Adoni Cotton Mills Vs. The Andhra
Pradesh State Electricity Board &Others [1976] INSC 173 (6 August 1976)
RAY, A.N. (CJ) RAY, A.N. (CJ) KRISHNAIYER,
V.R.
SINGH, JASWANT
CITATION: 1976 AIR 2414 1977 SCR (1) 133 1976
SCC (4) 68
CITATOR INFO:
F 1987 SC 364 (4) R 1989 SC 788 (32)
ACT:
Indian Electricity, Act 1910--Section
22B--Electricity Supply Act 1948-Section 18, 49 and 79(j)--Whether Section 49
invalid for excessive delegation Whether Electricity Board can reduce the quota
of consumption if the State Government has done so--Board having determined the
quota, whether can further reduce it--Whether Board can fix the quota without
framing regulations-Practice and procedure--Whether appellant can be allowed to
raise a new question of facts for the first time.
HEADNOTE:
Section 22B of the Electricity Act, 1910,
authorises the: State Government if it is of the opinion that it is necessary
or expedient so to do for maintaining the supply and securing equitable
distribution of energy to provide by an order for regulating the supply,
distribution, consumption or use of the electricity.
Section 18 of the Electricity Supply. Act,
1948 provides that it shall the duty of the Board to provide electricity as
soon as practicable to persons requiring such supply.
Under section 49 subject to the provisions.
of the Act and the regulations if any made, the Board may supply electricity to
any person upon such terms and conditions as the Board thinks fit. It further
provides that in fixing the tariffs and terms and conditions for the supply of
electricity the Board shall not show undue preference to any person.
Under the prescribed agreement the Board is
given unilateral right to vary from time to time the terms and conditions of
supply under the agreement by special or general proceedings.
The State Government made an order under s.
22B providing that the maximum demand limit will he 75 per cent of the average
monthly maximum demand over a certain period. It further provided that the
supply to consumers who violated the restrictions was liable to be cut off
without notice.
Without prejudice to the right to disconnect
the supply the Board was also authorised to bill the energy and maximum demand
utilised in excess of the limits prescribed at double the tariff rates. The
order of the State Government was occasioned because the water position in the
Hydro Electric Reservoirs in the State became very unsatisfactory because of
failure of monsoon. Secondly, sufficient power was not available to meet the
needs of the State and thirdly it became necessary to conserve available water
with a view to ensure regular and uniform supply of electrical energy during
the coming months.
The State Electricity Board fixed quotas for
consumption because power generated was not adequate to meet the requirements.
An extra charge for consumption of energy beyond the limits of quotas was also
introduced by the Board. The Board further cut the quota and enhanced the extra
charges.
Thereafter, the Board passed an order
increasing the power cuts at different percentage in different industries.
The Board also increased charges to be paid
for the excess consumption. This action of the Board was necessitated because
of great depletion of levels in the Hydel reservoirs and because no assistance
was forthcoming from the neighbouring States and because there was a heavy
increase of agricultural loads.
The appellants filed writ petitions in the
High Court praying for a writ or direction that the respondent should be
ordered not to collect from the appellants more than normal charges for
consumption of electricity and not to disconnect their supply and for a
declaration that the restrictions with regard to the imposition of quota and
the levy of penalty charges was illegal.
134 The High Court held that the Board has
power to fix quotas or otherwise to restrict consumption of electrical energy
and collect charges at 4 times the normal rates.
The appellants obtained special leave limited
to the question whether under s. 22B of the Electricity Act, 1910', it is open
to the Board to reduce the supply to anything less than 75 per cent and levy
extra charges for excess supply.
In an appeal by special leave the appellants
contended:
1. Section 22B of 1910 Act empowers the State
Govt. to control the distribution and consumption of energy. The State
Government exercised its powers and reduced the quota to 75%. Therefore, any
further reduction by the Board would be illegal.
2. Section 49 of the 1948 Act does not confer
power on the Board to effect rationing of supply because that would involve
excessive delegation of legislative power. There is no guideline in s. 49.
to reduce the supply and therefore, section
is bad.
3. In the alternative, the contention was
that unless the Board made regulations under s. 79(j) it could not ration the
supply in exercise of powers under s. 49.
