A statutory corporation cannot impose conditions of supply that are not authorized by the statute creating it or are contrary to public policy.

PREM PRAKASH, J. :- This special appeal arises from the decision of a learned single Judge of this Court in Writ Petition No. 1026 of 1969, brought by Smt. Lakshmi Devi Sehgal (hereinafter referred to as the consumer) against the U. P. State Electricity Board (to be described hereinafter as the Board), directing it by a writ in the nature of mandamus to replace at its cost, the stolen transformer, cost of which the Board by its order dated 24-10-69 had directed the consumer to deposit, to maintain and continue the supply of electricity. in terms of the agreement between the Board and the consumer, as amended by the Boards memorandum dated 12-12-1968 adding to the conditions of supply, a fresh condition No. 23 (a) providing:

If in any case the transformer in rural area outside the premises of a consumer from which he is receiving supply is stolen then the consumer will have to bear the cost of its replacement, If however, there are more than one consumer then cost will be shared in proportion to the H.P. contracted by each."

The fresh condition was added to the agreement, because Condition No.10 (1) of the Agreement stipulates that the consumer shall

"abide by the Electricity Board conditions of supply now in force and by any subsequent modification or alteration thereto, as if the same had been in corporated in this Agreement."

2. The consumer has an agricultural farm on the Lucknow-Barabanki Road; she has a tube well on the farm; she requisitioned the supply of electric energy to enable her to run the tube-well and upon her entering into the agreement on 30-8-1968 her premises were connected with the main. The electric motor of the tube-well stopped working in the first week of October and upon enquiry she was told that the transformer situate at a distance from her tube-well had been stolen. When she presented an application to replace the stolen transformer, the Board insisted her to bear the replacement cost and hence the writ petition. The Board contended that the consumer having agreed to abide by the subsequent modifications or alterations made by the Board in the Conditions of Supply and Condition No. 23 (a) added by the Board making it obligatory upon the consumer to bear the cost of the stolen transformer, the latter cannot turn round and ask the Board to resume the supply of energy without her performing her part of the contract. Finally, it was maintained that the rights of the parties flow from a contract, they cannot be enforced by invoking the extraordinary jurisdiction of the Court under Art. 226 of the Constitution.

3. The learned single Judge held that the petitioner was under no legal liability to bear the replacement cost of the transformer, it being not the part of service line as defined by S. 2 (1) of the Indian Electricity Act, 1910. A transformer, in the opinion of the learned single. Judge, is a part and parcel of the main transmission line as defined by S. 2 (7) of the Electricity (Supply) Act, 1948. As regards the plea that contractual rights and liabilities cannot be enforced, the learned single Judge held that the obligation which the Board sought to fasten upon the consumer was in contravention of Cl. (vi) of the Schedule 7 to Indian Electricity Act, 1910, the remedy for statutory breach could be availed of by the consumer and the Court can grant writ to her. Accordingly, the writ petition succeeded and the rule was made absolute.

4. Being aggrieved from that order, the Board has come up in appeal.

5. The Board is a body corporate which has been endowed with power to acquire and hold property, both movable and immovable, by S. 12 of the Electricity Supply Act, 1948. The Board is constituted by a notification made under S. 5 of that Act. It being thus a statutory corporation, it would be necessary at the outset to consider its nature and character and the extent of the powers which it may in its relationship with the consumer lawfully exercise. The right to conduct its business in the form of