30 Apr 2121

The consumer may have been required to sign fresh agreements for each enhancement agreement the enhancement being for the same electricity connection which continues, it would merely be an amendment of the initial agreement - Supreme Court of India

Case : Jharkhand State Electricity Board and Others v. M/S Ramkrishna Forging Limited Civil Appeal No. 6145 of 2010

Court : Supreme Court of India

Bench : Justice L. Nageswara Rao and Justice Vineet Saran

Decided on : 30 Apr 2121

Relevant Statutes

Section 50 and181(2)(x) of Electricity Act, 2005

Regulation 9.2.1 of Jharkhand State Electricity Regulatory Commission(Electricity Supply Code) Regulations, 2005

Brief Facts and Procedural History

1. The respondent which the small scale industry had entered into an agreement with the board on 14.04.2004 for High Tension (H.T.) connection of 325 KVA load.

2. On 14.03.2006 respondent applied for enhancement of load from 325 KVA to 1325 KVA, which allowed by the General Manager cum Chief Engineer of the Board.

3. The respondent again applied for enhancement of load from 1325 KVA to 3500 KVA, which was sanctioned by the Board on 26.12.2006.

4. The respondent again requested the Board for the enhancement of load, by 500 KVA to 4000 KVA on 07.07.2007.

5. The respondent alleges that after the enhancement of load, it was facing major trippings as well as continuous load shedding which was affecting the costly machinery and, therefore, the respondent decided to reduce the load from 4000 KVA to 1325 KVA.

6. On 20.09.2007 the respondent applied before the authority of the appellant’s Board for such reduction.

7. On the order dated 08.11.2007, the Electrical Superintending Engineer rejected the said application of the respondent for reduction of load informing the respondent that from the date of enhancement of supply of load, an agreement(dated 07.07.2007) would be enforced for three years and treating it to be a case of determination of agreement and that the respondent will have to pay the minimum granted charges and other charges, even if the respondent decides to terminate the agreement.

8. On 08.11.2007, the respondent filed Writ Petition No.6651 of 2007, challenging the said order of the Board, which has been allowed by the High Court.

The Issues of the Case

Whether the respondent was liable to pay the minimum guarantee charges as fixed by the electric supply company upon reduction of load from 4000 KVA to 1325 KVA?

Whether the provisions of Regulation 9.2.1 are discriminatory, arbitrary and against the public policy?

The Observations of the Court

1The Honourable Court observed that the Board has gone wrong in treating the application dated 20.09.2007 of the respondent for reduction of load to be that for determination of an agreement under Clause 9B of the agreement, which application ought to have been considered under Regulation 9.2 of the Jharkhand State Electricity Regulatory Commission (Electricity Supply Code) Regulations, 2005.

2. Further, they were unable to accept the submission of the learned Counsel for the appellant that the application of the respondent for reduction of the load was within three years because as they have discussed hereinabove, the agreement to be considered in the present case is the initial agreement dated 14.04.2004 and not the subsequent agreement dated 07.07.2007.

3. The judgements of this court rendered in Bihar State Electricity Board, Patna and Others v. M/s Green Rubber Industries and Others, (1990) 1 SCC 731; Orissa State Electricity Board v. Orissa TGiles Limited (1993) Supp. 3 SCC 481; Jharkhand State Electricity Board and Others v. Laxmi Business and Cement Company Private Limited & Another, (2014) 5 SCC 236, as having been relied upon by learned counsel for the parties is distinguishable on facts, in as much as they all relate to minimum guarantee charge and that too under the old Electricity Act of 1910.

The Decision held by the Court

1. The Honourable Supreme Court dismissed the appeal.

2. The application of the respondent dated 20.09.2007 has been allowed under the provisions of Regulation 9.2 of the Jharkhand State Regulatory Commission ( Electricity Supply Code) Regulations, 2005, and the respondent shall be entitled to all the consequential benefits.

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