4. The Board cannot fix different percentages
of cuts in the supply to different consumers nor can the Board impose penalty.
Dismissing the appeal,
HELD .: (1) Section 49 which requires the
Board not to show undue preference to any person embodies the principle
enumerated in Article 14 of the Constitution. It is the principle of equity or
non-discrimination. However, it is fairly settled that equality before law does
not mean that the things which were different will be treated as though they
were the same. It does not mean an economical equal treatment. It would be
justifiable to treat different industries and institutions with reference to
their urgencY, social utility and also the impact on the conservation and
economies in the available supply of electric power. [142 B-E] (2) The
recognition of the fact that the Board can introduce rationing by making a
regulation under s. 79(j) of the 1948 Act necessarily involves a concession
that the Board has a power to enforce rationing and to enunciate the principle
and scheme. of such rationing. The making of a regulation is not a new source
of power but is the exercise of power which exists. The language of s. 48
"'if any" shows that the power can be exercised without making any
regulation. The powers conferred on the State Government under s. 22B do not
exhaust the power of the Board under s.
49 of the 1948 Act. There is no conflict in
the existence of power at different levels. The higher authority may have the
power to override the order of the lower authority.
Powers under s. 22B of the 1910 Act and s.
49' of the 1948 Act may have some overriding features. Section 49,, however,
contains a much larger power because the Board is the authority primarily
charged with all aspects of development and supply under the 1948 Act. [142
E-G, 143 A-D] (3) The appellants cannot be allowed to raise the contention
which was not raised in the High Court that the cut imposed by the State
Government under s. 22B was effective throughout. If such facts were pleaded in
the High Court, the Board could have produced materials denying such allegations.
[143-D-F] (4) The orders of the Government and the Board were cumulative ,and
not contradictory. The Board is empowered to fix different rates "having
regard to" the geographical position of any area, the nature of the supply
and purpose for which supply is required and any other relevant factors.
The expression "any other relevant
factors' is not to be construed ejusdem generis because there is no germs of
the relevant factors. [144 B-D, E-F] 135 (5) If there is shortage of
electricity there has to be restriction on supply. The Board can disconnect
supply if the quota is exceeded. The Board can also impose higher rates if the
quota is exceeded. The imposition of higher rates is only to sanction the
rigour of ration by making persons who exceed the quota liable to pay higher
rates.
[144 G-H, 145 A]
CIVIL APPELLATE JURISDICTION: CIVIL APPEALS
NOS: 1241, 1245, 1506-1525 & 1770-1771/75-(Appeals by Special Leave from
the Judgment and Order dated 26.8.1975 of the Andhra Pradesh High Court in Writ
Petitions Nos: 874/75, 5894/75, 7068/74, 876/75, 1661, 930, 2326, 149, 3385/75,
6891/74, 825, 2247, 2409,3021, 6931/75, 6932, 7106, 7178/74, 123, 133, 235,
2241, 7170,731/75 respectively) and CIVIL APPEALs NOS :--1242, 1253, 1443, 14561461
1664-1666, 1772, 1774-1775, 1995-1996/75 & 164165/76:(Appeals by Special
Leave from the Judgment and Order dated 26.8.1975 of the Andhra Pradesh High
Court in Writ Petitions Nos :-6796/74, 5886/74, 732/75, 1583/75, 7297/74,
512/75, 6121/74, 6902/74, 6791/74, 215/75, 6287/74, 5854/74, 2871/75,. 2871/75,
6890/75, 1634/75, 525/75, 5843/74, 1635/75, 2053/75, 159, 311, 2298/75, 6478/74,
2218/75, 3360/75, 1509, 2040, 202, 244./75, respectively) and CIVIL APPEALS
NOS: 1244, 1462-1465, 1467-1498, 15001505, 1662, 1667, 1776-1780, 1991-1994/75
& 166/76: (Appeals by Special Leave from the Judgment and Order dated
26.8.1975 of the Andhra Pradesh High Court in writ Petitions Nos.
