However, according to another calculations, BSES would be entitled to deposit nearly Rs 113 crore.

MERC, while admitting BSES petition, directed Tata Power from disconnection of standby power supply to BSES and similarly the loss-making Maharashtra State Electricity Board (MSEB) had been asked to follow the suit in the case of Tata Power "in the public interest." However, MERC has warned BSES that its petition stands dismissed if it fails to deposit the necessary amount at its new account by January 11 since when the day to day hearing would begin.

The state government, which had kept in abeyance its order of March 22 asking BSES to pay arrears towards standby charges to Tata Power, had sought the adjournment and an extension of 15 days time to seek advice of the state advocate general.

MERC chairman P Subrahamaniam accompanied by its members Venkat Chary and Jayant Deo, however, ruled out BSES pray to grant an option of bank guarantee instead of depositing the money at its account.

MERC directed that BSES should deposit Rs 9 crore for the period between December 1, 1998 and March 31, 1999.

Furthermore, BSES would have to deposit 50 per cent of Rs 181.50 crore at the same account for the period between April 1, 1999 and March 31, 2000, "after taking credit for amounts already paid by BSES.

Moreover, MERC has directed BSES to deposit 50 per cent of the amounts payable as per Tata Power on a monthly basis for subsequent period also till a decision in this case is given (during April and December this year).

The commission has said that since the MSEB had increased the standby charges payable to Tata Power from May 1, 2000 onwards from Rs 550 per KVA per month to Rs 600. The Tata Power, "may if they so desire submit a tariff revision proposal for the consideration of this. The BSES may also do likewise if they deem it necessary."

MERC has asked the MSEB, which is at a receiving end to file a petition seeking its directive on the withdrawal of deposited amount to tide over the ongoing financial crisis. MSEB sources said that it would file the petition in this regard soon as it was in bad need of liquidity.

BSES chairman and managing director RV Shahi told The Financial Express that the company would deposit the money and said that its stand had been vindicated. "We have been arguing that the standby charge is a component of tariff and the MERC, which has come in place since August 1999 should be the competent body to decide upon such issues involving tariff and standby charges," he added.

MERC while admitting BSES petition filed on December 4 said that it would be difficult to deny that there is a subsisting dispute between BSES, Tata Power and MSEB. The commission pointed out that " it would be fallacious to hold that the dispute about the standby charges is a dispute restricted only to the BSES and the Tata Power, ignoring altogether the third player, the MSEB, which is also a utility."

MERC said that there still appears to be a dispute about the exact quantum of standby charges that the BSES has to pay to the Tata Power for the year 1999-00, since the two parties are "sticking to their respective rigid positions." The commission noted that even in the flurry letters exchanged by the utilities between themselves and with the state government, after March 22 order (one of them even holds out an explicit state government threat to cancel the BSES licence), there is no mention of a precise figure as to the exact standby charges payable by the BSES.