Case: The State Of Himachal Pradesh Chief Secretary Vs. M/S. Gujarat Ambuja Cements Ltd. Senior Vice President

2. The core facts that will be necessary to be noticed are as follows:The respondentwrit petitioner no.1M/s Gujarat Ambuja Cements Ltd. set up an industrial unit for manufacture of portland cement in Darlaghat, District Solan, Himachal Pradesh. The approval of the State Government for establishment of the said unit was accorded on 23rd January, 1990. The cement manufacturing unit of the respondentswrit petitioners was accorded the "prestigious status" to avail of incentives in accordance with the Revised Rules Regarding Grant of Incentive to Industrial Units in Himachal Pradesh, 1991 (hereinafter referred to as "Incentive Rules"), as amended from time to time. To be entitled to the incentives under the aforesaid Incentive Rules the respondentswrit petitioners had to and infact had satisfied the stipulated requirement of capital investment at least of Rs. 50 crores and guaranteed employment of minimum of 200 persons on permanent/regular basis who are bona fide residents of Himachal Pradesh. The cement manufacturing unit of the respondentswrit petitioners commenced commercial production on 26th September, 1995. At that point of time, under the Incentive Rules, the respondentswrit petitioners were entitled, inter alia, to a power tariff freeze for a period of four years from the date of commencement of commercial production. Specifically, the tariff freeze was to be worked out by granting to the respondentswrit petitioners reimbursement of any increase in industrial power tariff after the date of commencement of commercial production for a period of four years. The formula for calculating the increase in power tariff to be reimbursed was the rate of electricity per unit billed minus the rate of electricity as on date of commercial production.3. On 28th January, 1994 (before commencement of commercial production) the respondentwrit petitioner was informed by the Chief Engineer (Commercial) of the Himachal Pradesh State Electricity Board (hereinafter referred to as "the Board") that the power required by its cement unit (i.e. 21000 KW) can be made available subject to certain terms and conditions mentioned in the aforesaid letter (dated 28th January, 1994). By the said letter the respondentwrit petitioner was informed that Peak Load hours restrictions will be imposed between 6 p.m. to 9 p.m. for the summer months (April to October) and 5 p.m. to 9 p.m. for the winter months (November to March). Thereafter, it appears that in exercise of powers under Sections 49 and 59 of the Electricity (Supply) Act, 1948, the Board brought into force a schedule of electricity tariff known as "Himachal Pradesh State Electricity Board Schedule of Electricity Tariff, 1994 w.e.f. 31st May, 1994. Clause (m) of the said Schedule which deals with "Peak Load Hour Supply" is asPEAK LOAD HOUR SUPLYSupplies under Schedule Agriculture pumping (A.P.), Small Industrial Power (S.P), Medium Industrial Power Supply (Schedule M.S.), Large Industrial Power Supply for Mini Steel Mills etc. and for others (Schedule2) and Water and Irrigation pumping (Schedule W.I.P.) shall not be available during the peak load hours as may be notified by the Board from time to time. However, in the case of continuous process industries, or where a particular industrial consumer wants to run his industry during the peak load hours for any special reasons, a separate agreement shall have to be entered into with the Board.On 23rd August,1995, the Chief Engineer (Commercial) of the Board issued an Office Order according sanction in favour of the respondentwrit petitioner for running of its cement manufacturing unit during the evening peak load hours subject to the conditions enumerated in the said Office Order (dated 23rd August, 1995)5. After the respondentwrit petitioners unit went into commercial production, on 30th October, 1995 the Board issued another Notification in exercise of power under Sections 49 and 59 of the Electricity (Supply) Act, 1948 publishing another schedule of tariff and general conditions for supply of electricity to various categories of consumers in Himachal Pradesh with effect from 1st November, 1995. The aforesaid Notification (dated 30th October, 1995) dealing with the "Peak Load Hour Supply" which is relevant to the present case is asK LOAD HOUR SUPLYSupplies under Schedule Agriculture pumping (A.P.), Small Industrial Power (S.P), Medium Industrial Power Supply (Schedule M.S.), Large Industrial Power Supply for Mini Steel Mills etc. and for others (Schedule2) and Water and Irrigation pumping (Schedule W.I.P.) shall not be available during the peak load hours. The duration of peak load hours in summer and winter shall be as under:i) Summer(April to Oct) 6 PM to 9 PMii) Winter(Nov. to March) 5.30PM TO 8.30PMHowever, in the case of continuous process industries, or where a particular industrial consumer wants to run his industry during the peak load hours for any special reasons, a separate agreement shall have to be entered into with the Board. Such consumers shall be billed for additional charge as specified in the relevant schedules of tariff"In part II of the aforesaid Notification (dated 30th October, 1995) under the "Schedule of Tariffs" the provision with regard to "Peak Load Exemption Charge (PLEC)" were stated in the following terms:"5. Peak Load Exemption Charge (PLEC)The consumers availing special dispensation or exemption during evening peak load hours stipulated underGeneral of this notification shall be billed at extra charges of Rs. 1/per unit over and above the normal tariff. For this purpose, time of the day (T.O.D.) meters shall be provided. Till such time, these meters are provided, the monthly peak load exemption charges shall be Rs. 70/per KVA of exemption/relaxation sought.After the commencement of the commercial production by the cement manufacturing unit of the respondentwrit petitioner, in the year 1996, the Incentive Rules were revised and the incentive of power tariff freeze, though