PETITION - tantransco

7.2.5 The proposed R&M charges for FY 2013-14 is shown in the table below:
Table 43: R&M Expenses for FY 2013-14
Rs. Crs
Details FY 2013-14
Estimate
Plant & Machinery 4.03
Building 0.09
Civil Works 0.28
Lines & Cable network 3.74
Vehicles 0.40
Furniture & Fixtures 0.00
Office equipments 0.17
Total Expenses 8.71
Less: Capitalisation 1.45
Net Repair & Maintenance expenses 7.26
7.2.6 Based on above paragraphs, the proposed O&M cost for TANTRANSCO for the year FY
2013-14 is Rs. 361 Crs. The breakup of O&M expenses for the year FY 2013-14 is shown
as under:
Table 44: O&M Expenses for FY 2013-14
Rs. Crs
Particulars FY 2013-14
Projections
Employee Expense 346
Administration & General Expenses 8
Repair & Maintenance Expenses 7
Total 361
7.2.7 It is requested to the Hon’ble Commission to approve the O&M expenses as showcased
in the above table.
7.3 GFA and Depreciation
7.3.1 The depreciation rate considered in the petition are in line with the rates specified in
the Tariff Regulations. The total depreciation is calculated on the opening balance of the
Gross Fixed Assets (GFA) and on a average basis on the addition of the assets during the
year.
7.3.2 This is calculated in line with the tariff regulations and the APTEL order, the abstract of
which is outlined below:
The Honble Appellate Tribunal vide its Order dated July 15, 2009 (Appeal No. 137 of
2008) allowed the Appeal and ruled as under (TPC Vs MERC):
“In view of the provisions of the Tariff Regulations the Companies Act and the
Accounting Standard-6, we find full justification and rationale in the contention of the
appellant that proportionate depreciation has to be allowed even for part of the year
when the assets have been put to use. The asset once put to use will be exposed to wear
and tear which will not wait to depreciate till the start of the new financial year. We,
therefore, allow the appeal in this view of the matter also.”
7.3.3 In line with the above decision of Hon’ble Appellate Tribunal, TANTRANSCO has claimed
depreciation on the assets added during the year by assuming that the assets will be
added during the mid of the year.
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