K-ELECTRIC LIMITED vs FEDERATION OF PAKISTAN through Secretary, Ministry of Energy and Secretary, Ministry of Finance, Islamabad S — 2023 PLD 412 SUPREME-COURT

Case information

Citation: 2023 PLD 412 SUPREME-COURT
Court: Supreme Court of Pakistan
Year: 2023
Reporter: PLD
Parties: K-ELECTRIC LIMITED vs FEDERATION OF PAKISTAN through Secretary, Ministry of Energy and Secretary, Ministry of Finance, Islamabad S
Provisions referred to: S. 31---T; Electric Power Act

Fields are extracted from the reported citation and judgment text. Where a detail is not stated in the record, it is not shown.

Judgment text as reported

K-ELECTRIC LIMITED VS FEDERATION OF PAKISTAN through Secretary, Ministry of Energy and Secretary, Ministry of Finance, Islamabad S. 31---Tariff determination---Subsidies provided by Federal Government---Scope---Federal Government is well within its right to introduce, modify or withdraw subsidies---Subsidies are an integral part of its socioeconomic policies, which National Electric Power Regulatory Authority (NEPRA) must give effect to as per Section 31 of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997 ('the Act')---So a consumer of electricity is entitled to a subsidy as long as it is offered by the Federal Government and is bound by any modifications or withdrawals made by the Government---To give effect to a subsidy it is built into the tariff, as its obvious outcome is to reduce the price of electricity---So a subsidy is given effect through the tariff---No vested right existed in favour of the consumer with reference to a subsidy, simply because the subsidy is built into the tariff---Effectively, a subsidy is a relief package offered to consumers and remains operative for as long as it is required as per Government policy---In order to take the benefit of the subsidy, it has to be calculated in terms of the tariff, therefore, even if, it is reflected as a part of the tariff or separately it remains a subsidy and does not merge into the tariff---Essentially, it is based on a policy decision of the Federal Government and is not the outcome of a NEPRA determination---As per Section 31 of the Act, NEPRA is guided by government policies and must consider them, which means that it must reflect the subsidy through the tariff.

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