Case: Vijayawada Municipal Council Vs. Andhra Pradesh State Electricity Board and Another

harmony with the clear meanings of the terms of section 5(3), read with section 6(2) (a) of the Act as indicated above. This is the salutary rule of construction resting upon the doctrine that a statute, like any other document, must be read as a whole to extract its meaning and intendment correctly.10. Learned Counsel for the appellant submits that the exclusion by section 10(2)(b)(ii i) of the amounts which, according to the books of the licensee, "are due from the consumers to the licensee for energy supplied by him before that date" (i.e. the date of vesting), from the ambit of deductions from compensation, necessarily implies that these amounts can be appropriated by the appellant Municipality. We are, quite unable to see how this inference follows from an exclusion from items of deduction from compensation. A deduction from an item of compensation may, if there was nothing else to furnish a clue as to its meaning, imply that it was not being compensated for because the party whose rights were acquired was retaining the item. But, an exclusion from an item of deduction from compensation itself could, according to its natural meaning, only indicate that this was being done because this was an item which is covered by the compensation provided for and to be paid.A close examination of section 10(2)(b)(iii) wilt show that it is meant for security deposits and arrears of interest due on them which are generally held in trust by the licensee so as to be ultimately returned to the consumers, if the dues of the consumers have been met without resorting to the amounts deposited. They are used for a deduction of dues where these have not been paid; We know that these deposits are required so as to cover claims from defaulting consumers in order to avoid the trouble of litigating to enforce them. If these deposits have not been made over by the licensee to the Government, they will be claimable by the depositors from the licensee. Hence, it seems fair to deduct them from any item of compensation as these deposits are not meant to be kept by the licensee. They do not constitute profits of the business or price for anything supplied or payment for services rendered or an asset out of which liabilities of the licensee may be met. If, however, there are any amounts shewn in the books o[ the licensee as due from the consumers of energy supplied before the date of vesting, they would become realisable by the Govt. Hence, the amounts for which deductions from items of compensation will have to be made is reduced by the amounts which are due from consumers to the licensee for energy supplied by the licensee before the date of vesting as they become the claims realisable by the successor-in-interest of the licensee. Therefore, the High Courts interpretation was, obviously, correct. This provision supports the case of the respondents rather than that of the former licensee Municipal body. It is very difficult to see how it supports the appellants case.11. It appears that no question was raised before the High Court as to the nature of the obligation incurred by the Municipal Council to pay the amount claimed apart from its right to appropriate the amount itself as part of the assets which had, it was asserted, not vested in the State Government. An attempt was, however, made before us to confuse it with the payment made by the Municipal Council itself to the Government for the bulk supply of electricity used, inter alia, for street lighting and other purposes by the Council itself. But, no question was raised in the pleadings to indicate that the plaintiffs claim included these past dues. We do find that the licensee had set up certain reasons for its inability to realise certain amounts from the consumers. We do not know what all these reasons precisely were or whether the licensee, was really unable to realise them for any of these reasons. But, ground No. 1 of the special leave petition shows that the Municipal Council had Rs. 9 lakhs with it in deposit for the recovery of the claims not realised from which it proposed to deduct the amounts claimable towards dues and to. appropriate them itself. The ground runs as follows:"In the instant; case the learned trial judge found that there was a deposit of 3 lakhs of rupees with the Vijayawada Municipality and the Vijayawada Municipality by virtue of section 10(2)(b)( iii) is certainly entitled to adjust and by virtue of section 10(2)(b)(iii) of the Act 15 of 1964, the Government can deduct that security from out of compensation less the amount due to the licensee from its consumers upto the vesting date."12. We may also mention that it was not argued on behalf of the Municipal Council that what was vested in the Government was only the right to realise the claims itself and not an amount of money which the Municipal Council had actually realised or could have realised if it took steps to make realisations. On the other hand, ground No. 1 of the grounds of appeal quoted above, shows that the case of the Municipal Council was simply that it is entitled to deduct amounts claimed from whatever may be the amounts in deposit because. the claims against the consumers had vested in the Municipal Council and not in the Government. We think that legal questions of interpretation of the Act, to which the learned Counsel for the parties rightly confined their arguments, apart from some attempts to raise questions outside the pleadings which could not succeed, were rightly answered by the High Court when it held that the relevant provisions, if correctly interpreted, meant that the claims for dues on electricity supplied at enhanced rates, the validity of which had been unsuccessfully challenged by some consumers in certain other proceedings initiated before filing of the suit now before us, had vested in the State Government.13.