5890/74, 5109/74 6859/74, 185/75, 554/75,
1274, 1943, 2366, 2254, 1015, 1114, 764, 296, 2584/75, 6952, 5880/74, 6505,
2272/75, 6922/74, 205, 114, 251, 6318, 194, 2365, 1567, 6482, 897, 620/75,
6520, 6753/74, 673, 2409, 1395/75, 6724/74, 2760, 231, 1603/75, 6082/74, 2245/
75, 29/75, 29/75, 356/75, 7042, 1649/75, 29, 2113, 707, 1603, 1194, 1194,
3354/75, 6836/74, 2670/75, 5889/74 respectively) and CIVIL APPEALS Nos:1526-1530,
1663 & 1997 OF 1975 (Appeals by Special Leave from the Judgment and Order
dated 26.8.1975 of the Andhra Pradesh High Court in Writ Petitions Nos :--230,
276, 354, 355, 596, 230 and 230/75 respectively.
CIVIL APPEAL NO. 1532 OF 1975 (Appeal by
special Leave from the Judgment and Order dated 26.8.1975 of the Andhra Pradesh
High Court in Writ Petition No. 4320/74).
CIVIL APPEAL NO. 1533 OF 1975 (Appeal by
special Leave from the Judgment and Order dated 26.8.1975 of the Andhra Pradesh
High Court in Writ Petition No. 2311/75).
CIVIL APPEAL NOS. 1534 & 1661 OF 1975
(Appeals by Special Leave from the Judgment and order dated 26.8.1975 of the
Andhra Pradesh High Court in Writ Petitions Nos. 6926/74, and 2019,/75).
A. K. Sen, (In CA. 1245/75), B. Sen (In CA
1506/75} K. Srinivasamurthy, Naunit Lal and (Miss) Lalita Kohli for the
appellants in Cas. 1241, 1245, 1506-1525, 1770-1771/75.
136 M.C. Bhandare (In CA 1242/75), Eswara
Prasad (In CA 1443-1446), A.L. Lakshminarayana (In 1243, 1447-1451/75), A.
Panduranga Rao (In CA. 1460-1461,
1995-1996/75), D. Sudhakar Rao (In CA 1242/75) B. Kanta Rao for the Appellants
in CAs.
1242, 1243, 1443-1454, 1456-1461, 1664, 1666,
1772, 17741775, 19951996/75 and 164-165/76.
B. Sen (C.A. 1462/75) Sachin Chaudhry (CA
1244/75) for the appellants in C.A. Nos. 1244, 1462-1465, 1467-1498, 1500-1505,
1662, 1667, 1776-1780, 1991-1994/75 and 166/76.
Subodh Markandaya for the appellants in Cas
1526-1530, 1663 and 1997/75.
Rangam and (Miss) A. Subhashani, for the
Appellant in C.A. 1532/75.
A.K. Sanghi for the Appellant in CA 1533/75.
A. Subba Rao for the Appellants in Cas. Nos.
1534 and 1661/75.
Lal Narain Sinha, Sol. Gen. T. Anatha Babu,
K.R. Choudhary, S.L. Setia and (Mrs. Veena Khanna for the Respondents in all
the appeals.
The Judgment of the Court was delivered by RAY,
C.J.--These appeals are by special leave from the judgment dated 26 August,
1975 of the High Court of Andhra Pradesh.
The special leave was granted as follows :"During
the period in question there was an order of the State Government under section
22-B of the Electricity Act, 1910 limiting the supply of electricity to 75 per
cent of the previous consumption. The quotas fixed by the Board are very often
below 75 per cent and sometimes as low as 30 per cent. Special leave should be
granted limited to the question whether in the facts of the order under section
22-B it is open to reduce the supply to anything less than 75 per cent and
charge penalty of extra charges for that quantity." The State Electricity
Board referred to for brevity as the Board supplies electricity of two
varieties. One is high tension. The other is low tension. Power is generated by
hydro electrical method by use of river waters and also by thermal method using
coal. The Board fixed quotas for consumption with effect from March 1972
because power generated was not adequate to meet the requirements. For a short
period between 7 July, 1972 and 16 August, 1972 these quotas were lifted. The
restrictions were re-imposed. An extra charge for consumption of energy beyond
the limits of quotas was introduced on 25 February, 1973. The charge was double
the usual rate. This continued till 1 August, 1974. The Board introduced on 29
July, 1974 a further cut in quotas and enhanced the extra charges. The extra
charges were double the usual rates, if the excess consumption was 20 per cent
or below that limit over the newly introduced quotas. If the total consumption
was in excess of 20 per cent, the extra charge was four times the total excess
consumption. The Board on 20 March, 1973 reduced the quotas still further
retaining the pattern of extra charges.
