Case: STATE OF GUJARAT Vs. UTILITY USERS WELFARE ASSOCIATION THROUGH ITS PRESIDENT

the ‘trappings of the Court’, an aspect we have agreed to hereinbefore. Once it has the ‘trappings of the Court’ and performs judicial functions, albeit limited ones in the context of the overall functioning of the Commission, still while performing such judicial functions 58 Another distinguished jurist who served as a Professor of Law at The Harvard Law School Page 77 of 84which may be of far reaching effect, the presence of a member having knowledge of law would become necessary. The absence of a member having knowledge of law would make the composition of the State Commission such as would make it incapable of performing the functions under Section 86(1)(f) of the said Act. 106. In Madras Bar Association 59 (MJ-II), the Constitution Bench, referring to the decision in Madras Bar Association 60 (MJ-I) observed that members of tribunals discharging judicial functions could only be drawn from sources possessed of expertise in law and competent to discharge judicial functions. We are conscious of the fact that the case (MJ-I) dealt with a factual matrix where the powers vested in courts were sought to be transferred to the tribunal, but what is relevant is the aspect of judicial functions with all the ‘trappings of the court’ and exercise of judicial power, at least, in respect of same part of the functioning of the State Commission. Thus, if the Chairman of the Commission is not a man of law, there should, at least, be a member who is drawn from the legal field. The observations of the Constitution Bench in Madras Bar Association 61 (MJ-II) constitutes a 59 supra 60 supra 61 supra Page 78 of 84declaration on the concept of basic structure with reference to the concepts of“separation of powers”,“rule of law”and“judicial review”. The first question raised before the Constitution Bench as to whether judicial review was part of the basic structure of the Constitution was, thus, answered in the affirmative. 107. We are, thus, of the view that it is mandatory to have a person of law, as a member of the State Commission. When we say so, it does not imply that any person from the field of law can be picked up. It has to be a person, who is, or has been holding a judicial office or is a person possessing professional qualifications with substantial experience in the practice of law, who has the requisite qualifications to have been appointed as a Judge of the High Court or a District Judge. 108. In Brahm Dutt v. Union of India 62 , it has been observed that if there are advisory and regulatory functions as well as adjudicatory functions to be performed, it may be appropriate to create two separate bodies for the same. That is, however, an aspect, which is in the wisdom of the legislature and that course is certainly open for the future if the legislature deems it so. However, at present there is a 62 supra Page 79 of 84single Commission, which inter alia performs adjudicatory functions and, thus, the presence of a man of law as a member is a necessity in order to sustain the provision, as otherwise, it would fall foul of the principles of separation of powers and judicial review, which have been read to be a part of the basic structure of the Constitution. 109. We are also not in a position to accept the plea advanced by the learned Attorney General that since there is a presence of a Judge in the Appellate Tribunal that would obviate the need of a man of law as a member of the State Commission. The original proceedings cannot be cured of its defect merely by providing a right of appeal. 110. We are, thus, of the unequivocal view that for all adjudicatory functions, the Bench must necessarily have at least one member, who is or has been holding a judicial office or is a person possessing professional qualifications with substantial experience in the practice of law and who has the requisite qualifications to have been appointed as a Judge of the High Court or a District Judge. 111. The challenge laid in TC (C) Nos.139/2015 & 138/2015 is to the appointments made to the Tamil Nadu State Commission and the exercise of the powers suo moto by the Commission. The fundamental Page 80 of 84plea is of financial bias of the two members as they were working in their erstwhile avatars. The name of Mr. G. Rajagopal was recommended when he was still working as the Director, TANGEDCO and he opted for voluntary retirement after his name had been recommended. Mr. Akshayakumar retired from the post of Managing Director of TANTRANSCO on 31.5.14 and was appointed as Chairman of the Commission on 6.6.14. The tariff hike was approved by a majority of 2:1 with these two members being part of the majority view. 112. In respect of the aforesaid, reliance was placed on the judgment in Rajesh Awasthi 63 and Mor Modern Cooperative Transport Society Ltd. 64 . We, however, find that those judgments would not apply in the present case. The nature of financial interest was examined in the narrower sense as well as the wider sense and in the wider sense, it was held to include the direct or indirect interest of a person in relation to a financial undertaking. The situation arose when the person concerned was holding both the posts simultaneously, which is not so in the present case. (as noticed in para 52 above) It is also pointed out by the learned counsel appearing for the State of Tamil Nadu that the orders 63 supra 64 supra Page 81 of 84of appointment have been exclusively assailed right till the Supreme Court. It may be added that the Selection Committee was presided over by a retired Judge of the High Court. 