The Karnataka High Court has held that Karnataka Power Transmission Corporation Limited (KPTCL), being a State Transmission Utility and Transmission Licensee, has no statutory authority to unilaterally revise supervision charges for self-execution works beyond the ceiling prescribed by the Karnataka Electricity Regulatory Commission (KERC). The Court held that KERC’s observation permitting KPTCL to “take a suitable decision” based on internal account manuals did not amount to regulatory approval or authorisation for revision of charges.

The Bench further held that KPTCL’s own request seeking KERC approval for revision of supervision charges demonstrated the absence of any independent statutory power to effect such revision. Having acknowledged the requirement of KERC approval, KPTCL could not subsequently claim unilateral administrative authority to alter consumer-affecting charges.

Justice Ravi V. Hosmani observed, “…Very act of KPTCL addressing communication at Annexure-R1 to KERC seeking its approval for revision of supervision charges, would indicate absence of independent statutory authority to KPTCL to revise supervision charges…in absence of KPTCL sourcing its authority to revise supervision charges beyond ceiling prescribed under regulatory framework…cannot sustain”.

“Mere statement in reply by KERC at Annexure-R2 that KPTCL may take suitable decision based on rules/regulations framed by it in relevant Account Manuals, would not provide sufficient justification for revision/demand or be construed as formal approval or regulatory determination authorizing revision of charges. In absence of any regulation, order or notification issued by KPTCL in exercise of powers under Electricity Act, impugned revision of supervision charges cannot derive statutory legitimacy”, the Bench further noted.

Advocate Joseph Anthony appeared for the petitioner and Senior Advocate S. Sriranga appeared for the respondent.

The petitioner, M/s Anushka Realty Inc., represented through its General Power of Attorney M/s Puravankara Limited, was developing a multi-storied residential project at Kyalasanahalli village, Bengaluru East.

It was granted permission to carry out electrical works for a power supply of 8459 KW under self-execution mode, with supervision charges fixed at 10 percent of estimated cost not exceeding Rs. 15 lakhs under the KERC regulatory framework. While the petitioner was arranging payment accordingly, KPTCL issued a revised order dated June 27, 2018 prescribing slab-wise supervision charges and thereafter raised a demand of Rs. 1.02 crores, far exceeding the regulatory ceiling.

The Court found that the KERC Code prescribed supervision charges at 10 percent subject to a ceiling of Rs. 15 lakhs, and that any revision could only be effected by a formal order, regulation or notification of KERC. KPTCL had itself written to KERC in April 2018 seeking approval for revision, which KERC declined to grant formally, merely suggesting KPTCL may take a suitable decision based on its internal manuals.

The Court held that this fell far short of regulatory authorization. It rejected KPTCL's contention that the levy was an administrative measure for cost recovery, holding that charges affecting consumers and prescribing monetary liability cannot be treated as purely administrative action when Section 45 of the Electricity Act, 2003 stipulates a specific procedure for such fixation.

“Even contention of respondents that impugned order was an administrative measure for rationalization and recovery of actual cost of supervision also cannot be readily accepted. Levy of supervision charges affecting consumers and prescribing monetary liability cannot be regarded as purely administrative action, when Section 45 stipulated procedure for such fixation”, it noted.

Relying on the principle consistently reiterated by the Supreme Court that statutory power must be exercised only by the authority upon whom the statute confers it, the Court quashed the impugned order and demand notice.

Accordingly, KPTCL and BESCOM were directed to permit the petitioner to resume self-execution work on payment of supervision charges as originally prescribed in the sanction order, with any excess payment to be refunded within eight weeks failing which interest at 8 percent per annum would apply.

Cause Title: M/s Anushka Realty Inc. v. State of Karnataka and Others (Neutral Citation: 2026:KHC:25466)

Appearances:

Petitioner: Joseph Anthony, Advocate.

Respondents: Milind Dange, AGA, BN Prakash, S. Sriranga, Senior Counsel with Sumana Naganand, Advocates.

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