-25 Completion
Approved
Cost up to COD Cost
Cost
Asset-I 30770.28 36015.17 30539.00 - 3615.42 1549.47 35703.89
Asset-II 1459.72 2062.83 1844.21 - 136.57 58.53 2039.31
Total 32230.00 38078.00 32383.21 0.00 3751.99 1608.00 37743.20
Cost Over-run
22. The Petitioner has submitted that the estimated completion cost of the
transmission assets is more than the apportioned approved cost as per the FR cost.
The detailed reasons for cost over-run vis-à-vis FR apportioned approved cost of
the transmission assets are as follows:
Variation in IDC Cost:
The increase in Interest During Construction (IDC) is attributable to variation in the
rate of interest considered in FR compared to the actuals. In the FR cost, IDC was
calculated considering the rate of interest for domestic loans at 6.35%. However, in
actuality, the weighted average rate of interest on loan is at around 7.82%.

Therefore, the actual IDC accrued up to the COD of the transmission assets has
been considered in the claimed tariff.
Variation in Incidental Expenditure During Construction (IEDC) Cost:
IEDC was estimated and considered at 10.75% of the equipment cost. The actual
amount of the IEDC has been taken at the time of claim. There is an increase in the
IEDC on an actual basis for the project.
Variation in Equipment Cost:
Being a Government Enterprise, the Petitioner has an obligation to the indigenous
development of the manufacturer and to adhere to the Government of India (GoI)
guidelines in vogue. Accordingly, the Petitioner has been following a well-laid down
procurement policy, which ensures transparency and competitiveness in the bidding
process. A route of the Domestic Competitive Bidding process has been followed to
award this project. Through this process, the lowest possible market prices for
required product/services, as per the detailed design, is obtained, and contracts are
awarded on the basis of the lowest evaluated eligible bidder. The best competitive
bid prices against tenders may vary compared to the cost estimate depending upon
prevailing market conditions, design, and site requirements. The estimates are
prepared by the Petitioner as per well-defined procedures for cost estimate. The FR
cost estimate is a broad indicative cost worked out generally on the basis of the
average unit rates of recently awarded contracts. The cost estimate of the project is
on the basis of the June 2021 price level.
23. There is an increase of around ₹1205 lakh on account of sub-stations
auxiliaries and switchyard structures. The lump-sum quantity is considered while
preparing the FR, and the quantity varies according to actual execution. The
variation is due to the actual site condition and orientation of the switchyard with

respect to the FR.
Preliminary Investigation, Right of Way, PTCC, Statutory clearances and

Compensation
24. There is an increase in the costs of approximately ₹2798 lakh compared to
the FR cost due to the compensation payments related to the construction of
transmission lines. This increase encompasses compensation for crops, trees,
PTCC (Power Transmission Corridors), and NHAI (National Highways Authority of
India). The variation arises from the actual assessment conducted by Government
officials from the respective States and NHAI regarding crops, trees, land,
households, and highway areas within the line corridor. These assessments
revealed that the quantity and value of these elements are significantly lower than
the initial notional estimates. Tree compensation has been calculated and
disbursed based on the enumeration of trees within the corridor, utilizing rates
obtained from the Horticulture Department and the District Collector (DC). Similarly,
crop compensation has been estimated and paid according to the rates provided
by the Agriculture Department.
25. The Petitioner has further submitted that the RCE for the transmission project
was accorded vide Memorandum No. C/CP/ PA2324-11-0AL-RCE010 on 5.2.2024
with the approved cost of ₹38078 lakhs, including IDC of ₹5437 lakhs based on
October 2023 price level. Since the estimated completion cost as on 31.3.2025 is
₹37743.20 lakh, which is within the RCE Cost, therefore, there is no cost over-run
with respect to the transmission assets.
Reasons for Variation in FR Cost vis-à-vis RCE Cost:
26. The Petitioner has submitted the detailed reasons for the variation of ₹5849
lakhs in the FR cost of ₹32230 lakh vis-à-vis RCE cost of ₹38078 lakhs and the

same as under:
Variation between FR and RCE

Sl.
Variation on account of: Cost (₹5849 lakh)
No.
(₹ in lakh) (In %)
(i) Price Variation (PV)
DPR to LOA for the approved scope
a (-) 1509 (-) 4.68
(on competitive bidding while awarding)
Provision presently kept as per contract price
b 676 2.10
variation clause
Sub-Total (PV) (-) 833 (-) 2.58
(ii) Variation in the quantity of approved items (-) 314 (-) 0.97
(iii) Compensation 2812 8.73
Sub-Total (i to iii) 1666 5.17
(iv) Other Reasons (IEDC and IDC)
a IEDC (including contingencies) 669 2.08
b IDC 3514 10.90
Sub-Total (IEDC & IDC) 4183 12.98
Grand Total 5849 18.15
Cost Variation Due to Price Variation:
27. The Petitioner has submitted that the price variation is mainly due to the price
considered at the time of approval of the transmission project till the award of
various contracts based on the competitive prices received as per the competitive
bidding. Further, the price variation is also on account of the applicable price
variation provisions of respective contracts.
28. With regard to the Price Variation from DPR to LoA, the contracts for all
packages under the project were awarded only after approval of the competent
authority as per DoP to the lowest evaluated and responsive bidder on the basis of
the competitive bidding conducted by the Petitioner.
Cost Variation Due to Variation in Quantities of Approved Items:
29. With respect to the transmission line, the line length, type of various towers,
and foundations in the DPR were estimated on the basis of a walk-over/preliminary
survey. However, during the execution of the project, the line length was reduced
from 27 km to 23.88 km. Additionally, the quantities of the tower steel, foundations,

and other materials were adjusted based on the actual site conditions and revised
designs.
30. Regarding the sub-station, there has been a decrease in the quantities of civil
works related to the excavation, RCC, PCC, reinforcement steel, etc., and an
increase in quantities of civil works pertaining to the concrete road and RCC framed
multi-story building, etc. in respect of the DPR envisaged quantities, which
gradually resulted in a net decrease in the cost of the transmission project.
31. The transmission project has cost more because testing kits and spares for
the 220/66 kV Digital GIS Chandigarh with IEC 61850 Process bus-based
Substation automation have been procured.
Cost Variation Due to Payment of Compensation for Transmission Line and

Sub-station
32. The Petitioner has submitted that based on the approved DPR cost, there
was a provision of ₹1263 lakh under this head. However, based on the actual
expenditure incurred and the balance anticipated expenditure, an amount of ₹4075
lakh is incurred/likely to be incurred under this head, resulting in an increase of
₹2812 lakh in the project cost. The Petitioner has submitted the head-wise details
of the increase in cost, which are as follows:
(₹ in lakh)
As per As per
Description Remarks
DPR RCE
i) Compensation Crop and tree compensation of ₹82 lakh in DPR

towards Crop, Tree, 90 41 was approved @ 5 lakh/km on a normative basis,
PTCC, etc. which now works out to ₹1.72 lakh/km in the RCE.

As per As per
Description Remarks
DPR RCE
Based on actual payment for forest area
encountered for environmental clearances and
regulatory assets, the rate for Compensatory
Afforestation has substantially increased from
ii) Compensation ₹1.4 lakhs per Ha as considered in the DPR to
66 435
towards Forest ₹746 lakhs per Ha, amounting to ₹363 lakhs
including contingencies, departmental charges,
etc. Further, ₹17 lakh towards environmental
clearance and ₹54 lakh towards regulatory assets
was incurred.
iii) Compensation
As per the actual amount towards Municipal
towards Tower Base
Corporation, Railway crossing, Road Clearance,
and diminution of land 1107 3592
etc. (Road Clearance/License Fee to MoRTH-
value in the width of
Punjab was envisaged as ₹3457 lakh)
RoW Corridor
iv) Expense on Land
As per actual incurred towards land acquiring
Acquisition for Sub-
- 7 advertisement and architect hiring for approval of
station and R&R
CHD Adm.
Compensation
Total 1263 4075
Variation in IDC Cost:
33. The Petitioner has submitted that the increase in the IDC is attributable to
variation in the rate of interest considered in FR as against actuals. The Petitioner
has further submitted that in FR, the IDC was calculated considering the interest
rate for domestic loans at 6.35%. However, the weighted average rate of interest
on loans is around 7.82%. The Petitioner has submitted that the actual IDC accrued
up to the COD has been considered in the claimed tariff.
Variation in IEDC Cost:
34. The Petitioner submitted that 10.75% of the equipment cost has been
considered as IEDC in the FR. However, the amount of IEDC has been claimed,
and the increase in IEDC is on an actual basis for the transmission project.
35. We have considered the Petitioner’s submissions. As compared to FR cost,
the estimated capital cost of the transmission assets is higher by ₹3905.20 lakhs,

as on 31.3.2024. However, the estimated capital cost for the transmission assets
is less than the RCE cost by ₹1942.80 lakhs, as on 31.3.2024.
36. We have gone through the documents submitted by the Petitioner and it is
observed that as per Form-5 submitted by the Petitioner in the case of Asset-I, there
is a considerable increase in the completion cost of preliminary investigation and
RoW.
37. As compared with FR cost, the estimated costs of Assets-I and II are varied
by about ₹4933.61 lakh and ₹579.59 lakh, respectively. The Petitioner has
submitted RCE duly approved by its CMD on 31.1.2024 at an estimated cost of
₹38078 lakh. It is observed that the estimated completion cost of the transmission
assets is ₹37743 lakh, which is within RCE cost, and there is no cost over-run as
compared with RCE cost. However, as per Form-5 submitted by the Petitioner, the
Petitioner has not submitted the details such as quantity, rate, and estimated
amount as per RCE. The Petitioner is directed to submit the same at the time of
truing-up. It is further observed that the following major variations of certain
individual item(s) noticed in Form-5 are as follows:
Asset-I:
(₹ in lakh)
Particulars As per original Actual Capital Variation
Estimate Expenditure
Preliminary 1270.81 3756.99 2789.93
Investigation &
RoW & PTCC
66 kV GIS 297.54 451.50 249.82
Control, relay & 53.74 202.10 191.27
Protection panel
Sub-station 199.12 315.05 158.58
automation
system
Bus bar materials 85.73 490.57 469.52
& Erection H/W
Establishment 166.25 309.67 209.17
and Contingency
IDC 1836.30 5144.60 3308.30

Asset-II:
(₹ in lakh)
Particulars As per original Actual Capital Variation
Estimate Expenditure
Control, relay & 97.10 138.10 41.00
Protection panel
Power & Control 86.28 445.55 359.27
cables
Establishment 162.94 249.17 86.23
and Contingency
IDC 87.11 292.08 204.97
38. Therefore, the Petitioner is directed to submit detailed justifications along with
supporting documents for the above-mentioned items which shall be reviewed at
the time of truing-up. The capital cost claimed by the Petitioner is provisionally
allowed subject to a prudence check of the above-mentioned items.
Time over-run
39. The Petitioner has submitted that as per the IA dated 13.2.2017, the
transmission project was scheduled to be put into commercial operation within 24
months. Accordingly, the SCOD of the transmission assets is 13.2.2019, against
which they were put into commercial operation as follows:
Asset SCOD COD Time over-run

