KERALA STATE ELECTRICITY REGULATORY COMMISSION
THIRUVANANTHAPURAM
PRESENT
Shri P.Parameswaran, Member
Sri Mathew George, Member
PETITION IN THE MATTER OF
Tariff applicable to units engaged in Software Development and conducting
training classes
Date 15/02/13
Petition
Dated 20-09-2012
Sri Alexander Panicker
Petitioner
Tass Business Systems
OP 34/12
Palarivattom, Cochin 682025
Kerala State Electricity Board
Vaidyuthi Bhavanam,
Respondent
Trivandrum
ORDER
1. Background
1.01
The petitioner is the proprietor of TASS Business Systems which is an SSI Unit
having permanent registration No 19837, issued by the Industries Department.
The petitioners activities initially covered manufacture of PC stabilizers, Fax,
STD, ISD, Telex Computers and Office Automation products. The petitioner
subsequently started software development and training also as a franchisee of
NIIT. About 60 persons are working for software development and training.
1.02
The petitioner has an electricity connection with Consumer No 14287 for
manufacture and servicing of office automation products under Electrical
Section Palarivattom. The tariff applied for this connection was LT IV Industrial.
In March 1999 KSEB changed the tariff to LT VII A and issued additional bills
on the ground that the petitioner is using part of his consumed energy for
computer training which cannot be billed under LT IV Industrial category.
1.03 Petitioner stated that in the tariff order it is clearly stated that SSI Units engaged in
computerized colour photo printing , computer consultancy services with SSI
registration engaged in Software services and data processing activities and desk
top printing fall under LT IV tariff. The petitioner is an SSI Unit engaged in
Software Services and hence is eligible for LT IV Tariff .Software development
training project is part and parcel of the software development activity done by
the Unit as a whole.
1.04 KSEB has taken the stand that the consumer was ‘ conducting classes for computer
education ‘ and hence they have to segregate the load which shall be charged
under LT VI Tariff.
2. Prayer
Petitioner requested the Commission to categorize the service as LT IV
Industry since in the tariff order it is clearly stated that SSI Units engaged in
computerized colour photo printing , computer consultancy services with SSI
registration engaged in Software services and data processing activities and desk
top printing fall under LT IV tariff.
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3.0 Hearing of petition
3.01
In the public hearing on the petition held at 11.00 am at the Commissions Office
at Vellayambalam, Trivandrum, on 6-11-2012 the petitioner ,the proprietor of
TASS Business Systems stated that the activities of the unit initially covered
manufacture of PC stabilizers, Fax, STD, ISD, Telex Computers and Office
Automation products. The petitioner subsequently started software development
and training also as a franchisee of NIIT. About 60 persons are working for
software development and training.
3.02 The petitioner has an electricity connection with Consumer No14287 for
manufacture and servicing of office automation products under Electrical Section
Palarivattom. The tariff applied for this connection was LT IV Industrial. In
March 1999 KSEB changed the tariff to LT VII A and issued additional bills.
The stand of KSEB was that the petitioner is using part of his consumed energy
for computer training which cannot be placed under LT IV Industrial category.
Aggrieved by this the petitioner approached the Hon High Court . The High Court
vide Order dated 18-11-2004 directed the petitioner to file an appeal before the
Dy Chief Engineer , APTS, KSEB.
3.03 The Dy Chief Engineer, APTS disposed of the petition filed by the consumer vide
Order dated 25-06-2005 directing to charge LT VI Tariff till the alleged loads
under LT IV and LT VI were separated. The petitioner again approached the Hon
High Court against this order. The High Court vide Judgment dated 21-06-2012
directed the petitioner to approach KSERC for determining the tariff to be
applied.
3.04 Petitioner stated that in the tariff order it is clearly stated that SSI Units engaged in
computerized colour photo printing , computer consultancy services with SSI
registration engaged in Software services and data processing activities and desk
top printing fall under LT IV Industrial tariff. The petitioner is an SSI Unit
engaged in Software Services and hence is eligible for LT IV Tariff .Software
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development training project is part and parcel of the software development
activity done by the Unit as a whole.
3.05 KSEB has taken the stand that the consumer was ‘ conducting classes for computer
education ‘ and hence have to segregate the load which shall be charged under LT
VI Tariff. KSEB’s contention that 70% of the load is used for computer training
has no factual basis, the petitioner pointed out. Further the petitioner pointed out
that there is no faculty in the unit. The trainees themselves develop software for
the overall functioning of the Unit.