113. We, thus, find no merit in the plea sought to be advanced assailing either the appointment or the suo moto tariff revision. Conclusion: 114.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]T.C.(C) No.140/2015 and T.C.(C) No.137/2015 & IA Nos.3 & 4/201654. There was really no fresh material addressed before us so far as the aforesaid petitions are concerned.55. Insofar as IA Nos.3 & 4/2016, filed by CLP Wind Farms Private Limited, seeking intervention in T.C.(C) No.137/2015, are concerned, the prayer for intervention is made on the ground that the Court issues appropriate directions to the Tamil Nadu Electricity RegulatoryCommission for time bound hearing and expeditious adjudication of thepetitions, being DRP Nos.62/2014 & 63/2014. The Court finds no merit in the applications, as the prayers made in the applications are outside the lis being adjudicated by the Court. The same are accordingly disposed of.If we turn back to the provisions of Section 84 of the said Act, we find that the expressions used in sub-section (1) both in the context of the requirement of ability, integrity and standing as also in the context of adequate knowledge and capacity in dealing with problems relating to engineering, finance, commerce, economics, law or management. On the other hand, in sub-section (2) while dealing with the possibility of appointment of a Chairperson from the pool of sitting or retired Judges, the expression used isg it to be a discretionary power.80. We are, thus, inclined to accept the line of reasoning advanced by the learned counsel led by the learned Attorney General that the plain reading of the section leaves no manner of doubt that the legislature only envisaged a possibility of appointment of a Chairperson from the pool of sitting or retired Judges of the High Court, in which case the method of appointment would be different from the one as envisaged under Section 85 of the said Act.81. We may also look to the nature and functions performed by the State Commission. Functions of the State Commission are prescribed under Section 86 of the said Act. The enumerated functions aredetermination of tariff, regulation of electricity purchase and procurement process of distribution licencees, facilitating intra-state transmission, issuing licences to persons, promoting cogeneration and generation of electricity from renewable sources, levy fee, specify or enforce standards, fix trading margins. All these functions are regulatory in character rather than adjudicatory. The real adjudicatory function is only provided in sub-clause (f) whereupon the Commission has the option of adjudicating the disputes between the licencees and generating companies, or to refer such disputes to arbitration. There is also an advisory role to be performed by the State Commission as specified in sub-section (2). The issue, however, is not whether a Judge would be comfortable doing this function but whether these are types of functions which necessarily mandate a Judge to be a Chairperson. The answer to this would also be in the negative, supporting the view we have adopted on the plain reading of the section.85. Mr. Jayant Bhushan, learned senior counsel also rightly emphasized that were it to be presumed that the Chairperson had to be mandatorily a Judge, the process of appointment would have to be in terms of the proviso and not in terms of Section 85 of the said Act. This would make the reference to a Chairperson under Sub-Sections (2), (3), (5) & (6) of Section 85 otiose as that eventuality would never arise were such a plea to be accepted.We are, thus, unable to accept the contention advanced on behalf of the parties, who sought to sustain the view adopted by the Gujarat High Court. The fact that the Chairperson has a right to nominate theMember, who would chair meetings in his absence as per sub-section (2) of Section 92, or that the presence of a man of law would be no substitute to the requirement of a Judge who would bring a judicial thought process to the decision making as Chairman, or that the regulatory body should not be unregulated, are generalized pleas, which are difficult to accept. No doubt, the law declared by the Supreme Court