WARYAM STEEL CASTINGS PVT. LTD. versus PUNJAB STATE POWER CORPORATION LTD. AND ANR.

Citation: [2017] 8 S.C.R. 134 · Decided: 19-06-2017 · Supreme Court of India · Bench: RANJAN GOGOI · Disposal: Dismissed
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Judgment (excerpt)

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[2017] 8 S.C.R. 134 
WARYAM STEEL CASTINGS PVT. LTD. 
v. 
PUNJAB STATE POWER CORPORATION LTD. AND ANR. 
(Civil Appeal No. 7856 of 2012) 
JUNE 19,2017 
(RANJAN GOGOi AND NAVIN SINHA, JJ.( 
Electricity Act. 2003: 
ss. 2(4). 6i, 62, 63. 64, 86, i JJ and ll 2 - Levy of surcharge 
on defaulting industries - Legality of- Appellant-companies. arc 
furnace units, established prior to June i 995, drew power from 
JJKV High Tension Supply Line - Circular of State Electricity Board 
mandating all existing as well as prospective consumers. who had 
installed induction furnace units with a load above 1500 KVA. to 
D shift to 66KVfrom 11 KV voltage supply, failing which they were 
required to pay surcharge@ i7.5% - Howeve1; another circular 
dated 81h June, i999 issued by Electricity Board exempting all units 
existing as on 23'J June, i995 from the necessity of conversion to 
66KV as well as levy of i7.5% surcharge - Electricity bills by State 
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Power Corporation imposing surcharge on arc .fi1rnaces units 
established prior to June, 1995 - Writ petitions by appellants. 
dismissed - LPAs by appellants - While the LPAs were pending, 
tariff order issued by Regulatory Commission specifically levying 
surcharge 011 induction Furnace Units - Tariff order challenged 
before Appellate Tribunal for Electricity (APT EL) - Levy of surcharge 
held to be justified by APT EL by order dated i 6.07.20i0 - APTEL 5· 
order challenged before Supreme Court, which was dismissed vide 
order dated 14'h February 20JJ, thus confirming the levy of 
surcharge - LPAs dismissed by High Court - On appeal, held: 
insofar as the order of High Court dismissing the LPAs filed by 
appellants is concerned, the levy of surcharge has been upheld by 
G Supreme Court by its order dated 14'" February 2011 - Thus, the 
issue with regard to legality and justification for levy of surcharge 
stands foreclosed - Further, the absence of continuation of 
exemption granted vide circular dated 8'" June, i999 in respect of 
pre-i995 industries, in any of the tar(ff ordersfor subsequent years 
i.e. after coming into force of the Electricity Act is a conscious 
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134 
WARYAM STEEL CASTINGS PVT. LTD. v. PUNJAB STATE 
135 
POWER CORPORATION LTD. 
decision of Regulatory Commission with regard to the necessity and A 
justifiability of the levy of surcharge on defaulting industries - The 
said reason for levy of surcharge to disincentivize the defaulting 
units being justifiable, cannot be faulted with - No room for any 
other view in the matter - High Court was fully justffied in dismissing 
the writ petitions - Electricity Laws. 
Surcharge levied on defaulting industries who did not shift 
from 11 KV to 66KV voltage supply as mandated by circular issued 
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by State Electricity Board - Correctness of quantum/rate of said 
surcharge levied -APTEL vide its order dated 16.07.2010 held the 
levy of surcharge to be justified, but disagreed with the rate of 
surcharge and remanded the matter back to Regulatory Commission 
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for deciding the rate of surcharge afresh - Regulatory Commission 
on remand, reduced the rate of surcharge from 17.5% to 10% -
Held: The Regulatory Commission worked out the appropriate rate 
of surcharge by adding a penal element to the cost of conversion to 
disincentivise the consumers from continuing to receive supply on 
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. the 11 KV transmission lines - This being the basis for determination 
of the rate and that too by the expert body which has been further 
upheld by APTEL, no fault can be found with the said exercise. 
ss.61 to 64 - Determination of tariff - Nature of power 
exercised - Held: The said power has been consistently held and E 
understood to be statutory, required to be exercised within the four 
corners of the relevant provisions of the 2003 Act. 
Words and Phrases - 'Surcharge' - Meaning of - Explained. 
Dismissing the appeals, the Court 
HELD: 1. Insofar as the order of the High Court dismissing 
the Letter Patent Appeals filed by the industrial establishments 
is concerned, the matter should not detain the Court. Not only 
the levy of surcharge was upheld by this Court by order dated 
141h February 2011, though for the year 2009-2010, what stares 
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at the face of the record is the consistent view taken by the 
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Regulatory Commission in all the tariff orders commencing from 
the year 2004-2005, that to offset the transmission and all other 
losses and other incidental charges incurred in enabling the 
Induction Furnace Uni
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