LexJAGADAMBA PAPER INDHSTRIES (PVT.) LTD. ETC. ETC. versus HARYANA STATE ELECTRICITY BOARD & ORS. ETC.
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JAGADAMBA PAPER INDHSTRIES
(PVT.) LTD. ETC. ETC.
v.
t
HARYANA STATE ELECTRICITY BOARD & ORS. ETC.
September 29, 198 3
(AMARENDRA NATH SEN AND RANGANATH MISRA; jJ.)
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Indian Electricity (Supply) Act, 1948, Sections 39(1) read with clauses 22
and 31 of tf1e Standard-Contract Agreement to supply electricity-Power {)j the
Board to amend, revise and change schedule of tariff and charges and conditions
of supply of electricity-Whether the power can be assailed so long it is not
exercised arbitrarily or unreasonably-Sub-para (a) of the first proviso to c/a14se
VI of the Indian Electricity Act, 1910, scope of.
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From 1968, the Haryana ~tate Electricity Board has been collecting
security from every consumer to ensure timely cleafance of energy bills and in
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th'e case of industrial consumers ·the security was worked out at Rs. 30 per
KW. With effect from 1st April 1981. thC amount was changed to Rs. 100
per KW. Similarly in regard to the industrial meter a different basis has been
adopted and from April ·1, 1981 the security deposit now varies between
. Rs. 5,000 and Rs. 10,000 in regard to industrial consumers. The petitioners
have therefore, challenged the said unilateral increase on the ground that the
enhancement is without any jUstification.
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Dismissing the petitions, the Court
HELD : I. To contend that the Eleetricity (Supply) Act, 1948 and
the Rules made thereunder do not contemplate any provision f~r security for
the timely payment of energy charges "is not correct. Sub-para (a) of the first
·proviso to clause VI. of the schedule to the Indian Electricity Act, 1910 would
be applicable and what would be sufficient security should bC left to' the
Electricity Board to decide. [I 71 E-F]
· K'ishna Cement Works v.
The Secretary APSEB, AIR 1979 AP 291
approved. Mfs. B. R. Oil Mills v. Assistant Engineer (D). (RSEB), BharatPur
& Anr., AIR 1981 Raj. 108; and M/s. Goodyear India Ltd. v. H.S.E.B. & Ors.
CW. 4765/81 dated 9.4.82 Pb. & Haryana H.C. referred to Modi Industries
Ltd. (Steel Section) v. U.P. State Electricity Board AIR 1979 AU. 375; M/s.
Devidayal Metal Industries v. The Municipal CorporatiOfl for Greater Bombay
& Anr. AIR 1980 B!im. 154 distinguished.
2:1 Section 49{1) of the Indian Electricity {Supply) Act, 1948 clearly
indicates that the Board may supply electricity to any person upon such terms
and conditions as the Board thinks fit.
Jn exercise of this power the BO':l.rd
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SUPREME COURT !i.HPORTS
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had initially . introduced the condition regarding security and each of . the
petitioners had accepted the term. The Board has been conferred statutory
power under s. 49(1) of the Act to determine the cOnditions on the basis of
_ whic;:h supply is to be made. This Court in J!irra Stone Lime C1mpany Ltd. &
Anr. Etc. v. Orissa State Electricity Board & Anr., [1976) 2 SCR' 307., took the
view that enhancement of rates by way of surcharge w<is well within the pOwer
of the Board to fix or revise the rates of tariff under the proyisiQns of the Act.
What applied to the tariff would equally apply to the security, that being a
condition in the contract of supply. Each of the petitioning consu1ners had
agreed to furnish security in cash for payment of energy bills at the time of
entering into their respective supply agreements. There was no challenge.iri
these writ petitionS that the demand of security at the time of entering-into
supply agreements has to be struck down as being without jurisdiction.
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[172 G-H; E-F]
2:2 Under clause 31 of the Agreement the. Board reserved to itself the
right to amend, cancel or add to any of the schedules and conditions at a~y
time. The provisions of this clause are similar to clause 13 of the agreement
which came to be considered in Bisra Lime· Stone Company's Case (supra).
Therefore, the Board had authority under the agreement itself to amend the
conditions. In ex:ercise of that power the Board has now raised the additional.
demand. (173 A·BJ
2:3. It·is true that the affairs of the Boards 'in the different States of
the country are not upto the expectation of the co~sum,ers and there have been
instances which give rise to genuine anguish and dissatisfaction. The scheme
of the Act clearly i~dicates a legislative m¢1.ndate that the Board should manage
its co1nmercial activities in such a way that it does not make any loss. It is
alS'o clear that the Board being aExcerpt shown. Read the full judgment & AI analysis in Lexace.