4.00 KSEB stated that The petition was filed as per Judgment dated 21-06-2012 of Hon
High Court on Writ Petition WP (C )No 29532 of 2005 filed by the petitioner.
The Hon High Court has disposed the writ petition and directed the petitioner to
file a proper complaint before the Hon Commission within a period of two weeks
from date of receipt of judgment.
4.01 Petitioner is an LT Consumer and power connection was availed on 30-01-1997.
Originally as admitted by the petitioner electricity was used for the manufacturing
and servicing of office automation products covered by a valid SSI registration
issued by the Industries Department. During 1/1999, upon an inspection conducted
by the officials of section office in the premises of the petitioner , an unauthorized
load of 15 kW was detected and it was also found that electricity was used for
running a computer training institute , as a franchisee of NIIT. It was also found
that more than 70% of the load was used for running the computer training
Institute as a franchisee of NIIT. Since the petitioner had been using electricity for
running computer training institute also the tariff was changed to LT VII A.
Aggrieved by the change of tariff , the consumer filed a writ petition before the
Hon High Court of Kerala. As per the Judgment in OP No 9555/99 a hearing was
conducted by the Asst Executive Engineer, Palarivattom. Based on the hearing the
tariff was changed to LT VI applicable for educational institutions and a
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reassessment bill amounting to Rs 32548 was served to the consumer. Not
satisfied with this the consumer again approached the Hon High Court by filing
OP No 15066/1999. The Hon High Court in the Judgment directed petitioner to
file an appeal before Dy Chief Engineer, APTS against the bill issued to the
consumer. Accordingly consumer has filed appeal petition before the Deputy
Chief Engineer on 16-12-2004.
After completing all procedure formalities and affording a hearing
to the
petitioner , the Deputy Chief Engineer APTS had issued an order on the appeal petition
on 25-06-2005. Relevant portion of the order of the Deputy Chief Engineer is extracted
hereunder.
i) The appellant was misusing the electricity by utilizing the energy sanctioned
under LT IV for usage under LT VI category (Higher tariff). Hence the appellant
need to be charged under LT VI tariff till the loads under LT IV and LT VI are
segregated and separate service connections are availed . The impunged bills and
subsequent monthly bills need to be revised on LT VI tariff instead of L:T VII
alone.
ii) The 15 kW unauthorized load (UAL) detected need to be penalized as per Sec
42(d) of the Conditions of Supply of Electrical Energy till UASL was regularized
or load was removed.
iii) The Assistant Engineer , Electrical Section should revise the impunged bill and
the subsequent bill issued as orderd earlier and issue revised bill with details ,
taking into consideration the amount already remitted without surcharge to the
appellant. The appellant should remit the balance amount due in 15 days time
without fail.
iv) If the appellant requires separate connection under LT VI and LT IV Tariffs , the
same may be allowed as per rules.
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4.02 As per the above order of Dy Chief Engineer APTS the penal bill for unauthorized
load has been revised to Rs 689243.00 and regular bill amount ( for a period
from 1/1999 to 5/2005) was revised to Rs 426256.00 under LT VI B tariff
applicable to computer training institute. Aggrieved by this the consumer again
approached the Hon High Court of Kerala. The Hon High Court disposed off the
petition and directed the petitioner to approach Kerala State Electricity
Regulatory Commission to determine exact tariff applicable to petitioners
institution.
4.03 The petitioner has remitted Rs 2,50,000.00 on 22-01-2005 and Rs 1,50,000.00 on
23-11-2005. The balance amount pending from 11/2005 is Rs 7,15,499.00. The
consumer is paying the regular monthly electricity charges under LT VI (B)
Tariff since June2005 onwards. The unauthorized load is yet to be regularized.
Regarding the tariff applicable to the consumer, KSEB stated that
(i)
Board vide its tariff order effective from 01-01-1992 has categorized Computer
Consultancy Services with SSI registration and engaged in Software Services
and Data Processing activities and SSI Units engaged in computerized colour
printing under LT IV Tariff
(ii) In the tariff order effective from 15-05-1999 Computer training Institutes are
categorized under LT VI B tariff
(iii) The service connection to the petitioner was effected under LT IV Tariff and
later consumer has diversified the activities by running a computer training
institute and using electricity un authorized by connecting an additional load to
the extent of 15 kW, where only as the sanctioned load was only 9 kW.
