Bihar Transmission Utility’s 25% Depreciation Cut Set Aside: APTEL Says Missing Asset Register Cannot Justify Tariff Penalty

Bihar State Power Transmission Company Limited (BSPTCL), an intra-State transmission licensee, appealed against the Bihar Electricity Regulatory Commission’s order dated 28 March 2025.

In that order, the Commission allowed only 75% of the depreciation computed for the FY 2023–24 true-up because BSPTCL had not filed a certified Fixed Asset Register (FAR), although Regulation 23(vii) required its submission.

The Commission had previously directed BSPTCL to prepare and submit the FAR. BSPTCL’s review petition was dismissed on 17 June 2025.

In the appeal, BSPTCL challenged the depreciation reduction as an unauthorised penalty; it also relied on the Commission’s later approval of full depreciation for FY 2024–25, noting progress on the FAR.

Regulation 23(vii) of the BERC MYT Regulations required the licensee to submit a certified Asset Register with its tariff petition, but the Regulations did not prescribe a reduction in depreciation for non-submission.

Section 142 of the Electricity Act, 2003 provides a statutory mechanism, after an opportunity to be heard, for penalising contravention of the Act, regulations or Commission directions; its application does not distinguish between public and private entities.

Under Gujarat Urja Vikas Nigam Ltd. v. Solar Semiconductor Power Company (India) Pvt. Ltd., (2017) 16 SCC 498, a statutory commission cannot assume powers not conferred by statute or use inherent powers to bypass a procedure specifically provided by law.

The Tribunal also relied on MSEDCL v. MERC, Appeal No. 71 of 2007 (4 May 2009), and JBVNL v. JSERC, Appeal No. 364 of 2024 (2 January 2025), for the principle that tariff-setting powers cannot be converted into a penalty proceeding.

The Tribunal accepted that an FAR is important for verifying assets and calculating depreciation, and that BSPTCL had not yet completed it.

But the filing requirement did not itself authorise a 25% depreciation reduction.

The Commission’s decision to impose that reduction instead of proceeding under Section 142 could not be justified as a “lenient” response, nor could Regulations 42 and 43 supply the missing authority: those provisions preserved flexibility and statutory powers but did not permit an arbitrary departure from the prescribed tariff framework.

The deduction was therefore outside the governing statutory framework and unsustainable.

The judgment contains an apparent inconsistency in identifying the relevant financial year: the dispute and earlier discussion concern the FY 2023–24 true-up, but the operative paragraph refers to the true-up for FY 2022–23.

The appeal and pending interlocutory applications were disposed of accordingly.