Taj Mahal Hotels Challenges Electricity Surcharges of Rs 1 Crore Levied by TGSPDCL

 Hyderabad: Managements of the Taj Mahal Hotels at Abids and Secunderabad, Sundar Rao Hotels Ltd, Sundar Taj Mahal Hotels, K. Pratap Reddy and others, have approached the Telangana High Court challenging the levy of cross-subsidy surcharge amounting to approximately ₹1 crore imposed by the Telangana Southern Power Distribution Company Limited (TGSPDCL, southern discom) for the period from 2005-06 to 2014-15.

The dispute arose out of tariff orders issued by the Telangana Electricity Regulatory Commission (TERC) and concernedretrospective demands towards energy charges.

Pursuant to the tariff framework, the southern discom issued separate demand notices to the petitioner hotels. In respect of the Abids branch, Sundar Rao Hotels Ltd was served with a demand notice seeking payment of ₹27,58,378 towards the cross-subsidy surcharge in relation to its high tension service connection. Demand notices were issued to the Secunderabad branch, namely Sundar Taj Mahal Hotels and K. Pratap Reddy for ₹77,72,135.

The petitioner hotels had earlier approached the High Court challenging the demands. The court had then directed the TGSPDCL to consider the objections raised by the petitioners and pass appropriate orders in accordance with the law. The discom heard the submissions of the managements but rejected their objections on the ground that they had failed to submit valid documentary evidence to establish their entitlement to exemption from payment of cross subsidy surcharge.

Aggrieved by the rejection of their objections, the managements once again approached the High Court. During the hearing, the TGSPDCL defended its decision and argued that unless the managements paid 50 per cent of the demand amount, their electricity connections were liable to be disconnected. The discom sought permission from the court to disconnect the electricity supply to the petitioner hotels.

The bench expressed concern over the stand taken by the discom and questioned the propriety of seeking judicial directions for disconnection of power supply. The court observed that the electricity authorities had failed to follow the prescribed statutory procedure and were unable to discharge their duties in accordance with law, yet were seeking directions from the court for disconnection of electricity when the matter had been brought before it. The bench asked how the court could issue directions for disconnection in such circumstances.

Granting an opportunity to the petitioner hotels to submit their further contentions, the High Court adjourned the matters to January 21 for hearing.