Gujarat High Court
Consumer vs Gujarat on 31 July, 2008
Author: Mohit S. Shah
Bench: M.S.Shah
Gujarat High Court Case Information System
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SCA/9283/2008 7/ 9 ORDER
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL
CIVIL APPLICATION No. 9283 of 2008
=========================================
CONSUMER
PROTECTION COUNCIL - Petitioner(s)
Versus
GUJARAT
ELECTRICITY REGULATORY
COMMISSION
& 2 - Respondent(s)
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Appearance :
MR
NIRUPAM NANAVATY, SR. COUNSEL with MR SUDHIR M MEHTA for
Petitioner(s)
MR BD KARIA for Respondent(s) : 1,
MR KAMAL B.
TRIVEDI, LD. ADVOCATE GENERAL with MS. SANGEETA VISHEN, ASSISTANT
GOVERNMENT PLEADER for Respondent(s) : 2,
DS AFF.NOT FILED (N) for
Respondent(s) : 2,
MR MIHIR THAKORE, SR. COUNSEL with MR KB PUJARA
for Respondent(s) : 3,
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CORAM
:
HONOURABLE
THE ACTING CHIEF JUSTICE MR. M.S.SHAH
and
HONOURABLE
MR.JUSTICE D.H.WAGHELA
Date
: 31/07/2008
ORAL
ORDER
(Per : HONOURABLE THE ACTING CHIEF JUSTICE MR. M.S.SHAH) Rule.
Mr. B.D. Karia, learned advocate waives service of rule for respondent No.1. Ms. Sangeeta Vishen, learned Assistant Government Pleader, waives service of rule for respondent No.2, and Mr. K.B. Pujara, learned Advocate waives service of rule for respondent No.3. At the request of the learned counsel for the parties, we have taken up the petition for final disposal.
2. In this petition under Article 226 of the Constitution of India, the Consumer Protection Council has prayed for a writ of mandamus, directing the State Government to constitute a Selection Committee in terms of Section 85 of the Electricity Act, 2003 (?Sthe Act?? for brevity), for selecting Chairperson of the Gujarat Electricity Regulatory Commission. The petitioner has also prayed that the Selection Committee be required to select a Chairperson, who, as far as possible, be a retired Judge of this Court. It is further prayed that till the State Commission is properly constituted by appointment of the Chairperson, the State Commission be restrained from hearing and deciding the application of respondent No.3 for approval of increase in tariff rates.
3. The petitioner is a Non Governmental Organization looking after the interests of consumers in the State. Respondent No.3 has made an application to the State Commission for approving the proposed increase in the tariff rates for supply and distribution of electricity to the consumers. The application was received by the State Commission on 23.5.2008. Thereafter, State Commission has invited objections as to why the proposed increase in the tariff rate should not be granted. A number of persons including the petitioner have lodged their objections, and the objections are scheduled to be heard by the State Commission on 5th, 6th, 11th, 12th and 13th August, 2008.
4. The petitioner's grievance is that in spite of mandatory provisions of Sections 82, 84 and 85 of the Act, prescribing that the selection of the Chairperson and members of the State Commission shall be made by the State Government on the recommendation of a Selection Committee and in spite of the Office of the Chairperson having fallen vacant on 6th January, 2008, no appointment is made to the said Office. It is submitted that on account of the vacancy in the office of the Chairperson, the proposal of respondent No.3 and the objections raised by the petitioner and others will be considered by the Commission comprising only two members without the Chairperson, and it will be contrary to the public interest to allow a body of only two members without the Chairperson, to take a decision which will have far reaching effect on the consumers in the State. It is contended that if the proposal of respondent No.3 company is accepted by the Commission, there will be heavy burden on the consumers of electricity in the State, to the tune of Rs. 1150 crores, and the State Government owes it to the consumers at large to see that the State Commission is properly constituted with the Chairperson appointed within the time limit.
It is also contended that the thrust of the provisions of the Act is to see that a retired Judge of this Court should be appointed as the Chairperson of the State Commission and therefore, relevant provisions dispense with the appointment of the Selection Committee, where a Sitting or a Retired Judge of the High Court is to be appointed as the Chairperson of the State Commission.