Asset-I 1499 days
13.2.2019 24.3.2023
Asset-II (49 months and 09 days)
40. The Petitioner has submitted that the 220/66 kV GIS Chandigarh Sub-station
was ready in February 2019. However, due to the unavailability of upstream and
downstream, it was not possible to charge the sub-station. The Petitioner has
submitted that the main reasons for the time over-run in the case of the
transmission assets are RoW issues, viz. law and order problems during
construction of transmission lines, litigations, delay in approval from NHAI, outbreak
of the Covid-19 pandemic and the subsequent lock-downs and restrictions imposed

in the wake of the outbreak of Covid-19 pandemic.
41. To substantiate its claim regarding time over-run in respect of the
transmission assets, the Petitioner has submitted the detailed justifications, which
are as follows:
Delay Due to RoW Issues and Court Cases:
a) Upon investment approval, preliminary actions were initiated immediately to
take up survey works on this transmission line. The transmission line
traverses through the districts of Haryana, Punjab, and the Union Territory of
Chandigarh. Of late, due to increased industrialisation and infra projects,
severe RoW issues were encountered right from the beginning of
transmission line execution works, including during the stage of preliminary
survey, line plotting, and land scheduling. The RoW issues involved a
demand for exorbitant amounts of crop compensation, land compensation,
manhandling of gang workers, etc. Further, wherever possible, persuasive
measures were adopted to pacify the landowners/ villagers who were
agitating against the construction of the line. However, at certain locations,
verbal persuasions did not suffice, and eventually, assistance from the State
Administration, District Administration, and police department was sought to
mitigate the RoW issues. Many landowners had also taken the course of
courts to oppose the construction of the line through their premises. In this
regard, the intervention was also sought from State/ district/local authorities
under the respective State Government to resolve the issues without further
delay.
b) Out of the total 56 transmission towers planned for erection, 51 had already
been successfully installed. However, severe RoW issues at five tower

locations stalled the project. Specifically, in the Punjab region, 26 out of 31
towers falling in the villages of Gazipur, Sanauli, Mumbarakpur, Pandwala, and
Sundra were erected. The remaining five tower locations in the villages of
Mumbarakpur, Pandwala, and Sanauli—specifically at sites 7/2, 7/1, 7/0, and
6A/1—could not be taken up for construction on account of continuous
obstruction and resistance from the brick kiln owner, who objected to the
transmission line being laid over his land. As a result of this continuous
obstruction, construction work on the transmission line in these areas was
halted, prompting the Petitioner to seek assistance from the District
Administration.
c) Even after continuous persuasion, the Petitioner, along with the local
administration/ Magistrate, failed to convince the brick kiln owner/ landowners
as they demanded that the transmission line be diverted from their lands,
which was not legitimate and not acceptable. Due to ongoing obstructions
caused by the land-owners and to prevent further delays in the project's
completion, the Petitioner filed a Writ Petition being CWP No. 32701/2018,
titled ‘Powergrid Corporation of India Limited v. State of Punjab and Ors.’, in
December 2018 before the Hon’ble High Court of Punjab and Haryana in
Chandigarh which was subsequently dismissed as withdrawn.
d) Upon the direction of the Hon’ble High Court of Punjab and Haryana, the issue
was taken up with District Administration to resolve the RoW issue, and on
22.10.2020, DC Mohali issued the order in favour of the Petitioner to start the
work. Further, on 9.11.2020, DC Mohali issued the order to allow the work to
be resumed at RoW locations.
e) However, the brick kiln owner filed a Writ Petition No. 19391 of 2020 in the

Hon’ble High Court of Punjab and Haryana, challenging the Deputy
Commissioner's orders dated 22.10.2020 and 9.11.2020. The Hon’ble High
Court, vide its order dated 25.10.2021, upheld the orders dated 22.10.2020
and 9.11.2020 passed by the Deputy Commissioner (DC), SAS Nagar, Mohali,
and directed that transmission lines shall not be laid down before the re-
location of the temporary huts of the labourers/workers on the spot, and same
are to be facilitated by the Petitioner.
f) Accordingly, on 28.10.2021, a letter was submitted with a request to appoint Duty
Magistrate along with police help to facilitate the execution of the balance works
of 220 kV D/C Overhead Transmission Line as permitted by the then Deputy
Commissioner, vide orders dated 22.10.2020 and 9.11.2020. Further, DC,
Mohali issued a letter to SSP Mohali to provide Police Protection for the
execution of work and to appoint the Duty Magistrate. A Meeting was held on
10.11.2021, in the office of the District Magistrate, SAS Nagar, in which a
Committee was formed to visit the site and make a survey report containing the
details/ particulars of labour huts along with required maps and assess the cost
for the re-location of labour huts within one month and compensation required
for the same with an intimation to the office of District Magistrate, SAS Nagar.
g) Subsequently, the landowners filed Letters Patent Appeals (LPAs) bearing Nos.
1115, 1116, and 1121 of 2021 before the Division Bench of the Hon’ble High
Court of Punjab and Haryana, which were dismissed by the Court on 16.12.2022.
Additionally, the landowners filed Caveat Petitions in the Hon’ble Supreme Court
against the Hon’ble High Court's judgment in CWP Nos. 32701-2018, 5181-
2021, and CWP No. 19391-2021, as well as LPA Nos. 1115, 1116, and 1121 of
2021. The said Petitions are presently sub-judice before the Hon’ble Supreme

Court, and the construction work was completed on a priority basis with the
assistance of the District Administration, following the payment of compensation
for the re-location of huts and houses associated with the brick kiln. The
chronology of the RoW issues faced and the details of the Court cases hearing
are as under:
ROW Chronology
Sl. No Date Description of Delay Reason

Excavation work for the foundation at Location No. 7/0 started.
1 10.10.2017 During the excavation, tower labour from the brick kiln stopped the
work and threatened POWERGRID and KEC staff.
An e-mail was received from the owner of a brick kiln named M/s
2 26.10.2017 Sadashiv Brick Kiln, who mentioned stopping the work from this
location and re-routing the line.
POWERGRID informed SDM Derabassi/DSP Mubarakpur, Distt
3 20.11.2017
SAS Nagar, Mohali, to resolve the ROW issue.
POWERGRID approached the Deputy Commissioner, Mohali, vide
letter No.NR2/MM/220 kV-TL/F-731-1579 dt 22.11.2017. The
4 22.11.2017 Deputy Commissioner, Mohali, ordered police assistance in the
letter dated 22.11.2017 and marked the same to the SDM, Dera
Bassi, on 24.11.2017.
Letter received from Distt. Magistrate SAS Nagar Mohali informed
POWERGRID to change the route. This letter was based on the
5 11.1.2018
report submitted by SDM Dera Bassi after the site visit report of DSP
Dera Bassi under the influence of the brick kiln owner.
POWERGRID vide letter no NR2/MM/220 KV-TL/F-731/1763 dated
22.01.2018 submitted a detailed reply to the points raised in the
letter dated 11.1.2018. POWERGRID submitted that it was not
6 22.1.2018 possible to re-route the transmission line because tower
foundations on both sides had been completed. The route being
followed was the only techno-economical route for the Transmission
Line.
The matter was followed up by the POWERGRID with District
Administration SAS Nagar, again clarifying its stand that no
7 19.2.2018
rerouting of the line was possible and requesting that the issue be
resolved by passing appropriate orders.
Administration SAS Nagar, again clarifying that no rerouting of the
8 1.3.2018
line was possible and requesting that the issue be resolved by
passing appropriate orders.

Administration SAS Nagar, again clarifying that no rerouting of the
9 7.5.2018
line was possible and requesting that the issue be resolved by
passing appropriate orders.
The POWERGRID followed up with District Administration SAS
10 24.5.2018 Nagar, again clarifying that no line rerouting was possible and
requested that the issue be resolved by passing appropriate orders.
The POWERGRID followed up with District Administration SAS
11 25.5.2018 Nagar, again clarifying that no rerouting of the line is possible and
requesting that the issue be resolved by passing appropriate orders.
POWERGRID again met with DC SAS Nagar Mohali, and the DC
12 29.5.2018 issued a letter to SDM Dera Bassi to provide police protection for
casting the foundation in the ROW location.
The brick kiln owner approached Divisional Commissioner Ropar,
13 4.6.2018
who issued a letter to DC Mohali to look into the matter.
SDM Dera Bassi wrote a letter to POWERGRID to submit an
undertaking that POWERGRID did not violate any rule during route
14 7.6.2018
alignment, as asked by the Divn. Commissioner vide letter dated
4.6.2018.
15 8.6.2018 Accordingly, POWERGRID submitted a reply to SDM Mohali.
POWERGRID met with DC SAS Nagar Mohali and DC Mohali
16 14/06/18 called joint meetings of POWERGRID with PSTCL representative
and brick kiln owner.
Joint meeting was held in the chamber of DC, Mohali attended by
17 19.6.2018 SDM Dera Bassi, POWERGRID, Chief Engineer from PSTCL and
brick kiln owner.
SDM Dera Bassi, Ex-engineer of PSTCL Mohali, and senior
POWERGRID officials visited the ROW site. POWERGRID officials
18 26.6.2018
made it clear to SDM Dera Bassi that the route diversion was not
feasible, and that was a final route.
19 2.7.2018 Reply of joint visit dated 26.6.2018 submitted to SDM Dera Bassi.
Met with DC Mohali regarding ROW issue. DC Mohali told that she
20 12.7.2018 was submitting the report to CM Punjab office and would convey to
POWERGRID also in two or three days.
Met with DC Mohali regarding ROW issue. DC Mohali said that she
21 17.7.2018 could not submit the reply to the CM Punjab office due to the other
urgent assignments but would send the communication soon.
Visited the DC office due to the non-availability of DC in the office

22 20.7.2018
and submitted the letter in the office.
Letter from Addl DC SAS Nagar to Addl. Chief Secretary Punjab
regarding the inappropriate selection of route by POWERGRID and
23 1.8.2018
instructed POWERGRID to withhold work till the resolution of the
issue by Punjab Govt.

On receipt of the letter dated 1.8.2018, the then General Manager,
POWERGRID, Jammu, addressed a letter to the Additional Chief
Secretary, Government of Punjab, explaining all the facts regarding
the construction of the transmission line being undertaken in
24 28.8.2018
accordance with the provisions of the Electricity Act, 2003 and
relevant regulation wherein it is mentioned that appropriate distance
of the transmission line (conductors) has to be kept for safer flow of
electricity through the transmission line.
Repeatedly requested the Deputy Commissioner, Mohali, to
25 7.3.2019
cooperate and resolve the ROW issue.
Repeatedly requested the Deputy Commissioner, Mohali, for
26 22.3.2019
cooperation in resolving the ROW issue.
Repeatedly requested the Deputy Commissioner, Mohali, for
27 3.52019
cooperation and to resolve the ROW issue.
A letter from the Office of Additional District Magistrate was received
wherein the police protection was denied for the execution of work
at location no. 6/1 on the ground that the name of village
28 8.5.2019 Mubarakpur was not mentioned in the notification, and the case
about the same line was pending before the Hon’ble High Court. In
that reply, it was mentioned that police protection would not be
provided till the decision of Hon’ble High Court in Kewal Garg case.
29 21.5.2019
30 17.6.2019
Requested the Deputy Commissioner to resolve the issue and
31 9.82019 relook into the matter so that the prestigious national project can be
completed in the interest of the nation.
Letter from the office of District Magistrate, S.A.S Nagar, regarding
32 19.9.2019
meeting scheduled.
POWERGRID submitted the reply against the Minutes of Meeting
33 22.10.2019
dated 20.9.2019.
Letter to the Sub-Divisional Magistrate (SDM) of Dera Bassi, Mohali,
regarding the right-of-way (ROW) case, which had caused a delay
34 27.8.2020
in the construction of 5 towers. A request was made for necessary
protection to complete the remaining 5 towers.
Discussed in PRAGATI and PMG Projects Meeting (VC) chaired by
35 31.8.2020
Chief Secretary Punjab along with CMD, POWERGRID.
The meeting was attended by officials of POWERGRID and PSTCL,
wherein at the beginning of the meeting, POWERGRID informed
that the Writ Petition had been withdrawn. Thereafter, an alternate
route initially suggested by PSTCL was countered by
36 18.9.2020
POWERGRID, keeping in mind the technical and legal constraints.
Further, the Additional Chief Secretary directed POWERGRID to
explore the opportunity of underground cables in the area and
provide the technical feasibility with respect to the same.

