1989 Supreme(AP) 302
Andhra Pradesh High Court
Judges : SARDAR ALI KHAN
Ferro Alloys Corporation Ltd. - Appellant
Versus
A.P. State Electricity Board hyderabad - Respondent
Decided On : 07-12-89
The classification of consumers into different categories and the fixation of tariffs by the APSEB must be based on rational criteria and should not be discriminatory.
Headnote:
ELECTRICITY - TARIFF - POWER INTENSIVE INDUSTRY - CLASSIFICATION - DISCRIMINATION - H. T. CATEGORY-I - H. T. CATEGORY-III - OPTION TO CHANGE CATEGORY - VALIDITY - ANDHRA PRADESH ELECTRICITY (SUPPLY) ACT, 1948 - SECTION 49.
Fact of the Case:
The petitioner, a power intensive industry, challenged the classification of its industry as H. T. Category-III, arguing that it should be treated as H. T. Category-I and billed accordingly. The petitioner contended that the creation of a separate category for power intensive units was unwarranted and discriminatory, and that it had not exercised any option in favor of being treated as a power intensive industry.
Finding of the Court:
The court held that the Andhra Pradesh State Electricity Board (APSEB) had the power to classify consumers into different categories and fix tariffs accordingly, but that such classification must be based on rational criteria and should not be discriminatory. The court found that the creation of a separate category for power intensive units was justified, as such industries consumed large amounts of power and had a high load factor. However, the court also found that the APSEB had not provided any criteria for classification of industries as power intensive, and that this had led to discrimination against some industries, including the petitioner.
Issues: 1. Whether the creation of a separate category for power intensive units was warranted and supported by the provisions of the Indian Electricity Act or the Electricity Supply Act? 2. Whether the petitioner had exercised an option in favor of being treated as a power intensive industry? 3. Whether the classification of the petitioner's industry as H. T. Category-III was discriminatory?
Ratio Decidendi: The court held that the creation of a separate category for power intensive units was justified, as such industries consumed large amounts of power and had a high load factor. However, the court also found that the APSEB had not provided any criteria for classification of industries as power intensive, and that this had led to discrimination against some industries, including the petitioner. The court further held that the petitioner had not exercised any option in favor of being treated as a power intensive industry, and that the classification of its industry as H. T. Category-III was discriminatory.
Final Decision: The court directed the APSEB to treat the petitioner's industry as H. T. Category-I and bill it accordingly, with effect from the date of the judgment.
( 1 ) THERE are common questions of law and fact involved in this batch of writ petitions, which can be disposed of by a common judgment.
( 2 ) THE salient facts in W. P. No. 14843/87 may be taken as the common set of facts for all the cases except for such deviation which may be necessary to be dealt with separately.
( 3 ) THE petitioner in W. P. No. 14843/87 is Ferro Alloys Corporation limited, Shreeramnagar. The petitioner prays for the issue of a writ of mandamus directing the Andhra Pradesh State Electricity Board, hereinafter referred to as the respondent-Board, to treat the petitioner-industry as h. T. Category-I and bill them accordingly.
( 4 ) THE brief facts of the case are that the petitioner-industry bas two connections (points ). For the first connection (point) an agreement was entered into, which is being renewed from time to time, by virtue of which the Board has agreed to supply 46,105 KVA. The latest agreement in that regard is dated 13-1-1983. At the time of expansion, the petitioner-industry had entered into another agreement for supply of 17,000 KVA. The petitioner-industry comes within the category of H. T. Industries, which is further qualified by the term power intensive industry having high load factor and power factor, it has a high load factor of 80% to 90% compared to L. T. Consumers who have a load factor of 30-50%. Since the industry is one which consumes large power as compared to the domestic consumers, it comes under the category of power intensive industry.
( 5 ) THE respondent-Board was supplying power to bulk consumers at a less rate than it was done to other consumers. The supply to the bulk consumers is cheaper because the cost of such supply is considerably lower as compared to other consumers. The respondent-Board evolved certain guidelines in 1975 to classify certain industries as power intensive units for the purpose of charging lesser rates. Thereafter, B. P. Ms. No. 671 dt. 10-6-1987 and B. P. Ms. No. 736, dated 14-7- 87 revising the tariffs for various categories of consumers have been issued. The petitioner-industry satisfles the criterion stipulated for Category-I H. T Vide Part-A of Appendix-I Terms and conditions of supply of electrical energy at H. T. notified in B. P. Ms. No. 272 dated 1-5-1974. The grievance of the petitioner-industry is that the Board does not seem to have any criteria for classification. For instance, it is submitted that V. B. C. Ferro Alloys, which is located at Medak. and manufactures Ferro Alloys, arc bulk consumers of power but they are classified as H. T. I. Category whereas the petitioner-industry is classified as a power intensive industry, which entails payment of electricity charges at higher rates. Therefore, in sum and substance, what the petitioner-industry wants is that they should also be treated as H. T. I. Category and the consumption of energy by them should also be chargeable at the same rate. It seems, the petitioner-industry made a request to this effect to the respondent-Board, which has been rejected. The petitioner further denies that they have exercised any option in favour of being treated as power intensive industry thereby conferring the power on the Board to put the petitioner in that category. The petitioner further stresses the point that the creation of a separate category of consumers under the heading power intensive units is unwarranted and not supported either under the provisions of the indian Electricity Act or the Electricity Supply Act. The petitioner s further contention is that even if they are deemed to have opted for the category of power intensive industry, they should be allowed to come back to the category of H. T. Category-I as has been done in the case of certain industries like M/s. Chlorate India. The petitioner-industry, therefore, seeks to press home the charge that there is discrimination practised by the board against it while favouring similar industries like V. B. C. Ferro All