Jharkhand High Court
Ms Maithan Ceramics Limited Through Its ... vs Jharkhand Urja Vikas Nigam Limited ... on 28 July, 2016
Author: Shree Chandrashekhar
Bench: Virender Singh, Shree Chandrashekhar
1.
IN THE HIGH COURT OF JHARKHAND AT RANCHI
L.P.A. No. 36 of 2016
....
M/s Maithan Ceramics Limited, a company incorporated under the
Companies Act, 1956 having its factory at Chirkunda, PO & PS- Chirkunda,
Town and District-Dhanbad through its Manager (Electric) Sri Puspendu
Sarkar, S/o Bhakti Bhusan Sarkar, R/o Chinakuri, PO +PS- Sundarchak,
Dist-Bhurdawan. ..... Appellant
Versus
1.Jharkhand Urja Vikas Nigam Ltd. (earlier known as Jharkhand State
Electricity Board), having its Office at Engineers Bhawan, HEC, Dhurwa,
Ranchi through its Chairman-cum-Managing Director, Engineers Bhawan,
H.E.C., P.O.+P.S.-Dhurwa, District-Ranchi
2.The General Manager-cum-Chief Engineer, Dhanbad Area, Electricity
Board, JUVNL, having its office at Combined Building, PO+PS-Dhanbad,
Dist.-Dhanbad.
3.The Electrical Superintending Engineer, Electric Supply Circle, P.O.
+P.S.-Dhanbad, District-Dhanbad
4.The Electrical Executive Engineer (Commercial & Revenue), Electric
Supply Circle, P.O.+P.S.-Dhanbad, District-Dhanbad.
.... Respondents
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CORAM: HON'BLE MR. JUSTICE VIRENDER SINGH, CHIEF JUSTICE
HON'BLE MR. JUSTICE SHREE CHANDRASHEKHAR
------
For the Appellant : Mr. M. S. Mittal, Senior Advocate
Ms. Shili John, Advocate
For the Respondent-JUVNL : Mr. Ajit Kumar, Sr. S.C.
-----
th
09/ 28 July, 2016
Per Shree Chandrashekhar, J.:
The appellant-writ petitioner (hereinafter referred to as petitioner)
is aggrieved of dismissal of the writ petition, in which the main challenge
thrown by the petitioner was to order dated 02.03.2013 passed in Case
No.04/2012 and the Electricity Bills dated 18.06.2005 and 01.04.2013.
2. The brief facts of the case are summarized hereunder:
M/s Maithan Minerals Private Limited was granted electrical
connection in the year, 1971. It is H.T. consumer. In the year 1988, on the
request of the petitioner for reduction of contract load from 150 KVA to 115
KVA, an agreement was executed on 21.05.1988; the contract load was
subsequently enhanced to 200 KVA. Again, the contract load was
enhanced from 200 KVA to 360 KVA, for which an agreement was executed on
2.
03.03.1997and it was further enhanced to 460 KVA by executing agreement dated 08.07.1998. After the original company was amalgamated with M/s Maithan Ceramics Limited, a new agreement was executed on 30.01.2001 for contract load of 460 KVA. The petitioner-company made an application for enhancement of contract load to 550 KVA which was sanctioned vide letter dated 05.05.2004, and the petitioner executed agreement on 03.06.2004 for enhancement of contract load to 550 KVA. Dissatisfied with the irregular power supply, the petitioner gave a notice for determination of the agreement as per Clause 9(a) of the H.T. agreement, and the electrical supply was finally discontinued on 21.05.2005. However, the bill issued by the respondent-Board for the month of May, 2005 reflected levy of minimum monthly charges from June, 2005 to April, 2007 to the tune of Rs.31,62,500/-, besides current monthly charges for May, 2005. The aforesaid bill was challenged by the petitioner in W.P.(C) No.3738/ 2005, which was disposed of on 14.02.2012 with liberty to the petitioner to approach Vidyut Upbhogta Shikayat Nivaran Forum for redressal of its grievances; pursuant thereto, the petitioner filed complaint before the Forum which was registered as Case No.04/2012. The Forum dismissed the complaint petition vide order dated 02.03.2013. Thereafter, the Board served Energy Bill dated 01.04.2013, in which the Board levied DPS for the period between 01.05.2008 to 28.02.2013 over the unpaid amount. The petitioner approached the Writ Court, challenging order dated 02.03.2013 passed by the Forum and the aforesaid bills.