Letter to Addl Chief Secretary (Power) Punjab regarding feasibility
37 6.10.2020
of laying of underground cable at the concerned disputed site.
A meeting was attended by officials of POWERGRID wherein DC,
Mohali enquired about the ownership details of land where the
remaining five towers were to be constructed. In response to it, it
was explained that no revenue records were lying with
POWERGRID. Thereafter, DC, Mohali sought the ownership record
38 15.10.2020
of the said land from the SDM, Dera Bassi and directed the official
of POWERGRID to visit the office of SDM for that purpose.
Accordingly, POWERGRID official visited the office of SDM, Dera
Bassi and collected the details of landowners, which was,
thereafter, submitted to the office of DC, Mohali.
DC Mohali issued the order to start the work. At 10.00 hrs., the order
39 22.10.2020 was received from the DC office. But at 11.30, orders issued by DC
were withdrawn.
The meeting was called by Deputy Commissioner Mohali. The
meeting was attended by officials of POWERGRID and
40 30.10.2020
representatives of Mr. Kewal Garg, owner of the brick kiln under the
chairmanship of Additional Deputy Commissioner Mohali.
Meeting with DC Mohali, after considering the submissions, Deputy
41 4.11.2020 Commissioner, Mohali suggested finding an alternate route and
resolving the matter amicably,
DC Mohali handed over the new office order and allowed the work
42 9.11.2020
at ROW locations.
POWERGRID immediately filed the CAVEAT in the Hon’ble High
43 10.11.2020 Court and mobilized the executing agency, and started the detailed
survey alignment between Location Nos. 6A/1, 7/0, &/1 and 7/2.
Excavation for tower foundations started at locations Nos. 6A/1 and
7/0. The owner of Sadashiv brick kiln, along with his supporters,
reached the site and stopped the work. POWERGRID informed DC
44 11.11.2020 Mohali, and immediately, the administration provided a police force.
Thus, the work started again and continued until the morning of
16.11.2020 due to an interim stay order in favour of the brick kiln
owner by the Hon’ble High Court of Punjab and Haryana.
The court pronounced the judgment and dismissed the Writ
Petitions. The judgment was received wherein the Hon’ble High
45 25.10.2021 Court of Punjab & Haryana upheld the orders dated 22.10.2020 and
9.11.2020 passed by the Deputy Commissioner, SAS Nagar,
Mohali.
A letter was submitted with a request to appoint a Duty Magistrate
46 28.10.2021 along with police help to facilitate the execution of the balance work
of 220KV D/C Overhead Transmission Line.
For assessment of cost estimate for removal of temporary huts as
47 8.11.2021 directed by Hon'ble High Court along with the latest progress of
work done after stay vacation.
A Committee was constituted by ADC (S.A.S. Nagar) for finalizing
48 10.11.2021
the value of compensation. PWD, Mohali, was to inform the value.

The Committee was constituted by ADC (S.A.S. Nagar) to assess
and relocate the temporary huts that visited the site on various
49 12.1.2022
dates. Report on assessment of compensation for removal and
relocation of temporary huts was finalized by the Committee.
Letter to Deputy Commissioner, Mohali, regarding payment for
50 23.2.2022
depositing of labour huts.
A letter to the brick kiln owner, Mr. Kewal Garg, requested to
intimate the place/site within the brick kiln premises so that the
51 4.3.2022
labour huts can be relocated to that place before laying the
overhead transmission line.
A letter was sent to the Addl. Deputy Commissioner requesting that
52 1.4.2022
the relocation of labour huts be facilitated.
A meeting was held in which a Committee was formed to inspect
53 29.4.2022 the site for a feasible location for huts. The Committee submitted its
report on 5.5.2022
54 5.5.2022 The Committee submitted its report on the shifting of labour huts.
Based on the Committee report, a letter dtd. 13.5.2022 was
received from the Addl. District Magistrate, SAS Nagar, to relocate
55 13.5.2022
the temporary huts at Spot 3 (recommended by the Committee in
its report)
Incident Report regarding stoppage of work for construction of
56 17/05/22 temporary huts due to an issue created by Mr Sunny Garg regarding
ownership of a piece of land identified for the construction of huts.
Proposal for change in the earlier identified location for relocation of
57 19.5.2022
huts.
A letter was received from the Additional District Magistrate SAS
58 26.5.2022
Nagar based on the revised proposal for relocating temporary huts.
A letter was sent to the Deputy Commissioner, Mohali, requesting
59 19.12.2022
support to complete the work.
Chronology of Writ Petition CWP No. 32701 of 2018
Submission
Sl.
/ Hearing Description
No.
Date
In view of Sh. Kewal Garg's continuous obstruction and to avoid
unnecessary delay in completing the national project,
1 22.11.2018 POWERGRID filed a Writ Petition (CWP No. 32701/2018) titled
POWER Grid Corporation of India Limited Vs. State of Punjab
and others.
A Civil Writ Petition was filed before the Hon'ble High Court
2 26.11.2018 Punjab and Haryana at Chandigarh, and it was fixed for hearing
on 15.12.2018.
A copy of the Petition was handed over to the State counsel to
enable him to assist. The Court to examine whether the relief
3 15.12.2018
sought was against Respondent No.5, a private person and as
such was maintainable.

4 7.1.2019 Learned State counsel sought adjournment.
5 16.1.2019 Learned State counsel sought adjournment.
6 22.2.2019 On request, the matter was adjourned to 26.2.2019.
At the request of the State counsel, the hearing in the matter was
7 26.2.2019
deferred to 1.3.2019.
Learned State counsel sought an adjournment to seek
8 1.3.2019
instructions in pursuance of the order dated 15.12.2018.
Pursuant to the order dated 15.12.2018, separate replies on
9 18.3.2019 behalf of Respondent No.1 and Respondent Nos. 2 to 4 were filed
in Court.
10 3.4.2019 Learned counsel for Respondent No.5 sought time to file a reply.
11 31.5.2019 Learned counsel for Respondent No.5 sought time to file a reply.
A reply was filed by Respondent No.5, and its copy was supplied
12 24.7.2019
to the opposite counsel.
13 26.8.2019 Not heard due to a shortage of time.
Notice of the application to the opposite counsel be issued for
14 19.9.2019
14.10.2019.
The application was again submitted to the Hon’ble High Court
15 5.10.2019
for an early hearing.
At the request of learned counsel for Respondent No.5,
16 29.10.2019
adjourned to 19.11.2019 for final arguments.
In an affidavit dated 18.3.2019, filed by the Deputy
Commissioner, SAS Nagar (Mohali), the matter was under active
17 17.12.2019
consideration with the administration, and more time was sought
to complete the process.
Court proceedings were not conducted due to COVID-19, and
18 19.3.2020 only urgent cases were taken up by the Judge online being till
22.6.2020
A meeting (VC) was chaired by the Chief Secretary of Punjab
regarding PRAGATI and PMG Projects along with the CMD of
POWERGRID. Issues were discussed in detail, including the
19 31.8.2020 underground laying of cable in alternate. POWERGRID informed
that the laying of the cable was not feasible.CMD POWERGRID
was told to withdraw CWP No. 32701 from Court as agreed with
the Chief Secretary of Punjab in the PMG meeting.
ACS asked POWERGRID officials to contact the Deputy

Commissioner, Mohali, to proceed further in the matter.
20 3.9.2020
POWERGRID informed the Additional Chief Secretary (Power)
that the Writ Petition filed by POWERGRID should be withdrawn.
The meeting was attended by officials of POWERGRID under the

aforesaid direction of the Additional Chief Secretary, Power. The
issues were discussed in detail, and the application filed for the
21 8.9.2020
withdrawal of the Writ Petition was handed over to Deputy
Commissioner Mohali. CM No.9132 of 2020 filed in CWP No.
32701 of 2018.

It was submitted in the application that various rounds of
meetings were held with the Respondents, and they now intend
22 16.9.2020
to complete the pending work of laying a 220 kV electricity
transmission line on a priority basis.
23 16/09/20 CWP No. 32701 of 2018 was dismissed as withdrawn.
Chronology of Writ Petitions (CWP No. 19391 of 2020 and CWP No. 5181 of 2021)
Submission
Sl. No. / Hearing Description
Date
The brick kiln owner filed CWP against the Union of India, Govt.
1 12.11.2020 of Punjab, and 'POWERGRID' before the Hon'ble High Court of
Punjab and Haryana.
In the meantime, the Respondents were restrained from
2 16.11.2020
erecting any transmission lines till the next hearing date.
The matter was posted for completion of pleadings by
3 8.12.2020
Respondents Nos.1 to 3 for 13.1.2021.
4 13.1.2021 Adjourned to 23.2.2021
Adjourned at the request of Respondent No. 1 (UOI), seeking

5 23.2.2021
more time to file a reply.
Brick kiln labourers filed a new CWP No. 5181 of 2021, which
6 4.3.2021
was tagged to the existing case.
Counsel for the State and UOI sought time to file a reply in CWP
7 26.3.2021
No. 5181 of 2021.
The matter was adjourned to 20.8.2021 due to Covid-19
8 3.5.2021
pandemic.
9 20.8.2021 The matter was postponed for argument on 25.8.2021.
10 25.8.2021 The matter was fixed for the final argument on 26.8.2021.
11 26.8.2021 Arguments concluded, and order reserved.
12 25.10.2021 Judgment delivered.
Chronology of LPA Nos: 1115, 1116 and 1121 of 2021
Submission
Sl. No. / Hearing Description
Date
3 LPA Nos. 1115, 1116 and 1121 of 2021 filed against the
1 20.11.2021
judgment dated 25.10.2021.
2 25.11.2021 ASG for the Union of India sought adjournment.
The Assistant Solicitor General of India prayed for an
3 1.12.2021
adjournment.
4 20.12.2022 Additional Solicitor General of India prayed for some

more time to comply with the order passed by this Court on
1.12.2021.
More time was granted to file the affidavit. However, the Court
directed that a copy of the affidavit to be filed by the
5 17.1.2022
Respondents be served upon the counsel for the parties in
advance.
6 27.1.2022 Non-effective hearing. The matter was adjourned to 23.2.2022.
7 23.2.2022 Non-effective hearing.
8 2.5.2022 The matter was listed on 20.7.2022
9 20.7.2022 The matter adjourned due to ASG being unwell.
10 26.7.2022 Urgent application for granting a stay.
11 27.7.2022 Urgent application for granting a stay.
12 28.7.2022 Arguments concluded and judgement reserved.
The Court affirmed the order dated 25.10.2021, passed by the

13 16.12.2022
learned Single Judge.
Petition filed in Hon’ble Supreme Court (Caveat No: 12479-

2022 & 12486-2022) against the Hon’ble High Court judgment
14 17.12.2022 in CWP-32701-2018, CWP-5181-2021, CWP-19391-2021,
LPAs- 1115, 1116, 1121 of 2021 by Ravinder Singh and Kewal
Garg. Petition is sub-judice before the Hon’ble Supreme Court.
Delay due to Approval for Laying of Cable from NHAI
h) The cable implementation involved execution work along the Chandigarh-
Ambala Highway. Accordingly, a proposal was submitted on 10.1.2018 to the
Regional Officer (North), Ministry of Road Transport & Highways (MoRTH),
Chandigarh, and Highway Administrator cum Regional Officer wherein
MoRTH approved the proposal and copy along with NOC was received from
the Project Director, NHAI, Chandigarh on 31.12.2018. On 12.1.2019, the
Petitioner started the execution work along with Chandigarh-Ambala National
Highway. However, on the same day, the work was stopped by NHAI, and
after a lot of effort and persuasion, NHAI was again allowed to start work on
21.2.2019.

