Case: JHARKHAND STATE ELECTRICITY BOARD AND OTHERS Vs. M/S RAMKRISHNA FORGING LIMITED

of the supply of energy (4000KVA w.e.f. 12.07.2007). The consumer may determine this agreement with effect from any date after the said period on giving to the Board not less than twelve calendar months previous notice (this has charged not less than 6 Month Notice vide Secretary, Jharkhand State Electricity Board Notification No.5058 dated 20.08.2002) in writing in that behalf and upon the expiration of the period of such notice. This agreement shall cease and determine without prejudice to any right which then have accrued to the Board herewith provided always that the consumers may at any time with the previous consent of the Board transfer and assign this agreement to any other person and upon subscription of such transfer, this agreement shall be binding on the transferee and Board and take effect in all respects as if transferee had originally been party in place of the consumer who shall henceforth be discharged from all liabilities under or in respect thereof. Hence your request for reduction cannot be done as per agreement. 10. Heard learned Counsel for the parties and have carefully gone through the record. 11. From perusal of the communication dated 08.11.2007, it is clear that the application of the respondent for reduction of load has been rejected in terms of Clause 9(B) of the agreement, treating the date of commencement of the agreement to be 7/12.07.2007 and only by considering the provision of determination of the agreement, which could not have been without giving notice of less than 12 calendar months. It is clear that the said communication/order does not consider the provisions of the Regulations of 2005 with regard to reduction of load, but only treats the application for reduction of load to be an application for determination of the agreement. 12. Chapter 9 of the Regulations of 2005 deals with the enhancement and reduction of contract demand/sanctioned load. Regulation 9.1 deals with enhancement of contract demand/sanctioned load, whereas Regulation 9.2 deals with the reduction of contract demand/sanctioned load. 13. Just as the consumer has the liberty of getting its load enhanced under Regulation 9.1, the reduction of contract demand/sanctioned load can also be prayed for and decided in terms of Regulation 9.2. The proviso to Regulation 9.2.1, no doubt, provides that no reduction of load shall be allowed before expiry of the initial period of agreement, which is three years in the present case. The question would be whether the initial agreement is to be considered for such purpose, or the subsequent agreements. 14. Regulation 9.2.6 of the Regulations of 2005 provides for execution of a supplementary agreement for reduction of contract demand/sanctioned load of the consumer. Similarly, for enhancement of load also, even if a fresh agreement may have been executed between the parties, the same could be treated as nothing but a supplementary agreement of the initial agreement by which the electricity connection was granted for a particular load. Clause 2(l) of the Regulations also defines contract demand to be demand mutually agreed in the agreement or agreed through other written communication, meaning thereby that for variation of the contract demand execution of a fresh agreement is not essential and the same can be done otherwise also by mere written communication. 15. It is noteworthy that the Jharkhand State Electricity Board (the Board) is a monopoly supplier of electricity which has laid down its own terms and conditions, regarding which the consumer has no say or choice but to sign on the dotted lines, if it wants of get electricity load varied for running its industry. The Board is an instrumentality of the State. It has to be fair and reasonable. If the Regulations provide for contract load to be varied even through a written communication, then in our considered view, in all fairness, though fresh agreements may have been executed at the stage of enhancement of load of the same electricity connection, the same cannot be treated as anything but an extension/amendment or modification of the initial agreement granting the electricity connection, which in the present case would be the agreement dated 14.04.2004. On the dictates of the Board, the consumer may have been required to sign fresh agreements for each enhancement of load, but the enhancement being for the same electricity connection which still continues, it would merely be amendment of the initial agreement. This would also be in consonance with the provisions of the Regulations of 2005, which have to be liberally interpreted in favour of the consumer. 16. Reverting to the order dated 08.11.2007, which was impugned in the writ petition, we are of the opinion that the Board has gone wrong in treating the application dated 20.09.2007 of the respondent for reduction of load to be that for determination of the agreement under Clause 9B of the agreement, which application, in fact, ought to have been considered under Regulation 9.2 of the Regulations of 2005. Further, we are unable to accept the submission of the learned Counsel for the appellant that the application of the respondent for reduction of load was within the period of three years, because as we have discussed hereinabove, the agreement to be considered in the present case is the initial agreement dated 14.04.2004 and not the subsequent agreement dated 07.07.2007. 17. The judgments of this Court rendered in Bihar State Electricity Board, Patna and Others v. M/s. Green Rubber Industries and Others, (1990) 1 SCC 731 , Orissa State Electricity Board v. Orissa Tiles Limited, (1993) Supp. 3 SCC 481, Andhra Steel Corporation Ltd. and Others v. Andhra Pradesh State Electricity Board and Others, (1991) 3 SCC 263 and Jharkhand State Electricity Board & Others v Laxmi Business and Cement Company Private Limited and Another, (2014) 5 SCC 236 as have been relied upon by learned counsel for the parties, are distinguishable on facts, in as much as they all relate to minimum guarantee charge, and that too under the old Electricity Act of 1910, as is so in the first three cases.

