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1983 Supreme(Pat) 86

PATNA HIGH COURT
S.B.Sanyal and P.S.Sahay JJ.
Rajeshwar Singh
Versus
State Of Bihar
Civil Writ Jurisdiction Case No. 4581 of 1978 ;
Decided On : MARCH 10, 1983

An amendment to an incentive scheme, which restricts the exemption of annual minimum guarantee charges, is prospective in operation and does not affect industries installed prior to the amendment.

Headnote:

ELECTRICITY - Incentive scheme for small scale industries - Applicability - Amendment of scheme - Effect - Annual minimum guarantee charges - Liability of disconnected industry.

Fact of the Case:

Petitioners, a registered small scale industry, sought to quash an electric bill issued by the State Electricity Board (Board) and refusal to extend the incentive scheme formulated by the State Government in favor of registered small scale industries in the matter of consumption of electrical energy. The crux of the dispute was the applicability of the incentive scheme and the effect of its amendment.

Finding of the Court:

The Court held that: 1. The incentive scheme issued by the Government under Section 78-A of the Electricity Supply Act, 1948, was a direction binding on the Board, and the Board could not ignore it. 2. The amendment of the incentive scheme in 1976, restricting the exemption of annual minimum guarantee charges to a maximum of Rs. 1000/- per year, was prospective in operation and did not affect industries installed prior to the amendment. 3. The petitioners were entitled to the enjoyment of complete exemption from the payment of annual minimum guarantee charges from the date of its production till the completion of the term of 5 years, as per the original incentive scheme. 4. The petitioners were not liable to pay annual minimum guarantee charges for the period of non-supply of electrical energy, as the disconnection of the electrical line amounted to a waiver of the stipulation contained in the agreement regarding the payment of annual minimum guarantee charges.

Issues: 1. Applicability of the incentive scheme for small scale industries. 2. Effect of the amendment of the incentive scheme. 3. Liability of a disconnected industry to pay annual minimum guarantee charges.

Ratio Decidendi: 1. A direction issued by the Government under Section 78-A of the Electricity Supply Act, 1948, is binding on the Electricity Board, and the Board cannot ignore it. 2. An amendment to an incentive scheme, which restricts the exemption of annual minimum guarantee charges, is prospective in operation and does not affect industries installed prior to the amendment. 3. A disconnected industry is not liable to pay annual minimum guarantee charges for the period of non-supply of electrical energy, as the disconnection amounts to a waiver of the stipulation regarding the payment of annual minimum guarantee charges.

Final Decision: The writ petition was allowed. Annexure 14 and 16 were quashed. The Board was directed to restore electrical connection immediately on payment of fresh bills raised, which would be presented by the Board to the petitioners within 15 days from the date of the judgment. There was no order as to costs.

Judgment

S.B.Sanyal, J.

1. In this writ petition, relief sought, is for quashing an electric bill issued by the State Electricity Board (hereinafter to be referred to as the Board) dated 25.5.1978 which has been marked Annexure 14 as well as refusal to extend the incentive scheme formulated by the State Government in favour of registered small scale industries in the matter of consumption of electrical energy. The said letter of refusal is dated 24.(sic)78 and marked Annexure-16. The petitioners further pray for a direction to restore electrical connection, which has been snapped for not surrendering to the illegal demands raised from time to time by the Board, its agents and employees.

2. The crux of the dispute in the instant case is two-fold. The applicability of the incentive scheme of the Government of Bihar bearing No. 16808 dated 29.9.1973, by which registered small scale industries of the State of Bihar were exempted from the payment of annual minimum guarantee charges for a period of five years from the date of its production, as well as grant of subsidy of 9 paise per unit over the electrical energy consumed. Connected with this is the effect of amendment of the said scheme by Government notification dated 19.5.1976, restricting the exemption of annual minimum guarantee charges to a sum of Rs. 1000/-only per year and different modes envisaged to enjoy the amended benefit. The other question of importance is, in absence of electrical connection whether an industry is at all liable to pay annual minimum guarantee charges for the disconnected period.

3. The petitioners are partners of M/s. Alakha Rubber Industry, a factory set up at Jamira, Bhojpur, for production of rubber, tyres, tubes etc. in the small scale sector. It started production on 12.8.1974 and obtained registration from Industries Department as a small scale industry on 30.10.1975, a photo copy of the registration certificate has been marked Annexure22. Board was intimated about it by the petitioner on 13.11.1975 (Annexure-11) The respondent, Electrical Executive Engineer, while acknowledging the said letter, enquired about the registration number from the petitioner on 22.12.1975 (Annexure-12) in order to enable him to extend the facility of incentive scheme of the State Government to registered small scale industry.

4. On 12.8.1974 (Annexure-B), the petitioners entered into an agreement with the Board for (supply of electrical energy, The agreement shows that the contract demand was fixed at 100 KVA and the annual minimum guarantee charges under Clause 4(a) of the agreement was fixed at Rs. 14,892/-. The tariff was fixed under symbol H.T.G.T. The petitioners deposited a sum of Rs. 6000.00 by way of security money.

5. The factory of the petitioners along with its raw materials and finished products was washed away by the devastating flood of August, 1975 and, therefore, on 15.9.1975 the petitioners asked the respondent, Electrical Executive Engineer by a letter Annexure 1 to disconnect the line in order to avoid further financial burden, which was received in the office of the Executive Engineer on the same date. The industry was greatly affected by the flood is borne out by the inspection note of Deputy Director of Industry dated 6.10.1975 vide Annexure 3 as well as by the note of Project Executive Officer, Rural Development dated 9.11.1976, vide Annexure 4.

6. On 6.9.1976, respondent Electrical Executive Engineer, asked the petitioners that up-to-date bill of the industry amounts to Rs. 51,789 and odd and after adjustment of the security deposit the same should be paid. Electrical line was, however, disconnected on 16.10.1975. According to petitioners the said disconnection was at their request, whereas the Board, contends that it was at their instance, for non-payment of arrears bill The bills, however, went on rising despite disconnection since on 24.4.1977. the bill stood at Rs. 92,213/-. It may be here mentioned that on 21.9.1976, the respondent-Indu












































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