3. Heard.
4. Mr. M.S. Mittal, the learned Senior counsel, assailing the Writ Court's order, submits that 'the date of commencement of supply' must be reckoned from the year 1971, or atleast, from 30.01.2001 when fresh agreement was executed with the petitioner company for contract load of 3. 460 KVA and the subsequent agreement dated 03.06.2004 is only a continuation of the earlier agreement(s). Referring to Clause-8 of the agreement executed by the petitioner and the predecessor company, the learned Senior counsel submits that in all subsequent agreements the date of "commencement of supply" has been left blank and this fact leads to a conclusion that the respondent-Board also considers the date of commencement of supply from the date the first agreement was executed. It is further contended that the writ petition was dismissed only by referring to 'Note' to Clause-8 of the agreement, which is not applicable in the petitioner's case. It is further contended that the judgments referred in the impugned order dated 17.12.2015 are not at all applicable in the facts of the present case and the Writ Court has ignored binding decision of the Division Bench in 'M/s Super Smelters Ltd. Vs Jharkhand Urja Vikas Nigam Limited & Ors. [W.P.(C) No.5389 of 2005]' and 'M/s Ramakrishna Forging Limited Vs Jharkhand State Electricity Board & Ors. [W.P.(C) No.6651 of 2007]', which are squarely attracted in the facts of the instant case.
5. Per contra, Mr. Ajit Kumar, the learned Senior Standing counsel appearing for Jharkhand Urja Vikas Nigam Limited submits that every application for reduction or enhancement of contract load is treated as an application for new supply and the date of execution of agreement is normally the date of commencement of supply. On the question of blank spaces in the agreements (which would indicate the date of commencement of supply), the learned Senior counsel submits that it is a ministerial work which was ignored even by the petitioner, and in any case it would have no material bearing on interpretation of Clause-8 to the agreement. The learned Senior counsel referring to the judgments in M/s Bihar State Electricity Board, Patna & Others Vs M/s Green Rubber Industries and Others, reported in (1990) 1 SCC 731, 4. Kanoria Chemicals and Industries Ltd. and Others Vs U.P. State Electricity Board and Others, reported in (1997) 5 SCC 772 and Uttarakhand Power Corporation Limited and Another Vs ASP Sealing Products Limited, reported in (2009) 9 SCC 701, supports the Writ Court's order.
6. It is not in dispute that prior to formulation of Electricity Supply Code, Regulations 2005, consequent upon enactment of Electricity Act, 2003, in every case of enhancement of contract demand a supplemental HT agreement was required to be executed. In the supplemental HT agreement the following clauses are relevant :
"1.(a) The increased Contract Demand shall come into force with effect from the month in which the KV.A. actually drawn by the Consumer exceeds the last Contract Demand agreed to between the parties or from the month following the date of the written intimation by the Board to the Consumer that the additional K.V.A. is available, whichever is earlier, to be referred to hereinafter as the effective month but such effective month shall not be earlier than the month in which the consumer has given notice to increase the Conract Demand, unless of course, the K.V.A. actually drawn by the consumer has already exceeded the last Contract Demand.
(b) Notwithstanding other terms and conditions, the minimum guarantee by the Consumer mentioned in the Schedule hereto for the increased Contract Demand, shall be levied with effect from the effective month."
7. The supplemental agreement also contained provisions in Clause-3 and 4 similar to Clause-8 and 9 of the agreement executed in the present case, which read as under:
"8. The agreement shall be ordinarily in force for a period of less than three years in the first instance(except in exceptional cases in which written consent of the Board will be taken) from the date of commencement of supply 5. i.e.......... and thereafter shall continue from year to year until the agreement is determined as hereinafter provided.
