IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE SIXTEENTH DAY OF JUNE TWO THOUSAND AND NINE PRESENT THE HON'BLE MR JUSTICE B.SESHASAYANA REDDY WRIT PETITION NO : 18493 of 2002 Between: M/s. Aurobindo Pharma Limited, Rep. by its Manager-Legal and G.P.A.Holder Mr. K.K.Sastry, S/o. K.R.Sastry, A company incorporate under the Companies Act, 1956 Having its Registered & Administrative Office At Plot No.2, Maitrivihar, Ameerpet, Hyderabad, R/o.O/o.M/s.Aurobindo Pharma Ltd., Ameerpet, Hyderabad. ..... PETITIONER AND 1 M/s. Transimission Corporation of Andhra Pradesh Limited, Rep. by its Managing Director, (APTRANSCO) a company incorporated under the Companies Act, 1956 and wholly owned by Government of Andhra Pradesh being, Vidyut Soudha, Khairatabad, Hyderabad. 2 The Director (Commercial), M/s. Central Power Distribution Company of A.P.Limited, (APCPDCL), Singareni Bhavan, Red Hills, Hyderabad. 3 The Superintending Engineer, Operation Circle, M/s. Central Power Distribution Company of A.P.Limited, (APCPDCL), Sangareddy, Medak. 4 Senior Accounts Officer, Operation Circle, M/s. Central Power Distribution Company of A.P.Limited, (APCPDCL), Sangareddy, Medak. .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to to issue a writ, order or direction more particularly in the nature of Mandamus by declaring the action of respondnets for not allowing the benefit of incentive on the tariff rates of the petitionr's H.T. Service connection bearing No. MDK 584 since April, 2001 as per the Tariff orders issued by the Andhra Pradesh Electricity Regulatory Commission (APERC) which are applicable for the Financial years of 2001-2002 and 2002-2003 as arbitrary, illegal and violation of Article 14 of the Constitution of India, and for a consequential direction to the respondents to allow the said incentive on the tariff rates of the Petitioner's H.T. Service connecftion bearing No.MDK 584 since April, 2001 as per tariff orders of the APERC applicable for the Financial Years 2001-2002 and 2002-2003, and to refund the said accrued and allowed incentive amount to the petitioenr or adjust the same in future electricity bills that are being raised on the petitoner's said H.T. Service connection bearing No. MDK 584 by the Respondents, and pass Counsel for the Petitioner:MR.M.LAXMINARASIMHAM Counsel for the Respondent No.: MR.O.MANOHER REDDY The Court made the following : O R D E R: 1. The petitioner-company is engaged in manufacturing and trading of bulk drugs, intermediaries etc. It has been availing electricity supply from M/s Transmission Corporation of Andhra Pradesh Limited (APTRANSCO)-1st respondent vide service connection bearing No.MDK 584 under H.T. category. The petitioner’s unit is within the operation circle of Superintending Engineer, APCPDCL-3rd respondent. The contracted maximum demand for the said electricity supply is 1495 KVA at specified voltage of 11 KV. Tariff orders notified by Andhra Pradesh Electricity Commission (APERC) are being implemented by the respondents. The tariff orders notified for the financial year 2001-02 and 2002-03 provide incentives to consumers of H.T. category by way of giving discount on the energy rates depending upon the load factor. It is the grievance of the petitioner-company that though it is eligible for the benefit of the said incentive, the respondents are not extending the same benefit to it. Therefore, it filed the writ petition assailing the action of the respondents in not allowing incentives on the tariff rates. For better understanding of the grievance of the petitioner-company, I deem it appropriate to extract para 6 of the affidavit, which reads as under: “ 6. The petitioner submits that they have made oral representation to the 3rd and 4th respondent herein for allowing of said incentive to them, and they came to knew that the said incentive has not been allowed by respondents due to three disputed claim amounts which are (1) Rs.16,986/- towards FCA charges for the year 1997-98; (2) Rs.6,09,086/- relating to exceeding CMD charges of 150 KVA; and (3) Rs.3,64,597/- relating to V.C.M. bills pertaining to the period 24-8-94 by taking into consideration of CMD 475 KVA. It is submitted that no notice of arrears or disconnection has been served on the petitioner till date so far as the claim of Rs.16,896/- is concerned, and as such it cannot be a ground for not allowing incentive applicable to this petitioner since April, 2001, and further the petitioner herein has paid the said amount also on 24.7.2002. It is submitted that so far as the claim of Rs.6,09,086/- is concerned the petitioner herein has disputed the said claim and the petitioner has filed W.P.No.28402 of 98 before this Honourable court, and this Honourable court has granted stay of collection of the said amount till the disposal of the said writ petition. It is submitted that so far as the claim of Rs.3,46,597/- is concerned a