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It was further averred that upon establishing the subject Unit in April 1998, the petitioner made an application to respondent No.2 for electrical connection; that respondent No.3 categorised the subject Unit as H.T. Category II (Non-Industry) without considering the process involved therein and the tariff notification of the erstwhile A.P. State Electricity Board (APSEB) in vogue then and commenced supply of power on 24-8-1998. Realising that the said categorization as H.T. Category-II is not correct, the subject Unit of the petitioner submitted a representation dated 6-8-1999. That respondent No.3 considered the said representation vis--vis the process involved in the subject Unit and the then Tariff notification and issued proceedings re-categorising the same as H.T. Category-I (Industrial) from September 1999 and that since then the subject Unit has been functioning and was regularly paying the consumption charges under the said category.

That inasmuch as the pumping activity requires coordination between the Refinery, Visakha Unit and all other terminals, and for other administrative reasons, the manning of pumping equipment starting from Visakha Unit ending with Ghatkesar Unit, has been formed into one administrative unit called Visakha-Vijayawada- Secunderabad Pipe Line (VVSPL).

It was further averred that the provision governing the H.T. Category-I (Industrial) remained the same during the regime of the erstwhile APSEB and there was no change even after the A.P. Electricity Regulatory Commission (APERC) came into existence in the year 1999; that subsequently, the APERC issued Tariff Orders for the years 2000-01 to 2004-05 and the Tariff Order 2004-05, which governs the present case, was issued on 23-3-2004.

The petitioner further averred that the activity of the subject Unit falls within each of the expressions used under HT Category-I of the Tariff Order issued by the APERC viz., Industry, Process, Process and Preserving, Preserving for sale and also Manufacturing; and that therefore respondent No.3 has wrongly reclassified the subject Unit by misconstruing the said definition. That the supply under HT Category-I (Industry) covers only industrial consumers and the definition of industrial consumers used therein is inclusive in nature and not an exhaustive one; that the word industry in the expression Industrial consumers should be undisputedly the true and natural meaning keeping in view the context and especially in comparison with other categories, more so HT Category-II (Non Industry). That any organized mode of activity by spending considerable money, employing men and equipment and the nature and volume of the products being dealt with, is sufficient to bring the same within the fold of the expression industry. The petitioner specifically averred that consumers with much simpler activity than that of the subject Unit and with no manufacturing activity, have been included by the respondents under HT Category-I (Industry), viz., Cold Storage Units, Rice Mills, Effluent Treatment Plants etc.; that respondent No.3 ought to have noticed that HT Category-II (Non Industrial) is purely for the consumers whose activities are non- industrial in nature and when the subject Unit is an industry it can never be placed under HT Category-II (Non Industrial); and that even under the scheme of classification of consumers for the purpose of tariffs chargeable either under the Tariff Notifications issued by the erstwhile APSEB or under the Tariff Orders issued by the APERC, the activities being undertaken by the subject Unit are categorized only as industrial activity. That apart from the process of preserving and storing very large quantities of highly volatile petroleum products like Motor Spirit, High Speed Diesel and Kerosene Oil, the subject Unit also manufactures and produces Gasohol, which is a blend of Motor Spirit and Ethanol; Power, which is a variant of Motor Spirit; and Turbojet, which is a variant of High Speed Diesel; and that the subject Unit also undertakes the activity of doping of Kerosene Oil to detect adulteration of petrol and diesel.

That the activities of the subject Unit squarely fall within the definition of preserving for sale contained the description of HT Category-I (Industry); that the Divisional Engineer/DPE/Vijayawada inspected the Units of the petitioner at Sanathnagar and Kondapalli which are involved in handling of Liquefied Petroleum Gas (LPG) and requested the Superintending Engineers to classify the same into HT Category-II (Non Industrial) on the only ground that there is no production activity being carried on therein; that in pursuance of the said request, the Superintending Engineers sought clarification of the erstwhile APSEB; that the APSEB examined the whole issue and held that the activity of the petitioners Units amounts to preserving of goods for sale and distribution to various places in bulk loads and hence fall under HT Category-I (Industry) as per the then Tariff Notification i.e., B.P.Ms.No.32, dated 29-7-1996; that the APSEB has also advised the Superintending Engineers not to reclassify the Units of the petitioner as Category-II (Non Industrial) and directed them to continue the said Units in HT Category-I (Industry); and that the said decision was communicated to the Superintending Engineers by the Member Secretary of the APSEB vide proceedings dated 22-6-1998.