Weekly quotas instead of monthly ones, were
introduced.
A restriction was imposed to the effect that
for every 5 per cent of excess consumption there would be one day's cut.
It may be stated here that on 29th April,
1971 the usual tariffs both for high tension and low tension energy were
enhanced. The Board on 1 June, 1974 removed the slab system and a uniform rate
of 14 per unit was introduced.
The appellants filed writ petitions in the
High Court for a writ, direction or order to collect from the appellants normal
charges for consumption of electricity and not to disconnect their supply and
further order declaring the restrictions with regard to imposition of quota and
the levy of penalty charges as illegal. The High Court held that the Board has
power to fix quotas or otherwise restrict consumption of electrical energy and
collect charges at four times the normal rates.
The appellants obtained leave limited to the
question whether under section 22-B of the Electricity Act, 1910 referred to as
the 1910 Act it is open to the Board to reduce the supply to anything less than
75 per cent and levy extra charges for excess supply.
The State Government on 6 April, 1972 made an
order under section 22-B of the 1910 Act, inter alia, as follows :-"All
consumers of electricity (both high tension and low tension) being billed under
high tension categories I (both normal and alternative tariffs) II and III and
low Tension category V shall so regulate their use of electricity as not to
exceed in any month, the limits of maximum demand and energy specified
hereunder:
The maximum demand limit will be 75% of the
average monthly maximum demand over the period from March 1971 to February
1972. The limit for energy consumption will be 75% of the average monthly
consumption (number of units) over the period from March, 1971 to February,
1972. The supply to consumers who violate the restrictions being imposed
hereunder will be liable to be cut off without notice. Without prejudice to the
right to disconnect supply, the Board will also bill the energy and maximum
demand utilised in excess of the limits above prescribed, at double the tariff
rates. Consumers of High tension electricity being billed under alternative
tariff under Category I will further pay for the excess energy consumed, energy
charges at the rate of 20 paise per unit and M.D. charges at twice the tariff
rate.
X X X X 11--1003 SCI/76 138 The restrictions
shall not apply to (i) Railways, (ii) Hospitals including nursing homes and
Doctors Clinics, (iii) water supply, (iv) for sanitary arrangements for the
public, (v) Radio Stations (vi) Telephone Exchanges and other categories totaling
15 in number.
x x x x x x In the case of consumers who have
not availed supply during the entire period of March, 1971 to February, 1972
because their loads were seasonal or for some other reason, the average monthly
limits for maximum demand and energy will be computed with reference to the
period between March, 1971 and February 1972 during which supply was availed
Of." This order of the State Government in 1972 was occasioned by three
features as recited in the order. First, the water position in the
Hydroelectric reservoirs in the State became very unsatisfactory because of
failure of monsoon. , Second, sufficient power was not available to meet the
needs of the State. Third, it became necessary to conserve the available water
with a view to ensuring regular and uniform supply of electrical energy during
the coming months.
On 8 August, 1975 the State Government stated
that the Government issued several orders commencing 6 April, 1972 and ending
31 July, 1975 placing certain restrictions on the consumption of electricity
"in view of the critical power supply position." There were several
orders on 6 April 1972, 3 May 1972, 16 May 1972, 22 May 1972, 29 May 1972, 9
June 1972 and 22 September 1972. The Government canceled these orders on 8
August 1975 with effect from 7 July, 1972.
On 20 March, 1975 the Board in its order of
that date referred to its previous orders in the years 1973 and 1974 and the
order of 2 January, 1975 and stated as follows:
Because of greatly depleted levels in the
Hydel Reservoirs on account of the low rainfall in the catchmeat areas the
hydel generation in the Andhra Pradesh grid has come down very much. No
assistance was forthcoming from the neighbouring State as from the monsoon of
1974. Two new sets of Kothagudem Thermal Power Station have not stabilised.
Besides, normal load there has been heavy
increase of agricultural loads during the last month due to the onset of
summer. This has resulted in the load going far beyond the system capability.