representation was made on 16.7.1998 to the then Member Secretary, APSEB, Hyderabad and in the letter dated 20.7.98 issued by the office of Member Secretary it was stated that the said matter is under examination and the 3rd respondent herein was directed not to disconnect the power supply, and the said matte is still pending with the authorities and no further order was received in that regard either from the erstwhile Andhra Pradesh Electricity Board, or from it successors till date.” 2. The respondents filed counter affidavit. It is stated in the counter affidavit that as per tariff orders approved by APERC all the HT consumers are eligible for incentive on the energy charges based on the load factor subject to fulfillment of other conditions. Consumer is not entitled to incentive if there are outstanding dues to respondents. Since there were certain outstanding dues by the petitioner-company to APCPDCL as on 1.4.2001, incentive was not allowed to the petitioner- company. The dues outstanding by the petitioner-company to APCPDCL as on 1.4.2001 were: a) FCA charges for the year 1997-98 Rs. 16986.00 b) Penal demand charges Rs.609086.00 c) UCM charges Rs.346597.00 The petitioner-company paid Rs.16,986/- on 24.7.2002. The incentives to the petitioner-company came to be allowed from April to July, 2002 amounting to Rs.2,96,977.00 in the month of December, 2002. Eligible incentive amount was adjusted with the regular CC bills of the petitioner- company w.e.f. August, 2002 as no due condition in regard to allowing of incentive is deleted for the financial year 2002-03. As per the scheme for the financial year 2001-02 i.e. from 1.4.2001 to 31.3.2002, the petitioner- company is not eligible for incentive because of outstanding dues to APCPDCL. Since the petitioner-company availed supply from other suppliers i.e. third party developers during the month of 6/2002 and 7/2002 and such power availed from other sources shall be excluded for calculating the eligible incentive amount. Hence, the petitioner-company’s claim of incentive amount of Rs.2,19,807/- for the period from 4/2002 to 7/2002 is not correct. 3. The petitioner filed WPMP.NO.3696 of 2009 to receive additional affidavit. The said petition came to be allowed on 30.4.2009. It is stated in the additional affidavit that the respondents allowed incentives to the petitioner-company from September, 2002 as per the directions in WPMP.No.23263 of 2002, dated 25.9.2002. Though the petitioner is eligible for incentive on tariff rates from April, 2001 to March, 2002 the same was not allowed by the respondents till date. R3 addressed a letter to the petitioner on 27.1.2003 requesting for withdrawal of the writ petition on the ground that the eligible incentive was already granted. It is submitted that the respondents have not released the eligible incentive amount of Rs.5,07,547.31 for the financial year of 2001-02 and an amount of Rs.2,19,807.00 for the financial year 2002-03 to the petitioner’s unit bearing H.T. service connection No.MDK 584. 4. Heard learned counsel appearing for the parties. 5. Learned counsel appearing for the petitioner-company submits that as per the policy for the financial year 2001-02, the petitioner-company is eligible for incentives and the action of the respondents in not granting incentives is arbitrary and irrational. A further submission has been made that there is no final adjudication with regard to two amounts allegedly due and with regard to one amount it is negligible and therefore one which is not sufficient to deprive the action of the respondents in depriving incentives is highly irrational and arbitrary. In a way the contention is that for an outstanding due of Rs.16,986/- for the financial year 2002-03, the incentive which runs to lakhs of rupees cannot be denied to the petitioner. He would also contend that in the scheme introduced with regard to granting incentives to H.T. consumers for the year 2002-03, the clause which deals with the outstanding dues has been deleted and that itself is sufficient to allow the claim of the petitioner-company in respect of incentives for the year 2001-02 irrespective of outstanding dues. He relied on the following judgments of the Supreme Court in (1) CWT v. J.K.COTTON MANUFACTURERS LTD[1] (2) SIRAJ UL HAQ KHAN v SUNNI CENTRAL BOARD OF WAQF[2] (3) BIRLA CEMENT WORKS AND ANT. V. STATE OF RAJASTHAN AND OTHS[3] (4) M/S BAJAJ TEMPO LTD. V. C.I.T.