Case: Bhusawal Borough Municipality Vs. Amalgamated Electricity Company Limited &amp; Another

1. This judgment will also govern C. A. No. 48 of 1961. Both the appeals are by special leave from the judgment of the Bombay High Court in second appeal disposing of two appeals which arise out of two separate suits instituted by the appellant, the Borough Municipality of Bhusawal, against the Bhusawal Electricity Co. Ltd., respondent No. 1 before us, to which suits the State of Bombay was later added as a defendant.2. In each of the two suits the appellant had claimed refund of two sums of money paid by them to the respondent No. 1 under protest as electricity charges to which the respondent No. 1 claimed to be entitled by virtue of an order made by the Government of Bombay under the Bombay Electricity Supply (Licensed Undertakings War Costs) Order, 1944 (herein referred as Surcharge Order). The appellant succeeded in both the suits in the trial Court as well as the District Court. In second appeal, however, the High Court set aside the decrees passed by the trial Court and dismissed the two suits. While doing so, the High Court admitted on record certain documents by way of additional evidence and the only contentions raised before us by Mr. G. S. Pathak for the appellant are firstly that the High Court is incompetent in second appeal to admit additional evidence on record inasmuch as O. XLI, R. 27, C. P. C. is inapplicable to a second appeal. Secondly, the provisions of O. XLI, R. 27 cannot be used to fill up the lacuna in the evidence left by a party.. We may incidentally mention that when the High Court, by its order, dated April 30, 1958, decided to admit additional evidence on record, no objection was raised on behalf of the appellant before us.

Court's reasoning:
It is obvious from this communication that both the parties, that is, the appellant as well as the respondent No. 1 had stated their respective cases before the Government. There was no occasion for them to do so unless they were both purporting to act under the second proviso to Cl. 5 of the Order of 1944. After consideration of the cases of both the parties the Government has stated in the aforesaid communication that it had decided that the municipality should pay to the Electricity Company surcharge at the rate of 15 per cent fixed in a certain Government Order unless the Company raised its rate for the supply of energy for street lighting to more than four annas per unit. There is no reason to think that what is on the face of it a decision is nothing but an opinion because if there were anything in the correspondence to which a reference is made in that letter as well as in the endorsement at the bottom which went to show that the appellant did not purport to refer any dispute to the Government, it was for the appellant to produce that correspondence. Its omission to do so must be construed against it. Then Mr. Pathak said that under the Surcharge Order itself the dispute had to be referred by both the parties and not by only one of them. This contention is, however, untenable in view of the clear language of the proviso which says: "in the event of dispute by any party interested the decision of the Provincial Government. shall be final. There is, therefore, no substance in the contention. In our opinion the trial Court and the District Court had wholly misconstrued this document which is not merely of evidentiary value but is one upon which the claim of the respondent No. 1 for the surcharge is based. Misconstruction of such document would thus be an error of law and the High Court in second appeal would be entitled to correct it. This is what in fact has been done.