The graded tariff which was introduced expecting it to act as a sufficient
deterrant to the consumers against exceeding the quotas fixed has not given
relief to the extent expected. It has become impossible to meet the
agricultural demand and save the standing crop at this crucial stage. The Board
in this background decided to raise power cuts on demand and energy consumption
and ordered that all high tension and low tension consumers should so regulate
their use of electricity as not to exceed in any month the limits of maximum
demand and energy specified against each category.
139 Categories mentioned in the order of the
Board dated 20 March, 1975 are the Priority Industries, Continuous Process
Industries, Other industries, Essential Services, Low tension Category-Domestic
Supply, Low Tension Category non Domestic Supply and Public Lighting. The
industries which had been exempted from power cut before like Fertilizer
Industries, Oil Refineries, Pesticides Manufacturing Industries, All India
Radio were also subjected to 20 per cent cut both on maximum demand and energy
consumption. The cement industry which was having 100 percent quota was
subjected to. 20 per cent cut. The sugar mills and rice and Roller Flour Mills
continued to, be subjected to 10 per cent cut both on maximum demand and energy
consumption For closer control over consumption and for disconnecting those
that exceed the quotas, the system of weekly quotas was revived and was to be
implemented. The proportional quota for the week would be one, fourth of the
monthly quota already fixed. Besides the penal charges already existing, the
Board decided that the services of the consumers would be liable to be
disconnected if they exceeded the quotas fixed by anything beyond 5 per cent.
For every 5 per cent of excess over the quota the disconnection would be for
one day.
The Board did not subject the low tension
domestic supply category to any restriction. In priority industries the
existing quota of 70 per cent was reduced to 55 per cent. In food products
industries the maximum demand of 50 per cent was not reduced but the energy
consumption was reduced from 60 to 50 per cent. In Continuous Process
Industries the maximum demand and energy consumption were reduced from 65 per
cent to 55 per cent. In other industries not covered by those categories the
existing cut of 50 per cent was not subjected to further cut.
The appellants contend as follows: First,
section 22-B of the 1910 Act gives powers to the State Government to control
the distribution and consumption of energy. The State Government exercised its
powers under section 22-B of the 1910 Act and reduced the quota to 75 per cent
on 6 April, 1972. Therefore any further reduction by the Board would be
illegal. Second, section 49 of the Electricity Supply Act, 1948 referred to as
the 1948 Act does not confer power on the Board to effect rationing of supply
because that would involve excessive delegation of legislative power. Further,
there is no guidance in section 49 of the 1948 Act to reduce the supply, and
therefore, section 49 is bad. The alternative contention of the appellants is
that unless the Board made Regulations under section 79 (J) of the 1948 Act it
could not ration the supply in exercise of powers under section 49 of the Act.
The appellants contend that the Board had to lay down the principles in the
regulations which the Board is empowered to make under section 79 (J) of the
1948 Act and unless the regulations lay down the principles under section 79
(J) of the 1948 Act the Board cannot exercise power under section 49 of the
1948 Act.
The appellants also contend that the State
Government notification dated 6 April, 1972 regulating and restricting the
consumption 140 electricity on the basis of 75% of the average maximum demand
of a consumer between the period March 1971 and February 1972 remained in force
till 2 August 1975, and, therefore, the Board could not exercise the power of
regulating and controlling supply and consumption of electricity because it was
exercised by the State.
The relevant provisions of the 1948 Act are
as follows:-Section 18: "General duties of the Board: Subject to the
provisions of this Act the Board shall be charged with generally duty .. and it
shall be the duty of the Board .... (c) to supply electricity as soon as
practicable to any other licensees or persons requiring such supply and whom
the Board may be competent under this Act so to supply." Section 49:
"(1) Subject to the provisions of this Act and of regulations, if any,
made in this behalf, the Board may supply electricity to any person ...... upon
such terms and conditions as the Board thinks fit .............. (4) In fixing
the tariff and terms and conditions for the supply of electricity, the Board
shall not show undue preference to any person." Section 59: "The
Board shah not as far as practicable .... carry on its operations under this
Act at a loss and shall adjust its charges accordingly from time to time."
