2021 Supreme(SC) 234

SUPREME COURT OF INDIA
L. NAGESWARA RAO, VINEET SARAN, JJ.
JHARKHAND STATE ELECTRICITY BOARD AND OTHERS - APPELLANTS
VERSUS
M/S RAMKRISHNA FORGING LIMITED - RESPONDENT
CIVIL APPEAL NO.6145 OF 2010
Decided On : 30-04-2021

IMPORTANT POINTS:
(1) Regulation 9.2.6 of the Regulations of 2005 provides for execution of a supplementary agreement for reduction of contract demand/sanctioned load of the consumer. Similarly, for enhancement of load also, even if a fresh agreement may have been executed between the parties, the same could be treated as nothing but a supplementary agreement of the initial agreement by which the electricity connection was granted for a particular load(2) Clause 2(l) of the Regulations also defines “contract demand” to be demand mutually agreed in the agreement or agreed through other written communication, meaning thereby that for variation of the contract demand execution of a fresh agreement is not essential and the same can be done otherwise also by mere written communication

Headnote:

Jharkhand State Electricity Regulatory Commission (Electricity Supply Code) Regulations, 2005 – Electricity Act, 2003 - Section 181(2)(x) read with Section 50 – Application for reduction of load – Rejected treating the date of commencement of the agreement to be 7/12.07.2007 and only by considering the provision of determination of agreement – No reduction of load to be allowed by the Distribution Licensee before expiry of the initial period of agreement – Whether discriminatory, arbitrary and against the public policy – Held, consumer has the liberty of getting its load enhanced under Regulation 9.1, the reduction of contract demand/sanctioned load can also be prayed for and decided in terms of Regulation 9.2 – If Regulations provide for contract load to be varied even through a written communication, then though fresh agreements may have been executed at the stage of enhancement of load of the same electricity connection, the same cannot be treated as anything but an extension/amendment or modification of the initial agreement granting the electricity connection – Application ought to have been allowed by the Board in terms of Regulation 9.2 of the Regulations of 2005, treating the application to be beyond the period of three years from the date of the execution of the initial agreement by which the electricity connection of the respondent had been initially granted. [Para 13, 15 and 18]

Facts of the Case:

Respondent, small scale industry entered into an agreement with the for High Tension (H.T.) connection of 325 KVA load- Respondent thereafter applied for enhancement of load from 325 KVA to 1325 KVA, which was allowed by the General Manager-cum-Chief Engineer of the Board - Respondent again applied for enhancement of load from 1325 KVA to 3500 KVA, which was sanctioned by the Board - On a further request of the respondent, the load was again enhanced by 500 KVA to 4000 KVA. For each enhancement of load, fresh agreements to that effect were entered into between the respondent and the Board, the last one being on 07.07.2007 for supply of 4000 KVA load - Respondent alleges that after the enhancement of load, it was facing major trippings as well as continuous load shedding which was affecting the costly machineries and, therefore, the respondent decided to reduce the load from 4000 KVA to 1325 KVA. Accordingly, the respondent filed an application, before the authority of the appellants-Board for such reduction. Vide its order the Electrical Superintending Engineer rejected the said application of the respondent for reduction of load from 4000 KVA to 1325 KVA informing the respondent that from the date of enhancement of supply of load, an agreement (dated 07.07.2007) would be enforced for a period of three years and treating it to be a case of determination of agreement, and quoting the Clause 9B of the agreement, it was provided that the agreement could not be permitted to be determined prior to the completion of initial period of three years from 07.07.2007 and that the respondent will have to pay the minimum guarantee charges and other charges, even if the respondent decides to terminate the agreement - Challenging the said order of the Board respondent filed Writ Petition which has been allowed by the High Court vide its judgment primarily on the ground that the proviso contained in Regulation 9.2.1 of the Jharkhand State Electricity Regulatory Commission (Electricity Supply Code) Regulations, 2005 providing for no reduction of load to be allowed by the Distribution Licensee before expiry of the initial period of agreement was discriminatory, arbitrary and against the public policy. Challenging the aforesaid judgment, this appeal has been filed.

Finding of the Court:

Application of the respondent for reduction of load has been rejected in terms of Clause 9(B) of the agreement, treating the date of commencement of the agreement to be 7/12.07.2007 and only by considering the provision of determination of the agreement, which could not have been without giving notice of less than 12 calendar months. It is clear that the said communication/order does not consider the provisions of the Regulations of 2005 with regard to reduction of load, but only treats the application for reduction of load to be an application for determination of the agreement - For enhancement of load also, even if a fresh agreement may have been executed between the parties, the same could be treated as nothing but a supplementary agreement of the initial agreement by which the electricity connection was granted for a particular load. Clause 2(l) of the Regulations also defines “contract demand” to be demand mutually agreed in the agreement or agreed through other written communication, meaning thereby that for variation of the contract demand execution of a fresh agreement is not essential and the same can be done otherwise also by mere written communication - On the dictates of the Board, the consumer may have been required to sign fresh agreements for each enhancement of load, but the enhancement being for the same electricity connection which still continues, it would merely be amendment of the initial agreement. This would also be in consonance with the provisions of the Regulations of 2005, which have to be liberally interpreted in favour of the consumer - Board has gone wrong in treating the application dated 20.09.2007 of the respondent for reduction of load to be that for determination of the agreement under Clause 9B of the agreement, which application, in fact, ought to have been considered under Regulation 9.2 of the Regulations of 2005.

Result: Appeal dismissed