The principles of natural justice require that a person be given an opportunity to be heard before a decision is made that affects their rights.

1. This appeal is directed against the order of the learned single Judge in W.P.No. 3534 of 1989, dated 38. 1994. The writ petition relates to the action of the respondents in withdrawing the concessional rate of tariff on the ground that the petitioner was not eligible for availing the concessional rate because it is a branch unit of the appellant unit elsewhere. According to the petitioners, they established a unit at Hosur in or about April 1961, which was given the benefit of concessional tariff by the Court. The Board by letter dated 8. 1995, demanded payment of Rs. 2,36,767-83 on the ground that the petitioners’ unit at Hosur is nothing but a branch unit and therefore, they are not eligible for the grant of concession. Challenging this demand, it is contended that it is a new industrial undertaking and not a branch unit; that the action is vitiated by principles of natural justice; that the dispute as to whether the Unit at Hosur is a branch unit or a new industrial undertaking cannot be unilaterally decided by the respondents and that the respondents are estopped from denying the status of the petitioners’ unit as a “new industrial undertaking”.

2. The learned single Judge, at para 20 of the order has held that factual questions as to whether the petitioner’s units were new industrial undertakings or only branch units can be canvassed only in a civil suit and since the Board has a right to demand the arrears of electricity charges due to them under statutory provisions and they have also a right to disconnect the supply. The learned Judge has further held that it is not for the Board to approach the civil court, but for the petitioners who are aggrieved to approach the civil court, and dismissed the writ petition.

3. The appellant before us contended that the facts involved in the writ petition need not require any further investigation and therefore, it is not a question to be canvassed before the civil court and the withdrawal of tariff concession given to the petitioner company after five years of utilisation is illegal. The electricity Board has issued certain concession subject to certain conditions viz.:

1) This tariff concession is applicable only once to a consumer for new industrial undertaking and will not be available for subsequent expansion or diversification of production.

2) If a consumer starts a branch mill for the manufacture of the same products, the branch mill is not eligible for the concession.

It is also contended that M/s Nagalashmi Flour Mills Pvt. Ltd., Dindigul is a new company incorporated under the Companies Act. M/s United India Flour Mills Pvt. Ltd., Madras is a company incorporated much earlier and is functioning at Madras. In law, one company cannot be said to be a branch of another company and an industrial unit run by one company cannot be said to be a branch unit of another company merely for the reason that one or two directors of the companies are common. Even a subsidiary company cannot be said to be a branch of the holding company since both are independent legal entities. Unless it is shown that the affairs of the subsidiary companies are completely controlled by the holding company. He further contended that under Sec. 370 of the Companies Act there may be more companies under the same management. Still they are legal entities and cannot be styled as sister companies.

4. The question involved is whether the respondent Board is entitled to withdraw the concession between the period 30.11.77 to 30.4.82 without a show cause notice and an opportunity of being heard?

5. To deny concessional tariff under the relevant Rule, it should be a branch unit manufacturing the same product. Amendment to Explanation - I of the Tamil Nadu Revision of Tariff Rates on supply of Energy Act, 1978 (Tamil Nadu Act 1 of 1979) contemplates for the purpose of electricity tariff concession, what the term “New Industry” shall mean. It reads thus:

“For the purpose of electricity tariff conc