The Supreme Court on Wednesday ruled in favour of Delhi-based city gas distributor Indraprastha Gas Ltd (IGL) by holding that the Petroleum and Natural Gas Regulatory Board (PNGRB) has no authority to fix tariffs at which it sells petroleum products or natural gas to customers.
Ending a three-year-long legal battle between the Board and IGL, a Bench of Justices Dipak Misra and P.C. Pant said it is within the latter's realm to fix the Maximum Retail Price for petroleum or natural gas.
With this, the Bench upheld the June 2012 judgment of a Division Bench of the Delhi High Court, which had ruled that PNGRB is “not empowered to fix or regulate the maximum retail price at which gas is to be sold by entities such as Indraprastha Gas Ltd, to the consumers.
The judgment further said that the “Board is also not empowered to fix any component of network tariff or compression charge for an entity having its own distribution network”.
The verdict came on an appeal filed by the PNGRB in the Supreme Court against the 2012 High Court ruling.
Agreeing with the High Court, the Bench held ultra vires provisions of the Petroleum and Natural Gas Regulatory Board (Determination of Network Tariff for City or Local Natural Gas Distribution Networks and Compression Charge for CNG) Regulations, 2008 which empowered the Board to fix tariffs for distributors.
“In view of that the Board cannot frame a Regulation which will cover the area pertaining to determination of network tariff for city or local gas distribution network and compression charge for CNG. As the entire Regulation centres around the said subject, the said Regulation deserves to be declared ultra vires, and we do so,” the apex court held in its judgment.
