UNION OF INDIA THROUGH GENERAL MANAGER NORTHERN RAILWAYS versus CHAIRMAN, UP STATE ELECTRICITY BOARD & ORS.

Citation: [2012] 2 S.C.R. 416 · Decided: 09-02-2012 · Supreme Court of India · Bench: P. SATHASIVAM · Disposal: Disposed off
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Judgment (excerpt)

[2012] 2 S.C.R. 416 . 
A 
UNION OF INDIA THROUGH GENERAL MANAGER 
B 
c 
NORTHERN RAILWAYS 
v. 
CHAIRMAN, UP STATE ELECTRICITY BOARD & ORS. 
(Transfer Case (Civil) No. 37 of 2001 etc.) 
FEBRUARY 9, 2012 
[P.SATHASIVAM AND H.L. GOKHALE, JJ.] 
RAILWAYS ACT, 1989: 
ss. 11 (a) and (g) - Construction of electric supply lines 
by Railways - Held: Provisions of Railways Act clearly 
authorize the Railways to construct necessary transmission 
lines, dedicated for their own purpose - NTPC, i.e. the 
0 generating company, does have the necessary authority to 
enter into a power purchasing agreement u/s 43A of Electric 
(Supply) Act, 1948 -
Thus, the action of Railways of 
constructing transmission lines and drawing power from 
thermal power plants of NTPC was perfectly legal - Electricity 
E (Supply) Act, 1948 - ss. 26A (1) and 43A - Electricity Act, 
2003 - s. 10(2) 
In the instant transferred cases the issue for 
consideration before the court was the legality of 
construction of the transmission lines by Central 
F Railways to draw power from the power plant of the 
National Thermal Power Corporation Limited. 
Disposing of the Transferred cases, the Court: 
HELD: 1.1. In the case of Railways, the transmission 
G of electricity is ·governed by the provisions of a special 
enactment, i.e. the Railways Act, 1989 and not by the 
enactments governing electricity. [Para 15] [425-A-B] 
' 
1.2. Sections 11 (a) and (g) of the Railways Act, 1989 
H 
416 
UNION OF INDIA THROUGH GEN. MANAGER NORTHERN 
417 
RAILWAYS v. CHAIRMAN, U.P.S.E.B. 
clearly authorize the Railways to construct necessary 
A 
transmission lines, dedicated for their own purpose. It is 
not possible to read this Section in a restricted manner. 
The principal part of .s.11 authorizes the Railway 
administration to execute all necessary works .for the 
purpose of constructing or maintaining railways. Sub-s 
B 
(a) of this Section authorizes Railways to make or 
construct in or upon, across, under or over any lands 
electric supply lines. Sub-s. (g), thereof, cleawrly 
empowers the Railways to erect any electric traction 
equipment, and power supply and distribution c 
installation which is in connection with the work of the 
Railways. This will certainly include construction of 
transmission lines. [para 15 (ii)] [425-C-E] 
3. Besides, s.26A (1) of the Electricity (Supply) Act, 
1948 exempts the generating company from the 
D 
requirement of taking a license under Electricity Act, 1910. 
[Para 15 (iii)] [425-F] 
4. NTPC the generating company does have the 
necessary authority to enter into a power purchasing 
E' 
agreement u/s 43A of the Electricity (Supply) Act, 1948. 
/ 
NTPC has been permitted by the Central Government to ' 
enter into an agreement. Railways and NTPC both have . · 
obtained the permission from the concerned ministries' 
prior to entering into this agreement. In the instant cas,: 
F 
the Railways found the tariff of UPSEB to be excessive 
and therefore, they decided to construct their o~n 
transmission lines. This being so, the action on th~ part 
of the Railways of constructing transmission lines, and 
drawing power from thermal power plants of NTPC, was 
G 
perfectly legal. Even under the Electricity Act, 2003, a 
direct sale of power by a generating company to a 
consumer is specifically permitted u/s 10 (2) thereof. [Para 
15] [426-A-D] 
H 
J 
' 
418 
SUPREME COURT REPORTS 
[2012] 2 S.C.R. 
A 
1.5. In the circumstances, the notice dated 7 .9.1999 
given by the UPSEB was totally uncalled for, and is 
quashed and ·set-aside. [Para 16] [426-D-E] 
CIVIL APPELLATE JURISDICTION : Transfef Case (Civil) 
B No. 37 of 2001. 
Under Article 139 of the Constitution of India. 
WITH 
C Transfer Case (Civil) No. 38 of 2001. 
P.P. Malhotra, ASG, Pradeep Misra, Suraj Singh, Manoj 
Kr. Sharma, Sunita Sharma, Shailendra Sharma, M.P.S. Tomar, 
A.K. Sharma, N.D.B. Raju, Bharathi Raju, Guntur Prabhakar, 
··: Rachana Joshi lssar, Nidhi Tiwari for the appearing parties. 
D 
E 
The Judgment of the Court was delivered by 
H.L. GOKHALE J. 1. Both. the~e transferred cases are 
concerning the legality of construction of the transmission lines 
by Northern Railways to draw power from the power plants of 
the National Thermal Power Corporation Ltd. ('NTPC' for short), 
and no more from the transmission lines of Uttar Pradesh State 
Electricity Board ('UPSEB' for short), through which they were 
drawing power earlier. 
F Facts leading to these transferred cases are as follows:-
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