Written by Rakesh Kacker and Chitrakshi Jain

A division bench of the Supreme Court recently dismissed a batch of appeals involving the Indian Railways. The judgment has implications for public and private entities seeking the status of a deemed distribution licensee under the Electricity Act. The APTEL judgment from which the appeals arose had rejected the claim of the Indian Railways to be treated as a deemed distribution licensee, a view that has been upheld by the Supreme Court.

The Court was tasked with deciding first whether the Indian Railways qualifies as a deemed distribution licensee. It held that a distribution licensee must not only operate and maintain a distribution system, but it is also required to supply electricity to consumers. Indian Railways does not pass this test unambiguously, for it “operates a closed network for meeting operational requirements of the........

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