It is also appropriate at this stage to refer to.the provisions in the Andhra
Pradesh State Electricity Board Power Tariffs contained in Part F dealing with
general terms and conditions of supply. The relevant provisions are clauses 6.7
and
6.8 of Power Tariffs which are set out
hereunder:-Clause 6.7: "The Board shall have the unilateral right to vary
from time to time, the terms and conditions of supply by special or general
proceedings. In particular, the Board shah have the right to enhance the rates
chargeable for supply of electricity according to exigencies." Clause 6.8:
"The Board shall endeavour to afford continuous supply and to restore interrupted
supply as early as possible. The Board shah have the right to stagger consumer
or consumers according to operational and other exigencies. The Board shall not
be responsible for any loss or inconvenience occasioned to any consumer, by any
interruption of supply of any kind, whatever be the reason there for, unless
the interruption is exclusively attributable to the negligence of the
Board." Reference is also necessary to the form of agreement for purchase
of electricity supply consumption. There are forms and agreements 141 for high
tension as well as low tension. The relevant terms in the form of high tension
agreement are as follows:-"Clause 5: Obligation to comply with
requirements of Acts, and Terms and Conditions of supply:
I/We further undertake to comply with all the
requirements of the Indian Electricity Act, the Electricity (Supply) Act, 1948,
the Rules there under and the terms and conditions of supply notified by the
Board from time to time." "Clause 10: Board's right to vary terms of
Agreement:
I/We agree that the Board shall have the
unilateral right to vary, from time to time, the terms and conditions of supply
under this agreement by special or general proceedings." The Low Tension
agreement contained inter alia the following:
Clause 9: "Obligation of consumer to pay
all charges levied by Board:
From the date this agreement comes into
force, I/We shall be bound by and shall pay the Board maximum demand charges,
energy charges, surcharges, meter rents and other charges, if any, as
prescribed in the terms and conditions of supply notified by the Board from
time to time for the particular class of consumer to which I/We belong.
"In particular, the Board shall have the
right to enhance the rates chargeable for supply of electricity according to
exigencies." Clause 10: "Board's right to vary terms of Agreement:
I/We agree that the Board shall have the
unilateral right to vary, from time to time the terms and conditions of supply
under this agreement by special or general proceedings." These provisions
indicate that the Board is under a duty to supply electricity to consumers who
enter into contracts with the Board. The duty to supply however is inherently
limited by its capacity. If the Board is unable to supply electricity to meet
the full demand of consumers then necessarily it can only make limited supply.
Clause 6.8 of the Terms and Conditions of the
Power Tariffs establishes these features. The first part of clause 6.8 speaks
of the duty of the Board to make all endeavours to meet the whole demand of the
consumers.
Clause 6.8 also confers power on the Board to
stagger supply. It is obvious that if the Board cannot generate the energy
required to meet the .full demand of the consumer it will have to curtail the
supply.
The appellants realise that the Board has
power to curtail supply. But the appellants contend that the Board has no.
power to, exempt certain categories of consumers and impose different
percentage of cut.
142 The appellants contend that the Board has
no power under section 49 of the 1948 Act either to impose different percentage
of cuts in the supply to consumers or to impose penalty. The appellants contend
that only if the Board introduced principles by making regulations under
section 79(j) of the 1948 Act then the Board could have applied these
principles in imposing cuts.
The contentions of the appellants are
unsound. Section 49(4) of the 1948 Act states that in fixing the tariffs and
terms and conditions for the supply of electricity the Board shall not show
undue preference to any person. This section embodies the same principle which
is enunciated in Article 14 of our Constitution. The Board is a State for the
purpose of Part III of our Constitution. In the present case, we, are, however,
not concerned with the application of Article 14. All that requires to be appreciated
is that the provisions of Article 14 of our Constitution and section 49(4) of
the 1948 Act are similar in principle. It is the principle of equality or
non-discrimination. Section 49(4) of the 1948 Act does not mean a mechanical
equal treatment, It is fairly settled that equality before the law does not
mean that things which are different shall be treated as though they were the
same. The obligation not to discriminate involves both the right and the
obligation to make reasonable classification on the basis of relevant factors.