9. (a) The consumer shall not be at liberty to determine this agreement before the expiration of three years from the date of commencement of the supply of energy. The consumer may determine this agreement with effect from any date after the said period on giving to the Board not less than twelve calendar months' previous notice in writing in that behalf and upon the expiration of the period of such notice this agreement shall case determine without prejudice to any right which may then have occurred to the Board hereunder provided always that the consumer may at any time with the previous consent of the Board transfer assign this agreement to any other person and upon subscription of such transfer. This agreement shall be binding on the transferee and the Board and taken effect in all respects as if the transferee had originally been a party hereto in place of the consumer who shall henceforth be discharged from all liabilities under or in respect thereof.
(b) In case the consumer's supply is disconnected by the Board in exercise of its powers under this agreement and/or law and the consumer does not apply for reconnection in accordance with law within the reminder period of the compulsorily availing of supply as stated above or the period of notice whichever be longer, he will be deemed to have given a notice on the date of the disconnection in terms of aforesaid clause 9(a) for the determination of the agreement and on expiration of the above said remainder period of compulsorily availing of supply or the period of notice whichever is longer, this agreement shall cease and determine in the same way as above."
8. It is the specific stand of the respondent Urja Vikas Nigam that every supplemental agreement is a new agreement and the date of commencement of supply in case of an old consumer loses relevance because 6. KVA charges are levied not from the date but from the month enhanced load is supplied to a consumer. Under the old regime, as noticed above, Clause-1 of the supplemental agreement also made it apparent that the increased contract demand is reckoned from the month in which the KVA actually drawn by the consumer exceeded the last contract demand or from the month following the date of written intimation by the Board to the consumer that the additional KVA is available, whichever was earlier. Clause-9 of Electricity Supply Code, Regulations 2005 deals with "Enhancement and Reduction of Contract Demand/ Sanctioned Load". The Electricity Supply Code came into existence on 28.07.2005. Clause- 9.1.1 provides that the application for enhancement of contract demand/ sanctioned load shall be made in the prescribed form and in the manner as specified in new service connection in Clause-5 of the Regulations. Clause- 7.1 provides that the distribution licensee may require the applicant to execute agreement for obtaining new connection, for change of name, and for enhancement or reduction of sanctioned load. In the (Electricity Supply Code) Regulations, 2005, enhancement of contract demand/ sanctioned load is dealt with in the same manner as a new service connection is dealt with. It appears that the previous practice as reflected in different clauses of the supplemental agreement executed for enhancement of contract demand/ sanctioned load is continued under 2005 Regulations, in almost identical terms. The contention raised on behalf of the petitioner that the decision in Uttarakhand Power Corporation is distinguishable inasmuch as, the decision in the said case was rendered in view of specific provision under Regulations is, in view of the aforesaid facts, misconceived.
9. The contention that the date of commencement of supply of energy irrespective of the fact that supplemental or additional agreements have been entered for enhancement of contract load, would remain the date when 7. the supply of energy first commenced i.e., from the date mentioned in the first agreement, is liable to be rejected. The petitioner has not disputed supply of energy at the enhanced contract load after agreement dated 03.06.2004 was executed. The date of commencement of supply of energy loses its significance, in case of execution of supplemental agreement for enhancement of contract load for the reason that energy bill for the enhanced contract load is raised from the month and not from the "date of supply at enhanced contract load". The energy bill issued to the petitioner for the month of May, 2005, wherein minimum monthly charges have been levied amply demonstrates this fact. As noticed above, the supplemental agreement also discloses that the increased contract load shall come into force with effect from the month in which the KVA actually drawn by the consumer exceeds the last contract load or from the date it is actually supplied. The fact that the subsequent agreements do not mention the date of commencement of supply of energy and the space in the agreement (s) has been left blank would not lead to a conclusion that the respondent- Nigam has admitted that the date of commencement of supply of energy at enhanced contract load is the date when electrical energy was first supplied. The consumer at no point in time raised a dispute in this regard and it did not approach the respondent-Nigam for correction in the supplemental agreement(s) for insertion of date of commencement of supply therein. Moreover, enhanced contract demand was sanctioned to the petitioner on the condition that it will execute a fresh HT agreement and accordingly, the petitioner-company executed HT agreement dated 03.06.2004.
