LexRAMAYANA ISPAT PVT. LTD. AND ANR. versus STATE OF RAJASTHAN & ORS.
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[2025] 4 S.C.R. 436 : 2025 INSC 424 Ramayana Ispat Pvt. Ltd. and Anr. v. State of Rajasthan & Ors. (Civil Appeal No. 7964 of 2019) 01 April 2025 [Vikram Nath* and Prasanna B. Varale, JJ.] Issue for Consideration i) Whether the Rajasthan Electricity Regulatory Commission (RERC) has the jurisdiction to regulate inter-state open access under the Electricity Act, 2003; ii) Whether the imposition of penalties for variations in drawal from contracted demand amounts to an unreasonable restriction on the right to open access under Section 42 of the Act of 2003; iii) Whether Regulation 26(7) of Rajasthan Electricity Regulatory Commission (Terms and Conditions for Open Access) Regulations, 2016 is ultra vires for requiring an advance notice of 24 hours a day prior, thereby preventing urgent procurement and creating an artificial barrier to open access as protected by the Act of 2003; iv) Whether Regulation 21 is arbitrary and discriminatory, thereby discouraging captive power generation by creating unreasonable distinction between captive power plants (CPPs) and state distribution companies; v) Whether the appellants’ right to open access is foreclosed by the Regulations of 2016. Headnotes† Electricity Act, 2003 – Rajasthan Electricity Regulatory Commission (Terms and Conditions for Open Access) Regulations, 2016 – Whether the Rajasthan Electricity Regulatory Commission (RERC) has the jurisdiction to regulate inter-state open access under the Electricity Act, 2003: Held: 1. s.79(1)(c) of the Act of 2003, defines the regulatory authority of the CERC over inter-state transmission of electricity – However, this provision does not strip State Commissions, including RERC, of their jurisdiction over intra-state aspects of open access – s.42(2) of the Act of 2003 expressly empowers State Commissions to regulate open access within their respective states, * Author [2025] 4 S.C.R. 437 Ramayana Ispat Pvt. Ltd. and Anr. v. State of Rajasthan & Ors. ensuring fair and non-discriminatory access to transmission and distribution networks within the state – Further, s.42(3) of the Act of 2003 provides that whenever a consumer, with premises within the area of supply of a distribution licensee, requires supply of electricity from a generating company other than such distribution licensee, such transmission and supply shall be in accordance with the regulations made by the State Commission. [Para 45] 2. The key determinant is not the source of power but its delivery, end-user, and consumption within Rajasthan's intra-state grid – The Act of 2003 provides a framework for demarcating responsibilities between CERC and State Commissions, ensuring that intra-state aspects of electricity regulation remain within the purview of State Commissions – The claim that only CERC has the authority to regulate inter-state open access cannot be accepted in light of the legislative intent behind the Act of 2003 – Therefore, RERC retains jurisdiction over intra-state transactions even if the power originates from another state. [Para 47] 3. Further, s.2(47) of the Act of 2003 defines open access as non- discriminatory access to transmission and distribution systems, encompassing both interstate and intra-state transactions – The respondents argue that the statute does not differentiate between them for regulatory purposes, meaning that State Commissions naturally retain authority over open access within their jurisdictions – This interpretation aligns with s.42, which explicitly grants State Commissions the power to regulate open access for consumers in their states. [Para 48] 4. s.181 of the Act of 2003 empowers State Commissions to frame regulations necessary for implementing the provisions of the Act of 2003 – By granting State Commissions the authority to introduce and regulate open access, the legislature has clearly vested regulatory oversight with RERC in Rajasthan – The omission of any reference to CERC’s jurisdiction over open access consumers in s.42 of the Act is indicative of the legislature’s intent to keep such matters under State Commissions’ oversight, ensuring that electricity consumers and distribution networks within a state remain subject to state-level regulation. [Para 49] 5. Thus, the respondents’ argument is well-founded in statutory provisions, legislative intent, and the structural framework of the Act of 2003 – RERC’s authority to regulate intra-state aspects of open access
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