To illustrate, cutting down 50 per cent of the needs of a hospital and the
needs of industries producing consumer goods cannot be treated on the same
footing. It would be justifiable to treat them with reference to their urgency,
their social utility and also the impact on the conservation and economics in
the available supply of electric power. The guidance is clearly furnished by
the principles embodied in section 49(4) of the 1948 Act similar to Article 14
of our Constitution.
The recognition of the fact that the Board
can introduce rationing by making a regulation under section 79(j) of the 1948
Act necessarily involves a concession that the Board has the power to enforce
rationing and to enunciate the principle for determining the scheme of such
rationing. A regulation can be made only in the exercise of a power which exists
in the Act. The making of a regulation is not a new source of power but
regulates the exercise of power which exists. Section 49(1) of the 1948 Act
therefore gives a general power which could be regulated by making of a regulation.
The language: of section 49 of the 1948 Act shows that the power can be
exercised without making any regulation. The expression "regulation"
occurring in section 49(1) is qualified by the expression "If any".
It is, therefore, manifest that if the power is existing, it must be exercised
according to valid principles consistent with the provisions of section 49(4)
of the 1948 Act. This Court rejected the suggestion that the President or the
Governor cannot settle terms and conditions of the public servants without
making rules under Article 309 of the Constitution. If regulations were made,
such regulation would have to be in conformity with section 49(4) of the 1948
Act and in the exercise of its power the Board would have to abide by
regulations.
143 The argument of the appellants that
section 22-B of the 1910 Act which confers power on the State Government to
form an opinion as to the necessity or expediency of taking action for the
maintenance of the supply and securing the equitable distribution of energy,
exhausts the power of distribution of energy and the Board has no power under
section 49 of the 1948 Act to operate upon the field of supply of electricity
is unsound. Section 22-B of the 1910 Act is only enabling while the Board must
inevitably curtail supplies. If the Board must curtail supplies it is curious
to. suggest that the cuts must not be based on rational equitable basis
consistent with principles of reasonable classification within the meaning of
section 49(4) of the 1948 Act. Section 22-B of the 1910 .Act was introduced in
1959. It did not expressly or impliedly repeal or cut down the content of the
power of the Board in section 49 of the 1948 Act which was enacted in 1948 and
reproduced in 1966.
There is no conflict in the existence of
power at different levels. The higher authority may have the power to override
the order of the lower authority. Powers under section 22-B of the 1910 Act and
under Section 49 of the 1948 Act may have some overlapping features. Section 49
contains a much larger power because the Board is the authority primarily
charged with all aspects of development and supply under sections 18 and 49 of
the 1948 Act.
It may be stated here that on 6 April, 1972
the State order effected cut in supply. The Board also fixed quotas from March,
1972. Between 7 July, 1972 and 16 August, 1972 there was no cut in supply. The
order under section '22-B of the 1910 Act was not effective after the month of
July, 1972. The orders of the Board effecting cut in supply were effective
prior to July, 1972 and also from August, 1972.
The appellants enjoyed unrestricted supply of
electricity at ordinary rates from 7 July, 1972 to 16 August, 1972. The
appellants did not raise any contention in the High Court that the State order
of April, 1972 was effective all throughout. If such facts had been challenged
the Board would have given proper materials by way of facts to show that the
Board order was to the knowledge of everybody not effective after the month of
July, 1972. When the Board on 7 July, 1972 decided to remove all the
restrictions imposed earlier it is manifest that the Board tried best to
maintain the terms and conditions mentioned in clause 6.8 of the Power Tariffs
of the State Electricity Board. The Board filed in the High Court the statement
showing consumer requirement of energy in one column, actual generation in
another column, consumers' requirement of demand in Mega Watts in another
column and actual demand in Mega Watts in still another column from the month
of February 1973 right upto June, 1975. The High Court held' that the
correctness of the statement was not disputed by the appellants and the High
Court did not doubt the accuracy of the statement.
The High Court held that the actual consumer
requirement has all throughout been more than the actual generation. The fact
that the actual generation has been lower than the consumer’s requirements
shows that the Board has in a fair and just manner imposed cuts whenever
situation merited the same.
There is no, conflict between the order of
the Government in April, 1972 and the orders of the Board in the year 1975 for
these 144 reasons. The restrictions imposed by the Government ceased on 7 July
1972 when in the opinion of the Government scarcity conditions disappeared.
