Calcutta High Court (Appellete Side)
Rana Udyog (P) Ltd. & Anr vs The State Of West Bengal & Ors on 4 March, 2015
Author: Patherya
Bench: Patherya
1
04.03.2015
(PP)
W. P. No.32745 (W) of 2014
Rana Udyog (P) Ltd. & Anr.
Vs.
The State of West Bengal & Ors.
Mr. Joydeep Kar,
Mr. Aniruddha Roy,
Mr. Navneet Misra,
Mr. Sankarsan Sarkar
.....for the petitioners.
Mr. Sumit Panja,
Mr. Raj Kumar Basu
....for W.B.S.E.D.C.L.
Mr. Pratik Dhar,
Mr. Ritwik Pattanayak,
Mr. Pappu Adhikari
....for the respondent no.5.
By this writ petition, the petitioners seek a direction on the distribution company to raise bills on it as per the rates mentioned in the notice dated 23rd September, 2014. The petitioner has a unit in district Howrah. Electricity is supplied by the distribution company and the charge levied is more than that paid by the consumers of the distribution company in the Asansol-Durgapur belt. This amounts to unfair treatment as no parity has been maintained. Therefore, the same concession and benefit available to the consumers in the Asansol-Durgapur belt be also given to the 2 petitioners. The concession given finds mention in the notification dated 23rd September, 2014 and as the said concession has been extended only to a handful consumers it intends to discriminate other consumers similarly situate. The said notice dated 23rd September, 2014 be either quashed or the benefit thereunder be extended to the petitioners.
Counsel for the distribution company submits that the rates mentioned in the notice dated 23rd September, 2014 is pursuant to a policy decision taken by the distribution company in order to prevent wastage of surplus power and to prevent distribution loss. Under the 2003 Act, inter State grid cannot be maintained and the classification made is intelligible. No straight jacket formula has been adopted. Such classification is effected only in areas where multiple licensees exist. By virtue of such classification and policy decision the fixed cost will not only be recovered but will be beneficial to all consumers as costs of supply will be reduced. This will help the body of consumers at large. The 2003 Act permits the distribution company to trade. Section 62 (1) of the 2003 Act permits determination of tariff by the Commission and the Commission may, for promoting competition amongst licensees, fix maximum ceiling of tariff. Clause 2.2.2 of 2011 Tariff Regulation lays down the guiding factor for tariff determination and based on the 2003 Act and Regulations permits trading. The distribution 3 company undertook the exercise of giving concession to the industrial consumers in the Asansol-Durgapur belt. A meeting was held and decision taken to offer competitive tariff to the industrial consumers in the Asansol-Durgapur Division of the distribution company. The Commission by its letter dated 25th June, 2014, has sought for some clarification. Such clarification was given by letter dated 9th July, 2014 and it is only being satisfied with such clarification that the distribution company was allowed to introduce competitive tariff with specific mention of such tariff, but prior thereto consent of the State Government was to be taken and notification published. Pursuant to such notification, if any, suggestion or objection was raised the same was also required to be considered. Thereafter, consent was sought from the State Government and such consent was also granted. Notification was also published. As there has been compliance with the directives of the Commission, the distribution company became entitled to implement the competitive tariff in the Asansol-Durgapur division as per the competitive tariff fixed. The same cannot be extended to the petitioners as the petitioners are not consumers similarly situate to consumers in the Asansol- Durgapur division. Therefore, this application merits no order and be dismissed.
4
Counsel for the West Bengal Electricity Regulatory Commission (Commission) submits that the relevant tariff order is of 2013-2014. Objections were called for. On the tariff petition submitted by the distribution company objections were raised by several objectors. The petitioner filed no objection to the proposed tariff of the distribution company. In respect of industries enjoying 11 KV, the tariff scheme was set out for the year 2013- 2014 in Annexure-3A3 of the tariff order. Clause 3.2.27 provided as follows:-
"The tariffs determined under this order for different categories of consumers are the maximum ceilings for supply of electricity at any agreed price to the consumers of WBSEDCL only for those areas of supply of WBSEDCL where multiple licensees exist."
