State asked to repay ₹800 cr. to 2 lakh power consumers

Penalty for taking extra charges while installing new connections

A motorcyclist rides near a sub-station and electricity transmission pylons operated by Maharashtra State Electricity Distribution Co. (MSEDCL) in Nandurbar district, Maharashtra, India, on Wednesday, Jan. 18, 2017. Indian Prime Minister Narendra Modi pledged to bring reliable power to all citizens during the campaign that propelled him into office in 2014, the same year the World Bank pegged India as home to the world's largest un-electrified population. While his government has made progress meeting its 2019 deadline, many families are still missing out, holding back some of India's poorest, most-vulnerable citizens and preventing the country from achieving its development ambitions. Photographer: Dhiraj Singh/Bloomberg

In accordance with a Supreme Court order, the Maharashtra State Electricity Distribution Company (MAHADISCOM) will refund ₹800 crore to two lakh consumers for taking additional charges while installing new electricity connections. Maharashtra State Electricity Consumers Organisation (MSECO) has given the State-run body nine months to begin proceedings to repay the amount.

A Government Order in 2006 had struck down the practice of levying extra charges such as Service Connection Charge, Outright Contribution Charge on consumers seeking new power connections. The MSECO approached the Maharashtra State Electricity Commission in 2007 when MAHADISCOM continued to demand the extra charges. When the commission directed MAHADISCOM to refund the money, it appealed against the order in the Supreme Court. Following 10 years of legal battle, the court dismissed the appeal.

Pratap Hogade, convenor, MSECO, said, “Charging extra money was wrong. Now, MAHADISCOM has to pay ₹800 crore to the consumers. I feel the compensation amount should have been increased to ₹1,000 crore as MAHADISCOM continued to wrongfully demand the charges while the case was in court. We want the consumers to receive the refund immediately.”

Mr. Hogade said consumers were charged amounts ranging between ₹700 and ₹2.5 lakh for installing meters for residential and industrial purposes. In addition, ₹15,000 to ₹25,000 were charged for services such as wiring and erecting poles. He said, “The consumers were not aware that they were being wrongfully charged. Only a few of them raised the issue with the commission.”