Therefore it is clear that major portion of the energy has been using for
computer training.
(iv) The consumer is a franchisee of NIIT. The petitioner has agreed through its
petition that he has availed service connection for manufacturing process and
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later diversified the activities as a franchisee of NIIT. The NIIT is a nationally
accredited agency mainly engaged in business of computer training. At present
more than 70% of the present load of 24 kW was used for the training institute.
(v) Board has requested the consumer to segregate the industrial load and the load
used for training Centre and to avail separate connections so that Industrial
loads can be charged under LT IV Industrial Tariff
and energy used for
computer training can be charged under LT VI B category. However the
consumer is not willing to segregate the load between their industrial activity
and computer training Institute.
Fixed charges of LT Consumers are being charged on connected load. Since
consumer has enhanced the connected load as part of their diversification the petitioner
has to regularize their additional load as otherwise penalty has to be imposed for
additional load.
4.04 Considering the above the Board is requesting the Commission to direct the
petitioner to
(1) Regularize the unauthorized additional load.
(2) Segregate electricity supply for industrial activity and computer training activity
by separate connections so that Board can allow LT IV Tariff for Computer
Consultancy Services and LT VI (B)tariff for electricity used for ‘computer
training institute’.
(3) Remit pending penal charges for unauthorized load and arrears on electricity
charges amounting to Rs 7,15,499 plus interest.
5.0 Analysis
5.01
As per the provisions of the Electricity Act 2003, the Commission is not
mandated to intervene in the individual grievances of the Consumers of
Electricity. But the Hon’ble High Court of Kerala by a Judgment dated
21.06.2012 on WP(C) 29532/2005 allowed the Petitioner to approach KSERC for
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determination of the question regarding applicability of the exact tariff. The
Commission has been directed to examine the nature of activity vis-à-vis the
description of the Tariff Order prevailing during the relevant periods in order to
decide the applicability of proper tariff.
Accordingly the Commission shall confine to the question of applicability of the
proper tariff for the different operation of the Consumer. The issue raised by
KSEB related to the regularization of additional load, penal charges applicable etc
shall be settled in accordance with the Rules and Regulations in force. The
Petitioner can utilize the established grievance redressal procedure, under section
42(5) of the Electricity Act 2003, for redressal of any grievances related to such
matters.
5.02 KSEB vide tariff order effective from 1st January 1992 has categorized Computer
Consultancy Services with SSI registration and engaged in software services and
data processing activities and SSI Units engaged in computerized colour photo
printing under LT IV Tariff.. At the time of availing connection on 30-01-1997
the consumer was engaged in manufacture and servicing of office automation
products covered by SSI registration and the tariff applied was LT IV Industrial.
5.03 Subsequently the consumer started software development and training also as a
franchisee of NIIT in November 1998. Computer training institutes are
categorized under LT VI (B) from 1999. The connected load of the consumer was
increased from 9 kW to 24 kW with an additional load of 15 kW when the
Computer Training Institute activities were also commenced operation. The
Consumer shall be eligible for LT IV Industrial Tariff for Consultancy services
etc only after the load of Training activities are segregated and separately
connected up. Since Computer Consultancy Services with SSI Registration and
engaged in Software services and data processing activities alone are categorized
under LT IV Industrial Tariff as per Tariff Order, separate connections have to be
taken after segregating the load for Computer Consultancy Services and other
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activities which come under LT IV Industrial Tariff and Computer Training
Institute which comes under LT VI (B) Tariff.
6.0 Commissions’ Decision
The tariff applicable shall be LT IV Industrial Tariff for the portion of
connected load for Computer Consultancy Services and such other manufacturing
activities and LT VI (B) Tariff for the remaining portion of the connected load for
Computer Training Institute. The Connected load has to be segregated accordingly
and separate service connections have to be effected for Computer Consultancy
Services and other manufacturing activities under LT IV Industrial Tariff and for
Computer Training Institute under LT VI (B) Tariff. Till segregation is effected the
higher tariff LT VI (B) shall be applicable for the full connected load of consumer.
The petition is disposed of accordingly.
Sd/-
Sd/-
Member(E)
Member (F)
Approved for issue
Secretary
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