Case: Hitech Eletrothermics and Hydropower Limited Vs. State of Kerala &amp; Others

2. The Government of Kerala in the Industry department, issued GO(MS) dated 21.5.90, indicating therein that the power connection will be given on completion of any project irrespective of whether a general power cut is in force or not. It had also been stated therein that the new units commencing industrial production will be exempted from power cut for a period of 5 years from the date of commercial production. In February 1992, the government came out with industrial policy offering concessional rate of tariff and electricity duty to new industries for a period of five years from the date of commercial production, if the production commences between 1.1.92 and 31.12.96. The Kerala State Electricity Board adopted the aforesaid policy decision for implementation and in its order dated 27th of March, 1992, reiterated that the concessional tariff as indicated in industrial policy resolution, would be available if the commercial production is made between 1.1.92 and 31.12.96. The appellant industry was issued the registration certificate by the District Industries Centre, on 27.12.1993. In April, 1994, government issued another GO(MS), confirming that the industries registered prior to 31.12.1993 will continue to enjoy the tariff concession and exemption from payment of electricity duty. The State Electricity Board issued a letter on 7.11.1995 to the appellant industry, allocating power in their favour. In its letter dated 13th March, 1996, the said Kerala State Electricity Board confirmed that the appellant will be entitled to the tariff concession, as per the policy resolution of the government. The appellant is stated to have invested a huge sum of money in setting up factory for production of ferro alloys. On 24th of April, 1996, the Secretary to the Government of Kerala confirmed that the appellant will be eligible for concessional tariff, if commercial production starts before 31.12.1996. In June, 1996, the appellant had informed the Board that it is going ahead with the implementation of the project of manufacturing ferro alloys and requested for issuance of demand note to enable the appellant to pay the charges. On 23rd of August, 1986, the State Electricity Board informed the appellant about the estimated amount on the electric connection and further stated that the demand note will be intimated to the appellant at the earliest. On 3rd of August, 1986, news items was published in Delhis Times of India, showing the Kerala Government Policy in welcoming the investment in Kerala. Between August and October, 1996, the appellant intimated several authorities of the government as well as the Board, requesting them to provide power for manufacture of ferro alloys in appellants factory, which was otherwise ready for commissioning. But it is only in August, 1997, the Board issued the order, intimating the supply of power to the appellants factory to the extent of 15 MVA at 110 KV. The Board then took about one year in connecting the sub-station in the appellants factory for supply of power. Ultimately, the Board granted power to the appellants company on 22nd October, 1998. In the first week of November, 1998 the appellant got the Bill from the Board at the regular rate without the benefit of the concessional tariff as indicated in the Industrial Policy of the Government and also adopted by the Board. The appellant, therefore, approached the High Court and the High Court by an interim order directed that the appellant would be demanded the tariff on the basis of the prevalent rate prior to 1.1.1992. But the power connection had been cut off on account of non payment of the electricity charges. The High Court then passed an order that on payment of Rs. 50 lacs by the appellant, the electric connection would be given by its order dated 15.12.1999. The Board filed an application for modification of the aforesaid order and finally on 6.4.2000, the High Court of Kerala modified earlier order, denying the benefit of concessional tariff. The appeal was carried against the order to the division Bench, wherein the division Bench directed the Single Judge to dispose of the pending Writ Petition of the appellant and till the disposal of the Writ Petition, stayed the order and directed that the appellant would pay the electricity charges at pre 1.1.1992 rate by its order dated 23.5.2000. The Writ Petition of the appellant was dismissed by the learned Single Judge by order dated 21.12.2000 against which the appellant carried the appeal to the Division Bench and the Division Bench by the impugned order dated 6.4.2001 having dismissed the appeal, the present appeal by grant of special leave has been filed.

Court's reasoning:
5. On perusal of the industrial policy of the government, unequivocally indicting that concessional tariff rate would be given as well as the order of the Electricity Board adopting the same, it can be safely held that such concession could be availed of by the industrial units for a period of five years from the date, commercial production which start such production in between 1.1.92 and 31.12.1996. In this context the stand of the Board as well as the State Government cannot be held to be devoid of any substance when admittedly the commercial production of the appellants unit did not start till 31.12.96. But the question for consideration is when the government has itself come forward alluring industrial units to set up their industries and when under the provisions of the Electricity Act, every consumer has the right to get the supply of power and in the case in hand, when power allocation has been made in favour of the appellant as early as in 1995, and yet the same power could not be supplied for such non supply of power, the commercial production could not start by 31.12.96, would it at all be equitable to deny the relief to the appellant by giving a literal interpretation to the incentive scheme of the government as adopted by the Board? Our answer to this question must be in the negative. There are several documents on record, which were produced before us to indicate that the appellant has been communicating with the Board, seeking power connection at an early date so that it would be able to start commercial production by 31.12.96. In making such communication, the appellant has been bringing it to the notice of the Board but for supply, the appellant has made all other arrangements to set the production, but yet there has been inaction on the part of the Board in providing power to the appellant. Mr. Rohtagi, appearing for the Board no doubt brought to our notice a letter from the appellant to the Board and contended that it could not have been possible for the appellant to start production by 31.12.96 but we are unable to accept this submission nor are we making deeper probe into the matter. Suffice it to say that the appellant has been denied power supply by the Board in appropriate time, which has prevented the appellant from starting the commercial production by 31.12.96. This being the position, and having regard to the gamut of the circumstances, starting from the government policy resolution and culminating in setting up of the factory by the appellant in Kerala and commensurate the production of ferro alloys, though not by 31.12.96,