JUDGMENT :

1. This Civil Appeal is against the judgment and order of the Division Bench of the High Court of Calcutta¹[A.P.O.T. No. 519 of 2010 dated 19.05.2011], confirming the order of the Single Judge²[W.P. No. 1131 of 2002 dated 10.08.2010] dismissing the writ petition filed by the appellant challenging the arbitrary action of the West Bengal State Electricity Board³[Hereinafter referred to as the ‘Board’] withdrawing the concessional rate of power supply under Agreement dated 18.01.1999.

2. Facts, to the extent they are relevant for our purpose are that the respondent Board issued a notification dated 18.10.1996 revising the tariff applicable. The notification also provided concessional tariff to new and expanding industries as well as sick and closed industries being re-opened. The relevant provisions of the concession notification are as follows:

"Concessions to New Industries, Expanding Industries and Sick and closed Industries being reopened.

(a) Concession for New Industries:-

All new HT and EHT industries will be eligible for a concession in the Tariff (energy charge) based on consumption on the following pattern with effect from the date permanent connection is effected for a period of 3 (three) years.

All new industrial consumers drawing power at 66/132 KV will be given a concession of 40% on the total energy charges for three years.

All new HT industrial consumer drawing power at 33 KV will be given a concession of 30% on the total energy charges for three years.

All new HT industrial consumers drawing power at 6/6, 6/11 KV will be given a concession of 25% on the total energy charges for three years."

3. The appellant, an industry involved in manufacture of cast iron, had a Low Tension (LT) power supply connection for its factory at Dankuni, Hooghly, West Bengal. In order to expand its business and to cope with clean and technologically advanced industrial growth, the appellant installed 500 Kgs. capacity Induction Furnace (300 KVA) having production capacity of 1500 Mt. p/a in grey iron casting and additional capacity of 1200 Mt. p/a in ductile iron casting for its industry. By such upgradation, the appellant transitioned into a ‘New Industry’.

4. With the aforesaid installation and upgradation, appellant needed a HT/Bulk Power Supply from the Board. Accordingly, appellant filed an application for HT power supply in place of its existing LT Power Supply by furnishing all details in the prescribed proforma on 31.08.1998.

5. Pursuant to the above application, the Superintending Engineer vide his letter dated 03.09.1998 asked the appellant to deposit a sum of Rs.5,000/- for processing the application and for inspection of the factory premises. The appellant deposited the said amount and by its letter dated 05.09.1998 requested for an inspection. A joint inspection was held on 15.09.1998 and the appellant was informed that the authorities were fully satisfied and an estimation/quotation for service connection charges for effecting HT/Bulk Power Supply will be processed immediately.

6. By a Memo dated 10.10.1998, the Board sanctioned and proposed a HT/Bulk Power Supply to the appellant’s factory, subject to certain conditions. The relevant portion of the Memo is as follows:

“This has reference to your application No. Nil Dtd. 7.9.98 and subsequent joint inspection of site on 15.9.98 based on your load forecast conveyed to us through year above letter we have framed an estimate for the proposed Bulk Power Supply to your factory/at Jagannathpur, P.S. Serampore, District-Hooghly supply may be available to you under the following terms and conditions.

a) You will