Judgment

SARKAR, J. - The appellant is a company carrying on business as supplier of electricity in a certain area in the State of Bombay. The respondents Bathena and Tendulkar were consumers of electrical energy supplied by the appellant. The present appeals arise out of disputes between these consumers and the appellant concerning the legality of the charges made by the appellant for electricity supplied by it.

2. The supply of electrical energy is controlled by two statutes and the questions involved in the present cases will turn on them. These statutes are Electricity Act, 1910 and the Electricity (Supply) Act, 1948. I will first consider the Act of 1910. Section 3 of this Act gives power to the Government to grant a licence to a party to supply electrical energy in any specified area and to prescribe in the licence the limits of price to be charged by it for the supply. This section further provides that the provisions in the Schedule to the Act would, unless otherwise directed, be deemed, to be incorporated in the licence. Paragraph XI of that Schedule states that a licensee would not be entitled to exceed the limits of price fixed in his licence. This paragraph, however, gives power to the Government to alter these limits on the recommendation of an Advisory Board appointed under S. 35 of the Act. It is not necessary to refer to the other provisions of this Act.

3. The appellant had been supplying electricity under a licence issued in 1932 by the Government of Bombay under the Act of 1910. The licence fixed the limits of the prices which the appellant could charge but these limits were altered by an order made by the Government on December 30, 1942 under paragraph XI of the Schedule and stood thereafter as follows:

A. For lights and fans annas -/5/- (31 nP.) per unit and,

B. For motive power. (i) upto 4 B.H.P. anna -/1/- (0.06 nP.) per unit in addition to a standing charge of rs. 2/- per month per B.H.P. connected, (ii) over 4. B. H.P.-/-/9 pies (0.05nP.) per suit in addition to the standing charge at the same rate of Rs. 2/- per B.H.P. per month.

4. Due to the conditions brought abut by the Second World War, certain orders were made from time to time permitting the licensees to add a surcharge not exceeding -33 1/2 per cent to the existing charges. Lastly, on September 30, 1946 an Act was passed by the Bombay legislature called the Bombay Electricity (Surcharge) Act. 1946, hereinafter referred to as the Surcharge Act, which continued the surcharges specified therein for a period of three years. This Act expired on September 30, 1949. It is said that even thereafter the appellant continued charging the consumers at rates which included the surcharge under the Surcharge Act, and, therefore, at rates in excess of those fixed by the Order of December 30, 1942 and that was illegal. The appellant on its part claims that its charges after the expiry of the Surcharge Act were all justified under the Act of 1948 the relevant provisions of which came into force on September 10, 1948. This Act will be referred to later.

5. The respondent Bathena commenced taking electricity from the appellant sometime in 1954. Soon thereafter he started disputes about the legality of the charges realised from him by the appellant in respect of energy supplied for purposes of motive power of over 4 B.H.P. and in 1955 filed a suit against the appellant for refund of amounts alleged to have been illegally collected from him in excess of the limits fixed by the Order of December 30, 1942, namely, an excess standing charge of 0-69 nP. per B.H.P. per month over that fixed by the Order of December 30, 1942 and a similar excess unit charge of 0-01 nP. per unit. That suit is still pending and with the disputes involved in it I am not concerned in this judgment.

6. On September 25, 1958, the appellant gave notice to its customers that with effect from November 1, 1958 it would charge for motive power 0-09 nP. per unit plus a standing charge of Rs. 2.69 per B.H.P