10. In an identical situation, the Hon'ble Supreme Court in Uttrakhand Power Corporation case (supra) affirmed the liability of the consumer to pay minimum guarantee charges for the remaining period.
8.
11. In M/s Green Rubber Industries case, it has been held that the consumer's liability to pay the minimum guarantee charges for the remaining period before which the agreement could not have been determined, continued. The judgment in M/s Green Rubber Industries has been followed by the Supreme Court in Rajeshwar Singh case and recently in the case of Uttarakhand Power Corporation Limited.
12. The reliance placed on M/s Super Smelters Ltd. Vs J.U.V.N.L. & Ors. case is misplaced. In the said case supply of electricity was disconnected by virtue of order passed in L.P.A. No.76 of 2003. The Division Bench in such facts, held that the Clause-8 of the agreement is not applicable. It was further found that even the period of three years in terms of Clause-8 to the agreement was over. M/s Ramkrishna Forging Limited was a case of reduction of contract load. The Division Bench held that refusal to reduce the contract demand on the ground of Clause 9.2.1 of Electricity Supply Code, Regulations 2005, was discriminatory, arbitrary and against public policy. Apparently, the facts of the said case are entirely different from the facts in the present case.
13. The learned Single Judge has referred to 'Note' to Clause-8 of the Agreement and held that in absence of the date of commencement of supply mentioned in the agreement, it will be presumed that the supply of electricity at contract load of 550 KVA commenced from the date of execution of the agreement i.e. 03.06.2004. Note to Clause-8 reads as under :
"In case where the date of commencement of supply is a date subsequent to that of the execution of this agreement the Board is given power to fill in the date in the blank space provided for the same in this clause with prior intimation to the consumer. The consumer can produce his copy of the agreement to have such date filled in by the Board."9.
14. The learned Single Judge has held as under :
"9. Thus, from the plain reading of the aforesaid note, it is clear that the date is required to be filled in the blank space of Clause 8, if commencement of the supply is a date subsequent to that of the date of execution of the Agreement. Since in this case, the date has not been filled up in the blank space of Clause 8 of the Agreement, therefore, it will be presumed that supply of electricity at the contract load of 550 KVA commenced from the date of execution of the Agreement i.e. 03.06.2004. In that view of the matter, as per Clause 9, the Agreement cannot be determined within three years from 03.06.2004."
15. In the context of 'Note' to Clause-8, all that can be said is that it has no material bearing on the out come of the writ petition. As noticed above, in cases where supply of electrical energy has commenced prior to execution of supplemental agreement(s) 'Note' to clause-8 is rendered irrelevant. It is not the case of the petitioner that it produced the copy of agreement to the respondent- Jharkhand Urja Vikas Nigam Limited for filling up the date of commencement of supply of electrical energy. The submission of the learned Senior counsel for the petitioner that writ petition has been dismissed only referring to 'Note' to Clause-8 is not correct. The Writ Court has gone into facts in detail and noticed the contentions raised on behalf of the petitioner which stand answered by the Writ Court. The view taken by the Writ Court that blank space in Clause-8 of the agreement leads to a presumption that supply of electricity at the contract load of 550 KVA commenced from the date of execution of the agreement i.e. from 03.06.2004, may not apply in all cases, however, the fact remains that date of commencement of supply in cases of the supplemental agreement is inconsequential, in view of the fact that bills for enhanced contract load is raised from the month the supply has commenced or from a date notified by the respondent-Board. The contention raised on 10. behalf of the petitioner is a flogged plea which succumbs in the face of the facts noticed hereinabove.
16. Mr. M.S. Mittal, the learned Senior counsel next contended that the period during which the respondent-Nigam was restrained from taking coercive measures for recovery of minimum monthly charges for 23 months by virtue of the order passed by the Writ Court in W.P.(C) No.3738 of 2005, which continued till 02.03.2013 when the Forum dismissed the complaint petition cannot be treated as a period of default and the respondent-Nigam cannot levy Delayed Payment Surcharge over Rs.31,62,500/-. The learned Single Judge referring to decision in Kanoria Chemicals held that the Board (now, Nigam) is entitled to levy D.P.S. as per tariff, and there is no illegality in the impugned bill on this count. The learned Senior Standing counsel for the respondent- Nigam has reiterated the stand taken before the Writ Court.
