Case: Patna Electric Supply Company Limited Vs. Patna Municipal Corporation &amp; Others

2. The petitioner is a company incorporated under the Indian Companies Act. It holds a licence to supply electricity within the limits of Patna Municipal Corporation. For the purpose of transmission of electric energy, it had to place overhead lines. In that connection it erected several electric poles over the lands belonging to the Municipal Corporation. On December 8, 1967, the Administrator of the Municipal Corporation demanded from thefee for the lands occupied by it for fixing electric poles in the Corporation area. In that connection it called upon the petitioner to intimate the total number of electric poles erected within the limits of the Corporation and also the area occupied by each pole. The petitioner protested against that demand as per its letter dated December 26, 1967. It denied any liability to pay rent in respect of the poles fixed. On the same day namely December 26, 1967, the Administrator issued an order imposing a ground rent of Rs. 1/50 paise per pole per month and forwarded a bill for Rs. 51,300/in respect of the rent alleged to be due for the month of December 1967. Therein it held out a threat that if the rent demanded is not paid, coercive processes under Section 205 and 206 of the Patna Municipal Corporation Act would be taken against the petitioner. The petitioner again repudiated its liability to pay any rent as per its letter of December 30, 1967 and requested the Administrator to let the petitioner know the legal basis on which the rent is demanded. As per its letter of January 24, 1968, the Deputy Administrator of the Corporation informed the petitioner that the levy was made in pursuance of the power conferred on the Corporation under Section 262 of the Patna Municipal Corporation Act. By the letter dated January 18, 1968, the Resident Engineer of the Petitioner Company informed the Corporation that it had no power to levy the rent in question under the aforementioned Sec. 262. But the Administrator again asserted the Corporation s right to act under that provision as per his letter dated January 30, 1968. On February 5, 1968, the Assistant Administrator claimed a sum of Rs. 1,53,900/as arrears of rent. On March 7, 1968, another bill for Rs.51,300/as arrears of rent for the month of March, 1968, was forwarded to the petitioner company by the Administrator. Being apprehensive that coercive steps will be taken against theit moved the High Court under Article 226 of the Constitution for the reliefs mentioned earlier.3. The petition was opposed by the Corporation on various grounds but the High Court did not examine any one of those grounds. On the other hand it rejected the application on the sole ground that the only method prescribed by law for resolving the controversy between theand the Corporation was that provided by Section 15 of the Indian Telegraph Act, 1885.

Court's reasoning:
4. In our opinion the High Court has misread the provisions of the Indian Electricity Act, 1910 and the Indian Telegraph Act, 1885. The High Court purported to have based its decision on Section 51 of the Indian Electricity51 merely empowers the State Government to confer on the licensee certain powers which can be exercised by a telegraph authority under the Indian Telegraph Act. It does not by reference incorporate into the Indian Electricity Act all the provisions of the Indian Telegraph Act.6. Merely because some of the powers conferred under the Indian Telegraph Act on the telegraph authority could be conferred on a licensee under the Indian Electricity Act, it does not follow that all the rights and liabilities of a licensee under the Indian Electricity Act are governed by the provisions of the Indian Telegraphlicensee under the Indian Electricity Act cannot be considered as a Telegraph authority, an expression defined in Section 3 (6) of the Telegraph Act. Further that the disputes that can be referred to arbitration under that provision are only those referred to in that section and no other.9. In our opinion the High Court erred in rejecting the petition on the ground that the dispute in question should be referred to arbitration under Section 15 of the Indian Telegraph Act.Mr. S. V. Gupte, learned Counsel for the Corporation did not support the reasons given by the High Court in support of its judgment. On the other hand he contended that on the basis of the averments made in the application, the relief asked for by the petitioner could not have been granted and therefore the High Court was right in rejecting the same.The High Court has not considered this question. Hence we do not propose to go into the same.