Case: U.P. State Electricity Board Vs. Radhey Mohan Verma

1. Leave granted. 2. The appeal is directed against the order of the High Court of Allahabad in CMWP No. 12217 of 1983. The respondent was admittedly a suspended employee of Mirzapur Electricity Supply Co. (for short Company) against whom disciplinary pro ceedings were pending. On 1-9-1975, under Section 4(1) of the Indian Electricity Act, 1910, for short the Act, the licence of the Company was revoked under a memorandum of understanding and an agreement reached with the appellant. One of the terms thereof was that the appellant will not take any employee against whom disciplinary proceedings were pending. The appellant took over the Company. Eight years thereafter, the respondent filed the writ petition placing reliance on Section 6-A of the Act as amended by an U.P. Act and contended that the respondent was entitled to be taken into service, but was unlawfully prevented from discharging his duties. The High Court accepted the contention and issued the mandamus as prayed for with consequential reliefs. 3. The only question that arises in this case is whether the respondent is entitled to the relief under Section 6- A(3) of the Act. Sub-section (2) of Section 6-A reads thus "6-A. (2) Notwithstanding anything contained in Sections 4, 4-A, 5 and 6, the licence of every undertaking, unless revoked before the commencement of the Indian Electricity (Uttar Pradesh Second Amendment) Ordinance, 1975, shall stand revoked with effect from the appointed day." * Sub-section (3) of Section 6-A says that on revocation of the licence under sub- section (2) the following provisions shall have effect, namely, - (a) every undertaking the licence in respect of which stands revoked shall by virtue of this section stand and be deemed to have stood transferred to and vest and be deemed to have vested in the State Electricity Board, hereinafter in this section called the Board free from any debt, mortgage or similar obligation of the licence attaching to the undertaking:Provided that any such debt, mortgage or similar obligation shall attach to the amount payable for the undertaking as mentioned in clause (h); (b) the rights, powers, authorities, duties and obligation s of the licensee under his licence shall stand transferred to the Board and the licence shall cease to have further operation; (c) the licensee shall deliver forthwith the undertaking to the Board or to such officer as the Board may appoint in that behalf, and if any property or asset, book of account, register or other document forming part of the undertaking be in the possession, custody or control of any person other than a licensee, such person shall also deliver the same to the Board or to such officer as aforesaid; (f)the owner of every undertaking shall within sixty days from the appointed day or within such further time as the Board may allow in that behalf, furnish to the Board or to such officer as the Board may specify, complete particulars of all liabilities and obligations incurred on the security of the undertaking and subsisting on the appointed day, and also of all agreement and other instruments pertaining to the undertaking (including agreement, decrees, awards, standing orders and other instruments relating to leave, pension, gratuity, provident fund and other terms of service of any person employed in the undertaking) in force immediately before the appointed day and the Board shall afford him all reasonable facilities for the same; (g) the following provisions shall govern the working in the undertaking immediately before tire appointed day:- (i) Every person who has been immediately before the appointed day in the employment of the licensee shall become on and from the appointed day an employee of the Board on the same terms and conditions and with the same rights as to pension, gratuity and other matters as would have been admissible to him if the undertaking had not been transferred to and vested in the Board and continue to do so unless and until his employment under the Board is terminated or until his remuneration or other terms and conditions of employment are duly altered by the Board:".A combined reading of these provisions clearly indicates that notwithstanding anything contained in Sections 4, 4-A, 5 and 6 the licence of every undertaking, unless revoked before the commencement of the Indian Electricity (Uttar Pradesh Second Amendment) Ordinance, 1975 shall stand revoked with effect from the appointed day. On revocation of the licence under sub-section (2), the consequences enumerated in clauses (a) to (g) of Section 6-A(3) would flow (sic follow). The owner of every undertaking shall furnish to the Board or to its authorised officer complete particulars of all liabilities and pre-existing obligations.As seen, clause (g) postulates that every person who has been immediately before the appointed day, in the appointment of the licensee (Mirzapur Electricity Supply Co.) shall become or, and from the appointed date employee of the Board on the same terms and conditions.... IL Is seen that admittedly the licence of the Company was revoked on 1- 9-1975. The Ordinance had come into force on 2 7-11-1975. Much prior to the Ordinance had come into force, licence of the Company stood revoked on 1-9-1975. The consequence is that Section 6-A(2) became inapplicable. Once subsection (2) becomes inapplicable and it riot being a statutory revocation, operation of subsection (3) is not extended; consequently, the respondent was not a deemed employee by operation of law. Unfortunately, the High Court had riot considered this statutory operation. Therefore, the High Court has committed manifest error of law in allowing the writ petition and issuing mandamus and the consequential benefits sought for by the respondent. It is open to the respondent to pursue the remedy other than the relief sought for under Section 6-A(3).

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

Explanation:
1[ds]On revocation of the licence under(2), the consequences enumerated in clauses (a) to (g) of Sectionwould flow (sic follow). The owner of every undertaking shall furnish to the Board or to its authorised officer complete particulars of all liabilities andobligations.As seen, clause (g) postulates that every person who has been immediately before the appointed day, in the appointment of the licensee (Mirzapur Electricity Supply Co.) shall become or, and from the appointed date employee of the Board on the same terms and conditions.... IL Is seen that admittedly the licence of the Company was revoked on 1The Ordinance had come into force on 2Much prior to the Ordinance had come into force, licence of the Company stood revoked onThe consequence is that Sectionbecame inapplicable. Once subsection (2) becomes inapplicable and it riot being a statutory revocation, operation of subsection (3) is not extended; consequently, the respondent was not a deemed employee by operation of law. Unfortunately, the High Court had riot considered this statutory operation. Therefore, the High Court has committed manifest error of law in allowing the writ petition and issuing mandamus and the consequential benefits sought for by the respondent. It is open to the respondent to pursue the remedy other than the relief sought for under Section