Therefore, the distribution company was entitled to fix a tariff lesser than the maximum ceiling, provided the loss incurred, if any, was not passed on to its consumers. The distribution company expressed its desire to make competitive tariff applicable to the consumers in the Asansol-Durgapur belt where multiple licensees are functioning and intimation in this regard was given to the Commission. The Commission by its letter dated 25th July, 2014, informed the distribution company that the competitive tariff to be introduced should be specific and the details mentioned in letter dated 9th July, 2014 be more clear. Prior to introduction 5 of competitive tariff consent of the State Government should be taken so also notification published and in case suggestions and objections were received from any stake holder, the same should be considered. A publication was made on 2nd September, 2014 which was found incorrect and this was brought to the notice of the distribution company. Thereafter the Notification dated 23rd September, 2014 was published. The letter by which consent was sought from the State Government was lacking in particulars and the acts of the distribution company after issuance of letter dated 25th July, 2014 is not as per the requirements of the Commission. As the actions of the distribution company, subsequent to letter dated 25th July, 2014, being not in conformity with the requirements of the Commission, the acts are non-est and cannot be supported.
The petitioners have no locus standi to maintain this writ petition as the petitioners' unit is in District - Howrah and the competitive tariff has been extended to industrial consumers in Asansol-Durgapur belt. In the Asansol-Durgapur division, multiple licensees operate, not so in District - Howrah where the distribution company enjoys a monopoly. Therefore, the petitioners are not similarly situate with the industrial cousumners in the Asansol-Durgapur belt and this alone is reason enough to dismiss this writ petition.
6
In reply, counsel for the writ petitioners submits that the only reason for extending the benefit by the distribution company to the industrial consumers of the Asansol-Durgapur belt is to prevent distribution loss and loss of surplus power. In the proposal for fixation of tariff no loss has been shown. In case surplus power does exist, the petitioners are willing to purchase the same. Regulation 3.2.27 has been relied on by the Commission and in terms of Regulation 2.2.2, 3rd and 4th proviso in areas where multiple licensees exist tariff is to be treated as maximum ceiling. The licensee though empowered to supply at any agreed price cannot burden the other consumers with the loss, if incurred. The fourth proviso casts a duty on the Commission to determine the tariff of different classes of consumers, in case where multiple licensees have emerged by virtue of the 2003 Act. This exercise has not been undertaken by the Commission and as the petitioners are industrial consumers akin to industrial consumers of Asansol-Durgapur belt, the benefit given to the consumers of Asansol-Durgapur belt be also extended to the petitioners and in not doing so discrimination is writ large.
Having considered the submissions of the parties, the petitioners seek a direction on the distribution company to extend the rates mentioned in notice dated 23rd September, 2014 to it, on the ground that it is similarly situate to such consumers and in 7 the event rates are not extended, the same will amount to discrimination.
