Ahead of forming a political party after splitting with Anna Hazare, activist Arvind Kejriwal and his India Against Corruption (IAC) team on Sunday hit the streets against the power tariff hike by the Delhi government.

The agitation came on a day the media flashed reports that Hazare had declined to accept from Kejriwal a cheque of around Rs.2 crore of unspent funds of IAC lying with Kejriwal's NGO Public Cause Research Foundation (PCRF). IAC officials confirmed that Kejriwal had made the offer some months back but Hazare declined.

IAC's protest Sunday sought to highlight the resentment among people over "substantial" increase in their electricity bill.

Around 500 IAC activists gathered at Jantar Mantar in central Delhi protesting the 26 percent electricity tariff hike decided by the Sheila Dikshit government in July this year.

Shouting slogans against the power tariff hike, the IAC members also gathered in front of Dikshit's residence at Janpath. Police rushed to the spot and whisked them away.

IAC member Prashant Bhushan told the gathering that the hike was "unacceptable".

"Electricity bills have doubled after the power tariff hike. Earlier, people paid Rs.500 for 200 units of power. Now, they pay Rs.1,000 for the same quantity of power," Bhushan said.

The protesters demanded an immediate rollback of the power tariff hike.

Kejriwal hoped that Hazare would join them in three-four months if IAC programmes showed result. The protestors also included IAC members Manish Sisodia, Kumar Vishwas, Gopal Rai and Sanjay Singh.

IAC members said that private sector power distribution companies were making profits but were claiming losses to seek hike in power tariff.

The protest comes within a week of Hazare splitting with Kejriwal and his associates over their decision to form a political party.

Hazare distanced himself from the decision and publicly asked Kejriwal and his associates not to use his image or name in their political party.

Kejriwal and his team have decided to contest the Delhi assembly polls slated for 2013.

Hazare, they said, had also told his assoiates about Kejriwal's offer to return the unspent funds.

The issue of unspent IAC funds lying with PCRF was apparently raised by an ex-core committee member during a Sep 20 meeting in Delhi.

They said Kejriwal had travelled to Ralegan Siddhi with a cheque of around Rs.2 crore and requested Hazare to accept it but the veteran activist declined.