IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) SATURDAY, THE NINETEENTH DAY OF APRIL TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR JUSTICE V.ESWARAIAH WRIT PETITION Nos. 15888, 15892 & 15922 of 2001 W.P.No.15888 of 2001: Between: Kanchana Ganga Rice Industries Rep By Its Managing Partner K.Seshagiri Rao At Janapadu Village, Piduguralla Mandal, Guntur Dist. ..... PETITIONER AND 1 A P Southern Power Distribution Company Ltd., (APSPDCL) Rep By Its Managing Director Tirupathi. 2 The Superintending Engineer (Operation) AP Southern Power Distribution Company Ltd., Guntur. 3 The Asst Divisional Engineer, Construction & Operation, AP Southern Power Distribution Company Ltd., Piduguralla, Guntur Dist. 4 The Asst Engineer, Operation, AP Southern Power Distribution Company Ltd., Piduguralla, Guntur Dist. 5 The Asst Accounta Officer Electricty Revenue Office AP Southern Power Distribution Company Ltd., Sattenapalli, Guntur Dist. .....RESPONDENTS 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 of Certiorari or any other appropriate Writ or Writs, Order or Direction, to call for the records pertaining to the order dt.4.6.2001 in proc.No.SE/O/Gnt/Com1/F.Doc/D.No.1175/01 on the file of the 2nd Respondent herein and quash the same as illegal, arbitrary and without jurisdiction; Award costs and pass. Counsel for the Petitioner: MR.K.RAGHUVEER REDDY Counsel for the Respondent No.: MR.O.MANOHER REDDY Form-NIC-OGS/WP{RAGHU} WRIT PETITION No.15892 of 2001 Between: Venkata Sai Paraboiled Rice Mill Rep By Its Managing Partner L. venkateswarlu Janapadu Village, Piduguralla Mandal, Guntur Dist. ..... PETITIONER AND 1 AP Southern Power Distribution Company Ltd., (APSPDCL) Rep BY Its Managing Director Tiruipathi. 2 The Superintending Engineer ( Operation) Rep BY Its Managing Director AP Power Southern Distribution Company Ltd., Guntur. 3 The Asst. Divisional Engineer Construction & Operation AP Power Southern Distribution Company Ltd., Piduguralla Guntur Dist. 4 The Asst. Engineer Operation, AP Power Southern Distribution Company Ltd., Piduguralla Guntur Dist. 5 The Asst. Accounts Officer Electricty & Revenue Office, AP Power Southern Distribution Company Ltd., Sattenapalli, Guntur Dist. .....RESPONDENTS 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 of Certiorari or any other appropriate Writ or Writs, Order or Direction, to call for the records pertaining to Order dt.4.6.2001 in proc.No.SE/O/Gnt/Com1/F.Doc./D.No.1177/01 on the file of the 2nd Respondent and quash the same as illegal, arbitrary and without jurisdiction; Award costs and pass. Counsel for the Petitioner: MR.K.RAGHUVEER REDDY Counsel for the Respondent No.: MR.O.MANOHER REDDY Form-NIC-OGS/WP{RAGHU} WRIT PETITION No.15922 of 2001 Between: Venkateswara Rice Industries Rep By Its Managing Partner B. Peera Reddy At Janapadu Village, Plduguralla Mandal, Guntur Dist. ..... PETITIONER AND 1 A.P. Southern Power Distribution Company Ltd.,(APSPDCL) Rep By Its Managing Dirtector Tirupathi. 2 The Superintending Engineer (Operation) A.P. Southern Power Distribution Company Ltd., Guntur. 3 The Asst Divisional Engineer, Construction & Operation, AP Southern Power Distribution Co.Ltd., Piduguralla, Guntur Dist. 4 The Asst Engineer, Operation AP Southern Power Distribution Co.Ltd., Piduguralla, Guntur Dist. 5 The Asst Accounts Officer Electricty Revenue Office AP Southern Power Distribution Co.Ltd., Sattenapalli, Guntur Dist. .....RESPONDENTS 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 of Certiorari or any other appropriate Writ or Writs, Order or Direction, to call for the records pertaining to order dt.4.6.2001 in Proc.No.SE/O/Gnt/Com1/F.Doc/D.No.1174/2001 on the file of the 2nd Respondent and qush the same as illegal, arbitrary and without jurisdiction; Award costs and pass. Counsel for the Petitioner: MR.K.RAGHUVEER REDDY Counsel for the Respondent No.: MR.O.MANOHER REDDY Form-NIC-OGS/WP{RAGHU} The Court made the following: THE HON'BLE SRI JUSTICE V.ESWARAIAH WRIT PETITION Nos. 15888, 15892 & 15922 of 2001 COMMON ORDER: Heard both the counsel. 