HITECH ELECTROTHERMICS AND HYDROPOWER LTD. versus ST ATE OE KERALA AND ORS.

Citation: [2002] SUPP. 5 S.C.R. 128 · Decided: 07-12-2002 · Supreme Court of India · Bench: G.B. PATTANAIK · Disposal: Appeal(s) allowed

Judgment (excerpt)

A 
HITECH ELECTROTHERMICS AND HYDROPOWER LTD. 
v. 
ST ATE OE KERALA AND ORS. 
DECEMBER I 7, 2002 
B 
[G.B. PATTANAIK, CJ., AND K.G. BALAKRISHNAN, J.] 
Administrative Law: 
Government Po/icy-Offering of concessional tariff to new industrial 
C unit for period of five years from the date of commercial production, if 
production commenced between specified period-Industrial unit claiming 
incehtive of concessional tariff even though it did not have commercial 
production by the date specified-Held, since industrial unit could not start 
commercial production due to non-supply of power, it would not be equitable 
D to deny relief by giving literal interpretation to the incentive claim of the 
Government-Thus, on equitable consideration concessional tariff to be granted 
for period of three years. 
E 
The question which arose in these appeals was whether an industrial' 
unit could claim the benefit of the policy announced by the State 
Government offering concessional rate of tariff and electricity duty to new 
industries for a period of five years from the date of commercial 
production, ifthe production commenced between 1.1.1992 and 31.12.1996, 
notwithstanding the fact that there· was delay in production due to inaction 
on the part of the State Electricity Board in providing the necessary 
F electric connection. 
Appellant contended that when the appellant was persuaded to set 
up the industry being lured by incentive of getting the concessional power 
tariff for a period of five years, Board cannot be permitted to prevent such 
a benefit by its own failure to provide power, which prevented appellant 
G from starting commercial production by 31.12.1996. 
Respondent contended that since appellant'.s manufacturing unit did 
not start commercial production within the stipulated period, the benefit 
of the concessional tariff under the policy has rightly been denied; that 
H even if for certain latches on the part of the Board, appellant may be 
128 
HITECH ELECTROTHERMICS & HYDROPOWER LTD. v. STATE 
129 
entitled to an equitable consideration, but in the matter of incentive A 
granted under the policy decision by Government, no manufacturing unit 
could claim the benefit, so long as the conditions precedent of the 
applicability of policy resolution have not been satisfied; and that appellant 
himself was not in a position to start commercial production within the 
stipulated time. 
B 
Allowing the appeal, the Court 
HELD: I.I. On perusal of the industrial policy of the Government, 
unequivocally indicating that concessional tariff rate would be given as 
well as the order of the Electricity Board adopting the same, it can be 
safely held that such concession could be availed of by the industrial units C 
for a period of five years from the date, they start such production between 
1.1.1992 and 31.12.1996. In this context the stand of the Board as well as 
the State Government cannot be held to be devoid to any substance when 
admittedly the commercial production of the appellant's unit did not start 
till 31.12.96. But when the State Government came forward with a policy D 
decision alluring industrial units to set up their industries and under the 
provisions of the Electricity Act, every consumer has the right to get the 
supply of power and in the instant case when power allocation had been 
made in favour of appellant as early as in 1995, and yet the same power 
could not be supplied, for such non-supply of power, the commercial 
production could not start by 31.12.1996, it would not at all be equitable E 
to deny the relief to appellant by giving a literal interpretation to the 
incentive scheme of the Government as adopted by the Board. (134-A-DI 
1.2. The Board denied appellant power supply in appropriate time, 
which prevented appellant from starting the commercial production by F 
31.12.1996. This being the position, and having regard to the gamut of 
the circumstances, starting from the government policy resolution and 
culminating in setting up of the factory by appellant and commenced the 
production of ferro alloys, though not by 31.12.1996, granting the 
concessional tariff for a period of three years instead of five years, as 
indicated in the policy resolution would meet the ends of justice and it is G 
so directed: Be it be stated that appellant has been enjoying the 
concessional tariff on the basis of interim orders of the court and, 
therefore, that should be taken into account and due adjustment wo

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