The Appellate Tribunal for Electricity has held that a generating company's delay in filing a tariff true-up petition does not, by itself, extinguish its entitlement to carrying cost on capital expenditure that the regulator has otherwise found admissible. The ruling arose from an appeal by a thermal generator, referred to here as Meghdoot Thermal Power Ltd., against an order of the Central Electricity Regulatory Commission that had disallowed carrying cost on the ground that the true-up petition itself had been filed years after the relevant tariff period had closed.
The Tribunal distinguished between the timeliness of the petition and the substantive merits of the underlying claim, holding that a regulator cannot treat a procedural delay in filing as an automatic bar to a claim that is otherwise factually and legally sound, particularly where the delay itself was explained by circumstances outside the generator's control, such as pending audit reconciliation. At the same time, the Tribunal was careful to note that regulators retain the discretion to scrutinise a delayed claim more closely, and that a generator seeking condonation of delay must still place credible reasons for it on record rather than assume that mere disclosure at a later date is sufficient.
The order also reiterated that carrying cost, when allowed, should ordinarily run from the date the underlying expenditure was actually incurred, or from a date reasonably connected to it, rather than being pegged arbitrarily to the date of the true-up petition itself, since carrying cost is compensatory in nature and is meant to offset the time value of money the generator has been kept out of.
For generating companies that have deferred filing true-up petitions pending internal reconciliation or awaiting statutory auditor sign-off, the ruling provides some reassurance that a late filing will not automatically doom an otherwise valid claim, though it does not dilute the underlying obligation to file true-up petitions within a reasonable time of the relevant tariff period closing.