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

Explanation:
0[ds]It appears that no question was raised before the High Court as to the nature of the obligation incurred by the Municipal Council to pay the amount claimed apart from its right to appropriate the amount itself as part of the assets which had, it was asserted, not vested in the State Government. An attempt was, however, made before us to confuse it with the payment made by the Municipal Council itself to the Government for the bulk supply of electricity used, inter alia, for street lighting and other purposes by the Council itself. But, no question was raised in the pleadings to indicate that the plaintiffs claim included these past dues. We do find that the licensee had set up certain reasons for its inability to realise certain amounts from the consumers. We do not know what all these reasons precisely were or whether the licensee, was really unable to realise them for any of these reasons. But, ground No. 1 of the special leave petition shows that the Municipal Council had Rs. 9 lakhs with it in deposit for the recovery of the claims not realised from which it proposed to deduct the amounts claimable towards dues and to. appropriate them itself. The ground runs as follows:"In the instant; case the learned trial judge found that there was a deposit of 3 lakhs of rupees with the Vijayawada Municipality and the Vijayawada Municipality by virtue of section 10(2)(b)( iii) is certainly entitled to adjust and by virtue of section 10(2)(b)(iii) of the Act 15 of 1964, the Government can deduct that security from out of compensation less the amount due to the licensee from its consumers upto the vestingmay also mention that it was not argued on behalf of the Municipal Council that what was vested in the Government was only the right to realise the claims itself and not an amount of money which the Municipal Council had actually realised or could have realised if it took steps to make realisations. On the other hand, ground No. 1 of the grounds of appeal quoted above, shows that the case of the Municipal Council was simply that it is entitled to deduct amounts claimed from whatever may be the amounts in deposit because. the claims against the consumers had vested in the Municipal Council and not in the Government. We think that legal questions of interpretation of the Act, to which the learned Counsel for the parties rightly confined their arguments, apart from some attempts to raise questions outside the pleadings which could not succeed, were rightly answered by the High Court when it held that the relevant provisions, if correctly interpreted, meant that the claims for dues on electricity supplied at enhanced rates, the validity of which had been unsuccessfully challenged by some consumers in certain other proceedings initiated before filing of the suit now before us, had vested in the Stateappears that no question was raised before the High Court as to the nature of the obligation incurred by the Municipal Council to pay the amount claimed apart from its right to appropriate the amount itself as part of the assets which had, it was asserted, not vested in the State Government. An attempt was, however, made before us to confuse it with the payment made by the Municipal Council itself to the Government for the bulk supply of electricity used, inter alia, for street lighting and other purposes by the Council itself. But, no question was raised in the pleadings to indicate that the plaintiffs claim included these past dues. We do find that the licensee had set up certain reasons for its inability to realise certain amounts from the consumers. We do not know what all these reasons precisely were or whether the licensee, was really unable to realise them for any of these reasons. But, ground No. 1 of the special leave petition shows that the Municipal Council had Rs. 9 lakhs with it in deposit for the recovery of the claims not realised from which it proposed to deduct the amounts claimable towards dues and to. appropriate them itself. The ground runs as follows:"In the instant; case the learned trial judge found that there was a deposit of 3 lakhs of rupees with the Vijayawada Municipality and the Vijayawada Municipality by virtue of section 10(2)(b)( iii) is certainly entitled to adjust and by virtue of section 10(2)(b)(iii) of the Act 15 of 1964, the Government can deduct that security from out of compensation less the amount due to the licensee from its consumers upto the vestingy also mention that it was not argued on behalf of the Municipal Council that what was vested in the Government was only the right to realise the claims itself and not an amount of money which the Municipal Council had actually realised or could have realised if it took steps to make realisations. On the other hand, ground No. 1 of the grounds of appeal quoted above, shows that the case of the Municipal Council was simply that it is entitled to deduct amounts claimed from whatever may be the amounts in deposit because. the claims against the consumers had vested in the Municipal Council and not in the Government. We think that legal questions of interpretation of the Act, to which the learned Counsel for the parties rightly confined their arguments, apart from some attempts to raise questions outside the pleadings which could not succeed, were rightly answered by the High Court when it held that the relevant provisions, if correctly interpreted, meant that the claims for dues on electricity supplied at enhanced rates, the validity of which had been unsuccessfully challenged by some consumers in certain other proceedings initiated before filing of the suit now before us, had vested in the State