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Another anti-customer step by Maharashtra

World is currently hit by the global pandemic Covid-19 and so is India. The worst impact of Covid-19 apart from health is on economy. Every organisation is struggling to cope up from the impact of Covid-19. Majority of industries have suffered a major setback due to pandemic. In such a scenario, Maharashtra State Electricity Distribution Company (MSEDCL) has decided to collect double security deposit from its consumers from the coming Financial year. At present, average bill of one month from annual electricity consumption is collected as deposit which has been decided to be doubled to average bill of two months. This decision will have a much bigger impact as it is going to cost the Industrial sector, particularly the MSME sector, a ginormous sum of over ₹3000 Crores. This could further break the backbone of the micro, small and medium businesses which are already in losses due to pandemic.

In light of this, Laghu Udyog Bharati (Maharashtra Pradesh) has filed a petition to Maharashtra Electricity Regulatory Commission (MERC) to direct MSEDCL to delay the implementation of this decision for a period of 3 years. This proposed delay period may allow the industries to overcome the setback posed by the pandemic. Also the decision will badly affect the consumers at large who may not be able to take additional pressure during this challenging time. Maharashtra has a system where MSEDCL currently enjoy monopoly over all the consumers having connection less than 1MW. Due to this monopolistic business model, consumers don’t have a choice or alternate method than to abide by the rules of MSEDCL. At a time when each and every government is trying to ease out the burden from the shoulders of the people and the industries, Maharashtra State Electricity Distribution Company is putting an extra burden. This act is not only arbitrary but shows lack of apathy towards the common public.

It is also claimed by the Laghu Udyog Bharti that MSEDCL isn’t complying with tax regime and is not issuing proper GST invoice for it’s services including providing service connection fees, processing fees and meter connection charges due to which customers are largely deprived from their legitimate set-off. GST was introduced in India so to ease the tax regime. Main aim through GST was to reduce the complications and to support the common public as well as the businesses. It enabled India in excelling in business world and India grew exponentially in the ranking of Ease of doing business. However, such an attitude by the sole business entity in such an important field doesn’t only look bad but is against the law.

Laghu Udyog Bharti further claims that MSEDCL doesn’t pay return of TDS on time. Not paying TDS on time results in non-receipt of credit of the tax deducted. This is a direct loss to the consumer and common public. The claim is serious and seeks urgent attention of the tribunal as it may affect the people at large.

Ashish Chandaran as the Convenor of Energy Committee of Laghu Udyog Bharti has filed this Petition and has prayed before the tribunal, “to consider the present pandemic and relax the provision of doubling security deposit for existing customers for a period of three years”.

Laghu Udyog Bharti through Ashish Chandaran has further prayed for a direction to MSEDCL to comply with the GST regime and issue proper invoice against the services. It also sought a detailed report certified by the Director, Finance of MSEDCL informing about the TDS deducted/payment deposited, return filing dates and the lapses.


Author: Adv. Shashank Shekhar Jha
Legal Editor,

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