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1973 Supreme(SC) 323

SUPREME COURT OF INDIA
P. JAGANMOHAN REDDY, S.N. DWIVEDI AND P.K. GOSWAMI, JJ.
Narayana Sankaran Mooss, Appellant
Versus
State of Kerala and another, Respondents. 176
Civil Appeal No. 1279 of 1967
D/-12-10-1973.

Advocates:
A.C.RATNAPARKHI, A.R.SOMNATH IYER, B.SEN, K.L.RATHI, M.R.Krishna Pillai, N.M.GHATATE, S.BALAKRISHNAN, S.S.Anantakrishna Iyer, V.A.SEYID MUHAMMAD

Headnote:

Indian Electricity Act, 1910 - Section 5(1)(a), (1)(c), (3), 4(3), 4(1)(a), (c), (d) 5 (b), 4 and 4A(1) - Constitution of India, 1950 – Article 226, 19 (1) (g), 311 (2) and 311 - Indian Electricity Act, 1948 - Section 13 - Licensee for Supply of Electric Energy - Revocation of Licence - Whether Board is willing to purchase undertaking owned by Kottayam Electric Supply Agency - Whether Act obligates Board to consider explanation of licensee before recommending any action against him - Whether it should recommend to revoke licence, or not to revoke licence, or to permit license to remain in force subject to such further terms and conditions as may be thought proper – Held, It is difficult to conceive how Board will make a choice out of these three courses without considering explanation of licensee - Explanation may make out a case for not revoking license or a case for continuation of licence with certain over-added conditions - In a particular case Government may propose to revoke licence under S. 4 (1) (c) on ground that licensee has failed to show that he is in a position fully and efficiently to discharge duties and obligations imposed on him by his licence - Similarly, it may propose to revoke licence under S. 4 (1) (d) where financial position of licensee is such that he is unable fully and efficiently to discharge duties and obligations imposed on him by his license - In none of these cases Board will be able to make a just choice out of aforesaid three courses without applying its mind to explanation of licensee - In spite of Board advising against revocation, Government may, if satisfied that it is necessary to revoke licence, may revoke it - But having regard to object and context of Section 4, Court is of opinion that it should not be regarded as an over-weighing consideration - It will normally be difficult for Government to ignore Board s expert advice – Court is satisfied from object and context of Section 4 that Parliament intended to make consultation of Board an imperative condition to revoking a licence - Petition of appellant under Art. 226 of Constitution is allowed directing appellant to hand over the Undertaking to Board are quashed - Appeal allowed.

Judgment

DWIVEDI, J.:- The Kottayam Electric Supply Agency, Kottayam, is the licensee for the supply of electric energy in Kottayam in the State of Kerala The appellant, N. S. Mooss, is the proprietor of the licensee. By an order, dated May 17, 1963, the State of Kerala revoked the licence with effect from August 1. 1963. The order was made under Section 5 (1) (a) of the Indian Electricity Act, 1910 (hereinafter called the Act). On the same date, the State of Kerala made another order under Section 5 (1) (c) and (3) of the Act directing the appellant to deliver the undertaking to the Kerala Electricity Board (hereinafter called the Board) on or before July 1, 1963. The appellant filed a writ petition under Art. 226 of the Constitution challenging the two orders. The High Court has dismissed the petition Hence this appeal.

2. Sir Sen, counsel for the appellant, has urged four points before us. One of those points is: The Board endorsed the State proposal for the revocation of the licence before the explanation of the appellant reached the State. The explanation was not placed before the Board and accordingly not considered by the Board. So there was no due consultation of the Board and the order of revocation is void. As we are accepting this point, it is not necessary to notice his remaining points. We shall state only such facts as are necessary for the decision of the aforesaid point.

3. On August 17, 1962, the State Government issued a notice to the appellant under S. 4 (3) of the Act asking him to show cause why the licence should not be revoked. He was asked to send his explanation within three months and three days from the date of the receipt of the notice. Much before the issue of this notice. On June 21,1962, the State Government sent the letter No. 11795 EL 1/61/17/ P. W. to the Board. The letter states that the Government considered that the licence of the appellant should be revoked under S. 4 (1) (a) and requested the Board to communicate its views to the Government. On July 26, 1962 the Board sent its reply to the Government. The reply letter is No. B. VI/5705/62. The Board recommended the revocation of the licence. On November 5, 1962 within three months of the issue of the notice under Section 4 (3), the appellant sent his explanation to the Government. The Government was not satisfied with the explanation. It passed the impugned order on May 17, 1963 revoking the licence. These facts support Sri Sen s contention that the Board s recommendation was made without looking into the appellant s explanation. Indeed, it was humanly impossible for the Board to have looked into the explanation.

4. Counsel for the State Government and the Board have raised a preliminary objection. They point out that the argument advanced by Sri Sen was neither raised in the writ petition nor urged before the High Court. According to them it should not be allowed to be raised in this Court. It is true that the point is not specifically raised in the writ petition. But, in our view, it is embedded in paragraphs 6 and 22 of the affidavit accompanying the petition. Paragraph 6 asserts that the aforesaid two orders are "illegal and void and of no effect." Paragraph 22 states that "the entire proceedings culminating in the issue of (the two orders) constitute a gross violation of that the impugned order have been made in breach of the statutory conditions for revoking a licence. earlier we have said that Sri Sen s contention is embedded in paragraphs 6 and 22. We are reassured of our construction of these paragraphs by the fact that the Government as well as the Board have also construed the petition in the same sense and have controverted it in their affidavits. Paragraph 3 of the affidavit filed on behalf of the Government states: "(The appellant s) objections were considered and the Government formed an opinion that it was in public interest to revoke the licence and after consulting the Electricity Board revoked the licence as the Government











































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