Aurobindo Pharma Ltd filed a case against APTRANSCO over the collection of maintenance charges for two electricity connections in Srikakulam, Andhra Pradesh. One connection supplies electricity to the company’s pharmaceutical unit, while the other is linked to a 30 MW solar captive generating plant. Aurobindo argued that they had already paid all necessary charges for building and connecting the transmission lines and substations, including supervision charges and the full cost of construction. They built the infrastructure on a turnkey basis and later handed it over to APTRANSCO through formal gift deeds in May 2023.
For the pharmaceutical unit, APTRANSCO demanded over ₹46 lakh as annual maintenance charges for the period between 2011 and 2022. For the solar plant, ₹2.36 lakh was demanded for a year of maintenance from 2017 to 2018. Aurobindo maintained that these charges were illegal, as the assets had already been handed over to APTRANSCO, and that there were no contractual or statutory provisions requiring them to pay such charges. They also claimed that these costs are already included in the electricity tariffs they pay and that APTRANSCO had failed to respond to several representations asking for the withdrawal of these charges.
The company also highlighted that APTRANSCO refused to renew their Long-Term Open Access (LTOA) agreement for the solar plant unless the disputed charges were paid. They paid the charges under protest to ensure continued operations. Aurobindo relied on regulatory rules and earlier decisions, including a previous order from the Andhra Pradesh Electricity Regulatory Commission (APERC) in a similar case, which held that such charges are illegal.
In response, APTRANSCO argued that the assets were only officially handed over in 2023, so maintenance charges were valid until that date. They also justified their actions by citing the need to prevent duplication in accounting and to ensure that O&M services are not provided free of cost, which would otherwise burden ordinary consumers.
However, the Commission found that the respondents did not have the legal authority to demand maintenance charges. Clause 5.3.2.2 of the General Terms and Conditions of Supply (GTCS) clearly states that even if a consumer pays for the construction of service lines, they become the property of the electricity licensee, who is then responsible for maintaining them at its own cost. The Commission also noted that APTRANSCO had issued demand notices after several years, which made them invalid under the legal principle of delay and laches.
Regarding the solar power plant, the Commission acknowledged that it was primarily set up to inject power into the grid and only drew minimal power from DISCOM for start-up. Therefore, GTCS rules do not apply to this connection. The regulations and internal orders cited by APTRANSCO did not provide for any penalty or charges in case of delayed transfer of assets.
Ultimately, the Commission declared APTRANSCO’s actions illegal and directed them to refund the collected charges of ₹48.42 lakh to Aurobindo Pharma Ltd within one month, without any interest, given that APTRANSCO is a public utility.