Sl.
Date Description of Delay Reason
No
The cable's implementation involves execution work along the
Chandigarh-Ambala Highway. Accordingly, the NHAI proposal was
1 10.1.2018
submitted to the Regional Officer (North), Ministry of Road
Transport & Highways (MoRTH), Chandigarh.
NHAI returned a proposal to rectify MoRTH's observation. It was
2 7.2.2018
also directed to submit the proposal as per MoRTH guidelines.
Revised proposal as per MoRTH guidelines, submitted to the
Project Director, NHAI, Panchkula. In reply to the revised proposal,
3 9.2.2018 NHAI asked POWERGRID to adopt any other alternate route
because of future expansion and the creation of additional features
required for road users.
After NHAI denied the proposal, POWERGRID officials surveyed
the whole Zirakpur area. They found that the route already finalized
4 14.3.2018
was the only feasible route to lay the power cable. POWERGRID
once again requested that NHAI reconsider the proposal.
NHAI intimated that since important works under Zirakpur flyover
5 2.4.2018 were under consideration, the proposal could not be considered for
approval.
In response to the re-consideration of the revised proposal, PD,
NHAI, Mohali considered the proposal and forwarded it to the
6 12.7.2018
concerned Independent Consultancy to review it as per MoRTH
guidelines and calculate the ‘’License Fee’’ of the proposal.
After reviewing the report from the Independent Consultancy, NHAI
PD in Mohali notified POWERGRID that the annual License Fee
7 24.7.2018 was Rs. 74,31,900 and a Performance Bank Guarantee at the rate
of Rs. 100 per running meter for the initial one-year period was
required in favour of NHAI.
POWERGRID paid the License Fee amounting to Rs. 3,59,20,860
/- for five years, and the BG amounting to Rs. 8,70,000/-. The
8
Regional Officer of MoRTH in Chandigarh granted Provisional
Permission for one year in response to the above.
October, Project Director, NHAI, submitted the proposal to Highway
9
2018 Administrator cum Regional Officer, MoRTH Chandigarh.
Highway Administrator cum Regional Officer, MoRTH, approved
10 31.12.2018 the proposal and copy along with NOC received from Project
Director, NHAI, Chandigarh.
POWERGRID started the execution work along the Chandigarh—
11 12.1.2019 Ambala National Highway. However, on the same day, the M/S
GMR team stopped working.
12 21.2.2019 After a lot of effort and persuasion, NHAI allowed the work.
Delay due to Covid-19 related lockdown and restrictions:
i) Another reason for the time over-run was the outbreak of the Covid-19

pandemic and the subsequent lockdowns and restrictions imposed in the wake
of the outbreak of Covid-19.
j) The specific Covid-19 related challenges, which included supplier-delivery
issues, worker absenteeism due to illness, delayed issuance of permits, travel
restrictions, and loss of time or inefficiencies due to the need to practice social
distancing on the job site, affected the implementation of the transmission
assets. The contractors could not carry out the work in view of the restrictions
imposed by the Governments to prevent the spread of the outbreak Covid-19
pandemic. The major factors impacting the project schedule and
implementations were the lack of engineering, technical support, and supply
chain disruptions. The following are the details of the nationwide lockdowns in
India in various phases owing to the Covid-19 pandemic:
· Phase 1: 25th March, 2020 – 14th April, 2020 (21 days)
· Phase 2: 15th April 2020 – 3rd May, 2020 (19 days)
· Phase 3: 4th May, 2020 – 17th May, 2020 (14 days)
· Phase 4: 18th May, 2020 – 31st May, 2020 (14 days)
Unlock:
· Unlock 1.0: 1st June, 2020 – 30th June, 2020 (30 days)
· Unlock 2.0: 1st July, 2020 – 31st July, 2020 (31 days)
· Unlock 2.0: 1st August, 2020 – 31st August, 2020 (31 days)
k) Therefore, the commissioning of the transmission project also faced delays
due to the squeezing of supply lines and construction activities.
l) When construction resumed, some additional delays and inefficiencies
pushed back completion dates. The construction could not be started
immediately due to the biggest hurdle, the supply chain not being fully

restored. There was also the consideration that the area would be sealed if
anybody got infected on the construction site after work had started. All related
people would be quarantined for 14-28 days. As a result, the construction
pace came to a grinding halt. Additionally, administrative action/FIR would be
lodged against the sub-contractors, adding to the pace of lethargic progress.
With the halting of various line construction activities, the work was at a
standstill position and gradually gathered speed in line with government
directives.
m) Hearings of the Petitions related to RoW issues before the Hon’ble High Court
of Punjab and Haryana were suspended or delayed due to the COVID-19
pandemic. This disruption contributed to the postponement of the judgment in
the case, and it further delayed the construction of the transmission line.
n) The Ministry of Power (MoP) also acknowledged the Covid-19 pandemic as a
Force Majeure event and, vide its letter dated 27.7.2020, allowed the extension
of the SCOD by 5 months in case of all the inter-State transmission projects,
which were under construction as on 25.3.2020, to mitigate the issues of
disruption in supply chains and manpower, caused due to outbreak of the
Covid-19 pandemic. MoP vide its letter dated 12.6.2021, allowed further
extension in SCOD by 3 months to all inter-State projects with the SCOD after
1.4.2021.
o) In response to the Commission’s Record of Proceedings (RoP) dated
27.2.2024, the Petitioner filed an affidavit on 12.3.2024 detailing the impact of
the Covid-19 pandemic on the transmission project. The Petitioner additionally
explained that when the construction activities resumed, additional delays and
inefficiencies further pushed back the completion dates. Immediate

commencement of construction was not feasible. The primary obstacle was the
incomplete restoration of the supply chain. If any worker was contracted with
COVID-19 on-site, the area used to be sealed, and all individuals present would
be required to quarantine for 14 to 28 days. Consequently, the construction
pace significantly came to a standstill due to the Covid-19 pandemic.
Furthermore, concerns about potential administrative actions or FIRs against
sub-contractors contributed to a sluggish pace of progress. As various
construction activities were halted, work remained at a standstill until it
gradually picked-up speed in accordance with Government directives.
p) The Petitioner has submitted the following summary of reasons for the delay:
Sl. No. Delay

Reasons for Delay Start End Net delay (Days)
(Days)
Delay due to RoW
1 10.10.2017 19.12.2022 1896 1896
issues
CWP No. 32701 of
(Common with
2 2018 before the Hon’ble 22.11.2018 16.9.2020 664
Sl. No. 1)
High Court
CWP Nos. 19391 of
2020 and CWP No. (Common with Sl.
3 12.11.2020 25.10.2021 347
5181 of 2021 before the No. 1)
Hon’ble High Court
LPA Nos. 1115, 1116

(Common with Sl.
4 and 1121 of 2021 before 20.11.2021 16.12.2022 391
No. 1)
the Hon’ble High Court
407 (Subsumed
5 Delay due to NHAI 10.1.2018 21.2.2019 407
in Sl. No. 1)
Covid-19 Pandemic (Common with Sl.

6 25.3.2020 24.8.2020 153
(First Wave) Nos. 1, 2, 3 & 4)
Covid-19 Pandemic (Common with Sl.

7 1.4.2021 30.6.2021 91
(Second Wave) No. 3)
Total Net Delay (60 months and 9 days) 1896
q) There were persistent RoW issues, along with stay orders issued by the

Punjab State administration and the Courts, from 22.11.2017 to 16.12.2022,
resulting in a total duration of 60 months and 9 days. Further, there was a
delay on account of approval from NHAI for the laying of cable from 10.1.2018
to 21.2.2019 (around 13 months). Although various problems occurring
concurrently could have delayed the project enormously, the Petitioner’s
experience and expertise in project planning and execution curtailed the
aforesaid cumulative delays to 49 months and 9 days. Thereafter, the
Petitioner immediately completed the work on a war footing, and the
transmission assets were ready to be declared under commercial operation
from 24.3.2023.
Analysis and Decision
42. We have considered the Petitioner’s submissions and perused the record.
43. On perusing the record, we note that, as per the IA dated 13.2.2017, the
transmission project was accorded by the Board of Directors of the Petitioner on
9.2.2017 and was scheduled to be completed within 24 months, i.e., by 9.2.2019.
The transmission assets were declared under commercial operation on 24.3.2023,
with a delay of 49 months and 14 days (i.e., 9.2.2019 to 24.3.2023 = 1504 days).
44. The Petitioner has contended that the commissioning of the transmission
assets was delayed due to Right of Way (RoW) issues, court cases, delay in getting
approval from NHAI, and the outbreak of the COVID-19 pandemic. For the delay
on account of RoW issues, the Petitioner has contended that the commissioning
work of the transmission assets was hampered and obstructed for the period from
10.10.2017 to 19.12.2022 (i.e., 1896 days). The item-wise time over-run is
analysed, and the same is as follows:

(a) Delay Due to RoW Issues
45. According to the Petitioner, its 220/66 kV GIS Sub-station was ready for
charging in February 2019, but the sub-station could not be charged due to the
unavailability of upstream and downstream infrastructure. The transmission line
traverses the districts of Haryana, Punjab, and the Union Territory of Chandigarh.
However, during the implementation of the transmission line, the Petitioner faced
severe RoW issues, including excessive crop compensation, land compensation,
man-handling of gang workers, etc. To alleviate the RoW issues, the Petitioner
received assistance from the State Administration, District Administration, and the
Police Department.
46. The Petitioner has contended that, out of 56 transmission towers, 51 were
completed, while there were several RoW issues concerning 5 towers. Further, 26
out of 31 towers in Punjab were erected, while 5 towers located in villages
Mumbarakpur, Pandwala, and Sanauli faced construction-related challenges and
obstructions caused by a local brick kiln owner. The RoW issues persisted between
10.10.2017 and 19.12.2022. During this period, the Petitioner approached the
concerned Governmental Authorities and Courts to redress the grievances.
47. On perusal of the Petition, we find that the Petitioner started excavation work
for the foundation at location no.7/0. The same was stopped by the labour deployed
by a brick kiln owner who threatened the Petitioner and its staff. We further note
that the Petitioner, vide its letter dated 22.11.2017, approached the Deputy
Commissioner, Mohali, who in turn informed SDM Dera Bassi and asked him to
provide police assistance. We further note that on 11.1.2018, the Petitioner
received a letter from the District Magistrate, SAS Nagar, Mohali, to change the line

route, which was based on the report of SDM Dera Bassi and DSP Dera Bassi. On
22.1.2018, the Petitioner wrote a letter to the Deputy Commissioner, SAS Nagar,
Mohali, informing him that the tower foundations on both ends had been completed
and the route that followed was the only possible techno-economical route for the
transmission line. The Petitioner, through its letters dated 19.2.2018, 1.3.2018,
7.5.2018, 24.5.2018, and 25.5.2018, informed the District Administration, SAS
Nagar, that re-routing was not possible and urged them to pass appropriate orders.
Letters from 29.5.2018 to 20.7.2018, written by the Petitioner, show that they were
exchanged with the different Governmental authorities in connection with the line
route.
48. The Petitioner has placed on record a letter dated 1.8.2018 written by ADM,
SAS Nagar, addressed to Addl. Chief Secretary, Department of Power,
Government of Punjab, informing him that the Petitioner had selected an
inappropriate route and instructed him to withhold the work till resolution of the issue
by the Punjab Government. Referring to a letter dated 1.8.2018, the Petitioner
wrote a letter to the Chief Secretary, Government of Punjab, on 28.8.2018
explaining that the appropriate distance of the transmission line (conductors) has
been maintained for the safe flow of electricity through the transmission line. The
contents of the letters written by the Petitioner from 7.3.2019 to 16.6.2019, show
that it followed up the matter with the Government Authorities for RoW issues. On
18.9.2020, the Additional Chief Secretary directed the Petitioner to explore the
possibility of an underground cable to be laid in the area and provide the technical
feasibility report with respect to the same.
49. On perusal of the orders dated 22.10.2020 and 9.11.2020, it is revealed that
District Magistrate, SAS Nagar, granted permission under Section 10 of the Indian

