Vidyut Mandal Abhiyanta Sangh Vs. Chattisgarh State Electricity Regulatory Commission
& Anr  Insc 960 (19 September 2007)
Sema & Lokeshwar Singh Panta
APPEAL NO. 3996 OF 2006 (With C.A.No.4268 of 2006 & C.A.No.4529 of 2006) H.K.SEMA,J
Civil Appeal No.3996 of 2006 is filed by Chhattisgarh Vidyut Mandal Abhiyanta Sangh.
Civil Appeal No.4268 of 2006 is filed by Chhattisgarh State Electricity Board
and Civil Appeal No.4529 of 2006 is filed by M/s Jindal Steel and Power
these appeals are directed against the common judgment and order of the
Tribunal dated 11.5.2006 passed in Appeal Nos. 179 of 2005, 188 of 2005, 16 of
2006 and 27 of 2006 preferred under Section 111 of the Electricity Act, 2003
(in short the Act). In the aforesaid appeals, the appellants have challenged
the order dated 29.11.2005 passed by the Chhattisgarh State Electricity
Regulatory Commission (in short the Commission)
have heard Mr. Ravi Shankar Prasad, learned senior counsel, appearing on behalf
of Chhattisgarh State Electricity Board - appellant in C.A.No.4268 of 2006; Mr.
Shanti Bhushan, learned senior counsel, appearing on behalf of M/s Jindal Steel
and Power Limited appellant in C.A.No.4529 of 2006 and Mr. Kavin Gulati,
learned counsel appearing on behalf of Chhattisgarh Vidyut Mandal Abhiyanta Sangh
appellant in C.A.No. 3996 of 2006.
Counsel for the appellant in C.A.No.3996 of 2006 has adopted the arguments of
Mr. Ravi Shankar Prasad, learned senior counsel, appearing for the appellant in
C.A.No.4268 of 2006.
C.A.No.4268 of 2006, the appellant has assailed the order dated 29.11.2005
passed by the Commission, granting license in favour of respondent No.2 herein
and the appellant in C.A.No.4529 of 2006.
Ravi Shankar Prasad, learned senior counsel appearing for the appellant, would
contend that the impugned order of the Commission granting license to
respondent No.2 - M/s Jindal Steel and Power Limited, is contrary to the
provisions of Section 14 particularly proviso 6 of the Section.
would also contend that the grant of license is contrary to Section 43, the
National Electricity Policy framed under Section 3 particularly 5.4.7. which
according to the counsel is statutory in character and sub-rule 2 of Rule 3 of
the Code of Conduct Rules, 2005 and explanation thereof. He would also contend
that the grant of license in favour of respondent No.2 would also offend the
provisions of Section 41 proviso 3 and Section 86(4) of the Act. In this
connection, counsel has taken us to the grounds taken in the memo of appeal
filed by the appellant. He has also taken us to the entire impugned judgment
rendered by the Tribunal. The Tribunal has not at all dealt with the grounds
urged by the appellant in the judgment. The Tribunal, however, rejected the
grounds in paragraph 38 as under:
up the fourth point, Concedingly after coming into force of The Electricity Act
2003 the Jindal Power has submitted an application for grant of distribution
license under Section 12 of the Act.
14 of the Act provides for the grant of license. Section 15 of the Act
prescribes procedure for grant of license. Though the Electricity Board has
raised an objection, it is a clear after thought presumably because of change
or shifting of personalities in power, and such shifting stand had been
adopted. The objections raised by Electricity Board are devoid of merits. The
Regulatory Commission has considered the request of Jindal Power and directed
issue of distribution license. We do not find any illegality or error in the
grant of license as Jindal Power do possess all the requirements for the
Jindal Steel and Power Limited - appellant in C.A.No.4529 of 2006, was
aggrieved by the order of the Commission recorded in paragraph 22 of the Order.
22 of the Order is in the following terms:- "The last issue for discussion
is the treatment of the period from 1.4.04 till the date of the grant of
distribution licence, during which supply of power by the applicant has been
without legal authority. As already discussed in para 11 to 13 ante, the
applicant did not have the necessary legal authority either under the 1910 Act
or under the present Act to supply electricity in his industrial estate.
constitutes a clear contravention of the provisions of Sec.12 of the Act that
mandates licence to be obtained for supply of electricity. This act of the
applicant is punishable under Sec.142 of the Act. The applicant is clearly
liable for penalty under this provision of law.
no opportunity has specifically been provided to the applicant of being heard
in this regard as required and the provision of this section, the elaborate
proceedings in this case has provided sufficient opportunity to the applicant
to prove that he had not contravened the provision of the Act, in supply of
power to his industrial estate. In fact, his main case is that he had the legal
authority for his action, which we have not accepted.
Commission, therefore, feels that there is no need for another opportunity
being given to the applicant of being heard in the matter. The Commission
directs that the applicant pay a penalty of Rs. One lakh for contravention of
the provisions of the Act aforementioned.
amount shall be deposited with the Secretary of the Commission within seven
days of this order."
Aggrieved by this order M/s Jindal Steel and Power Limited appellant in
C.A.No.4529 of 2006 also filed appeal No.27 of 2006 before the Tribunal.
ground taken in the appeal was that Jindal Power does not require the license
for supply of electricity as in terms of Section 10(2) of the Act as a
generating company, it is competent to supply electricity to any person without
using the transmission lines of the Electricity Board. After considering the
ground of appeal, the Tribunal framed the following issues:-
Whether Jindal Power was licensed to distribute electricity at any time?
Without securing a license is it permissible for Jindal Power to distribute
Whether Jindal Power could claim that it is a deemed licensee entitled to
distribute power after coming into force of The Electricity Act, 2003?
Mr. Shanti Bhushan, learned senior counsel, has taken us through the entire
judgment of the Tribunal but the questions so framed were not at all addressed
particularly the application of Section 10(2) of the Act.
is in these circumstances, learned senior counsels, appearing for the
respective appellants, contended that this is eminently a fit case where this
Court should set aside the order of the Tribunal and the matter be remitted to
the Tribunal for fresh decision after considering all the grounds raised in the
respective appeals. In the facts as alluded above we would also think so.
may also hasten to note that the appeal under Section 111 before the Tribunal
is in the nature of first appeal.
Tribunal, therefore, must examine the entire grounds of appeal and record its
reasons on each ground while disposing of the appeal.
Accordingly, these appeals are allowed. The order dated 11.5.2006 passed in
appeals are set aside. The appeals are restored to the file of the Tribunal.
The Tribunal shall consider each ground in appeals and dispose of the appeals
in accordance with law. We make it clear that we have not expressed any opinion
on the merit of the case whatsoever.
Having regard the question of public importance of far reaching consequences
involved in these appeals, the Chairman of the Tribunal may consider for
constituting an appropriate bench for hearing the appeals. With the aforesaid
directions/observations these appeals are allowed. No costs.