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

Explanation:
1[ds]5. It is noteworthy that after the initial agreement dated 14.04.2004, which came into effect from 16.04.2004 whereby the contract demand of 325 KVA was allowed in favour of the respondent, the Jharkhand State Electricity Regulatory Commission (for short, the Commission) in exercise of power conferred by Section 181(2)(x) read with Section 50 of the Electricity Act, 2003, framed the Jharkhand State Electricity Regulatory Commission (Electricity Supply Code) Regulations, 2005, which came into effect from 28.07.2005.11. From perusal of the communication dated 08.11.2007, it is clear that the application of the respondent for reduction of load has been rejected in terms of Clause 9(B) of the agreement, treating the date of commencement of the agreement to be 7/12.07.2007 and only by considering the provision of determination of the agreement, which could not have been without giving notice of less than 12 calendar months. It is clear that the said communication/order does not consider the provisions of the Regulations of 2005 with regard to reduction of load, but only treats the application for reduction of load to be an application for determination of the agreement.12. Chapter 9 of the Regulations of 2005 deals with the enhancement and reduction of contract demand/sanctioned load. Regulation 9.1 deals with enhancement of contract demand/sanctioned load, whereas Regulation 9.2 deals with the reduction of contract demand/sanctioned load.13. Just as the consumer has the liberty of getting its load enhanced under Regulation 9.1, the reduction of contract demand/sanctioned load can also be prayed for and decided in terms of Regulation 9.2. The proviso to Regulation 9.2.1, no doubt, provides that no reduction of load shall be allowed before expiry of the initial period of agreement, which is three years in the present case.15. It is noteworthy that the Jharkhand State Electricity Board (the Board) is a monopoly supplier of electricity which has laid down its own terms and conditions, regarding which the consumer has no say or choice but to sign on the dotted lines, if it wants of get electricity load varied for running its industry. The Board is an instrumentality of the State. It has to be fair and reasonable. If the Regulations provide for contract load to be varied even through a written communication, then in our considered view, in all fairness, though fresh agreements may have been executed at the stage of enhancement of load of the same electricity connection, the same cannot be treated as anything but an extension/amendment or modification of the initial agreement granting the electricity connection, which in the present case would be the agreement dated 14.04.2004. On the dictates of the Board, the consumer may have been required to sign fresh agreements for each enhancement of load, but the enhancement being for the same electricity connection which still continues, it would merely be amendment of the initial agreement. This would also be in consonance with the provisions of the Regulations of 2005, which have to be liberally interpreted in favour of the consumer.16. Reverting to the order dated 08.11.2007, which was impugned in the writ petition, we are of the opinion that the Board has gone wrong in treating the application dated 20.09.2007 of the respondent for reduction of load to be that for determination of the agreement under Clause 9B of the agreement, which application, in fact, ought to have been considered under Regulation 9.2 of the Regulations of 2005. Further, we are unable to accept the submission of the learned Counsel for the appellant that the application of the respondent for reduction of load was within the period of three years, because as we have discussed hereinabove, the agreement to be considered in the present case is the initial agreement dated 14.04.2004 and not the subsequent agreement dated 07.07.2007.17. The judgments of this Court rendered in Bihar State Electricity Board, Patna and Others v. M/s. Green Rubber Industries and Others, (1990) 1 SCC 731 ,  Orissa State Electricity Board v. Orissa Tiles Limited, (1993) Supp. 3 SCC 481, Andhra Steel Corporation Ltd. and Others v. Andhra Pradesh State Electricity Board and Others, (1991) 3 SCC 263    and Jharkhand State Electricity Board & Others v Laxmi Business and Cement Company Private Limited and Another, (2014) 5 SCC 236    as have been relied upon by learned counsel for the parties, are distinguishable on facts, in as much as they all relate to minimum guarantee charge, and that too under the old Electricity Act of 1910, as is so in the first three cases.