Telegraph Act, 1885, for the construction of towers of 220 kV D/C Chandigarh-
Panchkula Transmission Line at Location Nos. 61/1, 6A/1,7/0, 7/1 and 7/2 in the
concerned villages. The District Magistrate, SAS Nagar, in its said orders, further
directed that temporary huts of the labourers in the brick kiln which were falling
within the transmission line corridor be removed and shifted to any other place
within/near the brick kiln premises and the costs of such removal and shifting would
be borne by the Petitioner.
50. Against the aforesaid orders of the District Magistrate, the brick kiln owners
filed CWP Nos. 19391 of 2020 and 5181 of 2021 before the Hon’ble High Court of
Punjab and Haryana. Upon hearing the parties, the Court, vide its order dated
25.10.2021, upheld the orders of the District Magistrate.
51. The record shows that pursuant to the orders of the Hon’ble High Court dated
25.10.2021, ADC formed a Committee vide its letter dated 12.1.2022 to assess
compensation and re-location of the temporary huts. The minutes of the meeting
dated 29.4.2022 issued by the District Magistrate, SAS Nagar, show that
instructions were issued to inspect the site and submit a feasibility report regarding
the re-location of huts. Thereafter, on 19.12.2022, the Petitioner wrote a letter to
the Deputy Commissioner, SAS Nagar, Mohali, regarding the erection and stringing
of the remaining tower at location no. 6A/1 of 220 kV DC Panchluka-Chandigarh
line.
52. In view of the above discussions and on perusal of the documents on record,
we are of the view that the Petitioner earnestly took up the matter to resolve the
severe RoW issues/ obstructions created by the brick kiln owner/ landowners of
Mubarakpur with the District Administration through various

correspondences/meetings. The Petitioner also requested for the appointment of a
Duty Magistrate and adequate police protection to facilitate the completion of the
remaining work on the transmission line peacefully and categorically expressed its
inability to re-route the transmission line/underground cable at the disputed site and
the same is apparent various letters from the letters dated 22.11.2017, 22.1.2018,
19.2.2018, 1.3.2018, 7.5.2018, 24.5.2018, 25.5.2018, 29.5.2018, 8.6.2018,
28.8.2018, 7.3.2019, 22.3.2019, 3.5.2019, 21.5.2019, 17.6.2019, 9.8.2019,
22.10.2019 and 6.10.2020. We further note the letter dated 1.8.2018 issued by
ADM, SAS Nagar to Addl. Chief Secretary, Department of Power, Government of
Punjab, stated the Petitioner had selected an inappropriate route and instructed
him to withhold the work till resolution of the issue by the Punjab Government, and
as such, the Petitioner could not proceed with the project work till 22.10.2020 and
9.11.2020, when the District Magistrate, SAS Nagar, granted permission to
exercise the powers under Section 10 of the Telegraph Act, 1885 regarding the
construction of towers for the 220 kV D/C Chandigarh-Panchkula Transmission
Line at location Nos. 6/1, 6A/1, 7/0, 7/1, and 7/2 in the respective villages. In these
circumstances, we are of the view that the delay that occurred from 10.10.2017 to
9.11.2020 was uncontrollable and beyond the Petitioner’s control, and the same
has been condoned.
53. The orders passed by the District Magistrate dated 22.10.2020 and
9.11.2020 were challenged by the brick kiln owner before the Hon’ble High Court
of Punjab and Haryana in CWP No. 19391 of 2020 on 12.11.2020 and in CWP No.
5181 of 2021 on 4.3.2021. The aforesaid orders of the District Magistrate were
affirmed by the Hon’ble Court vide its common judgment dated 25.10.2021 in CWP
Nos. 19391 of 2020 and 5181 of 2021, with the observations that the transmission

line shall not be laid before the re-location of the temporary huts of the labours.
Accordingly, a Committee was constituted by the ADC, SAS Nagar, Mohali, to
assess costs relating to the re-location of huts, which submitted its report to the
District Administration vide letter dated 26.5.2022 in order that the re-location of
huts may take place and commissioning of the balance work of the transmission
line may be done. Thereafter, the Petitioner wrote a letter to DC Mohali to provide
support in completing the work. Thus, the delay, in our opinion, subsequent to the
orders of the District Magistrate dated 20.10.2020 and 9.11.2020, i.e., from
10.11.2020 to 24.10.2021, was uncontrollable due to the Court cases being
pending before the Hon’ble High Court of Punjab and Haryana. The time period
from the date of pronouncement of judgment in CWP Nos. 19391 of 2020 and 5181
of 2021, dated 25.10.2021 to 26.5.2022 i.e., owing to the re-location of huts, was
uncontrollable and beyond the Petitioner’s control. Accordingly, we condone the
delay from 10.11.2020 to 26.5.2022. The Petitioner has not submitted any proper
justification for the intervening period of 26.5.2022 to 19.12.2022 (i.e., 6 months
and 23 days). In the absence of any documentary evidence, we do not find any
reason to condone the delay that occurred between 26.5.2022 and 19.12.2022 (207
days) as uncontrollable, and the same has not been condoned.
54. As discussed above, the time period from 10.10.2017 to 9.11.2020 due to
ROW problems is beyond the control of the Petitioner, and the same has been
condoned. The time over run from 25.10.2021 to 26.5.2022, owing to the re-location
of huts, was beyond the control of the Petitioner, and the same has been condoned
Therefore, the net impact on account of RoW issues in the commissioning of the
transmission line from the SCOD of the transmission asset is from 09.2.2019 to
9.11.2020 (640 days) & from 25.10.2021 to 26.5.2022 ( 214 days), i.e., a total of

854 days is beyond the control of the Petitioner, and the same has been condoned.
the
Condonation of Delay Due to filing of CWP No. 32701 of 2018
55. The Petitioner has prayed for condonation of a delay from 22.11.2018 to
16.9.2020, i.e., 664 days on account of filing CWP No. 32701 of 2018 before the
Hon’ble High Court of Punjab and Haryana. We have considered the Petitioner's
submissions on this count. The Petitioner, being aggrieved by the obstructions
caused by the brick kiln owner, filed a CWP No. 32701 of 2018 before the Hon’ble
High Court of Punjab and Haryana, which was later withdrawn by it on 16.9.2020.
We refrain from making any observations with regard to the delay for this duration.
However, the period of delay from 9.2.2019 to 16.9.2020 is subsumed in the delay
that we have already condoned above in this order with reference to the observation
on the condonation of delay for RoW issues. Accordingly, the time over-run on
account of CWP No. 32701 of 2018 is subsumed in RoW problems faced by the
Petitioner.
Condonation of Delay Due to the filing of CWP Nos. 19391 of 2020 and 5181
of 2021
56. The Petitioner has contended that two CWP Nos. 19391 of 2020 and 5181
of 2021 were filed before the Hon’ble High Court of Punjab and Haryana on
12.11.2020 and 4.3.2021 by the brick kiln owner and by brick kiln labourers
respectively, against the orders passed by the District Magistrate on 22.10.2020
and 9.11.2020. The Hon’ble High Court, vide its order dated 16.11.2020, restrained
the Petitioner from laying the transmission line, and the Hon’ble Court, vide its order
dated 25.10.2021, eventually disposed of the said CWPs.
57. We have considered the contentions of the Petitioner and have perused the

record. In our opinion, the petitioner was not able to continue the work at the site
from 16.11.2020 to 24.10.2021 due to a restrain order passed by the Hon’ble High
Court dated 16.11.2020. Therefore, the net impact on account of the restrain order
passed by the Hon’ble High Court for the period from 16.11.2020 to 24.10.2021,
i.e., 343 days in commissioning of the transmission line, is beyond the control of
the Petitioner. Accordingly, the time over-run of 343 days on account of CWP No.
32701 of 2018 has been condoned.
Condonation of Delay Due to the filing of LPA Nos. 1115, 1116, and 1121 of
2021
58. The Petitioner has contended that landowners filed the LPA Nos. 1115, 1116,
and 1121 of 2021 before the Hon’ble High Court of Punjab and Haryana on
20.11.2021 against the order dated 25.10.2021 in CWP No. 19391 of 2020 and
5181 of 2021 of the Hon’ble High Court. The Hon’ble High Court, vide its order
dated 16.12.2022, dismissed the said LPAs and upheld the order dated
25.10.2021. Accordingly, the Petitioner has prayed for condonation of a delay from
20.11.2021 to 16.12.2022 (391 days).
59. We have considered the above contentions of the Petitioner and have
perused the record. On perusal of the record, we note that the said LPAs were
posted for hearing before the Hon’ble Court from 25.11.2021 to 28.7.2022, but no
stay was there during this period on the commissioning of the transmission line by
the Petitioner against the order dated 25.10.2021 in CWP Nos. 19391 of 2020 and
5181 of 2021. The said LPAs were dismissed by the Hon’ble Court on 16.12.2022.
Thus, we are not inclined to consider the delay that occurred from 20.11.2021 to
16.12.2022, as there was no stay on the order dated 25.10.2021 in CWP Nos.
19391 of 2020 and 5181 of 2021.

Delay Due to Approval for Laying of Cable From NHAI
60. The Petitioner has contended that the implementation work of cable involved
commissioning work along the Chandigarh-Ambala Highway. Accordingly, the
NHAI proposal was submitted by the Petitioner on 10.1.2018 to the Regional Officer
(North), Ministry of Road Transport. A copy of the approval of the proposal along
with NOC was received from the Project Director, NHAI, Chandigarh, on
31.12.2018. On 12.1.2019, the commissioning work was started along with the
Chandigarh– Ambala National Highway. However, on the same day, M/s. GMR
team stopped the work and, after a lot of efforts and persuasions, NHAI again
allowed to start work on 21.2.2019.
61. We have considered the Petitioner’s contentions and have gone through the
documents on record. It is observed that the delay of 407 days, i.e., from 10.1.2018
to 21.2.2019, as claimed by the Petitioner, is due to a delay in NOC to start the
work from NHAI. We are of the view that we already condoned the time over-run
on account of net impact due to RoW problems, and the Petitioner had resolved
the NHAI permission-related issues prior to SCOD of the transmission assets, i.e,,
9.2.2019. Therefore, only the time period from 9.2.2019 to 21.2.2019 is impacted
due to NHAI’s permission to carry cable laying work. The net impact of the delay
in NHAI permission is subsumed in RoW problems.
Delay Due to Covid-19 Pandemic
62. The Petitioner has contended that COVID-19 was declared a global
pandemic by the World Health Organization (WHO) and constituted a force majeure
event affecting all global business and industry sectors. The pandemic led to critical
delays in project commissioning due to various factors, such as movement
restrictions that severely impacted supply chains, transportation, and labour

availability, including absenteeism caused by illness, quarantine, and migration.
The Petitioner has contended that MoP vide circulars dated 27.7.2020 and
12.6.2021 accorded the extension of 5 months and 3 months, respectively, in
respect of SCOD due to the nationwide lockdown restrictions for containment of the
spread of the Covid-19 pandemic.
63. We have considered the Petitioner’s contentions and have gone through the
record. It is observed that the delay claimed by the Petitioner due to the COVID-19
pandemic is subsumed in the delay condoned in respect of RoW issues from
9.2.2019 to 25.5.2022. Therefore, no finding is called for on this count.
64. The Petitioner has contended that as per the Gantt/CPM Chart submitted,
the Petitioner kept only 12 days for testing and commissioning while the Petitioner
took 93 days, i.e., from 19.12.2022 to 23.3.2023 for testing and commissioning of
the 220 kV D/C Chandigarh to Panchkula transmission line. The Petitioner has
prayed to condone the delay from 19.12.2022 to 23.3.2023.
65. We have considered the above contentions of the Petitioner and have
perused the record. On examination of the record, we note that the Petitioner has
failed to furnish any reasons why it took 93 days to test and commission the
transmission assets. In the absence of any justification for testing and
commissioning of the 220 kV D/C Chandigarh to Panchkula transmission line, the
minimum time of 12 days planned by the Petitioner is hereby condoned, and the
balance period of 81 days is not condoned.
66. The summary of the delay claimed by the Petitioner and the period of delay
condoned/not condoned is as follows:

Time over- Time over-run Time over-run not
Asset Original SCOD COD
run condoned condoned
Asset I 24.3.2023 1214 Days 290 days
9.2.2019
1504 Days
Asset II 24.3.2023 1214 Days 290 days
1504 Days
Interest During Construction (IDC) and Incidental Expenditure During

Construction (IEDC)
67. The Petitioner has claimed IDC for the transmission assets and has
submitted the statement showing IDC claim, discharge of IDC liability as on COD
and thereafter, and the same is as follows:
(₹ in lakh)
IDC as per IDC
Asset Auditor’s IDC discharged IDC discharged
discharged
Certificate during the FY during the FY
up to COD
2022-23 2023-24
Asset I 5144.60 4818.03 0.00 326.57
Asset II 292.08 275.21 3.02 13.85
68. We have considered the submissions of the Petitioner. The allowable IDC
has been worked out considering the information submitted by the Petitioner in
respect of the transmission assets on a cash basis. The loan details submitted in
Form-9C for the 2019-24 tariff period and IDC computation sheet have been
considered for IDC calculation on a cash and accrued basis. The undischarged IDC
has been considered as ACE during the year in which it has been discharged. The
IDC claimed and considered as on COD and summary of discharge of IDC liability
up to the COD and thereafter, for tariff determination subject to its revision at the
time of truing-up is as follows:

