The Supreme Court on Friday sought replies from the Centre, GAIL and others on a Tata Power plea seeking clarity on the Petroleum and Natural Gas Regulatory Board’s (PNGRB) powers to regulate gas transportation tariff.
Tata Power Delhi Distribution, a JV between Tata Power Company and the Delhi government, has challenged the Delhi High Court order of September 11 that held “to be bad” the Model Gas Transmission Agreements (GTA) guidelines issued by the regulator for fixing and regulating the tariff of gas transport. The HC said that PNGRB can do so only by way of regulations and, also in exercise of its adjudicatory functions, it cannot pass any order determining and regulating such tariff.
A bench headed by Justice Dipak Misra sought replies from the oil ministry, Lanco Kondapalli power, GMR Energy and others on Tata firm’s plea alleging that the HC had adopted a flawed approach.
Senior counsel Gopal Jain and counsel Sanjay Kapur said that there was a conceptual difference between the power to regulate and the power to make regulations, and thus the HC had curtailed the regulator’s power to regulate only by way of regulations.
According to the Tata firm, the HC has proceeded on an erroneous basis that guidelines are not binding in nature and this is contrary to various apex court decisions holding that policy decisions or guidelines formulated by an authority, which is a creature of statute, will have binding effect in the absence of rules to the contrary.
Tata Power Delhi Distribution, which owns a 108 Mw gas-based plant, was allocated 0.4 mmscmd of natural gas from KG-D6 fields. Tata Power had also been shipping the quantity of natural gas from the pipeline system of GAIL. Due to a decrease in the supplies of natural gas from KG-D6, the EGoM decided to give first priority to the fertiliser sector, followed by LPG consumers and then the power sector. Thus, Reliance Industries, the suppliers, reduced gas to the Tata Power plant.