This is manifest from the Government Order dated 2 August, 1975. The appellants
cannot be allowed to urge that the Government Order of the year 1972 continued
after 7 July, 1972. The appellants acted upon the footing that the restrictions
had been lifted and consumption was even more than their normal maximum demand
on normal rates. Even if the Government Order of 1972 continued the
restrictions imposed by the Government Order and the Board Order were
cumulative and not contradictory. The Government Order was addressed to the consumers
not to consume in excess of 75 per cent of their normal maximum demand. If the
appellants sought any relief in respect of consumption in violation of the
order under section 22-B of the 1910 Act it would be an offence under section
41 of the 1910 Act. Such a contention cannot be allowed to be raised.
Section 49(4) of the 1948 Act casts a duty on
the Board not to show any undue preference in fixing the tariff and terms and
condition. Clauses 6.7. and 6.8 of the Power Tariffs. show that the Board shall
have the right to stagger or curtail supply of electricity to any consumer
according to operational and other exigencies. The Board can therefore release
supply or block the same areawise and has no means of enforcing the quota
except through sanctions. Such sanctions can take any reasonable form either
disconnection in case of gross and persistent defaults or the lesser sanction
of enhanced tariff.
The power to enhance the tariff is included
in section 49 of the 1948 Act. The expression that the Board "may supply
electricity on such terms and conditions as the Board thinks fit" in
section 49 (1 ) is related to the terms and conditions of the agreement
referred to above. Section 49 of the 1948 Act in sub-section (1) confers power
on the Board to supply electricity to any person not being a licensee upon such
terms and conditions as the Board thinks fit. This power contains the power to
regulate and ration supply. The terms and conditions to which reference has
been made make explicit what is implicit in the power.
The terms and conditions contain the power of
the Board to enhance the dates. Section 49(3) of the 1948 Act states that the
Board has power to fix different tariffs for the supply of electricity having
regard to the geographical position of any area, the nature of the supply and
purpose for which supply is required and any other relevant factors.
The expression "any other relevant
factors" is not to be construed ejusdern generis because there is no genus
of the relevant factors. The combined effect of section 49 of the 1948 Act and
the terms and conditions of supply is that having regard to the nature of
supply and other relevant factors particularly when there is shortage of
electricity the Board has power to enhance the rates. If there is shortage of
electricity there is to be restriction on supply. The Board can disconnect
supply if the quota is exceeded. The Board can also impose higher rates if the
quota is exceeded. The imposition, of 145 higher rates is only to sanction the
rigour of ration by making persons who exceed the quota liable to pay higher
rates.
The High Court upheld the content of the
power of the Board under section 49 of the 1948 Act and also to charge enhanced
tariff for exceeding the allotted quota. It is manifest that the requisite
power exists in the Board and this Court did not permit the finding of the High
Court to be re-examined; nor the question whether the power had been properly
exercised within the limits of section 49 and the terms of the agreement
because the terms were directly corelated to the availability of electricity
for being supplied. From 7 July, 1972 up to 16 August, 1972 the appellants
enjoyed unrestricted supply at ordinary rates.
The appellants took advantage of it. Section
22-B order to the knowledge of everybody was not effective after July, 1972.
The appellant cannot assert the authority that the Government Order of April
1972 was effective. (See Southeastern Express Company v.W. 1. Miller(1).
There is no question of excessive delegation
because power is conferred by the statute.
In Indian Aluminium Company etc. v. Kerala
State Electricity Board(2) this Court held that under section 49(3) of the 1948
Act the Board stipulates for special tariff for supply of electricity at
specified rates from time to time.
For the foregoing reasons the conclusion is
that the Board has power under section 49 of the 1948 Act to regulate supply
and also to fix higher rates for consumption on excess of quota. There is no
conflict between section 22-B of the 1910 Act and section 49 of the 1948 Act
with regard to regulating or restricting highter consumption.
The appeals are therefore dismissed. There
will be no order as to costs because the High Court made similar order.
P.H.P. Appeal dismissed.
(1) 68 L. Ed. 541.
(2) [1976] 1 S.C.R. 70.
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