IMPORTANT POINT
Low tension Industrial users in Bihar are entitled to exemption from payment of minimum guarantee charges to Bihar State Electricity Board as per the Industrial Policy framed by Govt. of Bihar in 1955.

Headnote:(i) Industrial Policy framed by Government of Bihar in 1955-Concession and Incentive in Power Tariff to Industrial connections-Appellants setting Industrial Units in Bihar-Granted low tension connections-Whether low tension Industrial users are entitled to exemption from payment of minimum guarantee charges as per the Industrial Policy of 1955 which makes no distinction between high tension and low tension connections? (Yes)-Appeal allowed-High Court reversed.
       Held : In our view, the provisions of Paras 9.4 and 9.6 have to be read together. A conjoint reading makes it clear that the Government is aware that there are low tension connections and high tension connections. Whilst granting exemption the Government is not specifically excluding low tension connections. (Para 9)
       (ii) Electric Supply Act, 1948-Section 78A-Policy direction in respect of tension connections-Whether Bihar State Electricity Board accepted it only for high tension connections? (No).
       Held : The Board is accepting the Government s directions given to it under Section 78A of the Electricity Supply Act. In its Resolution it is granting exemption from payment of minimum guarantee (minimum base charge). The Respondents are well aware of the difference between low tension connections and high tension connections. If, as is claimed, the term "minimum guarantee charge" is not used for high tension connections, then they would not have used that term at all in the Resolution if they wanted to restrict the exemption to high tension connections. Advisedly they have used both the terms "Minimum Guarantee" and "Minimum Base Charge". This itself shows that the exemption applied to both types of connections. Respondents have not stated that such exemption would not be granted to low tension connections. In our view, the Respondents having adopted the direction of the Government are bound to comply with those directions. So long as the other conditions of the Police decision are complied with the exemption has to be for both high tension connections as well as low tension connections. (Para 12)
       Held finally : In this view of the matter, we set aside the Orders of the High Court and allow the Appeals on this point. It is not disputed that Appellants are otherwise entitled to exemption. Thus Respondents must now repay to the Appellants amounts received as Minimum Guarantee Charges, which are in excess of payments due for actual consumption. Such refund to be made within six weeks from today. In the circumstances of the case, there will be no Order as to costs. (Para 13)

JUDGMENT

S.N. Variava, J.-Leave granted.

2. In these Appeals the only question urged before us is whether low tension industrial users are entitled to exemption from payment of minimum guarantee charges as per the Industrial Policy framed by the Government of Bihar in 1995. In the Appeal arising from SLP 17210 of 2000 other questions are also raised. However they are not pressed before us.

3. The relevant portions of the Industrial Policy read as follows:

"9.4 PRIORITY TO INDUSTRIAL CONNECTION

With a view to facilitating timely start up of an industrial project, over-riding time bound priority would be given to L.T./H.T. Industrial connection.

9.5 POWER TARIFF

Power tariff would be reviewed and simplified to provide power at tariff comparable with neighbouring states to industrial units.

9.6 POWER INCENTIVE

- exemption from payment of minimum guarantee charge for new industrial units having connected load upto 500 KVA.

- exemption from Electricity Duty for 5 years on captive power generation upto 25 MW for own consumption to new industrial units.

- loads upto 99 H.P. to be made available on L.T. for new connection to industrial units.

- special arrangements for expeditious clearance for rebate for non supply of power to industrial under takings."

4. Pursuant to this Policy the Respondents passed a Resolution dated 11th October, 1996. The relevant portion reads as follows:

"The Board in its 443rd meeting, vide Resolution No. 6917, has decided to implement the directive issued by the State Government under Section 78A of the Electricity Supply Act, 1948 by Resolution No. 3493 dated 3.9.1996 of the Department of Energy. Accordingly, the following benefits will be given to the consumers:

1. Units which come into production during 1.4.1993 to 31.8.2000 and the defined units undertaking expansion/diversification, whose connected load is upto 500 (five hundred) KVA, are exempted from payment of Minimum Guarantee (Minimum Base Charge) for five years from the date of connection."

5. The Appellants in both these Appeals have set up Industrial units in the State of Bihar. They have been given low tension connections. However, in spite of the policy decision granting exemption from payment of minimum guarantee charges they were forced to pay minimum guarantee charges. Therefore, they challenged the levy of minimum guarantee charges. Their Petitions came to be dismissed by the single Judge of the High Court. M/s. K.D. Industries also filed an Appeal which has been dismissed by the Division Bench of the High Court at Patna. The Appellants have thus filed these Appeals.

6. Mr. Sinha submitted that Para 9.4 shows that the Policy applies both to low tension as well as high tension industrial connections. He submitted that Para 9.6 had to be read with Para 9.4. He submitted that a joint reading of the two paragraphs shows that the exemption is not just for high tension connections but also for low tension connections.

7. On the other hand, Mr. Reddy submitted that low tension connections are always referred to in terms of Horse Power (H.P), whereas high tension connections are always referred to in terms of KVA basis. He submitted that the Government s Policy granted exemption, from payment of minimum guarantee charges, only to connections having load upto 500 KVA. He submitted that this itself made it clear that it was only in respect of high tension connections. He submitted that this was further clear from fact that Para 9.6 itself provides that load upto 99 H.P. was to be made available on low tension for new connections. He relied upon the Tariff Notification issued by the Bihar State Electricity Board. From this he pointed out that in respect of high tension connections "minimum base charge" is collected, whereas from low tension connections a "minimum guarantee charge" is collected.

8. We have considered the

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2001 Supreme(SC) 532

IMPORTANT POINTLow tension Industrial users in Bihar are entitled to exemption from payment of minimum guarantee charges to Bihar State Electricity Board as per the Industrial Policy framed by Govt. of Bihar in 1955.

Cases Referred (1)

IMPORTANT POINT
Low tension Industrial users in Bihar are entitled to exemption from payment of minimum guarantee charges to Bihar State Electricity Board as per the Industrial Policy framed by Govt. of Bihar in 1955.