The Supreme Court of India has ruled that Indian Railways is liable to pay cross-subsidy surcharge and additional surcharge to distribution companies.
The court held that Railways cannot claim the status of a deemed distribution licensee under the Electricity Act, 2003, as it does not supply electricity to independent consumers. Instead, Railways functions as a consumer of electricity, procuring power exclusively for its operational requirements, including traction systems, signalling and station-related services. The court further observed that operation of transmission or distribution infrastructure alone does not qualify an entity as a deemed distribution licensee under the Act.