is binding on all Courts within the territory of India, which would also include principles of law emanating from a judgment or interpretation of the law, but then the ratio decidendi of the judgments of the Supreme Court, makes the principle of mandatory requirement of a Judge applicable only to cases where the judicial function is sought to be shifted through the process of. We may also note that Section 84(2) of the said Act begins with a non-obstante clause, i.e., Notwithstanding anything contained in(1), it does not take away what is stated in sub-section (1), which deals with the requirements that are necessary in the appointment of a Member or Chairperson. It would not cut down the clear terms of the enactment being sub-section (1). The occasion to use such a non-obstante clause really arose because the process ofappointment of a Chairperson who is, or has been a Judge, is required to be different, and thus, the mandatory consultation with the Chief Justice. It is nothing more or less. Further sub-section (1) of Section 85 provides for a Selection Committee to be headed by a Judge of the High Court but with the proviso that the said provision would not apply for the appointment of a person as a Chairperson who is, or has been, a Judge of the High Court. This, in fact, shows that a non-Judge can be appointed as the Chairperson by the Selection Committee constituted under Section 85 of the said Act, which in turn is chaired by a Judge of the High Court. We are, thus, unequivocally of the view that Section 84(2) of the said Act only gives the discretionary option to the State Government to appoint a Judge as the Chairperson of the State Commission. The said provision therefore, is not mandatory in nature.are conscious of the fact that the case (MJ-I) dealt with a factual matrix where the powers vested in courts were sought to be transferred to the tribunal, but what is relevant is the aspect of judicial functions with all the ‘trappings of theand exercise of judicial power, at least, in respect of same part of the functioning of the State Commission. Thus, if the Chairman of the Commission is not a man of law, there should, at least, be a member who is drawn from the legal field. The observations of the Constitution Bench in Madras Bar(MJ-II) constitutes adeclaration on the concept of basic structure with reference to the concepts ofe of. The first question raised before the Constitution Bench as to whether judicial review was part of the basicof the Constitutionwas, thus, answered in the affirmative.We are, thus, of the view that it is mandatory to have a person of law, as a member of the State Commission. When we say so, it does not imply that any person from the field of law can be picked up. It has to be a person, who is, or has been holding a judicial office or is a person possessing professional qualifications with substantial experience in thew, who has the requisite qualifications to have been appointed as aof the High Courtor a District Judge.at present there is asingle Commission, which inter alia performs adjudicatory functions and, thus, theof a man of law as a memberis a necessity in order to sustain the provision, as otherwise, it would fall foul of the principles of separation of powers and judicial review, which have been read to be a part of the basic09. We are also not in a position to accept the plea advanced by the learned Attorney General that since there is aof a Judgein the Appellate Tribunal that would obviate the needof a man of law as a memberof the State Commission. The original proceedings cannot be cured of its defect merely by providing a right of appeal.We are, thus, of the unequivocal view that for all adjudicatory functions, the Bench must necessarily have at least one member, who is or has been holding a judicial office or is a person possessing professional qualifications with substantial experience in theaw and who has the requisite qualifications to have been appointed as aof the High Courtor a District Judge.In respect of the aforesaid, reliance was placed on the judgment in Rajeshand Mor Modern Cooperative Transport Society Ltd.We, however, find that those judgments would not apply in the present case. Theal interest was examined in the narrower sense as well as the wider sense and in the wider sense, it was held to include the direct or indirect interest of a person in relation to a financial undertaking. The situation arose when the person concerned was holding both the posts simultaneously, which is not so in the present case. (as noticed in para 52 above) It is also pointed out by the learned counsel appearing for theil Nadu that the ordersof appointment have been exclusively assailed right till the Supreme Court. It may be added that the Selection Committee was presided over by a retiredWe, thus, find no merit in the plea sought to be advanced assailing either the appointment or the suo moto tariff