GUJARAT ELECTRICITY BOARD versus GIRDHARLAL MOTILAL AND ANR.

Citation: [1969] 1 S.C.R. 589 · Decided: 06-08-1968 · Supreme Court of India · Bench: R.S. BACHAWAT · Disposal: Dismissed

Cited by 1 judgment(s) · cites 1 · see the full citation network in Lexace

Judgment (excerpt)

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589 
GUJARAT ELECTRICITY BOARD 
v. 
GIRDHARLAL MOTILAL AND ANR. 
August 6, 1968 
[R. S. BACHAWAT AND K. S. HEGDE, JJ.J 
Indian Electricity Act, 1910, s. 6(1)-as amended by Act 32 
of 
1959-notice to exercise option to purchase undertaking-requirement as 
ta calling upon licensee to sell undertaking-if mandatory for exercising 
power to purchase. 
The respondent held a licence granted by the Government of Baroda 
under the Baroda Electricity Act 1 of 1964 to supply electric energy with· 
in certain defined territories. 
On June 23, 1961 the appellant, which was 
constituted under s. 5 of the Indian 
Electricity 
(Supply) Act, 
1948, 
served a notice on the respondent to the effect that in exercise of the 
powers conferred on it by virtue of s. 71 of the Electricity (Supply) Act, 
1948 read together with section 6 0f the Indian Electricity Act, 1910, as 
amended by the Indian Electricity (Amendment) Act 32 of 1959, the 
appellant had decided to and would exercise the option to purchase the 
respondent's undertaking on 3-1-1963 i.e. the date on which 
the licence 
was due to expire. The respondent challenged the validity of this notice 
and the High Court held the notice. was invalid. 
On appeal to this Court, 
HELD : The High Court was tight in holding that the impugned notice 
was invalid and by virtue df that notice the appellant could not compel 
the respondent to sell the undertaking. [594 A] 
Before the option to purchase the undertaking can be exercised. the 
~tate Electricity Board must call upon the licensee by means of a notice 
in writing within the period mentioned in s. 6( I) to sell the undertaking 
to it on· the expiration of the period for which the licence was given. 
The impugned notice did not require the licensee to sell the undertaking. 
It merely notified the respondent that the appellant Board has decided to 
exercise and would exercise th·e option of purchasing the 
respondent's 
undertaking on the date of expiry of the licence. [592 D-E] 
Nazir Ahmad v. King Emperor, L.R. 63 I.A. 
372: 
and Ballavdas 
Agarwala v. Shri S. C. Chakravarty, [1960] 2 S.C.R. 739; referred to. 
There was no force in the contention that the notice complied subs-
tantially with the requirements of the law and should therefore be given 
c;:ffect to. The issuing of a notice strictly in accordance with the provisions 
•f s. 6(1), which prescribes that the notice must specifica!iy cal! upon 
the licensee to sell the undertaking, is a condition precedent to the exercise 
of the power conferred on the State Electricity Board to purchase the 
undertaking. Furthermore, on reading the impugned notice, the licensee 
could not have been definite whether th.c appellant Board purported to 
exe'rcise the power under the law as it was on the date of the notice i.e . 
. the Indian Electricity Act. 1910 as amended by Act 32 of 1959, or as it 
was under the unamended act. The rights and liabilities of the Electricity 
Board .and the licensee before Act 32 of 1959 came 
into force 
were 
~ubstantially different from those after the amendment. [593 C-G] 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2526 of 
1966. 
590 
SUPREME COlJRT REPORTS 
(1969] I S.CR. 
Appeal from the judgment and order dated October 30, 31, 
A 
l 963 of the Gujarat High Court in Special Civil Application No. 
1098 of 1962. 
C. K. Daphtarl', A11omey-Genera/ and /. N. Shroff, for the 
appellant. 
· 
M. C. Chagla, R. M. Vin and R. Gopalakrishnan, for respon-
ll 
dent No. 1. 
R. If. Dhebar and S. K. Dholnkia, for respondent No. 2. 
The Judgment of the Court was delivered by 
Hegde, J. The only question for decision in this appeal is 
whether the notice issued by the appellant on June 23, 1961 under 
s. 6 of the Indian Electricity Act, 1910 as amended by Act 32 of 
1959 (lo be hereinafter referred to as the Act) is valid. 
The 
High Court has come to the conclusion that it is 
not a valid 
notice. 
On 4th January 1923, the father of respondent No. 1 was 
granted a licence lo supply electric energy within the area consist-
ing of municipal limits. of .Dabhoi and the territories comprised 
within half mile radius from the municipal boundary lines by the 
Government of Baroda under the Baroda Electricity Act Samvat 
1964 (Act I of 1964). The said Company was 
known as 
Dabhoi Electricity Company. Respondent No. 
I 
was 
at 
all 
material tim~s the holder of this licence. 
The said licence conferred an option on the Government t<> 
purchase the under

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