Income tax, if any, on the licensed business of the distribution licensee shall be treated as expense and shall be recoverable from consumers through tariff. However, tax on any income other than that through its licensed business shall not be a pass through, and it shall be payable by the distribution licensee itself.
(2) Any under-recoveries or over-recoveries of tax on income shall be adjusted every year on the basis of income-tax assessment, under the Income Tax Act, 1961, as certified by the statutory auditors:
Provided further that the benefits of tax-holiday as applicable in accordance with the provisions of the Income Tax Act, 1961 shall be passed on to the consumers.
(3) The income tax actually payable or paid shall be included in the ARR. The actual assessment of income tax should take into account benefits of tax holiday, and the credit for carry forward losses applicable as per the provisions of the Income Tax Act, 1961 shall be passed on to the consumers.
(4) Tax on income, if any, liable to be paid shall be limited to tax on return on equity. However, any tax liability on incentives due to improved performance shall not be considered.
1 [25. Non tariff income.—(1) All incomes being incidental to electricity business and derived by the licensee from sources, including but not limited to profit derived from disposal of assets, rents, meter rent (if any), income from investments other than contingency reserves, miscellaneous receipts from the consumers but excluding delayed payment surcharge and income to licensed business from the other business of the distribution licensee shall constitute non tariff income of the licensee.
(2) The amount of non tariff income as approved by the Commission shall be deducted from the Aggregate Revenue Requirement of the distribution licensee:
Provided that the distribution licensee shall submit full details of its forecast of non tariff income to the Commission along with its application for determination of tariff.
(3) The indicative list of items under non-tariff income of licensee shall inter-alia include:
(a) Income from rent of land or buildings;
(b) Income from statutory investments;
(c) Income from interest on contingency reserve investment;
(d) Interest on advances to suppliers/contractors;
(e) Rental from staff quarters;
(f) Rental from contractors;
(g) Income from hire charges from contactors and others;
(h) Income from advertisements, etc.;
1 Subs. vide Not. HPERC-F(1)-1/2018 dated 22 nd November, 2018 published in R.H.P. dated 27 th November, 2018 at p. 6265-6277. Before its substitution read as under:
“25. Non-tariff Income.-[(1) All incomes being incidental to electricity business and derived by the licensee from sources, including but not limited to profit derived from disposal of assets, rents, meter rent (if any), income from investments other than contingency reserves, miscellaneous receipts from the consumers but excluding delayed payment surcharge and income to licensed business from the other business of the distribution licensee shall constitute non-tariff income of the licensee.]
(2) The amount received by the licensee on account of non-tariff income shall be deducted from the aggregate revenue requirement in calculating the net revenue requirement of such licensee.” Compendium of HPERC Regulations, March 2021 29
(i) Meter/metering equipment/service line rentals;
(j) Service charges;
(k) Consumer charges;
(l) Recovery for theft and pilferage of energy;
(m) Rebate availed on account of timely payment of bills;
(n) Miscellaneous receipts;
(o) Deferred Income from grant, subsidy, etc., as per Annual Accounts;
(p) Miscellaneous receipts;
(q) Excess found on physical verification;
(r) Prior period income.]
1 [26. Other Income of the Licensee.- (1) Where the licensee is engaged in any other business, the income from such business will be calculated in accordance with the Himachal Pradesh Electricity Regulatory Commission (Treatment of Income of Other Businesses of Transmission Licensees and Distribution Licensees) Regulations, 2005 and shall be deducted from the aggregate revenue requirement in calculating the revenue requirement of the licensee.
[ 2 [(2) The licensee shall maintain separate accounts and sub balance sheets for each of the other business including Generation (individual stations wise), Survey and Investigation of new power projects, investments in the existing and new projects etc.:
Provided that the licensee shall follow a reasonable basis for allocation of all joint and common costs between the distribution business and the other business and shall submit the Accounting Statements, as approved by its board of directors, to the Commission alongwith his application for determination of tariff:
Provided further that where the sum total of the direct and indirect costs of such other business exceeds the revenues from such other business or for any other reason, no amount shall be allowed to be added to the aggregate revenue requirement of the licensee on account of such other business.]