LexMAHARASHTRA STATE ELECTRICITY BOARD AND THE STATE OF MAHARASHTRA versus NAGPUR ELECTRIC LIGHT AND POWER COMPANY LTD. & ANR
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A B G D E F G H 19 MAHARASHTRA STATE ELECTRICITY BOARD AND THE STATE OF MAHARASHTRA v. NAGPUR ELECTRIC LIGHT AND POWER COMPANY LTD. &ANR. . January 1, 1972 (S. M. S!KRI, C.J., J. M. SHELAT, I. D. DUA, H. R. KKAN:<:A AND G. K. MITTER, JJ.) Indian Electricity Act 1910, S. 4(3)-A11iendnie11t of tenns & co11di· tions of Nagpur ,Electricity Licence-Validity of a1nend111e;nt niadc in 1.966--Lega/ity of notice undet s. 6 of Act for purchase of undertaking by Electricity Board. On May 4, 1905 a J:ccnce was granted under s. -lll) of the Indian Electricity Act, 1903 to Crompton & Co. Ltd. for 1 he supply of electricity in the municipal area of Nagpur. A notification gnint:ng the above license was published in the Central Provinces Gazette on May 6. 1905. The lic:cn'.!e provideCi that the right of the governtncnt to purchase the undertaking &hall arise after 42 · years from the conimencen1ent of the license and aft!!r every, subsequent period of 10 years. Para 4 of thr license provided that it '"'·oul<l come into force c.tnJ have effect on the day \Vhen the notification confirming it was published in the Central Pro- vinces Gazette and that <lay would for the purpose of Act, be deemed to be the c'ommcnccment of the license. On January 1. 1911 the IncYan Electricity Act, 1910 came into force. On June 28, 1913 a notificatio:i permitting the ·assignn1ent of the licence in favour of ·the Nagpur Electric Light and Power Company Ltd, (respondent herein) was published in the gazette. On May 2. 1947 amendments in the -terms and conditions of the licence were made under s. 4(3) of the Act of 1910 and were pub- lished in the gazette. In the preambJe it was stated that these a1nend- ments were "in •he terms and conditions of the Nagpur Electric:ty licence grante~. under the Public Works Dept!. Notification No. 45 dated 4th May 1905 .......... " fa the various amendments made throughout the reference 'was made to May 4. 1947 as being the date when various changes were deemed to start or operate. In clause 3 paragraph ( o) (i) was provided that "Option of purchase given by sub-section 1 of section 7 of the Act shall be exercisable on .the expiration of ten years or 4th May 1957 and the expiration of every subsequent period of ten years during continuance of this licence." On September 4, 1948 the Electricity Supply Act, 1948 came into force. Section 71 of this Act provided that the ri~t and options to purchase under the Indian Electricty Act. 1910 were deemed to have been transferred to the Provincial (now State) Electri- city Board. The Indian Electricity Amendment Act. 1959 (32 of 1959) amended Indian Electrictv Act. 1910. In the newly inserted section 4A(l) t.he proviso thereto said that no alterations or amendments in the license shall be made except with the consent of the lisensee unless such consent was in the opinion of the State aovernment unreuo.ably with· held. In the amended Act section Ii provided for the purchase of th<" licensee's undertaking by the State Electricitv Boa...t. but the old section 7 was allowed to continue. On Se!>tember 15, 1965 notice w1s g;ven to the resrondent under sub-section (I) and sub.-tion (61 of section 6 ' of the Indian Electricity Act, 1910 whereby the respondent was required 20 SUPREME. COURT REPORTS [1972] 3 S.C.R. to sell its undertaking to the Board on the midnight of 3rd/4th May, l 967 being the date of the expiry of the licence granted to it. Doubts arose as to the interpretation of clause 3 paragraph (o) (i) of the licence because of the use of the word 'or' between words 10 years and "the 4th May. 1957" in the said clause. The State Government on April l 9, 1966 published a notification whereby in the said clause between the words "IO years" and "the 4th May, 1957" the \\-'Ord "on" was substi- tuted, the effect of which was that the option to purchase became exer- cisable on the expiration of period of 10 years on the 4th MaY. 1957. After this amendment another notice was given under sub-section ( 1) and (6) of s. 6 of the Indian Electricity Act, .J910 on April 26, 1966. The \VOrds of this notice were the same as that of the earlier notice but it \\'as expressly given in supersession of the earlier notice. The res- pondent filed a \\'fit petition under article 226 of the Constitution challeng- ing the aforesaid notice dated April 26, 1966. The High Court held that since the operation of Jicense con1men
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