[4] 6. In the first cited decision, the Supreme Court held that the expression ‘outstanding’ in Section 2(m) (iii) (a) and (b) will have to be construed in the background of the phrase “amount of tax….payable in consequence of an order” and in that context it must mean remaining unpaid after the obligation to pay is incurred. In the second cited decision, the Supreme Court held that in construing the provisions of a statute courts should be slow to adopt a construction, which tends to make any part of the statute meaningless or ineffective; an attempt must always be made so to reconcile the relevant provisions as to advance the remedy intended by the statute. In such a case, it is legitimate and even necessary to adopt the rule of liberal construction so as to give meaning to all parts of the provision and to make the whole of it effective and operative. In the third cited decision, the Supreme Court held that provision empowering levy of interest should be construed applying normal rule of interpretation so as to effectuate the object and purpose of the statute and should not be construed strictly. 7. Learned Standing Counsel appearing for the respondents submits that of the three outstanding liabilities of the petitioner-company, there is no dispute with regard to one item and the same came to be cleared by the petitioner-company on 24.7.2002 and the respondents granted incentives from that date onwards. 8. The issue that falls for adjudication is – Whether the action of the respondents in not allowing the incentives to the petitioner-company for the year 2001-02 is justified? 9. The relevant clause which deals with the incentives for the financial year 2001-02 reads as under: “ 1. Incentive: a) The following telescopic incentives are applicable for consumers for use of Licensee supply: Load Factor Discount applicable on The energy rates More than 40% upto 50% 10 % More than 50% upto 60% 15 % More than 60% upto 70 % 20 % More than 70 % 25 % b) The incentive is applicable for the consumption in excess of the average monthly consumption for the FY 2000-01 and the actual consumption for the corresponding month of the FY 2000-01 and only if the consumer does not have any outstanding dues to APTRANSCO/Distribution Companies. This scheme is applicable for new consumers also.” 10. When the petitioner-company is claiming incentive under the policy declared by the respondents, the petitioner-company has to fulfill all the conditions stipulated therein to become eligible for the incentives. The eligibility criteria for becoming eligible for incentive is that there shall not be any outstanding dues to the respondents. 11. Indisputably there were three amounts outstanding. Of course, the petitioner-company claims that there is no final adjudication with regard to two amounts. Be that as it may there is no dispute with regard to outstanding liability of Rs.16,986/- towards FCA charges for the year 1997-98. This liability has been liquidated by the petitioner on 24.7.2002. This fact is evident from the letter dated 24.7.2002 addressed to the Senior Accounts Officer, Operation, Medak Circle, Sangareddy. The text of the letter reads as under: “ We understand on enquiry that the following amounts are outstanding in respect of the above service due to which the incentive amounts are not being released. 1) Rs.16,986/- towards FCA charges for the year 1997-98. 2) Rs.6,09,086/- relating to exceeding CMD charges of 150 KVA in view of interim orders of court in WP.No.28402 of 98. 3) Rs.3,46,597/- relating to VCM bills pertaining to the period 24.8.94 by taking into consideration of CMD 475 KVA. We would like to clarify the position as follows: 1) Please find enclosed the cheque No.076520, dated 24.7.2002 of ICICI bank for Rs.16,986/- towards FCA charges for 1997-98. This item gets cleared with this payment. 2) Rs.6,09,086/- since the amount is covered by court order as per the clarifications given on many occasions by the Director, Commercial the incentive can be released even without payment of this amount. However, we have been informed that general instructions are also given in respect of release of incentives covered by T.O 2002-03 (copy enclosed). 3) Rs.3,46,597/-; copies of the claim, our representation dated 16.7.98 and the letter of Board are enclosed for ready reference. From the above it may be seen that the claim is disputed and final orders are yet to be issued by the Board. Hence, this amount cannot be treated as arrears. Hence, it is requested the incentives due to us are released and adjusted in the C.C. bill for July, 98.” 12. It is no more in dispute that after the payment of Rs.16,986/-, incentive has been granted as per the policy for the financial year 2001- 02. The petitioner-company is not entitled for incentive since there was undisputed outstanding amount of Rs.16,986/- towards FCA charges. Therefore, the action of the respondents in not granting incentive for the year 2001-02 cannot be found fault. 13. Accordingly, this writ petition is devoid of merits and the same is dismissed. No costs. 16th June, 2009. (B.Seshasayana Reddy,J) tnb ..... REGISTRAR // TRUE COPY // SECTION OFFICER To 1) 2 CD copies Form-NIC-OGS/WP{KRD} THE HONOURABLE SRI JUSTICE B.SESHASAYANA REDDY WRIT PETITION NO.18493 OF 2002 16TH JUNE 2009. [1] AIR 1984 SC 946 [2] AIR 1959 SC 198 [3] (1994) 4 SCC 277 [4] AIR 1992 SC 1622(1)