STATE ELECTRICITY BOARD AND OTHERS versus M/S RAMKRISHNA FORGING LIMITED

Citation: [2021] 4 S.C.R. 454 · Decided: 30-04-2021 · Supreme Court of India · Bench: L. NAGESWARA RAO · Disposal: Dismissed

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Judgment (excerpt)

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SUPREME COURT REPORTS
[2021] 4 S.C.R.
   [2021] 4 S.C.R. 454
454
JHARKHAND STATE ELECTRICITY BOARD AND OTHERS
v.
M/S RAMKRISHNA FORGING LIMITED
(Civil Appeal No. 6145 of 2010)
APRIL 30, 2021
[L. NAGESWARA RAO AND VINEET SARAN, JJ.]
Electricity: Jharkhand State Electricity Regulatory
Commission (Electriity Supply Code) Regulations, 2005 – Regns.9.1,
9.2 – On 14.04.2004, the respondent, small scale industry entered
into an agreement with Board for High Tension connection of 325
KVA load – Thereafter, on 14.03.2006, respondent applied for
enhancement of load from 325 KVA to 1325 KVA, which was
sanctioned – On 26.12.2006, respondent again applied for
enhancement of load from 1325 KVA to 3500 KVA which was also
sanctioned by Board – On a further request of respondent, on
07.07.2007, the load was again enhanced to 4000 KVA – Due to
continuous load shedding, which was affecting machineries,
respondent decided to reduce load from 4000 KVA to 1325 KVA –
However, the application to that effect was rejected treating it to be
a case of determination of agreement, and quoting the Clause 9B
of the agreement which provided that the agreement could not be
permitted to be determined prior to the completion of initial period
of three years from 07.07.2007 and that the respondent will have to
pay the minimum guarantee charges and other charges, even if the
respondent decides to terminate the agreement – Respondent
successfuly filed writ petition before High Court – Board filed instant
appeal – Held: Chapter 9 of the Regulations of 2005 deals with the
enhancement and reduction of contract demand/sanctioned load –
Regn.9.1 deals with enhancement of contract demand/sanctioned
load, whereas Regn.9.2 deals with the reduction of contract demand/
sanctioned load – Regn.9.2.6 of the Regulations of 2005 provides
for execution of a supplementary agreement for reduction of contract
demand/sanctioned load of the consumer – If the Regulations
provide for contract load to be varied even through a written
communication, then in all fairness, though fresh agreements may
have been executed at the stage of enhancement of load of the
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same electricity connection, the same cannot be treated as anything
but an extension/amendment or modification of the initial agreement
granting the electricity connection, which in the present case would
be the agreement dated 14.04.2004 – Thus, even though the
consumer may have been required to sign fresh agreements for each
enhancement of load, but the enhancement being for the same
electricity connection which still continues, it would merely be
amendment of the initial agreement – This would also be in
consonance with the provisions of the Regulations of 2005, which
have to be liberally interpreted in favour of the consumer – The
Board was wrong in treating the application of the respondent for
reduction of load to be that for determination of the agreement under
Clause 9B of the agreement, which application, in fact, ought to
have been considered under Regn. 9.2 of the Regulations of 2005
– The agreement to be considered in the present case is the initial
agreement dated 14.04.2004 and not the subsequent agreement
dated 07.07.2007.
Dismissing the appeal, the Court
HELD : 1. After the initial agreement dated 14.04.2004,
which came into effect from 16.04.2004 whereby the contract
demand of 325 KVA was allowed in favour of the respondent, the
Jharkhand State Electricity Regulatory Commission in exercise
of power conferred by Section 181(2)(x) read with Section 50 of
the Electricity Act, 2003, framed the Jharkhand State Electricity
Regulatory Commission (Electricity Supply Code) Regulations,
2005, which came into effect from 28.07.2005. [Para 5][459-F-H]
2.1 The communication dated 08.11.2007 of the Electrical
Superintending Engineer of the Board, refusing the prayer of the
respondent for reduction of load showed that the application of
the respondent for reduction of load was rejected in terms of
Clause 9(B) of the agreement, treating the date of commencement
of the agreement to be 7/12.07.2007 and only by considering the
provision of determination of the agreement, which could not have
been without giving notice of less than 12 calendar months. It is
clear that the said communication/order does not consider the
provisions of the Regulations of 2005 with regard to reduction of
load, but only treats the application for reduction of load to be an
JHARKHAND STATE ELECTRICITY BOARD v.
M

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