IN THE HIGH COURT OF JUDICATURE AT BOMBAY
S. C. Dharmadhikari & G.S.Patel, JJ.
MUNICIPAL CORPORATION OF GREATER MUMBAI - Petitioner
Versus
MAHARASHTRA ELECTRICITY REGULATORY COMMISSION & Ors. - Respondents
WRIT PETITION NO. 2641 OF 2014
Decided On : 2-3-2016
Electricity Act - Municipal Corporation of Greater Mumbai - Section 43(1), Section 181(2)(t) - Regulations 4.10, 4.1, 4.7, 4.8, 4.10 - The court dismissed the petition challenging the Regulations 4.10, 4.1, and 4.7 of the Maharashtra Electric Regulatory Commission (Standards of Performance of Distribution Licensees, Period for Giving Supply and Determination of Compensation) Regulations 2014. The court found the challenge to be against the legislative purpose and intent of the 2003 Act, which is pro-consumer and attempts to afford each consumer a plenitude of choice. The court also found the Regulations to be necessary to maintain the balance between immediate supply and stable, efficient, and uninterrupted electricity supply.
Fact of the Case:
The Municipal Corporation of Greater Mumbai (MCGM) challenged Regulations 4.10, 4.1, and 4.7 of the Maharashtra Electric Regulatory Commission (Standards of Performance of Distribution Licensees, Period for Giving Supply and Determination of Compensation) Regulations 2014, claiming they were ultra vires Section 43(1) and Section 181(2)(t) of the Electricity Act, 2003. The MCGM sought to retain a complete monopoly over its command area, opposing competition and attempting to deprive consumers of choice of supplier.
Finding of the Court:
The court found the MCGM's challenge to be without merit, contrarian, antagonistic, and designed to retain a complete monopoly within its command area, all at the cost of the individual consumer. The court dismissed the petition, censuring and excoriating MCGM for its deplorable conduct in attempting to perpetuate its stranglehold on the people of Mumbai.
Issues: The issues included the challenge to Regulations 4.10, 4.1, and 4.7 of the Maharashtra Electric Regulatory Commission (Standards of Performance of Distribution Licensees, Period for Giving Supply and Determination of Compensation) Regulations 2014, and the MCGM's attempt to retain a complete monopoly within its command area.
Ratio Decidendi: The court's decision was based on the legislative purpose and intent of the 2003 Act, which is pro-consumer and attempts to afford each consumer a plenitude of choice. The court also considered the necessity of maintaining the balance between immediate supply and stable, efficient, and uninterrupted electricity supply.
Final Decision: The court dismissed the petition, finding it utterly without merit and censuring and excoriating MCGM for its deplorable conduct in attempting to perpetuate its stranglehold on the people of Mumbai.
G. S. Patel, J.
1. Rule. Respondents waive service. By consent, Rule is made returnable forthwith and the Petition is taken up for hearing and disposal. We have heard Mr. Setalvad and Mr. Chagla, learned Senior Counsel for the Petitioners and the 2nd Respondent respectively at some length, and, in addition, Mr. Singh and Ms. Calcuttawala for the other Respondents. We have considered the material on record.
2. The Petitioner is the Municipal Corporation of Greater Mumbai (“MCGM”). This is a statutory corporation and a local authority for Greater Mumbai. Among its various functions is the provision of electric supply and transport for the Island City of Mumbai, through the Brihanmumbai Electric Supply & Transport Undertaking (“BES&T”; in this judgment, the term BES&T refers also to the Petitioner). In this Writ Petition under Article 226 of the Constitution of India, the MCGM challenges Regulation 4.10 read with Regulations 4.1 and 4.7 of the Maharashtra Electric Regulatory Commission (Standards of Performance of Distribution Licensees, Period for Giving Supply and Determination of Compensation) Regulations 2014 (“the SOP Regulations 2014”; “the Regulations”), framed by the 1st Respondent. The challenge is on two grounds. First, that these Regulations are ultra vires Section 43(1) read with Section 181(2)(t) of the Electricity Act, 2003 (“the 2003 Act”), and, second, that the impugned Regulations are beyond the rule-making power of the 1st Respondent under Section 181(2)(t) of the 2003 Act.
3. In our considered view, there is no merit at all in this Petition. The BES&T’s challenge is a studied attempt at subverting a statute that has as its primary intent the interests of the individual consumer of electricity and the promotion of efficient and healthy competition, the adoption of best practices and the development of effective power distribution systems. We find, however, that the BES&T’s attempts are in exactly the opposite direction: to retain, willy-nilly, its stranglehold over its hapless consumers and to keep out all competition. We find MCGM’s approach to be far, far less than fair and candid; we find it to be contrarian, antagonistic, and designed to retain a complete monopoly within its command area, all at the cost of the individual consumer. We have dismissed the Petition. Our reasons follow.
4. In 1905, BES&T was granted a license under the erstwhile statutes, viz., Indian Electricity Act, 1903 and the Indian Electricity Act, 1910. BES&T was subsequently acquired and municipalized in 1947 by the Bombay Municipal Corporation. It is a ‘Distribution Licensee’ within the meaning of Section 2(17) of the 2003 Act.
5. The 1st Respondent is the Maharashtra Electricity Regulation Commission (“MERC”), a statutory body constituted under Section 82 of the 2003 Act. Respondent No.2, Tata Power Company Ltd. (“TPC”) is a limited company that has been selling, supplying and distributing electricity in and around Mumbai city and its suburban area for more than a century, under licenses acquired under the previous statutes. It is today a deemed licensee under Section 14 of the 2003 Act. Respondent No.3 is the State of Maharashtra.
6. In April 2009, one of BES&T’s consumers approached TPC for the supply of electricity, intending to switch over from the former. BES&T refused to allow TPC to use its distribution network for electric supply. The matter was taken to the MERC for adjudication. MERC directed TPC to fulfil the demand for electricity using either its own cables or those of BES&T. The MCGM challenged this order before the Appellate Tribunal, which dismissed the appeal by an order dated 4th April 2012. Aggrieved, the MCM appealed to the Supreme Court under Section 125 of the 2003 Act., Brihanmumbai Electric Supply and Transport Undertaking v. Maharashtra Electricity Regulatory Commission, (2015) 2 SCC 438. The Supreme Court dismissed the Appeal on 8th May 2014. On 20th May 2014, MERC framed the impugned regulations.
7. Mr. Se
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