(₹ in lakh)
IDC
disallowed IDC IDC
IDC as per IDC
due to IDC discharged discharged
Asset Auditor’s discharged
time over- allowed during the during the
Certificate upto COD
run not FY 2022-23 FY 2023-24
condoned
Asset I 5144.60 695.12 4449.48 4075.13 374.36 0.00
Asset II 292.08 38.53 253.55 236.67 3.02 13.86
69. The Petitioner has claimed IEDC of ₹4018.32 lakh for Asset-I and ₹292.08
lakh for Asset-II and has also submitted the Auditor’s Certificate in support of the
same. The Petitioner has further submitted that the entire IEDC has been
discharged as on COD. The time over-run for 294 days has not been condoned,
therefore, the IEDC for the transmission assets has been proportionately
disallowed. The IEDC claimed as per the Auditor’s Certificate, IEDC considered
and discharged up to the COD for the transmission assets is as follows:
(₹ in lakh)
IEDC
IEDC IEDC
claimed as per
Assets disallowed due to allowed
Auditor’s certificate
time over-run not condoned (B) (C)=(A-B)
(A)
Asset I 4018.32 521.63 3496.69
Asset II 249.17 32.35 216.82
Initial Spares
70. The Petitioner has claimed the following Initial Spares for the transmission assets:
(₹ in lakh)
Plant and
Spares Limit
Machinery Allowable Excess Spares
Asset Particulars claimed (c)
Cost (d=c*(a-b)/(100-c) (e=b-d)
(b) in %
(a)
Transmission
Asset-I 17453.17 184.40 1.0 174.43 (-)9.97
Line
AIS-Brown Field
Asset-I 547.29 28.91 6.0 33.09 4.18
Sub-station
GIS-Green Field
Asset-I 6422.44 134.53 5.0 330.94 196.41
Sub-station
GIS-Green Field
Asset- II 1214.75 33.26 5.0 62.18 28.92
Sub-station
71. Further, the Petitioner has submitted the year-wise break-up of the Initial

Spares being discharged and claimed as ACE as follows:
(₹ in lakh)
Initial spares
Total
Initial Spares claimed claimed as ACE
Asset Particulars spares
up to COD during
claimed
FY 2023-24
Asset-I Transmission Line 184.40 184.40 0.00
AIS-Brown Field
Asset-I 28.91 26.52 2.39
Sub-station
GIS-Green Field
Asset-I 134.53 120.58 13.95
Sub-station
GIS-Green Field
Asset-II 33.26 30.53 2.73
Sub-station
72. Regulation 23(d) of the 2019 Tariff Regulations provides that Initial Spares
shall be capitalized as a percentage of the plant and machinery cost up to the cut-
off date, subject to the following ceiling norms:
“23. Initial Spares: Initial spares shall be capitalised as a percentage of the Plant
and Machinery cost, subject to following ceiling norms:
….
(d) Transmission System
(i) Transmission line- 1.00%
(ii) Transmission sub-station
- Green Field- 4.00%

- Brown Field- 6.00%
(iii) Series Compensation devices and HVDC Station- 4.00%
(iv) Gas Insulated Sub-station (GIS)
- Green Field- 5.00%
- Brown Field- 7.00%
(v) Communication System- 3.50%
(vi) Static Synchronous Compensator- 6.00%”
73. We have considered the Petitioner’s submissions. Based on the information
available on record, the Initial Spares for the transmission assets are allowed as per
Regulation 23(d) of the 2019 Tariff Regulations. The Initial Spares allowed for the
transmission assets are as follows:

(₹ in lakh)
Plant and
Machinery Ceiling as
cost for Initial per Initial Excess Initial
Components of Spares Spares Initial Spares
Assets the assets calculation Regulations
of Initial claimed (in %) allowable Spares allowed
Spares
D=(A-
A B C B)*C/(100%- E=B-D
C)
Transmission Line 17453.17 184.40 1.00 174.43 9.97 174.43
Asset-I
GIS-Green Field
Asset-I 6422.44 134.53 5.00 330.94 0.00 134.53
Sub-station
Asset-I AIS-Brown Field
Sub-station 547.29 28.91 6.00 33.09 0.00 28.91
GIS-Green Field
Asset-II 1214.75 33.26 5.00 62.18 0.00 33.26
Sub-station
74. Further, out of the total allowable Initial Spares, Initial Spares of ₹16.34 lakh
and ₹2.73 lakh for Assets-I and II, respectively, have been allowed as ACE during
the FY 2023-24 as follows:
(₹ in lakh)
Initial Spares allowed as ACE during
Asset Particulars
FY 2023-24
Asset-I Transmission Line 0.00
Asset-I GIS-Green Field Sub-station 13.95
Asset-I AIS-Brown Field Sub-station 2.39
Asset-II GIS-Green Field Sub-station 2.73
75. The capital cost of the transmission assets (as on COD) is allowed as follows:
(₹ in lakh)
Capital Cost IDC disallowed
claimed as on Excess Capital Cost
due to time Undischarged IEDC
Asset COD Initial as on COD
over-run not IDC as on COD disallowed
(Auditor’s Spares (F) = (A-B- C-D-E)
condoned (C) (D)
Certificate) (A) (E)
(B)
Asset-I 30539.00 695.12 374.36 521.63 9.97 28937.93
Asset- II 1844.21 38.53 16.88 32.35 0.00 1756.45

Additional Capital Expenditure (“ACE”)
76. Regulations 24 and 25 of the 2019 Tariff Regulations provide as follows:
“24. Additional Capitalisation within the original scope and upto 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 23of 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

capitalization shall be worked out after adjusting the gross fixed assets and
cumulative depreciation of the assets replaced on account of de-capitalization.
(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.
25. Additional Capitalisation within the original scope and after the cut-
off date
(1) The additional capital expenditure incurred or projected to be incurred in

respect of an existing project or a new project on the following counts within the
original scope of work and after the cut-off date may be admitted by the
Commission, subject to prudence check:
(a) 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;
(b) Change in law or compliance of any existing law;
(c) Deferred works relating to ash pond or ash handling system in the
original scope of work;
(d) Liability for works executed prior to the cut-off date;
(e) Force Majeure events;
(f) Liability for works admitted by the Commission after the cut-off
date to the extent of discharge of such liabilities by actual payments;
Raising of ash dyke as a part of ash disposal system.
(2) In case of replacement of assets deployed under the original scope of the
existing project after cut-off date, the additional capitalization may be admitted by
the Commission, after making necessary adjustments in the gross fixed assets and

the cumulative depreciation, subject to prudence check on the following grounds:
(a) The useful life of the assets is not commensurate with the useful life of
the project and such assets have been fully depreciated in accordance with
the provisions of these regulations;
(b) The replacement of the asset or equipment is necessary on account of

change in law or Force Majeure conditions;
(c) The replacement of such asset or equipment is necessary on account

of obsolescence of technology; and
(d) The replacement of such asset or equipment has otherwise been

allowed by the Commission.”
77. The Petitioner has submitted that the ACE incurred/ projected to be incurred
is mainly on account of balance/ retention payments and, therefore, the same is
claimed under Regulation 24(1)(a) and Regulation 24(1)(b) of the 2019 Tariff
Regulations. The ACE claimed by the Petitioner for the transmission assets is as
follows:
(₹ in lakh)
FR RCE Projected ACE
Apportioned Estimated
Apportioned Expenditure
Asset Approved 2022-23 2023-24 2024-25 Completion
Approved
up to COD Cost
Cost Cost
Asset I 30770.28 36015.17 30539.00 0.00 3615.42 1549.47 35703.89
Asset II 1459.72 2062.83 1844.21 0.00 136.57 58.53 2039.31
Total 32230.00 38078.00 32383.21 0.00 3751.99 1608.00 37743.20
78. The Petitioner, vide affidavit dated 16.1.2024, has submitted the liability flow
statement in respect of Asset-I and Asset-II that is as follows:
(₹ in lakh)
Discharge Additional Liability Outstanding
Outstanding (Unexecuted work) Liability as
Asset Party Particulars Liability as on 31.03.2024
on COD 2022-23 2023-24 Total 2022-23 2023-24 Total
(2019-24) (2019-24)
Sterling &
Civil &
Wilson and
Building 23.86 0.00 3.82 3.82 0.00 42.94 42.94 20.04
Misc.
works
Asset- I Contractors
Transmission
KEC 1645.59 0.00 419.35 419.35 0.00 2441.86 2441.86 1226.23
line work

(2019-24) (2019-24)
Sterling & Substation
396.65 0.00 93.46 93.46 0.00 613.99 613.99 303.19
Wilson works
Total 2066.10 0.00 516.63 516.63 0.00 3098.78 3098.78 1549.47

(2019-24) (2019-24)
Sterling &
Civil &
Wilson and
Building 8.94 0.00 6.26 6.26 0.00 0.00 0.00 2.68
Misc.
works
Asset II Contractors
Sterling & Substation
186.16 0.00 130.31 130.31 0.00 0.00 0.00 55.85
Wilson works
Total 195.09 0.00 136.57 136.57 0.00 0.00 0.00 58.53
79. We have considered the submissions of the Petitioner. The projected ACE
allowed under Regulation 24(1)(a) of the 2019 Tariff Regulations on account of
balance/ retention payments and unexecuted work is as follows:
Asset-I:
(₹ in lakh)
Particulars 2022-23 2023-24
ACE approved for the Year 0.00 3599.08
Additional IDC Discharged 374.36 0.00
Additional Initial Spares Discharged 0.00 16.34
ACE allowed in the instant order 374.36 3615.42
Asset-II:
(₹ in lakh)
Particulars 2022-23 2023-24
ACE approved for the Year 0.00 133.84
Additional IDC Discharged 3.02 13.86
Additional Initial Spares Discharged 0.00 2.73
ACE allowed in the instant order 3.02 150.43
80. The capital cost considered for t r a n s m i s s i o n assets for the 2019-24
tariff period is as follows:

(₹ in lakh)
Capital Cost Projected ACE
Capital Cost as on
Asset
as on COD 2022-23 2023-24 31.3.2024
Asset-I 28937.93 374.36 3615.42 32927.71
Asset-II 1756.45 3.02 150.43 1909.90
Debt-Equity ratio
“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 utilization 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.”
82. The debt-equity ratio considered for t h e computation of tariff for the
transmission assets for the 2019-24 tariff period is as follows:
Asset I:
ACE Capital Cost

Capital Cost
during as on
Funding as on COD (in %) (in %) (in %)
2019-24 31.3.2024
(₹ in lakh) (₹ in lakh) (₹ in lakh)
Debt 20256.56 70.00 2792.85 70.00 23049.40 70.00
Equity 8681.37 30.00 1196.93 30.00 9878.31 30.00
Total 28937.93 100.00 3989.78 100.00 32927.71 100.00
Asset II:
ACE
Capital Cost Capital Cost as
during
Funding as on COD (in %) (in %) on 31.3.2024 (in %)
2019-24
(₹ in lakh) (₹ in lakh)
(₹ in lakh)
Debt 1229.52 70.00 107.42 70.00 1336.93 70.00
Equity 526.93 30.00 46.04 30.00 572.97 30.00
Total 1756.45 100.00 153.45 100.00 1909.90 100.00
Depreciation
“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 and its 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 assets 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 upto 31.3.2019 from the gross depreciable value of the assets.
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-capitalization 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.”
84. We have considered the Petitioner’s submissions. Considering the admitted
capital cost as on COD and ACE allowed during the 2019-24 tariff period, the
depreciation has been worked out. The Weighted Average Rate of Depreciation
(WAROD) has been worked out and placed as an Annexure for Assets I and II as
per the rates of depreciation specified in the 2019 Tariff Regulations. Depreciation
allowed in respect of the transmission assets for the 2019- 24 tariff period is as
follows:

Asset-I:
(₹ in lakh)
2022-23
days)
A Opening Gross Block 28937.93 29312.29
B Addition during the year 2019-24 due to projected ACE 374.36 3615.42
C Closing Gross Block (A+B) 29312.29 32927.71
D Average Gross Block (A+C)/2 29125.11 31120.00
E Average Gross Block (90% depreciable assets) 28536.38 30527.49
F Average Gross Block (100% depreciable assets) 588.73 592.51
Depreciable value (excluding IT equipment and software)
G 25682.74 27474.74
(E*90%)
H Depreciable value of IT equipment and software (F*100%) 588.73 592.51
I Total Depreciable Value (G+H) 26271.47 28067.25
J Weighted average rate of Depreciation (WAROD) (in %) 5.30 5.30
K Lapsed useful life at the beginning of the year 0 0
L Balance useful life at the beginning of the year 31 31
M Depreciation during the year (D*J) 33.82 1648.06
N Cumulative Depreciation at the end of the year (M+N) 33.82 1681.88
Remaining Aggregate Depreciable Value at the end of the
O 26237.65 26385.37
year (I-N)
Asset-II:
(₹ in lakh)
2022-23
days)
A Opening Gross Block 1756.45 1759.47
B Addition during the year 2019-24 due to projected ACE 3.02 150.43
C Closing Gross Block (A+B) 1759.47 1909.90
D Average Gross Block (A+C)/2 1757.96 1834.69
E Average Gross Block (90% depreciable assets) 1730.08 1806.67
F Average Gross Block (100% depreciable assets) 27.88 28.02
Depreciable value (excluding IT equipment and software)
G 1557.07 1626.01
(E*90%)
H Depreciable value of IT equipment and software (F*100%) 27.88 28.02
I Total Depreciable Value (G+H) 1584.95 1654.02
J Weighted average rate of Depreciation (WAROD) (in %) 5.04 5.05
K Lapsed useful life at the beginning of the year 0 0
L Balance useful life at the beginning of the year 25 25
M Depreciation during the year (D*J) 1.94 92.63
N Cumulative Depreciation at the end of the year (M+N) 1.94 94.57
Remaining Aggregate Depreciable Value at the end of the
O 1583.01 1559.45
year (I-N)
Interest on Loan (“IoL”)
“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-capitalization of assets, 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.”
86. The Weighted Average Rate of Interest on Loan (WAROI) has been
considered based on the prevailing rate on COD. The Petitioner has prayed that
the change in interest rate due to the floating rate of interest applicable, if any,
during the 2019-24 tariff period will be adjusted. Accordingly, the floating interest
rate, if any, will be considered at the time of truing-up. Therefore, the IoL has been
allowed in accordance with Regulation 32 of the 2019 Tariff Regulations for the

transmission assets, and the same is as follows:
Asset I:
(₹ in lakh)
2022-23
Particulars (pro-rata 2023-24
8 days)
A Gross Normative Loan 20256.56 20518.61
B Cumulative Repayments upto Previous Year 0.00 33.82
C Net Loan-Opening (A-B) 20256.56 20484.79
D Additions due to ACE 262.05 2530.79
E Repayment during the year 33.82 1648.06
F Net Loan-Closing (C+D-E) 20484.79 21367.52
G Average Loan (C+F)/2 20370.67 20926.15
H Weighted Average Rate of Interest on Loan (in %) 7.824 7.816
I Interest on Loan (G * H) 34.94 1635.60
Asset-II:
(₹ in lakh)
2022-23
Particulars (pro-rata 2023-24
8 days)
A Gross Normative Loan 1229.52 1231.63
B Cumulative Repayments upto Previous Year 0.00 1.94
C Net Loan-Opening (A-B) 1229.52 1229.69
D Additions due to ACE 2.12 105.30
E Repayment during the year 1.94 92.63
F Net Loan-Closing (C+D-E) 1229.69 1242.36
G Average Loan (C+F)/2 1229.60 1236.03
H Weighted Average Rate of Interest on Loan (in %) 8.075 8.072
I Interest on Loan (G * H) 2.18 99.78
Return on Equity (“RoE”)
87. Regulation 30 and Regulation 31 of the 2019 Tariff Regulations provide
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

cutoff date beyond the original scope, excluding additional capitalization on
7 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 ₹ 1,000 crore;
(b) Estimated Advance Tax for the year on above is ₹ 240 crore;
(c) Effective Tax Rate for the year 2019-20 = ₹ 240 Crore/₹ 1000 Crore
= 24%;
(d) Rate of return on equity = 15.50/ (1-0.24) = 20.395%.
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.”
88. The Petitioner has submitted that the MAT rate applies to it. Accordingly, the
MAT rate applicable during the 2019-24 period for respective financial years has
been considered for the purpose of RoE, which will be trued up in accordance with
Regulation 31(3) of the 2019 Tariff Regulations. The RoE allowed with respect to
the transmission assets for the 2019-24 tariff period is as follows:
Asset-I:
(₹ in lakh)
2022-23
Particulars (pro-rata 8 days) 2023-24
A Opening Equity (A) 8681.37 8793.68

B Additions (B) 112.31 1084.63

C Closing Equity (C) = (A+B) 8793.68 9878.31
D Average Equity (D) = (A+C)/2 8737.53 9336.00
E Return on Equity (Base Rate) (in %) 15.500 15.500
F MAT Rate for respective year (in %) 17.472 17.472
G Rate of Return on Equity (in %) (E/(1-F)) 18.782 18.782
H Return on Equity (D * G) 35.97 1753.44
Asset II:
(₹ in lakh)
2022-23
Particulars 2023-24
(pro-rata 8 days)
A Opening Equity (A) 526.93 527.84
B Additions (B) 0.91 45.13
C Closing Equity (C) = (A+B) 527.84 572.97
D Average Equity (D) = (A+C)/2 527.39 550.40
E Return on Equity (Base Rate) (in %) 15.500 15.500
F MAT Rate for respective year (in %) 17.472 17.472
G Rate of Return on Equity (in %) (E/(1-F)) 18.782 18.782
H Return on Equity (D * G) 2.17 103.37
Operation & Maintenance Expenses (“O&M Expenses”)
89. The O&M Expenses claimed by the Petitioner for the transmission assets for
the 2019-24 tariff period are as follows:
Asset I:
(₹ in lakh)
2022-23
Particulars 2023-24
(pro-rata 8 days)
Transmission Line – 220 kV D/C Chandigarh Panchkula
Line Length 14.237 14.237
Norms 0.419 0.433
Total O&M Expenses 0.13 6.16
Transmission Line – 220 kV D/C Chandigarh Panchkula Cable Portion (M/C)

Norms 1.713 1.773
Sub-station - Panchkula:220 kV Chandigarh (Hallomajra) Line (AIS) 220 kV

Number of Line Bays 2 2
Norms 24.96 25.84
Sub-station – Hallomajra Chandigarh: ICT- I & ICT-II at Chandigarh (Hallomajra)

Number of ICT’s 2 2
MVA Capacity 160 160
Norms 0.272 0.282

Sub-station: (GIS) 220 kV
i. Hallomajra Chandigarh: Panchkula Line Bays
ii. Hallomajra Chandigarh: ICT-I & ICT-II Bays
Norms 17.472 18.088
Sub-station: (GIS) 132 kV Hallomajra Chandigarh: ICT-I & ICT-II Bay

Norms 12.481 12.922*
Asset II:
(₹ in lakh)
2022-23
Particulars 2023-24
(pro-rata 8 days)
Sub-station: (GIS) 132 kV Hallomajra Chandigarh: Bays for Downstream Line EDUTC
Number of line bays 8 8
Norms 12.481 12.922*
90. Regulation 35(3)(a) of the 2019 Tariff Regulations provides as follows:
“35. Operation and Maintenance Expenses:
(3) Transmission system: (a) The following normative operation and maintenance
expenses shall be admissible for the transmission system:
2019- 2020- 2021- 2022- 2023-

Particulars
20 21 22 23 24
Norms for sub-station Bays (₹ 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 (₹ 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 (₹ Lakh per km)
Single Circuit (Bundled
Conductor with six or more sub- 0.881 0.912 0.944 0.977 1.011
conductors)
Single Circuit (Bundled
conductor with four sub- 0.755 0.781 0.809 0.837 0.867
conductors)

Single Circuit (Twin & Triple
0.503 0.521 0.539 0.558 0.578
Conductor)
Single Circuit (Single
0.252 0.260 0.270 0.279 0.289
Conductor)
Double Circuit (Bundled
conductor with four or more 1.322 1.368 1.416 1.466 1.517
sub-conductors)
Double Circuit (Twin & Triple
0.881 0.912 0.944 0.977 1.011
Conductor)
Double Circuit (Single
Conductor) 0.377 0.391 0.404 0.419 0.433
Multi Circuit (Bundled
Conductor with four or more 2.319 2.401 2.485 2.572 2.662
sub-conductor)
Multi Circuit (Twin & Triple
1.544 1.598 1.654 1.713 1.773
Conductor)
Norms for HVDC stations
HVDC Back-to-Back stations (₹
Lakh per 500 MW) (Except 834 864 894 925 958
Gazuwaka BTB)
Gazuwaka HVDC Back-to-Back
1666 1725 1785 1848 1913
station (₹ Lakh per 500 MW)
500 kV Rihand-Dadri HVDC
bipole 2252 2331 2413 2498 2586
scheme (₹ Lakh) (1500 MW)
±500 kV Talcher- Kolar HVDC
bipole scheme (₹ Lakh) (2000 2468 2555 2645 2738 2834
MW)
±500 kV Bhiwadi-Balia HVDC
bipole scheme (₹ Lakh) (2500 1696 1756 1817 1881 1947
MW)
±800 kV, Bishwanath-Agra
HVDC bipole scheme (₹ 2563 2653 2746 2842 2942
Lakh)(3000 MW)
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 (2500 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.”
91. We have considered the submissions of the Petitioner. The O&M Expenses
have been worked out as per the norms in the 2019 Tariff Regulations, and the
same will be subject to truing up, which are as follows:
Asset-I:
(₹ in lakh)
2022-23
Particulars 2023-24
(pro-rata 8 days)
Transmission Line – 220 kV D/C Chandigarh Panchkula
Norms 0.419 0.433
Transmission Line – 220 kV D/C Chandigarh Panchkula Cable Portion (M/C)

Norms #1.713 1.773
Sub-station - Panchkula:220 kV Chandigarh (Hallomajra) Line (AIS) 220 kV
Norms 24.96 25.84
Sub-station – Hallomajra Chandigarh: ICT- I & ICT-II at Chandigarh (Hallomajra)

Number of ICT’s 2 2

MVA Capacity 160 160
Norms 0.272 0.282
Sub-station: (GIS) 220 kV

iii. Hallomajra Chandigarh:Panchkula Line Bays
iv. Hallomajra Chandigarh: ICT-I & ICT-II Bays
Norms 17.472* 18.088
Sub-station: (GIS) 66 kV Hallomajra Chandigarh: ICT-I & ICT-II Bay

Norms 12.481* 12.922
Asset-II:
(₹ in lakh)
2022-23
Particulars 2023-24
(pro-rata 8 days)
Sub-station: (GIS) 66 kV Hallomajra Chandigarh: Bays for Downstream Line EDUTC
Number of line bays 8 8
Norms 12.481* 12.922
* 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
# Norms for cable is not defined in the Tariff Regulation, 2019. O&M norms of Multi
circuit (Twin & Triple) Conductor AC line has been considered for cable.
Interest on Working Capital (“IWC”)
92. Regulations 34(1)(c), 34(3), 34(4) and 3(7) of the 2019 Tariff Regulations
specify 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.
(2) The cost of fuel in cases covered under sub-clauses (a) and (b) of clause (1)
of this Regulation shall be based on the landed fuel cost (taking into account
normative transit and handling losses in terms of Regulation 39 of these regulations)
by the generating station and gross calorific value of the fuel as per actual weighted

average for the third quarter of preceding financial year in case of each financial
year for which tariff is to be determined:
Provided that in case of new generating station, the cost of fuel for the first
financial year shall be considered based on landed fuel cost (taking into account
normative transit and handling losses in terms of Regulation 39 of these regulations)
and gross calorific value of the fuel as per actual weighted average for three months,
as used for infirm power, preceding date of commercial operation for which tariff is
to be determined.
(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. - In these regulations, unless the context otherwise requires:-
‘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;”
93. The Petitioner has submitted that it has computed IWC for the 2019-24 period
considering the SBI Base Rate plus 350 basis points as on 1.4.2019. The Petitioner
has considered the IWC to be 10.50%.
94. The IWC is worked out in accordance with Regulation 34 of the 2019 Tariff
Regulations. The Rate of Interest (RoI) considered is 10.50% (SBI 1-year MCLR
applicable as on 1.4.2022 of 7.00% plus 350 basis points) for the FY 2022-23 and
12.00% (SBI 1-year MCLR applicable as on 1.4.2023 of 8.50% plus 350 basis
points) for the FY 2023-24.
95. The components of the working capital and interest allowed thereon are as
follows:

