Big Win for Rooftop Solar Users: Madras HC Rules No Separate Network Charges, Already Included in Tariff [Read Order]

In a recent ruling, the Madras High Court held that network charges cannot be levied separately on rooftop solar power users, as such charges are already factored into the existing electricity tariff structure.

The South India Spinners Association and several industrial consumers filed writ petitions challenging the demand notices issued by TANGEDCO (Tamil Nadu Generation and Distribution Corporation) for retrospective network charges on solar energy generated for captive use.

GST READY RECKONER: Complete Topic wise Circulars, Instructions & Guidelines Click here

The petitioners argued that their rooftop solar systems operated independently and with minimal reliance on the electricity grid, so the tariff order did not authorize separate network charges.

Read More: 14 Year Delay to Issue Tax Notice: Kerala HC Holds No Protection u/s 17D KGST Act on “Fast Track Assessments” [Read Order]

TANGEDCO (the respondent), supported by the Tamil Nadu Electricity Regulatory Commission (TNERC), contended that the solar installations depended on the grid infrastructure for synchronization and voltage support, and that network charges were necessary to recover such costs.

The court found that the Tariff Order had already embedded network charges within the overall tariff and did not permit an additional or retrospective levy. The court observed that TANGEDCO (Tamil Nadu Generation and Distribution Corporation) had not provided mandatory generation meters at the consumers’ premises, as required under the regulations, further undermining the validity of the demands.

Read More: Technical breach in obtaining Provisional ID for GST migration: Calcutta HC directs to reconsider Claim of Transitional Credit [Read Order]

Single bench member, Justice Dr. Anita Sumanth observed that imposing additional charges after the fact would contradict the principles of transparency and fair regulatory practice. The court explained that the petitioners had relied on government policies promoting rooftop solar adoption, and such unexpected levies would penalize them for aligning with the State’s clean energy goals.

Complete practical guide to Drafting Commercial Contracts, Click Here

The court set aside the impugned order and held that no further charges could be collected beyond what was already stipulated in the tariff, and that any such attempt would amount to double recovery. The writ petitions were allowed, and all connected miscellaneous petitions were closed.

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates