In what is seen as a major setback for Indian Railways, the Maharashtra Electricity Regulatory Commission (MERC) directed the national transporter to pay Rs 3,351 crore as interim payment to Maharashtra State Electricity Distribution Company Limited (MSEDCL) in the case relating to outstanding cross subsidy surcharge (CSS) and additional surcharge (AS). The two State-run agencies have been at loggerheads over the additional recovery sought by MSEDCL as to supply of power through open access. The dispute began in 2024 and the case moved upto Supreme Court, where Railways’ challenge was dismissed and it was deemed liable to pay open access surcharges to State distribution utilities.

 

The fresh order came even as final hearing in the case no. 24 of 2024 is listed later, but the interim order came on basis of Apex Court’s ruling of May 8, 2026. Immediately after, MSEDCL filed interlocutory application, seeking adjudication of dispute relating to non-payment of CSC and AS. The Railways’ counsel, arguing before the full bench comprising Chairperson Valsa Nair Singh, Anand Limaye and Surendra Biyani, both Members, sought three months’ time to study the Supreme Court order and frame his arguments.

 

The Railways said, total outstanding payment is Rs 6,702.20 crore and as per the order dated May 29, MERC directed the national transporter to clear 50 per cent of claims within a period of 30 days. This was in response to MSEDCL counsel saying while final hearing may be held later, Railways should be asked to pay atleast 50 per cent of claimed amount. MSEDCL, in its application before MERC, stated that, post SC order on May 20, 2026, they had issued a detailed computation of the CSS and ASC amounts outstanding against Railways. This, they said, is since the commencement of transmission open access by Railways, from November 2015 to March 2026. Further, the State utility expressed readiness to carry out reconciliation of the above computation as requested by Railways.

 

The matter MSEDCL counsel argued can be listed for hearing after reconciliation process is completed. Earlier, Railways’ counsel tried to buy time, stating that after CCS and ACS computation period of nine years, some time is required to study the issue in depth. Further, he argued that, there are some overlapping claims from both MSEDCL and Tata Power Company Ltd. -Distribution (TPC-D) about the two surcharges and sought 3-months’ period to carry out reconciliation with MSEDCL. Since Supreme Court already went into details of arguments stated by IR, MERC declined the request and passed the order, bringing curtains down on the bitter dispute.