Delhi HC Dismisses BSES Pleas Against Proposed CAG Audit As Premature

New Delhi, Jun 24 (KNN) A vacation bench of Justice Tejas Karia dismissed as ‘premature’ the petitions filed by BSES Rajdhani Power Limited (BRPL) and BSES Yamuna Power Limited (BYPL) against the June 6 notices proposing a CAG audit.

The bench also observed that the communications merely invited the discoms to submit representations and avail an opportunity for a hearing, reported Hindustan Times. 

Notices Did Not Warrant Judicial Intervention

In its 30-page judgment, the Delhi High Court said the notices contained no adverse findings and merely required the discoms to submit responses and appear for hearings within the prescribed timelines. 

As no decision affecting their rights had been taken, the court held that judicial intervention at this stage was unwarranted and the petitions were premature. 

Discoms Challenged Proposed CAG Audit 

BRPL and BYPL moved the Delhi High Court after the Delhi government did not respond to their request to withdraw the audit notices. 

Appearing for the discoms, senior advocate Sandeep Sethi argued that the proposed CAG audit was contrary to established judicial precedents and that only the Delhi Electricity Regulatory Commission (DERC) had the authority to oversee audits of distribution companies. 

Discoms Cite Regulatory Jurisdiction 

He contended that tariff-related matters fall exclusively within the jurisdiction of the regulator and cannot be examined by an external authority outside the framework of the Electricity Act. 

The discoms also relied on earlier Supreme Court judgments in the regulatory assets matter and the Delhi High Court's ruling in the URJA case to support their stand.

Delhi Government Defends Audit Proposal

Opposing the petitions, Additional Solicitor General SV Raju, appearing for the Delhi government, argued that the notices merely sought representations on the proposed audit and did not constitute adverse orders. 

He further contended that a CAG audit served the larger public interest, as expenses claimed by discoms before DERC are ultimately passed on to consumers through tariffs and surcharges.

Court Clarifies Scope of Supreme Court Ruling 

Delivering the verdict, Justice Tejas Karia held that the Supreme Court's ruling in the regulatory assets case did not bar a CAG audit of BRPL and BYPL, provided it complied with the provisions of the CAG Act and the directions issued in that judgment. 

The court also observed that the facts of the URJA case were materially different and its findings did not apply to the present matter. 

(KNN Bureau)