17. In "Shree Chamundi Mopeds Ltd. Vs Church of South India Trust Asson." reported in (1992) 3 SCC 1, it has been held that a distinction has to be drawn between the stay of an order and quashing of an order. In the said case considering the effect of the order passed by Delhi High Court staying the operation of the Appellate Authority, whereby the appeal filed by Sri Chamundi Mopeds Limited challenging the order of the Board of Industrial and Financial Reconstruction, which upon consideration of the facts and material before it found that the company had become economically and commercial non-viable, was dismissed, the Hon'ble Supreme Court observed as under;
"10. ...............While considering the effect of an interim order staying the operation of the order under challenge, a distinction has to be made between quashing of an order and stay of operation of an order. Quashing of an order results in the restoration of the position as it stood on the date of the passing of the order which has been quashed.11.
The stay of operation of an order does not, however, lead to such a result. It only means that the order which has been stayed would not be operative from the date of the passing of the stay order and it does not mean that the said order has been wiped out from existence. This means that if an order passed by the Appellate Authority is quashed and the matter is remanded, the result would be that the appeal which had been disposed of by the said order of the Appellate Authority would be restored and it can be said to be pending before the Appellate Authority after the quashing of the order of the Appellate Authority. The same cannot be said with regard to an order staying the operation of the order of the Appellate Authority because in spite of the said order, the order of the Appellate Authority continues to exist in law and so long as it exists, it cannot be said that the appeal which has been disposed of by the said order has not been disposed of and is still pending. We are, therefore, of the opinion that the passing of the interim order dated February 21, 1991 by the Delhi High Court staying the operation of the order of the Appellate Authority dated January 7, 1991 does not have the effect of reviving the appeal which had been dismissed by the Appellate Authority by its order dated January 7, 1991 and it cannot be said that after February 21, 1991, the said appeal stood revived and was pending before the Appellate Authority. ............."
18. In "Kashyap Zip Ind. Vs. Union of India and Ors." reported in (1993) Supp (3) SCC 493, the direction of the High Court to pay interest on the amount of duty, after dismissal of the petition, for the period during which the stay granted by the High Court was in operation, was questioned before the Supreme Court. The Hon'ble Supreme Court dismissed the Special Leave Petition, however, with modification in the rate of interest from 17.5% to 12 % per annum. In Kanoria Chemicals case the validity of the Notification which provided for payment of interest in case the bill amount is not paid within the stipulated period was challenged before the Allahabad High Court. The High 12. Court during the pendency of the writ petition stayed the operation of the said Notification. After dismissal of the writ petition the Electricity Board issued notice of demand calling upon Kanoria Chemicals to pay the Late Payment Surcharge, which was again challenged before the High Court. The High Court dismissed the writ petition, against which a Special Leave Petition came to be filed before the Supreme Court. The Court held that, "it is ununderstandable how the enhanced rates can be said to be payable but not the Late Payment Surcharge thereon, when both the enhancement and the Late Payment Surcharge are provided by the same Notification and operation of which was stayed". The Kanoria Chemicals was referred and relied in subsequent judgment by the Supreme Court; one being "Style (Dress Land) Vs. Union Territory, Chandigarh and Another" reported in (1999) 7 SCC 89.
19. In the present case, the petitioner did not challenge the provision for levy of Delayed Payment Surcharge, and it simply challenged the bill on the ground that the period during which the Board was restrained from taking coercive measures against the company, it is not liable to pay Delayed Payment Surcharge. The plea raised by the petitioner is liable to be rejected in view of the decision in Kanoria Chemical.
20. In view of the aforesaid discussions, we arrive at the conclusion that the impugned order dated 17.12.2015 passed in W.P.(C) No.2864 of 2013 does not suffer from any infirmity either on facts or in law. Consequently, the instant Letters Patent Appeal stands dismissed.
(Virender Singh, C.J.) (Shree Chandrashekhar,J.) Sudhir/SI,, A.F.R.