HINDUSTAN ZINC LTD versus RAJASTHAN ELECTRICITY REGULATORY COMMISSION

Citation: [2015] 7 S.C.R. 1104 · Decided: 13-05-2015 · Supreme Court of India · Bench: V. GOPALA GOWDA · Disposal: Directions issued

Cited by 3 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

A 
B 
[2015]7S.C.R.1104 
HINDUSTAN ZINC LTD. 
v. 
RAJASTHAN ELECTRICITY REGULATORY COMMISSION 
(Civil Appeal No.4417of2015) 
MAY 13, 2015 
[V. GOPALA GOWDA AND R. BANUMATHI, JJ.] 
Rajasthan Electricity R&gulatory Commission 
c (Renewable Energy Obligation) Regulations, 2007; 
Rajasthan Electricity Regulatory Commission (Renewable 
Energy Certificate and Renewable Purchase Obligation 
Compliance Framework) Regulations, 2010: Constitutional 
validity of the Regulations 2007 and 2010 directing the 
D captive power plants to p'urchase minimum energy from 
renew~ble sources - Held: The object of imposing RE 
Obligation is protection of environment anar preventing 
pollution by utilising Renewable Energy Sources as much 
as possible in larger public interest - The Regulations 
E impose reasonable restrictions upon the captive gencos as 
permissible u/Art. 19(6) of the Constitution - The impugned 
Regulations fall within the four corners of the Act of 2003 as 
well as Electricity Policy, 2005 - National Electricity Policy, 
2005- Electricity Act, 2003- s. 86(1) - Constitution of India, 
F 1950-Articles 19(1)(g), 19(6), 51A(g). 
Electricity Act, 2003: ss.2(3), 86(1 )- Captive power plant 
- Regulatory jurisdiction of Commission - Heild: The mere 
fact that no licence is required for Establishment, Operation 
G and Maintenance of a Captive Power Plant would not imply 
that the industries engaged in van·ous commercial activities 
putting up such Captive Power Plants cannot be subjected 
. to Regulatory Jurisdiction of the Commission- RE obligation 
H 
1104 
HINDUSTAN ZINC LTD. v. RAJASTHAN ELECTRICITY 1105 
REGULATORY COMM. 
has been imposed upon the consumption of electricity A 
whether purchased from the Distribution Licensee or 
consumed from its own Captive Power Plant or through open 
access. 
Dismissing the appeals and disposing of the l.A.s, B 
the Court 
HELD: 1. These Regulations are framed by the RERC 
with a laudable objective of achieving Directive Principles 
of the State Policy as provided in Article 48A read with 
Fundamental Duties under Article 51A(g) of the C 
Constitution, which mandate upon the State and its 
instrumentalities to protect the environment in the area 
with a view to see that the citizens/residents of the area 
to lead a healthy life. To achieve the same it has framed 
the National Electricity Policy, 2005. Further, the D 
impugned Regulations framed by the RERC which 
impose reasonable restriction as provided under Article 
19(6) of the Constitution of India to achieve the Directive 
Principles of State Policy and to see that the State and 
its instrumentalities shall discharge their fundamental E 
duties to protect and maintain environment in the area 
to facilitate the residents and living creatures to live 
peacefully. [Paras 15, 16] [1122-G-H; 1123-A-B] 
2. The Electricity Act of 2003 being a self-contained F 
comprehensive legislation in the matter of generation, 
transmission and supply of energy to its consumers, the 
provisions of Section 82 of the Act of 2003 enjoin upon 
every State Government to constitute a Regulatory 
Commission in their respective State to regulate the G 
implementation of the provisions of the Act of 2003 by 
framing suitable Regulations and Rules with reference 
to the matters/entries enumerated in Section 181 of the 
·Act of 2003 and accordingly the State of Rajasthan has 
constituted the RERC. [Para 26] [1130-F-G; 1131-A] 
H 
3. Where the validity of subordinate legislation is 
1106 
SUPREME COURT REPORTS 
[2015] 7 S.C.R. 
A challenged, question to be asked is whether power given 
to the rule making authority has been exercised for the 
purpose for which it was given. The Court has to 
examine the nature, object and scheme of the legislation 
as a whole to consider what is the area over which 
B powers are conferred upon the rule making authority. 
However, the Court has to start with the presumption 
that the Rule is intra-vires and has to be read down only 
to save it from being declared ultra-vires in case the 
Court finds that the above presumptions stand rebutted 
C and the impugned regulations are relatable to the 
specific provision contained in Section 86(1)(e) of the 
Act. 
Para 4.2.2 of the National Action Plan on Climate 
Change and Preamble of the Act of 2003 emphasise upon 
0 
promotion of efficient and environmentally benign 
policies to encourage generation and consumption of 
green energy to sub-serve the mandate of Article 21 read 
with Arti

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