5. Mr. Nirupam Nanavaty, learned Senior Counsel appearing with Mr. Sudhir Mehta for the petitioner has invited our attention to the provisions of Section 85 of the Electricity Act, 2003 and submitted that the tenure of Mr. G. Subba Rao as the Chairperson of the Commission was going to come to an end on 6th January, 2008, on attaining the age of 65 years and therefore, the State Government was required to constitute a Selection Committee under sub-section (1) of Section 85 of the Act, by 5th July, 2007. No such Selection Committee was constituted till 29th March, 2008. It is also contended that the constitution of the Selection Committee even on 29th March 2008 is not done in accordance with law, as only a person who has been a Judge of the High Court can be appointed as the Chairperson of the Selection Committee and not a Sitting Judge of the High Court. Moreover, the Selection Committee constituted on 29th March, 2008 has also not finalised the selection of the Chairperson within three months of the date on which the Committee was constituted and reference was made to it. It is therefore, vehemently submitted that either the State Government should appoint a sitting or a retired Judge of this Court as the Chairperson of the State Commission, or the State Government should reconstitute the Selection Committee headed by a retired Judge of this Court. It is also submitted that till the Chairperson of the State Commission is appointed, the proposal made by respondent No.3 for approving the increase in the tariff rates should not be permitted to be considered by the State Commission.
Reliance is placed on the decisions of the Apex Court in The Workmen of M/s. Firestone Tyre and Rubber Co. of India Pvt. Ltd. Vs. The Management and ors. - (1973) 1 SCC 813 para 58, Ashok Tanwar and anr. Vs. State of H.P and ors. - (2005) 2 SCC 104 para 15, and of the Allahabad High Court in Dr. (Mrs) Shabbir Fatima and ors. Vs. The Chancellor, University of Allahabad - AIR 1966 Allahabad 45, in support of the contention that the expression ?Sa person who has been a Judge of the High Court?? can only mean a former Judge of the High Court.
6. On the other hand, Mr. Kamal B. Trivedi, learned Advocate General appearing with learned Assistant Government Pleader Ms. Sangeeta Vishen, has submitted that the Selection Committee has already been constituted on 29th March, 2008 and the State Government will appoint the Chairperson of the State Commission by 30th September, 2008. It is, however, submitted that the vacancy in the office of the Chairperson does not disable the State Commission from considering the proposal of respondent No.3 for approval of the proposed increase in the tariff rates. Strong reliance is placed on Section 93 of the Act and Regulation 89 of the Gujarat Electricity Regulatory Commission Conduct of Business Regulations, 1999 (as published by the Authority by Notification No.02 of 2004) providing that no act or proceedings of the Commission shall be questioned or shall be invalidated merely on the ground of existence of any vacancy or defect in the constitution of the Commission. Reliance is also placed on Regulation No. 16. The said Regulation provides that Quorum for the proceedings before the Commission shall be two. On the basis thereof, it is submitted that the Commission presently having two members can certainly proceed to perform the functions of the Commission.
7. Mr. Mihir Thakore, learned Senior Counsel with Mr. K.B. Pujara, learned Advocate for respondent No.3 has supported the submissions made by learned Advocate General. Mr. Thakore has further submitted that the proposal made by respondent No.3 for permission to increase the tariff rate was received by the State Commission on 23rd May, 2008 and the said proposal is required to be considered and decided by 22nd September, 2008. He has drawn our attention to sub-section (3) of Section 64 of the Electricity Act, 2003, which provides that an application for determination of tariff under Section 62 made by a generating company or licensee shall be considered by the appropriate Commission, within 120 days from the receipt of the application and after considering all suggestions and objections received from the public. Thus, sub-section (3) of Section 64 of the Act provides in mandatory terms that the Commission shall, within 120 days of the receipt of the application, issue a tariff order accepting the application or reject the application for reasons to be recorded in writing, after considering all suggestions and objections received from the public. It is also submitted that after hearing the objections from a large number of persons between 5th and 13th August, 2008, the State Commission will also have to give a reasonable opportunity of being heard to respondent No.3 and thereafter, take a final decision on the proposal by 22nd September, 2008. It is, therefore, submitted that the decision on the proposal of respondent No.3 may not be permitted to be delayed on account of any vacancy in the Office of the Chairperson in the State Commission. Mr. Thakore has also relied upon the aforesaid statutory provisions to contend that any vacancy in the Office of the Chairperson cannot invalidate the proceedings of the State Commission.
8. Having heard learned Counsel for the parties, we find considerable substance in the submission made by the learned counsel for the petitioner that sub-section (2) of Section 85 of the Act requires the State Government to constitute the Selection Committee under sub-section (1) and make a reference to the same for filling up the vacancy six months before super-annuation or end of the tenure of the Chairperson, or the member of the State Commission, as the case may be. It is only where the vacancy arises by reason of death, resignation or removal of Chairperson or member that the Legislature has provided for shorter time limit of one month after the occurrence of the vacancy, but in case of superannuation or end of the tenure of the Chairperson by efflux of time, it is known well in advance and therefore, the Legislature required the State Government to initiate the process six months in advance.
