The Central Government has the statutory power to pass provisional orders and determine a date for dissolution of the existing Board. The apportionment of assets and liabilities between successor Boards must be rational and not arbitrary.

JUDGMENT

S.B. SINHA, J :

Interpretation and application of Section 58 of the Madhya Pradesh Reorganisation Act, 2000 (for short "the 2000 Act") arises for consideration in these writ petitions.

Parliament enacted Electricity (Supply) Act, 1948 (for short "the 1948 Act"), in terms whereof the Madhya Pradesh State Electricity Board (for short "MPSEB") was established on 1.4.1957. It was a body corporate in terms of Section 12 thereof. The territorial jurisdiction of the Board was the entire State of Madhya Pradesh as notified and constituted by States Reorganisation Act, 1956 (for short "the 1956 Act").

A new State known as State of Chhattisgarh comprising of 16 districts carved out of the State of Madhya Pradesh was formed on 1.11.2000. Distribution of assets and liabilities of the States are indisputably governed by the 2000 Act. Pursuant to or in furtherance of the provisions of Section 58 of the 2000 Act, the State of Chhattisgarh was entitled to constitute its own State Electricity Board. It was constituted with effect from 15.11.2000. It started collecting revenue with effect from the said date but it offered the revenues collected to the MSEB till 30th November, 2000. The State of Madhya Pradesh also constituted a new Board with effect from 1.1.2001. It informed the Government of India about the formation thereof and requested it to issue necessary orders under Section 58(4) of the 2000 Act enabling the successor Boards to take over assets, liabilities of the existing Board.

A meeting of the officers of the both the States was held by the Special Secretary, Ministry of Home on creation of new States on 10.1.2001. On a complaint made by the State of Madhya Pradesh that the revenues were being collected illegally by the Chhattisgarh State Electricity Board (for short "CSEB"), it was recorded:

"The Government of India made clear that no unilateral action is to be taken by any State and revenues realized within the State relating to distribution of power should be remitted without fail to M.P. State Electricity Board till the Board is bifurcated on a date as certified by the competent authority. It was decided that the new Boards should come into being by 31st March, 2001 positively. The Director, Ministry of Power indicated that steps were being taken by his Ministry to settle disputes of successor States and exercises were underway to complete the bifurcation of the State Electricity Board by end of the current financial year."

Several correspondences also passed between the respective State Governments and the Boards as well by and between them and the Central Government.

It stands admitted that the States could not arrive at a material agreement on the division of assets and liabilities of the MSEB. A notification was issued by the Government of India approving constitution of the successor Boards with effect from 15.4.2001.

Guidelines in regard to division of assets, rights, liabilities, contracts and employees as also for arrangement for distribution of power were laid down therein. The State of Madhya Pradesh made a representation to the Secretary, Government of India, Ministry of Personnel requesting for modification and/ or review of the said notification in regard to the basis of the apportionment of assets and liabilities. A writ petition came to be filed by the MPSEB before the High Court of Delhi inter alia against the CSEB for remittance of revenues illegally retained for the period 1.12.2000 to 14.4.2001. Provisionally, apportionment of assets and liabilities was confirmed by the Government of India, Ministry of Personnel by a letter dated 4.12.2001 with effect from 15.4.2001 opining that the revenue collected by the CSEB before the said date should be remitted to MPSEB. The Central Government appointed the Central Electricity Authority (CEA) as an independent agency for ascertaining the total liabilities of the two States and their classification in terms of the purported criteria laid down in the