State Govt Cannot Assume Jurisdiction u/S 11 of Electricity Act In Cases Of Inter-State Transmission: Karnataka HC

The Karnataka High Court observed that the State Government cannot assume jurisdiction under Section 11 of the Electricity Act in cases of inter-state transmission of electricity.

In that context, the Bench of Justice BM Shyam Prasad observed that, "in the light of the binding precedent in M/s Energy Watchdog, the State Government could not have assumed jurisdiction under Section 11 of the Electricity Act in cases of inter-state transmission of electricity and directed even those engaged in inter-state transmission to supply electricity only to the State Grid."

Counsel Shridhar Prabhu appeared for the petitioner, while DSG Shanti Bhushan, along with others, appeared for the respondents.

Certain Generating Companies and a Licensed Trader filed petitions challenging a State Government Order issued under the Electricity Act on October 16, 2023. The order directed all electricity generators in Karnataka to operate at maximum capacity and supply electricity only to the State Grid. The State faced a power crisis due to low reservoir levels and increased demand.

The petitioners contested the order, citing discrepancies in calculations and arguing that they were unable to trade power as a result. The State Government defended its actions, emphasizing the need to address the power shortage.

The High Court observed that if "the jurisdiction of the Commissions is made dependent on the government which exercises the jurisdiction under section 11[1] of the Electricity Act there would be an anomaly and a violation of the Scheme of the Act. In fact, it is placed on record that after the State Government’s order dated 16.10.2023, M/s KPTCL has approached the KERC [the Karnataka Electricity Regulatory Commission], though in terms of the scheme under the Electricity Act and the decision in M/s Energy Watchdog, if the generating companies are transmitting electricity inter-state, it should have approached the Central Regulatory Commission."

Subsequently, the petitions were allowed and the State Government's order was quashed.

Appearances:

Petitioner: Counsel Shridhar Prabhu

Respondents: DSG Priyanka S Bhat, AG Shashi Kiran Shetty, AGA Bhojegouda T Kollar, Senior Counsels SS Naganand, SS Sriranga, Counsels Sumana Naganand, Nidhi Gupta

Cause Title: Altilium Energie Private Limited vs Union of India & Ors.

Click here to read/download the Judgment