LexHINDUSTAN ZINC LTD. ETC. ETC versus ANDHRA PRADESH STATE ELECTRICITY BOARD & ORS
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__. . HINDUSTAN ZINC LTD. ETC. ETC. v. ANDHRA PRADESH STATE ELECTRICITY BOARD & ORS. MAY 2, 1991 [M.N. VENKATACHALIAH, J.S. VERMA AND N.D. OJHA, JJ.] Electricity (Supply) Act, 1948: Ss. 4A, 16, 49, 59, 61, 63, 67, 67A, 68, 78-A-Orders No. 1014 and No. DEJCOMLJIV/2250/83/l dated 13.12.1983 and Memo dated 18.11.1975. S. 49-Tarzffs-Power of fixation-No unreasonable preference shall be shown to any person. S. 16--Electricity Tariff-Revision-State Electricity Consulta- tive Council-Non-consultation by State Electricity Board-Validity of. A B c S. 59-State Electricity Board-Finance-Tariff-Generation of D surplus-Non-specification of quantum by _State Government- Whether board can adjust its tariffs to generate a reasonable surplus. Whether the ·surplus generated could be called extravagant. Whether revision of tariffs fall within the scope of judicial review. Fuel cost adjustment'-Charged only from particular category of consumers-Whether reasonable. S. 78A-Tariffs-Directions by State Government-Whether binding on the Board. Administrative Law: Delegated legislation-'Laying procedure' -Placing Electricity Board's annual financial statement u/s 61 of the Electricity (Supply) Act before the Legislature-Whether effectively controls exercise of Board's delegated power. E F The appellants are H. T. electricity consumers of various catego- G ries in the State of Andhra Pradesh. The respondent-State Electricity -i Board (the Board), by its orders B.P. Ms. No. 1014 dated 13.12.1983 revised upwards the tariffs for various categories of consumers includ- ing H. T. categories 1 (lndustrial) and II (Non-Industrial); and by Memo No. DE/CO ML/IV /2250/83/I of the same date it revised upwards the electricity tariffs for highly power intensive industries falling under H 643 644 SUPREME COURT REPORTS [ 1991] 2 S.C.R. A H.T. Category III. Tariffs consisted of three parts. The said three categories of H.T. consumers fell in Part A. H.T. consumers availing supply of electricity for irrigation and agricultural purposes were included in part B. Part C provided for miscellaneous and general ~ charges. Tariffs were not revised for consumers availing H. T. supply for purposes of irrigation and agriculture falling in Part B or L. T. supply B for domestic cottage industries, public lighting and small poultry farms units. Besides the energy charges, the H. T. consumers included in Part A were also required to pay at different rates effective from 1.9.1982 <- an additional charge levied as 'fuel adj_ustment charges'; and some c amount as 'voltage surcluuiled' in accordance with the terms of the agree- ment entered into by the individual consumers with the Board. The writ petitions filed by the appellants challenging the said upward revision of the Electricity Tariffs were dismissed by the High Court upholding the revision of tariffs made by the respondent-Board. D Aggrieved the appellants preferred appeals by special leave to this Court. It was contended on behalf of the appellants that: ( 1) the upward revision of tariffs by the State Electricity Board was invalid being made without prior consultation with the State Electricity Consultative E Council as envisaged by s. 16 of the Electricity (supply) Act, 1948; (2) without specification of any surplus by the State Government the Board had no power to adjust its tariffs in a manner which resulted in general- ing any surplus; (3) there is discrimination in recovery of the entire run . ~ cost adjustment from the H.T. consumers alone; (4) the upward hike of the tariffs for the H. T. consumers including power intensive consumers F was arbitrary and discriminatory inasmuch as it was not related to the cost of generation and was based on irrelevant factors; and (5) and the Board had acted with profit motive losing its public utility character. Learned counsel representing the power intensive consumers also con- _,tended that in the absence of a clause relating to fuel cost adjustment in the G.Os. issued in respect of the power intensive units, they could not ~ G be governed by the clause of fuel cost adjustment made applicable to the ~ H. T. tariffs. Dismissing the appeals, this Court, HELD: 1.1 The power of i1XBtion of tariffs in the Board is pro- H vided by s. 49 of this Supply Act whch requires the ilXBtion of uniform HINDUSTAN ZINC v. A.P.S.E.B. 645 tariffs ordinarily having regard particularly to the specified factors
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