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Monday, December 21, 1998

Double power cess, says Dhumal

Ashwani Sharma  
SHIMLA December 20: Even as the Centre has received the chief ministers' nod to levy generation cess on the power projects in the country for boosting hydel power generation programme, Himachal Pradesh is making a fresh bid to seek ``reasonably'' higher share of the revenue for the power generating states.

Chief Minister Prem Kumar Dhumal, who earlier had succeeded in getting the pattern for the state's sharing changed from `consuming states to generating states,' now has made a fervent plea to Prime Minister Atal Behari Vajpayee to double the rate of cess from the proposed five paise per unit to 10 paise per unit.

The Bill proposing imposition of the power generation cess at a rate of five paise per unit is being introduced in the Parliament. Out of Rs 2,000 crore, which the Centre plans to collect through the measure, Himachal Pradesh having an installed capacity of 15,000 million units would get nearly Rs 55 crore annually. The same, however, is expected to cross Rs 200 crore even at existing rates when 1,500 mw capacity Natpha Jhakri Hydel project starts generating power by 2002. Had the pattern of state's sharing not changed, Himachal Pradesh would have got a lowest Rs 13 crores,'' the Chief Minister says.

Still expecting a greater scope, Dhumal, in his letter to the Prime Minister suggested that instead of proposed five paise per unit, the Centre must consider levying 10 paise per unit as had been initially proposed. Not only this, the CM has also asked for raising the state's share from 60 per cent to 75 per cent.He has tried to justify the same quoting that the power generated in the central sector was not more than 25 per cent.

Union Energy Minister P. R. Kumaramangalam says that the revenue collected through the cess would go into a special fund. Of this the proportion of sharing between states and Centre would be 60:40 per cent. The entire amount would be utilised for boosting hydel power generation and transmission.

Senior government officials, though quite hopeful of making the Centre agree to its twin proposal, doubling the rate of cess and providing a higher share of 75 per cent, are describing the Centre's move as a new ``milestone'' in the country's hydro power development programme. Himachal Pradesh having an identified power potential of 20,000 mw, will definitely be a big gainer.

The revenue share coming to the state from the special fund on the cess while going to be a tied amount, the state is also looking for clearance of its proposal on levying the generation tax. For this, a Bill was passed by the state assembly in 1995 but did not get Central approval.

``The matter is still pending before the Centre and I have spoken twice to the Prime Minister exclusively on this issue. There is also a lot of correspondence going on on the issue with the Union Energy Ministry,'' Dhumal informed.

Recently, the state government had also consulted some of the top lawyers like Soli Sobrajee on the issue to convince the Centre of its power to enact its law for levying the generation tax as per recommendations of the Rangarajan Committee. But it is yet to be seen whether following the Centre's decision to levy power generation cess, Himachal Pradesh would get permission to impose separate generation tax.


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