Appeal No. 115 of 2016 and I.A. Nos. 265, 266 of 2016. Case: Sanwariya Gas Limited Vs Petroleum & Natural Gas Regulatory Board. APTEL (Appellate Tribunal for Electricity)

Case NumberAppeal No. 115 of 2016 and I.A. Nos. 265, 266 of 2016
CounselFor Appellant: K.K. Rai, Sr. Adv., S.K. Pandey and Anshul Rai, Advs. and For Respondents: Prashant Bezboruah and Sumit Kishore, Advs.
JudgesRanjana P. Desai, J. (Chairperson) and B.N. Talukdar, Member (T) (P&NG)
IssuePetroleum And Natural Gas Regulatory Board Act, 2006 - Sections 13 16, 19, 23, 28
Judgement DateFebruary 03, 2017
CourtAPTEL (Appellate Tribunal for Electricity)


Ranjana P. Desai, J. (Chairperson)

  1. The Appellant is a company incorporated under the Companies Act 1956. The Appellant is an authorised entity to inter alia implement the Piped Natural Gas ("PNG") and Compressed Natural Gas ("CNG") project for various applications in domestic, commercial, industrial and automobile sectors in Indian cities. The Appellant is selling CNG in Geographical Area ("GA") of Mathura. The Respondent is the Petroleum and Natural Gas Regulatory Board ("the Board") constituted under the Petroleum and Natural Gas Regulatory Board Act 2006 ("the said Act") having both the administrative and quasi-judicial functions. In this appeal the Appellant has challenged order dated 22/05/2013 passed by the Board.

  2. It is necessary to give the gist of facts of the case.

    (a) On 12/06/2009 the Appellant was granted authorisation for laying, building, operating or expanding CGD network in GA of Mathura.

    (b) On 13/09/2010 the Board issued a notice to the Appellant in respect of authorisation for CGD network granted for GA of Mathura. In the said notice it was stated that as per the requirement of Regulation 11(1) of the Petroleum and Natural Gas Regulatory Board (Authorizing Entities to Lay, Build, Operate or Expand City of Local Natural Gas Distribution Networks) Regulations, 2008 ("the said Regulations"), the Appellant needs to have a firm Gas Tie Up in place within 90 days of the grant of authorisation. It was intimated to the Appellant that the Appellant's time limit for a proper Gas Tie Up lapsed on 09/09/2009. However, no information/confirmation on a Gas Tie Up has been supplied to the Board by the Appellant and therefore, prima facie it appears that the Appellant has failed to meet the requirement under Regulation 11(1). It was further intimated to the Appellant that the Appellant's performance on achievement of physical target for the first year has been reviewed and a shortfall has been observed in Inch-Kms to be laid and domestic connections to be achieved thereby showing non-compliance with Regulation 13 and Schedule D of the said Regulations. The Appellant was called upon to appear before the Committee constituted by the Board and present its case on 21/09/2010 at 11.00 hrs at the address specified in the notice.

    (c) Admittedly, the Appellant's representative appeared before the Committee on 21/09/2010 and gave reasons for non-compliance of the relevant regulations. The Board found the said reasons to be not satisfactory. The Board therefore sent a notice on 03/11/2010 to the Appellant calling upon the Appellant to show cause as to why action under Regulation 11(5) of the said Regulations and under Section 23 of the said Act should not be initiated against the Appellant. The Appellant sent reply dated 15/11/2010 to the Board. The Board addressed another letter dated 14/01/2011 to the Appellant. In the said letter the Board requested the Appellant to attend a meeting in the Board's office on 07/02/2011 in connection with the show cause notice issued by the Board on 03/11/2010. The Appellant was intimated that the Appellant will have to clarify its position on various issues such as (i) inability to achieve firm Gas Tie Up within the stipulated time, (ii) Non-achievement of physical parameters as per commitments in the bid and (ii) Restructuring of the project finances and revised financial closure.

    (d) Instead of attending the said meeting the Appellant sent a letter dated 01/02/2011 requesting for adjournment. The Board accepted the request of the Appellant and communicated to the Appellant by its letter dated 04/02/2011 that future date will be communicated to the Appellant. By its e-mail dated 15/09/2011 the Board intimated to the Appellant that it has noticed that there were shortfalls in achievement of 2nd year targets for Mathura GA. The Appellant was asked to submit reasons for the said shortfalls as per the attached sheet latest by 20/09/2011. The Board addressed letter dated 16/03/2012 to the Appellant requesting the Appellant to depute its authorized official to appear before the Committee constituted by the Board to look into the compliance issue on 28/03/2012 at 04.00 p.m. at the Board's office. Hearing was held on 28/03/2012. In the hearing the Appellant's representative requested for more time to present its case before the Committee. The Board granted the said request and by its e-mail dated 29/03/2012 directed the Appellant to appear before the Committee on 02/04/2012 at the Board's office.

    (e) The Board by its letter dated 10/12/2012 directed the Appellant to submit details of domestic PNG connections registered till 30/06/2012 in the attached format latest by 20/12/2012. By its letter dated 18/12/2012 the Appellant asked for further time of 20 days for submitting information on the ground that its office was shifted to some other premises. The Board by its letter dated 21/12/2012 and e-mail of the same date acceded to the request and extended the date to submit the information latest by 31/12/2012. As no data was submitted though sufficient time was given to the Appellant the Board by its e-mail dated 01/01/2013 reminded the Appellant that the Board had not received any communication from the Appellant and therefore the Board will be constrained to consider the performance relating to the domestic connections only where the actual supply has started. By its letter dated 01/01/2013 the Appellant submitted information regarding registration of 9493 domestic PNG connections for Mathura GA in specified format. By its letter dated 10/01/2013 the Board asked for further details and information to enable verification of physical connections. The Appellant by its e-mail dated 14/01/2013 forwarded details about domestic connections. The Board by its letter dated 01/02/2013 asked for further details within two weeks stating that most of the information submitted by the Appellant was incomplete. Details of 28000 connections were called for. By its letter dated 25/02/2013 the Appellant furnished details of 9493 domestic customers and map showing laying of pipeline. The Appellant stated that balance data will be provided shortly. On 21/05/2013 the Board addressed a letter to the Appellant stating that out of 28000 connections the Appellant has provided information in connection with only 9493 connections and that during verification it was found that the...

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