continued, underwent certain modifications. While the said notification may not be strictly relevant for the present what was clearly provided in the revised Incentive Rules is that the power tariff to be reimbursed will not include any other charge/surcharge/peak load charge/fuel adjustment charge etc. as may be levied by the competent authority. It may be noticed, at this stage, that the aforesaid revised Incentive Rules were made applicable to new industrial units which fact is borne out from clause 1.2(a) of the Revised Incentive Rules (which came into force with effect from 1st October, 1996) dealing with eligibility which is in the followingEligibility(a) New Industrial units as defined in these rules, shall be eligible for grant of incentives as provided for under these rules. Units which have commenced commercial production before the appointed day will continue to be governed for grant of all incentives under the Revised Rules regarding Grant of Incentives to Industrial Units inas amended from time to time, unless otherwise provided in these rules. Such industrial units will be eligible for incentives, concessions and facilities only if they meet the minimum employment criteria as laid down under these rules."The definition of New Industrial Unit" contained in clause 2(s) of the aforesaid Revised Incentive Rules (of 1996) may also be extracted below for convenience."2(s) "New industrial unit" means a registered SSSBE, tiny, small, ancillary, medium or large scale industrial unit as defined in clauses 2(x) and 2(za) of these rules, located within the State of Himachal Pradesh which commences commercial production on or after the appointed day and includes any existing unit which is eligible to get fresh registration as per the guidelines provided by the Development Commissioner, Small Scale Industries, Govt. of India, from time to"appointed day" was notified as 1st day of October, 1996.7. It is in the above backdrop of the core facts that the issue arising in the case, namely, the entitlement of the respondentwrit petitioner to reimbursement of the PLEC will have to be decided.

Court's reasoning:
10. We have considered the submissions advanced on behalf of the rival parties. The sequence of facts recited in the preceding paragraphs makes it abundantly clear that what was provided for by way of an incentive under the Incentive Rules framed under the Industrial Policy of the State is power tariff freeze for a period of four years from the date of commercial production by reimbursement of the amount of increase in tariff during the aforesaid period of four years. It cannot be lost sight of that even before the cement manufacturing unit had gone into the commercial production, by letter dated 28th January, 1994 the respondentswrit petitioners were clearly informed that the State is going through a phase of acute shortage of power affecting peak load hour supply. The schedule of tariff published by the Board by Notification dated 31st May, 1994 made an unequivocal reiteration on the part of the Board that power supply during peak load hours, as may be notified by the Board from time to time, shall not be available and in case of continuous process and like industries electricity supply during peak load hours would be provided only for special reasons and by means of a separate agreement to be entered into with the Board. In fact, an Office order dated 23rd August, 1995 was passed by the Chief Engineer (Commercial) of the Board according sanction for supply of electricity during peak load hours to the respondentswrit petitioners unit subject to the terms and conditions mentioned therein. Finally by notification dated 30th October, 1995 another schedule of tariff was published levying peak load exemption charge (PLEC) at the rate of Rs. 1/per unit over and above the normal tariff. Power during peak hours was to be provided as a special dispensation for industries which could not afford to remain without continuous power/electricity. The mode of making available the power was also different inasmuch as the Notification dated 30th October, 1995 contemplated installation of separate meters for the said purpose. As already noticed, in the counter affidavit filed by the Board before this Court it has been stated that power, to make electricity supply available during the peak load hours, was obtained from other sources. The normal supply of electricity for which there was a normal tariff was infact discontinued during the peak hours. Normal supply of electricity therefore has to be distinguished from the supply of electricity during peak load hours which was an act of special dispensation and upon payment of PLEC which change, in the facts noted, would assume the character of a surcharge. The question is not one whether PLEC is a part of the tariff having regard to the dictionary and the natural meaning of the word tariff. The question is how the word/expression tariff is to be understood in the context in which such meaning is required to be determined. The meaning that has to be assigned must, naturally, be contextual having regard to what was promised i.e. tariff freeze. The nature of the charge imposed i.e. PLEC has to be understood keeping in mind that supply of power during the peak load hours was an exception; a special dispensation involving a special arrangement i.e. procurement from other sources.11. If the matter is to be viewed from the aforesaid perspective we have to arrive at the conclusion that the incentive provided under the Incentive Rules would not include PLEC and the respondentswrit petitioners would not be entitled to reimbursement towards the PLEC paid for availing power supply by way of special dispensation in force. The fact that in the revised Incentive Rules of 1996 PLEC has been specifically excluded from the scope of reimbursement made on account of power tariff will not fundamentally alter the situation. The said declaration can be reasonably understood to be clarificatory and intended to clear all doubts, queries and issues raised on the aforesaid score.