Asset-I:
(₹ in lakh)
2022-23
Particulars 2023-24
(pro-rata 8 days)
A Working Capital for O&M Expenses
(O&M Expenses for one month) 21.18 21.94
B Working Capital for Maintenance Spares
38.13 39.49
(15% of O&M Expenses)
C Working Capital for Receivables (Equivalent to
629.34 662.37
45 days of annual transmission charges)
D Total Working Capital (A+B+C) 688.66 723.80
E Rate of Interest (in %) 10.50 12.00
F Interest on Working Capital (D * E) 1.58 86.86
Asset-II:
(₹ in lakh)
2022-23
Particulars 2023-24
(pro-rata 8 days)
A Working Capital for O&M
Expenses (O&M Expenses for one month) 8.32 8.61
B Working Capital for Maintenance Spares
(15% of O&M Expenses) 14.98 15.51
C Working Capital for Receivables (Equivalent to 45
48.63 50.17
days of annual transmission charges)
D Total Working Capital (A+B+C) 71.92 74.29
E Rate of Interest (in %) 10.50 12.00
F Interest on Working Capital (D * E) 0.17 8.92
Annual Fixed Charges for the 2019-24 Tariff Period
96. The transmission charges allowed with respect to the transmission assets for the 2019-
24 tariff period are as follows:
Asset-I:
(₹ in lakh)
2022-23
A Depreciation 33.82 1648.06
B Interest on Loan 34.94 1635.60
C Return on Equity 35.97 1753.44
D Interest on Working Capital 1.58 86.86
E O&M Expenses 5.57 263.29
F Total 111.88 5387.25

Asset-II:
(₹ in lakh)
2022-23
A Depreciation 1.94 92.63
B Interest on Loan 2.18 99.78
C Return on Equity 2.17 103.37
D Interest on Working Capital 0.17 8.92
E O&M Expenses 2.19 103.38
F Total 8.65 408.08
Filing Fee and the Publication Expenses
97. The Petitioner has sought reimbursement of the fee paid for filing the Petition
and publication expenses. The Petitioner shall be entitled to reimbursement of the
filing fees and publication expenses in connection with the present Petition directly
from the beneficiaries on a pro-rata basis in accordance with Regulation 70(1) of
the 2019 Tariff Regulations.
License Fee, RLDC Fees and Charges
98. The Petitioner has sought reimbursement of the licensee fee in accordance
with Regulation 70(4) of the 2019 Tariff Regulations for the 2019-24 tariff period.
The Petitioner shall be entitled to reimbursement of the 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 to the recovery of RLDC fees and charges
in accordance with Regulations 70(3) of the 2019 Tariff Regulations for the 2019-
24 tariff period.
Goods and Services Tax
99. The Petitioner has submitted that if GST is levied at any rate and at any point
of time in the future on charges of transmission of electricity, the same has to be
borne and additionally paid by the Respondent(s) to the Petitioner and the same
will 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, and the same may be allowed to be recovered from the
beneficiaries.
100. We have considered the Petitioner’s submissions. Since GST is not levied
on transmission service at present, we consider the Petitioner’s prayer premature.
Security Expenses
101. The Petitioner has submitted that security expenses related to transmission
assets are not claimed in the instant Petition and that it would claim them
separately.
102. We have considered the Petitioner’s submissions. The Petitioner has claimed
consolidated security expenses on a projected basis for the 2019-24 tariff period
on the basis of actual security expenses incurred in the FY 2018-19 in Petition No.
260/MP/2020. The Commission, vide its order dated 3.8.2021 in Petition No.
260/MP/2020, has approved security expenses from 1.4.2019 to 31.3.2024.
Therefore, the Petitioner’s prayer in the instant Petition for allowing it to file a
separate Petition for claiming the overall security expenses has become
infructuous.
Capital Spares
103. The Petitioner has sought reimbursement of capital spares at the end of the
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

104. The Petitioner has submitted that the tariff of the transmission assets will be
recovered monthly in accordance with Regulation 57 of the 2019 Tariff Regulations
and shared by the beneficiaries as per the Central Electricity Regulatory

Commission (Sharing of Transmission Charges and Losses) Regulations, 2020
(“the 2020 Sharing Regulations”).
105. We have considered the Petitioner’s submission.
106. Regulation 13(12) of the 2020 Sharing Regulations provides as follows:
“13. Treatment of transmission charges and losses in specific cases

(12) In case of a transmission system where COD has been approved in terms of
proviso (ii) of Clause (3) of Regulation 4 of the Tariff Regulations, 2014 or Clause
(2) of Regulation 5 of the Tariff Regulations, 2019 or where deemed COD has been
declared in terms of Transmission Service Agreement under Tariff based
Competitive Bidding, the Yearly Transmission Charges for the transmission system
shall be:
(a) paid by the inter-State transmission licensee whose transmission system is
delayed till its transmission system achieves COD, or
(b) paid by the generating company whose generating station or unit(s) thereof is
delayed, till the generating station or unit thereof, achieves COD, or
(c) shared in the manner as decided by the Commission on case to case basis,
where more than one inter-State transmission licensee is involved or both
transmission system and generating station are delayed.”
107. As discussed above in this order, the COD of Assets- I and II has been
approved as 24.3.2023 under Regulation 5(2) of the 2019 Tariff Regulations. This
decision is based on the fact that the associated downstream asset to be developed
by EDUTC was not ready, with actual power flow commencing on 29.3.2024.
Consequently, EDUTC is responsible for paying transmission charges from
24.3.2023 to 28.3.2024. With effect from 29.3.2024, the transmission charges
associated with Assets-I and II shall be included in the PoC Pool.
108. Accordingly, the billing, collection, and disbursement of the transmission
charges shall be recovered in terms of Regulation 57 of the 2019 Tariff Regulations
and shall be shared by the beneficiaries and long-term transmission customers in
the Central Electricity Regulatory Commission (Sharing of Inter-State Transmission

Charges and Losses) Regulations, 2010 as amended from to time.
Interim Tariff
109. The Petitioner has prayed to allow the interim tariff in accordance with
Regulation 10(3) of the 2019 Tariff Regulations for inclusion in the point of
connection charges.
110. We have considered the petitioner's submissions. Since we have determined
the transmission tariff in respect of the transmission assets in this order, the prayer
for the interim tariff becomes redundant. Therefore, we have not considered it in
this order.
111. To summarize:
a. AFC allowed in respect of the transmission assets for the 2019-24 tariff period are as
follows:
(₹ in lakh)
Asset 2022-23 2023-24
(pro-rata 8 days)
Asset-I 111.88 5387.25
Asset-II 8.65 408.08
112. The Annexures to this order form a part of the order.
113. This order disposes of Petition No. 328/TT/2023 in terms of the above
findings and discussions.
sd/- sd/- sd/-

(Harish Dudani) (Ramesh Babu V.) (Jishnu Barua)
Member Member Chairperson
Order in Petition No. 328/TT/2023 CERC Website S. No. 445/2024 Page 73 of 75

ANNEXURE
Asset I:
Projected ACE Admitted Annual Depreciation

Admitted
capital
capital Rate of
cost as on
Capital cost as 2019-20 2020-21 2021-22 2022-23 2023-24 depreciation 2019-20 2020-21 2021-22 2022-23 2023-24
31.3.2024
Expenditure on COD (in %)
Building 2685.64 - - - 34.73 46.76 2767.13 3.34 - - - 90.28 91.64
Transmission - - -
17860.04 - - - 231.10 2861.21 20952.35 5.28 949.11 1030.75
Line
Substation 7754.67 - - - 100.28 707.45 8562.40 5.28 - - - 412.09 433.42
PLCC 52.64 - - - 0.68 0.00 53.32 6.33 - - - 3.35 3.38
IT Equipment 584.95 - - - 7.56 0.00 592.51 15.00 - - - 88.31 88.88
Total 28937.93 - - - 374.36 3615.42 32927.70 - - - 1543.15 1648.06
Average Gross - - -
Block 29125.11 31120.00
WAROD
0.00 0.00 0.00 5.30 5.30
(in %)

Asset II:
Projected ACE Admitted Annual Depreciation

Admitted capital
Rate of
Capital capital cost as on
2019-20 2020-21 2021-22 2022-23 2023-24 depreciation 2019-20 2020-21 2021-22 2022-23 2023-24
Expenditure cost as 31.3.2024
(in %)
on COD
Building 353.84 - - - 0.61 9.05 363.50 3.34 - - - 11.83 11.99
Transmission 5.28 - - -
0.00 - - - 0.00 0.00 0.00 0.00 0.00
Line
Substation 1374.75 - - - 2.37 141.16 1518.28 5.28 - - - 72.65 76.44
PLCC 0.00 - - - 0.00 0.00 0.00 6.33 - - - 0.00 0.00
IT Equipment 27.86 - - - 0.05 0.22 28.13 15.00 - - - 4.18 4.20
Total 1756.45 - - - 3.02 150.43 1909.90 - - - 88.66 92.63
Average Gross - - -
Block 1757.96 1834.69
WAROD
(in %) 0.00 0.00 0.00 5.04 5.05

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CENTRAL ELECTRICITY REGULATORY COMMISSION

Petition No. 328/TT/2023

Shri Jishnu Barua, Chairperson

Date of Order: 23.09.2024

In the matter of:

And in the matter of:

Power Grid Corporation of India Limited,

1. Ajmer Vidyut Vitran Nigam Limited,

2. Jaipur Vidyut Vitran Nigam Limited,

3. Jodhpur Vidyut Vitran Nigam Limited,

5. Punjab State Power Corporation Limited,

6. Haryana Power Purchase Centre,

7. Jammu Kashmir Power Corporation Limited,

8. Uttar Pradesh Power Corporation Limited,

9. BSES Yamuna Power Limited,

10. BSES Rajdhani Power Limited,

11. Tata Power Delhi Distribution Limited,

12. Uttarakhand Power Corporation Limited,

13. North Central Railway,

14. New Delhi Municipal Council,

15. Chandigarh Electricity Department,

Order in Petition No. 328/TT/2023 Page 2 of 75

Commission (Terms and Conditions of Tariff) Regulations, 2019 (hereinafter

(COD) to 31.3.2024 in respect of Asset-I: 220/66 kV New GIS Sub-station at UT

Circuit (“D/C”) Line from 220/66 kV Chandigarh Sub-station to 400/220 kV

bays at Panchkula Sub-station and Asset-II: 8 Nos. 66 kV line bays at Chandigarh

GIS Sub-station (hereinafter referred to as the “transmission assets”) under

“Establishment of 220/66 kV, 2x160 MVA GIS Sub-station at UT Chandigarh along

station” (hereinafter referred to as “transmission project”) in the Northern Region.

2. The Petitioner has made the following prayers:

4) Condone the delay and allow IDC/IEDC as claimed in the petition.

Order in Petition No. 328/TT/2023 Page 3 of 75

7) Approve the reimbursement of expenditure by the beneficiaries towards

a. Investment Approval (IA) of the transmission project was accorded by the

Board of Directors of the Petitioner in its 337th meeting held on 9.2.2017

and communicated vide Memorandum No. C/CP/Chandigarh GIS dated

13.2.2017 with an estimated cost of ₹32230.00 lakhs, including an IDC of

₹1923.00 lakhs based on the October 2016 price level.

Order in Petition No. 328/TT/2023 Page 4 of 75

i. 2x160 MVA, 220/66 kV GIS Sub-station at UT Chandigarh.

ii. Bays extension at 400/220 kV Panchkula Sub-station.

Standing Committee meetings of the Transmission Planning for Northern

Region held on 2.1.2013, 8.8.2014, and 13.7.2015, respectively. The

meetings of the Northern Regional Power Committee (NRPC) held on

26.4.2013, 11.11.2014, and 24.12.2015, respectively. During the 33rd

Empowered Committee Meeting dated 30.9.2014, the Petitioner

recommended the implementation of the scheme under a Regulated

Tariff Mechanism (RTM) with a compressed time schedule. The Ministry

implementation to the Petitioner under a compressed schedule through

d. The Revised Cost Estimate (RCE) of the transmission project was

accorded vide Memorandum No. C/CP/PA2324-11-0AL-RCE010 dated

5.2.2024, at an estimated cost of ₹38078.00 lakhs, including IDC of

₹5437.00 lakhs based on the October 2023 price level. The

commissioning of the transmission assets under the transmission project

has been completed. The details of the scheduled date of commercial

Order in Petition No. 328/TT/2023 Page 5 of 75

claimed by the Petitioner are as follows:

4. The Respondents are Railways, Distribution Licensees, and Power

mainly beneficiaries of the Northern Region.