Multi-Year Tariff Petition for FY 2013-14 to FY 2015-16 - UERC

PETITION FOR TRUE-UP OF FY 2004 TO FY 2011-12 &MYT PETITION FOR THE CONTROL PERIOD FY 2013-14 TO FY 2015-164.2.14 NON-TARIFF INCOMESThe Hon‟ble Commission had approved a non-tariff income of Rs. 1.24 Crore for FY 2012-13 in the tarifforder dated April 4, 2012. For the purposes of projections for the MYT petition, PTCUL has considered ayear on year increase of 5% in the non-tariff incomes.4.2.15 INTEREST ON WORKING CAPITALIt is understood that the payments received by PTCUL from UPCL would be subject to the provisions oftax deducted at source under Section 194 J of the Income Tax Act as the payment for transmission andwheeling charges are considered as „fees for technical services‟. According to the current provisions ofSection 194J, 10% TDS is the applicable charge. This would lead to certain cash flow deferment as 10%tax would be withheld by UPCL upon payment of transmission and wheeling charges to PTCUL. Howeversince the normative working capital is provided to the PTCUL as per the framework of the regulations, itwill tide over the cash flow issue on this account.The interest on working capital is worked out on normative basis and is based on norms specified underthe Regulation 34 (2) of Tariff Regulations, 2011. The rate of interest for calculation of interest on workingcapital has been considered at 13.25% which is the rate approved by the Hon‟ble Commission in its tarifforder for PTCUL for FY 2012-13 dated April 4, 2012.Accordingly the interest on working capital has been calculated as given below:Table 42: Interest on Working Capital (Figures in Rs Crore)Particulars 2013-14 2014-15 2015-16Computation of Working CapitalO&M Expenses of one month 10.99 13.16 15.19Maintenance spares 19.78 23.69 27.34Two months receivables 52.20 61.01 70.77Working Capital 82.96 97.87 113.30Rate of interest on working capital 13.25% 13.25% 13.25%Interest on Working Capital 10.99 12.97 15.014.2.16 INCOME TAX AND OTHER TAXESAs per Regulation 35 of the Tariff Regulations, 2011; income tax payable for each year of the controlperiod is based on the actual income tax paid. Any variation in income tax actually paid & approved shallbe reimbursed at the time of truing up for each year of the control period. Taxes on incomes and othertaxes would be recovered on actual basis as and when incurred.Power Transmission Corporation of Uttarakhand Ltd. Page 40