Case: Shreyans Industries Ltd Vs. Punjab State Electricity Board and Ors

1. Leave granted in Special Leave Petition (Civil) No. 29155 of 2011. All these appeals which were heard analogously are directed against the common judgment and order of the High Court of Punjab and Haryana at Chandigarh by which the LPAs filed against the dismissal of writ petitions filed by the Appellants have also been dismissed. The challenge in the writ petitions filed was against the levy of surcharge on the Appellants for not converting from 11 KV to 66 KV transmission. As the bills raised/submitted were of the year 2007, we will understand the period of time required to be considered to be relatable to the tariff orders for the years 2004-2005, 2005-2006 and 2006-2007.2. The Appellants are electricity consumers of the genera] category who were drawing power at 11 KV. Under different notifications, issued from time to time, while other consumers like Induction Furnaces and Arc Furnaces were required to migrate to 66 KV transmission and in the interregnum pay surcharge at the stipulated rate, there was no such requirement for the Appellants. The first time that such a stipulation came was in the ARR for the year 2004-2005 which was brought in by a corrigendum dated 15th September, 2004 issued well after the conclusion of the public hearings on the published Annual Revenue Requirement (concluded on 3rd September, 2004). The net result of the above would be that so far as the consumers of the category to which the Appellants belong were made to suffer the levy of surcharge without an opportunity of hearing against the proposed levy. The point though not urged in the pleadings contained in the writ petitions appears to have been projected before the High Court in the course of the hearing. The High Court understood the corrigendum to be a beneficial exercise for the consumers and, therefore, discarded the plea urged with regard to violation of the principles of natural justice.3. Having read and considered the corrigendum we are of the view that the same has been misconstrued by the High Court inasmuch as the benefit thereunder was afforded only to are furnaces and the general category consumers like the Appellants were brought in within the framework of the surcharge for the first time by the said corrigendum. It is on the aforesaid basis and in view of the provisions of Section 64(3) of the Electricity Act, 2003 that we are considering the appeals notwithstanding the fact that there was no challenge by the Appellants to the tariff order(s) of any of the three years which issue is not being dealt with by us in the present order.4. As the provisions of Section 64(3) of the Electricity Act, 2003 appears to have been infringed and the levy of surcharge imposed on the Appellants were without adequate notice and opportunity to them we are of the view that insofar as the year 2004-2005 is concerned, the Appellants ought to be afforded the necessary relief. We have considered the options available to us at this stage insofar as grant of relief is concerned, specifically, in a situation where over a decade has elapsed in the meantime. Having debated and considered the precise relief that would be in consonance with the principles of justice we are of 6 the view that so far as the year 2004-2005 is concerned the bills raised against the Appellants on account of levy of surcharge should be to that extent interfered with by us. We make it clear that the above relief will be confined only to the present Appellants who have approached this Court.5. We have perused the tariff orders along with the extracts of the ARR for the years 2005-2006 and 2006-2007 which have been placed before us by Shri V. Giri, learned Senior Counsel appearing for the Respondents. The tariff orders for the aforesaid two years do not indicate any fundamental flaw which would require us to interfere either with the exercise undertaken or the refusal of the High Court to interfere with the same to the remaining extent, namely, the years 2005-2006 and 2006-2007. It appears from a reading of the aforesaid two tariff orders that the abridged version of the ARR was duly published; objections were invited/received and duly considered and thereafter the matter was proceeded with.

Decision reasoning: 1[ds]3. Having read and considered the corrigendum we are of the view that the same has been misconstrued by the High Court inasmuch as the benefit thereunder was afforded only to are furnaces and the general category consumers like the Appellants were brought in within the framework of the surcharge for the first time by the said corrigendum. It is on the aforesaid basis and in view of the provisions of Section 64(3) of the Electricity Act, 2003 that we are considering the appeals notwithstanding the fact that there was no challenge by the Appellants to the tariff order(s) of any of the three years which issue is not being dealt with by us in the present order4. As the provisions of Section 64(3) of the Electricity Act, 2003 appears to have been infringed and the levy of surcharge imposed on the Appellants were without adequate notice and opportunity to them we are of the view that insofar as the year 2004-2005 is concerned, the Appellants ought to be afforded the necessary relief. We have considered the options available to us at this stage insofar as grant of relief is concerned, specifically, in a situation where over a decade has elapsed in the meantime. Having debated and considered the precise relief that would be in consonance with the principles of justice we are of 6 the view that so far as the year 2004-2005 is concerned the bills raised against the Appellants on account of levy of surcharge should be to that extent interfered with by us. We make it clear that the above relief will be confined only to the present Appellants who have approached this Court5. We have perused the tariff orders along with the extracts of the ARR for the years 2005-2006 and 2006-2007 which have been placed before us by Shri V. Giri, learned Senior Counsel appearing for the Respondents. The tariff orders for the aforesaid two years do not indicate any fundamental flaw which would require us to interfere either with the exercise undertaken or the refusal of the High Court to interfere with the same to the remaining extent, namely, the years 2005-2006 and 2006-2007. It appears from a reading of the aforesaid two tariff orders that the abridged version of the ARR was duly published; objections were invited/received and duly considered and thereafter the matter was proceeded with7. There is another dimension of the case in one of the appeals, namely, Civil Appeal Nos. 6293-6294 of 2013 where there is a categorical assertion on the part of the Appellant therein that the Appellant had tendered payment of the necessary charges for conversion to 66 KV on 28th August, 2006. The line was energized on 31st March, 2008. Relying on clause 5.8 of the Electricity Supply Regulations, 2004 it is contended that the Appellant would not be liable to pay surcharge for the period from the date of the deposit of the costs for the switch over to 66 KV, namely, from 28th August, 2006.