2. The petitioners in all these three writ petitioners are small scale industries, running rice mills with the electricity service connection Nos.1250, 1251 and 1252 respectively. The connected loads, permitted to the petitioners’ connections are 75 HP to 150 HP under LT Category III-B. It is stated that the petitioners have entered into an agreement under LT Category III-B and after complying with all the required formalities pursuant to the agreement, the service connections have been issued. There is no dispute that the tariff connection is applicable as per the terms and conditions of the agreement and for LT Category III-B. While so, demand notices dated 14.11.2000 were issued by the 5th respondent-Assistant Accounts Officer, demanding a sum of Rs.4,41,125-95 ps in the case of the petitioner in WP.15888/2001, Rs.1,84,464-50 ps in the case of the petitioner in WP.15892/2001 and Rs.4,38,724-05 ps in the case of the petitioner in WP.15922/2001. 3. Questioning the said demand of for low power factor surcharge for the period from 6/99 to 9/2000 i.e. for a period of one year three months, the petitioners filed writ petitions being W.P.Nos.24180/2000, 24161/2000 and 24192/2000 respectively before this Court and this Court by order dated 19.01.2001 disposed of those three writ petitions, directing to treat the demand notices as show cause notices, permitting the petitioners to file their explanations against the said demand notices within a period of two weeks from the date of receipt of the order, and on filing such explanations, the respondents are directed to consider and pass appropriate orders thereon. It is stated that though the petitioners filed their detailed explanations, the respondents did not consider the same and negatived their request and confirmed the low power factor surcharge, and directed to prefer appeals if the petitioners aggrieved by the said confirmation of the low power factor surcharge. It is stated that the petitioners filed appeals before the Divisional Electrical Engineer. The appellate authority examined the matter and directed the petitioners to pay the revised amounts towards low power factor surcharge. Against which the petitioners filed another second round of writ petitions before this Court which were disposed of, directing the 2nd respondent- Superintending Engineer to consider and dispose of the appeals filed by the petitioners. The appellate authority having considered the various contentions raised by the petitioners, dismissed the appeals, holding that the low power factor is below 0.9. It is further stated that the lower power factor surcharge is applicable for L.T.Category III-B services also as in the case of HT consumers as per tariff Gazette notifications, and therefore, the demand raised for the low power factor surcharge for the period from 6/99 to 9/2000 was upheld. 4. The learned standing Counsel appearing for the respondents submits that as per the conditions of the Sale of Electricity to Persons other than Licensees Revised Tariffs, notified under B.P.Ms.No.62 (Operation & Commercial), dated 28.12.1998, published in the Andhra Pradesh Gazette, dated 29th December, 1998, the surcharge for lower power factor taken below 0.90 is also applicable to L.T.Category III-B. I have perused the said Gazette notification. A perusal of the said Gazette Notification goes to show that Part-‘A’ applies to H.T.Tariffs and there are various categories for High Tension for H.T.Catetory-I, H.T.Category-II, H.T.Category-IV, H.T.Category-V, H.T.Category-VI and as per Condition No.6 of the general conditions of H.T.Supply, the power factor of the consumer’s installation shall not be less than 0.90, and if the power factor falls below 0.90 during any month, the consumer shall pay a surcharge. There is no any notification with regard to the surcharge leviable for lower power factor for L.T.Category. 