9. We also find considerable substance in the grievance being made by the learned counsel for the petitioner that the Selection Committee is required to finalize the selection of the Chairperson or Member of the State Commission, within 3 months from the date on which reference is made to it. What is required to be noted is that the Selection Committee has to recommend a panel of two names, and therefore, selection made by the Selection Committee is not going to be the end of the process. The State Government would thereafter, take some time to select one of the names recommended by the Selection Committee. Having examined the scheme of the Act, the object of establishing State Commission and the powers and the duties of the State Commission, we are of the opinion that the State Government is required to initiate the process for filling up the vacancy six months prior to the superannuation or end of the tenure of the Chairperson or the Member, as the case may be.
10. It is true that Section 93 of the Act and Regulation 89 provide that no act or proceedings of the Commission shall be questioned or shall be invalidated merely on the ground of existence of any vacancy in the constitution of the Commission. However, these provisions are only meant to be a shield against a challenge levelled after the decision is taken. These provisions cannot justify the inaction on the part of the State Government in not filling-in the vacancies in the Office of the Chairperson or Member, as the case may be.
11. In view of the above discussion, we are of the view that the State Government will have to appoint the Chairperson of the State Commission with utmost expedition, and the State Government shall do so within five weeks from today i.e. by 7th September, 2008.
12. The next question is whether the State Government is bound to appoint a sitting or a former Judge of this Court as Chairperson. Having carefully examined the provisions of the Act, particularly Sections 82 to 85, we find substance in the submission made by the learned Advocate General that it is not mandatory for the State Government to appoint either a sitting judge or a former Judge of this Court as the Chairperson of the State Commission. The non-obstante Clause in sub-section (2) of Section 84 of the Act, and even the proviso to sub-section (1) of Section 85 of the Act merely enable the State Government to appoint a sitting or a retired Judge of the High Court as the Chairperson of the State Commission and in such a contingency, the procedure of constituting a Selection Committee headed by a former Judge of the High Court and the Selection Committee recommending a panel of two names, is not required to be followed. That does not, however, mean that the State Government is obliged to appoint only a sitting or a retired Judge of the High Court as the Chairperson of the State Commission.
13. We may now consider the submission made on behalf of the petitioner that the constitution of the Selection Committee is invalid because the Selection Committee should only be headed by a former Judge of the High Court, and not by a sitting Judge of the High Court, as is done by the Government by Notification dated 29th March, 2008. While interpreting the expression 'a person who has been Judge of the High Court' in Section 7(3)(a) of the Industrial Disputes Act, 1947 and Section 16(1)(a) of the Consumer Protection Act, 1986, the Apex Court has held in Workmen Vs. Firestone Tyre and Rubber ? (1973) 1 SCC 813, (para 58) and in Ashok Tanwar and anr. Vs. State of H.P and ors. - (2005) 2 SCC 104, (paras 15, 16 and 19), that the expression refers to a former Judge of the High Court. Considering the provisions of the Electricity Act also, it is clear that the Act has made a distinction between a sitting Judge and a former Judge of the High Court.
14. At this stage, the learned Advocate General submits that the State Government will appoint a Chairperson of the Gujarat State Electricity Regulatory Commission by 30th September, 2008, after obtaining recommendation from the Selection Committee constituted in accordance with the provisions of Section 85(1) of the Act, or by appointing a sitting/former Judge of the High Court as the Chairperson.
15. Having regard to the submissions made by the learned counsel for respondent No.3, we find that proposal for approval of the increase in tariff rate is pending with the State Commission since 23rd May, 2008 and the delay in considering the proposal will only be prejudicial to respondent No.3. In the peculiar facts and circumstances of the case, particularly when the delay in appointment of the Chairperson of the State Commission occurred firstly on account of the delay in appointment of the Selection Committee, and also considering the fact that the selection Committee itself has not made any recommendations for the last four months, we direct that:
(i) the State Government shall appoint Chairperson of the Gujarat Electricity Regulatory Commission within five weeks from today, and
(ii) the State Commission shall consider and decide the proposal of respondent No.3 company, within six weeks from the date of appointment of the Chairperson.
16. We clarify that we are not granting any stay against the Scheduled hearing of the objections by the State Commission, because Regulation 89 provides that no act or proceedings of the Commission shall be invalidated merely on the ground of existence of any vacancy or defect in the constitution of the State Commission. Even then the proposal of respondent No.3 for increase in the tariff rate is going to have a far reaching effect on the consumers in the State and will impose additional burden on them running into hundreds of crores of rupees, and therefore, we direct that the final decision on the proposal shall be taken by the Commission after appointment of the Chairperson.
17. Rule is made absolute to the above extent.
Direct service is permitted.
(M.S. Shah, Actg. C.J.) (D.H. Waghela, J.) */Mohandas Top