Section 108: Directions by State Government

Electricity Act • Official Statutory Text & Practice Guide

Statutory Regulation
Legal Standard
Competent Court / Tribunal
Act 2003

Legal Commentary & Landmark Judgments: Section 108

Section 108 of the Act empowers the State Government to issue directions on questions of policy to the State Commission, binding the Commission on state policy matters while preserving its adjudicatory autonomy.

  • State Policy Directive Authority: Empowers the State Government to issue written policy directions to the State Commission on matters impacting state energy development and public interest.
  • Prohibition Against Interfering in Adjudication & Tariffs: Strictly bars the State Government from issuing directives that fix specific tariff numbers or interfere in ongoing dispute adjudications under Section 86(1)(f).
  • Consultation Requirement Prior to Issuing Directions: Directs that the State Government shall give a reasonable opportunity to the State Commission to express its views before deciding whether a question is one of policy.
Key Landmark Precedents:
  • West Bengal Electricity Regulatory Commission v. CESC Ltd. (2002) 8 SCC 715: Supreme Court held that policy directions issued by a State Government are guidance on broad policy and cannot dictate how the Commission decides individual tariff components or utility disputes.
  • Brihanmumbai Electric Supply v. MERC (2013) 4 SCC 71: Supreme Court affirmed that the State Commission must act independently of state political directives when fixing consumer tariffs.
  • Gujarat Urja Vikas Nigam Ltd. v. Essar Power Ltd. (2008) 4 SCC 755: Affirmed that Section 108 directives cannot encroach upon the Commission's exclusive jurisdiction over contractual dispute adjudication.
Courtroom Practice & Strategic Litigation Guidance:

If a State Government issues a Section 108 directive ordering the SERC to freeze tariffs or waive industrial open-access surcharges, challenge the directive before the High Court under Article 226 citing CESC Ltd. as an impermissible executive usurpation of regulatory powers.