The petitioners are industrialists in Howrah district where there is only one licensee operating, i. e., the distribution company. In the Asansol-Durgapur belt where benefit of competitive tariff is sought to be extended multiple licensees exist. Section 62 of the 2003 Act has empowered the Commission to fix maximum ceiling of tariff for promoting competition amongst the licensees in areas where multiple licensees exist. Proviso 3 to Regulation 2.2.2 of the 2011 Regulations specifically states that the tariff of any licensee in areas where multiple licensees exist is to be treated as the maximum ceiling for supply of electricity and has permitted the licensee to effect supply to any consumer at a lesser price than the maximum ceiling, provided loss, if any, will not be passed on to the other consumers. The Commission while passing the tariff order for 2013-2014 has made a mention of this proviso in Clause 3.2.27. In the Asansol-Durgapur belt, there are multiple licensees and, therefore, the distribution company was entitled to supply power to its consumers in the said belt at a price lesser than maximum ceiling and it ventured to do so and application was made with the Commission and the Commission permitted the same, provided certain conditions were complied with. On a perusal of the said as rightly submitted by counsel for 8 the Commission there has been infraction. This is not the allegation with which the petitioners came to Court. The petitioners' case was simpliciter that the rates published on 23rd September, 2014 be made applicable to it. But, before applying the said rate, it is necessary to ascertain where the unit of the petitioners is situate and from paragraph 2 of the petition it appears that the petitioners have a mini steel plant in District - Howrah. The area with which the petitioners seek to compete is Asansol-Durgapur belt and by no stretch of imagination is the Howrah industrial belt similar to the Asansol-Durgapur belt, vis-à- vis supply of electricity. The reason for this is that in District - Howrah, the distribution company is the sole supplier of electricity whereas in the Asansol-Durgapur belt there are multiple licensees and in view of section 62, competition amongst distribution licensees is permitted. Therefore, the petitioners as consumer is not similarly situate to the consumers in the Asansol-Durgapur belt and, therefore, cannot seek to make the rates applicable to such consumers where multiple licensees exist to itself. This would be reason enough to dismiss the writ petition, but in the course of hearing certain facts have emerged. From the records disclosed in the affidavit filed by the distribution company, it appears that the steps taken pursuant to letter dated 25th July, 2014 is not as the per the requirements of the Commission. The 9 Commission is not a hapless creature of statue but is the watch dog and, therefore, is required to be vigilant and active. Although the Commission has submitted that the acts of the distribution company, subsequent to letter dated 25th July, 2014, are far from its requirement but to quash the actions of the distribution company in a writ petition which is not maintainable would amount to nullify acts for which no grounds have been taken. At the same time, to allow the distribution company to continue without satisfying the requirements would be to allow a wrong to continue. Therefore, on the basis of the affidavit filed by the distribution company and the acts not being justified all actions taken by the distribution company, pursuant to letter dated 25th July, 2014, is set aside.
It is made clear that this finding is independent and the finding in the writ petition is based on the records of the distribution company alone and submission of the Commission. In the affidavit affirmed by one Debajyoti Dasgupta, the Superintending Engineer (PTR Cell) of the distribution company on 2nd February, 2015, the letter dated 25th June, 2014 has been disclosed. This letter was written by the distribution company to the Commission informing its intent to offer competitive rate to industrial consumers in the Asansol-Durgapur belt. A reply was given on 25th June, 2014 whereby clarification was sought. Such 10 clarification was forwarded by letter dated 9th July, 2014 by the distribution company. On 25th July, 2014, the Commission informed the distribution company that the competitive tariff as submitted could not be accepted. In fact, the competitive tariff to be introduced should be specific and before introduction of such competitive tariff consent of the State Government was to be taken so also notification published. The third condition was that in case suggestions or objections were received from any stake holder, the same be considered. At present, consent of the State Government and notification is of importance and a consent was sought from the State Government. But while seeking consent, the year in respect of which consent was sought, i. e., 2014-2015 finds no mention. The competitive tariff rate has also not been specified and on the basis of an inadequate representation, consent was given on 21st August, 2014 subject to certain conditions. Notice was published on 2nd September, 2014 and 23rd September, 2014. The Commission raised an objection to the notice published on 2nd September, 2014 and it is only thereafter the notice dated 23rd September, 2014 was published. The basis of the consent of the State Government remained unrectified. On what basis the competitive tariff was being levied finds no mention in the latter dated 7th August, 2014 by which consent was sought and the year for which competitive tariff was to be levied also finds 11 no mention. Therefore, acts of the distribution company pursuant to letter dated 25th July, 2014 cannot be allowed to stand and is accordingly set aside. This, however, will not prevent the distribution company from taking action in compliance with the letter dated 25th July, 2014.
Certified copy of this order, if applied for, be given to the parties on priority basis.
(Patherya, J.)