5. Both the counsel appearing for the parties submits that admittedly, condition No.23 of the Sale of Electricity to Persons other than Licensees – Revised Terms and Conditions of Supply, issued under B.P.Ms.No.690, dated 17.09.1975 is applicable and as per the said condition, the power factory of the consumer’s installation shall not be less than 0.85, and if the power factor falls below 0.85 during any month, the consumer shall pay a surcharge of two percent on the amount of that month’s bill (excluding demand charges and customer charges) for each 0.01 (decimal naught one) fall in the power factor. If the power factor is less than 0.85 continuously for a period of six months, the consumer shall pay surcharge at the rate of three percent on the bill amount for the subsequent consecutive months, if any, during which the power factor is below 0.85. 6. The learned counsel appearing for the petitioner submits that in so far as the L.T.Category III-B is concerned, as per the condition No.38.9 with regard to low power factor, the customers shall install capacitors with the required rating within such time as may be prescribed by the Board and if the capacitors are not replaced or rectified, a notice is required to be given, and in the instant case, it is stated that without giving any show cause notice and without giving any opportunity to install the capacitors or for the rectification capacitors, straight away lower power factor surcharge was imposed. 7. The learned counsel for the petitioners further relied upon the judgment of the Division Bench of this Court in the case of M/s.Arif Spinning Mills, Jalpally v. Assistant Divisional Engineer, Operation, APSEB, Saroornagar[1] in support of his version. In that case also, the contracted load was 60 HP. The petitioner therein had similar service connection i.e. L.T.Category-III-B, and in that case also the Electricity Board demanded the lower power factor surcharge and the Division Bench while quoting condition No.38.9(a) and (b) held that the said condition requires to issue a notice to get the capacitors replaced or rectified or corrected within 30 days of the inspection and intimate the fact of replacement/rectification to the concerned officer. It is stated that as no opportunity was given to the petitioner therein under Condition No.38.9(a) and (b) of the Agreement to rectify the malfunctioning of capacitors, the Division Bench allowed the writ petition. 8. In the instant case also, I am of the opinion that the surcharge for lower power factor applicable for the high tension tariff is made applicable to the L.T.Category III-B and prior notice is required to be issued to the petitioners for getting the capacitors replaced/rectified and the record would go to show that no such notice was issued to the petitioners, and therefore, the said impugned orders are unsustainable. In view of the judgment of the Division Bench of this Court mentioned supra, I am of the opinion that the same ratio would be applicable to the case of the petitioners herein. 9. After dictating the orders on 11.04.2008, a mention has been made by the learned Standing Counsel appearing for the respondents stating that the lower power factor surcharge is also applicable to the L.T. Category-III-B industrial units as in the case of H.T. consumers applicable as per the tariff notification, dated 29.12.1998 with effect from 01.01.1999. Even as per the tariff notification, the lower power factor surcharge is applicable as in the case of H.T. consumers, I am of the opinion that the Condition No.38.9(a) and (b) of the Agreement cannot be dispensed with as held by the Division Bench of this Court in the case of M/s. Arif Spinning Mills cited supra. 10. For the reasons stated above, these three writ petitions are allowed, and the impugned orders are set aside. No order as to costs. __________________ V.ESWARAIAH,J Dated: 19.04.2008 Dsr/ccm To 1 A P Southern Power Distribution Company Ltd., (APSPDCL) Rep By Its Managing Director Tirupathi. 2 The Superintending Engineer (Operation) AP Southern Power Distribution Company Ltd., Guntur. 3 The Asst Divisional Engineer, Construction & Operation, AP Southern Power Distribution Company Ltd., Piduguralla, Guntur Dist. 4 The Asst Engineer, Operation, AP Southern Power Distribution Company Ltd., Piduguralla, Guntur Dist. 5 The Asst Accounta Officer Electricty Revenue Office AP Southern Power Distribution Company Ltd., Sattenapalli, Guntur Dist. 6. 2CCs to 7. 2CD copies [1] AIR 1998 Andhra Pradesh 48