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2001 (2) JLJ 47
(SUPREME COURT)
B.N. Kirpal, Doraiswamy Raju and K.G. Balakrishnan, JJ.
Raymond Ltd. and another v. M.P. Electricity Board and others
Civil Appeal Nos. 4218-19 of 1998; against order of MP.
High Court published in 1999 (1) JLJ 238 (FB); Decided on 16.11.2000.
(2) Electricity Act, 1910 -- S. 22B -- big consumer not able to consume any part of electrical energy beyond his control -- consumer is entitled to proportionate reduction of minimum charge -- circumstance of power cut as order of government -- is one of such circumstances. (1976) 2 SCC 877 relied on. [Para 12
(3) Electricity (Supply) Act, 1948 -- Ss. 49 and 79 -- MP. Electricity Board Agreement for Supply of High Tension electricity -- Cl. 23 -- payment of minimum guaranteed charges by consumer -- reduction may be claimed if Board was unable to supply minimum of energy.
The question of exonerating the consumer from the liability undertaken to pay minimum guaranteed charges for a month and billing only for the actual consumption of energy or allowing a consumer to pay the rates on the actual consumption of electricity measured in units will and can arise and has also been considered for determination only in case the supply by the Board itself fell short of the minimum of energy, the consumption of which goes to make up the minimum guaranteed sum. It is well settled and there could be no controversy over the position that if only the supply was available for consumption but the consumer did not consume so much of energy up to the extent of the obligation cast upon him to pay the minimum charge, there is no escape from the payment of the minimum guaranteed charges, except in very exceptional cases envisaged under clause 23 of the contract and that too subject to the stipulations and restrictions contained therein. 1993 JLJ 306 referred to. (1995) 4 SCC 320, (1976) 2 SCC 877, (1989) 1 SCC 452, (1990) 1 SCC 731, (1991) 3 SCC 263, (1975) 2 SCC 508 and (1969) I MLJ 69 discussed. [Para 16
(4) Contract Act, 1872 -- S. 56 -- agreement for supply of high tension electricity -- provisions under have no application. [Para 17
(5) Electricity (Supply) Act, 1948 -- Ss. 22B and 79 -- MP. Electricity Board Agreement for Supply of High Tension Electricity -- Cls. 11.12. 21 (b) and 23(b) and Tariff notification -- minimum guarantee given by consumers against minimum consumption -- Board not able to supply such consumption -Board not entitled to amount of minimum guarantee.
Even going by "the tariff notification which prescribes also a minimum entitling the Board to collect it [vide clause 21 (b)] it merely casts liability on the consumer to "guarantee a minimum monthly consumption equivalent to 40% load factor of the contract demand". Consequently, for the consumer to honour his/its commitment so undertaken to give a minimum consumption there should essentially be corresponding supply by the Board at least to that extent, without which the consumption of the agreed minimum is rendered impossible by the very lapse of the Board. The minimum guarantee, thus, appears to be not in terms of any fixed or stipulated amount but in terms of merely the energy to be consumed. The right, therefore, of the Board to demand the minimum guaranteed charges, by the very terms of the language in the contract as well as the one used in the tariff notification is made enforceable depending upon a corresponding duty, impliedly undertaken to supply electrical energy at least to that extent, and not otherwise. It is for this and only reason we find that the ultimate conclusion arrived at by the Full Bench of the High Court does not call for any interference in these appeals. Order of High Court affirmed. [Para 21
(6) Income Tax Act, 1922 -- Ss. 66 and 66A (2) -- High Court under S. 66 exercises special advisory jurisdiction -- scope is limited -- Supreme Court hearing appeal under S. 66A (2) -- can do what High Court could do. AIR 1966 SC 1089 referred to. [Para 23
(7) Constitution of India -- Art. 226 -- power of the High Court under -does not carry any restriction in the quality and content of such power. AIR 1966 se 1089 distinguished. [Para 23
(8) Constitution of India -- Arts. 136. 141 and 142 -- doctrine of prospective overruling -- Supreme Court can always have recourse to the said doctrine -- it can pass any order found to be necessary in balancing the rights of parties. (1991) 1 SCC 588, (1993) 4 SCC 727 and AIR 1990 SC 85 relied on. (1999) 9 SCC 559 distinguished. [Para 23
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¼2½ fo|qr vf/kfu;e] 1910&/kkjk 22[k&cM+s miHkksDrk }kjk fo|qr ÅtkZ dk dksbZ Hkkx mlds fu;a=.k ds ijs miHkksx ugha gks ldk&miHkksDrk] U;wure çHkkj dks vkuqikfrd NwV dk gdnkj gS&bl /kkjk ds v/khu ljdkj }kjk fctyh dh dVkSrh ds vkns‘k tSlh ifjfLFkfr&,slh ifjfLFkfr;ksa esa ,d gSaA ¼1976½ 2 ,l lh lh 877 voyafcrA ¿iSjk 12
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¼8½ Hkkjr dk lafo/kku&vuq-136] 141 rFkk 142&Hkfo";y{kh fofu.kZ; dk fl)kar&mPpre U;k;ky; lnSo mDr fl)kar dk vkJ; ys ldrk gSa&i{kdkjksa ds vf/kdkjksa dks larqfyr djus esa og dksbZ Hkh vkns‘k ikfjr dj ldrk gS tks vko‘;d ik;k tk,A ¼1991½ 1 ,l lh lh 588] ¼1993½ 4 ,l lh lh 727 rFkk , vkb vkj 1990 ,l lh 85 voyafcrA ¼1999½ 9 ,l lh lh 559 çHksfnrA ¿iSjk 23
Raju, J. -- 1. The above batch of appeals arise out of a common judgment rendered in a batch of writ petitions by a Full Bench of the Madhya Pradesh High Court, since reported in Raymond Ltd. v. State of MP. [199 (1) JLJ 238 (FB)] and also the consequential separate orders passed subsequently by the Division Bench dismissing the writ petitions. The writ petitioner industries filed appeals against that portion of the opinion of the Full Bench confining the declaration of law made for prospective application only and the dismissal of the writ petitions, whereas, the Electricity Board had filed appeals against that portion of the opinion of the Full Bench declaring the position of law that whenever the contracted supply falls short of 40% of the contract load then the Board shall be entitled to charge only for the reduced energy actually supplied and not for 40% of the contract load as minimum charges and thereby overruling an earlier decision of a Division Bench of the said High Court reported in Gwalior Steels (P) Ltd. v. MP. Electricity Board. [1993 JLJ 306] For the purpose of appreciating the points raised, we would advert to the facts in one of these appeals, particularly those in M/s Raymond Ltd. in CAs Nos. 4218-19 of 1998.
2. The appellant M/s Raymond Ltd., a company registered under the Companies Act, 1956 and having its cement manufacturing division within the State of Madhya Pradesh, entered into an agreement with the Madhya Pradesh Electricity Board on 27.3.1979 renewed periodically for supply and purchase of high-tension electric energy for use in the manufacture of cement. The minimum contractual demand was for 33 MW (38, 822 KVA) per day and clause 19 provided for the tariff, while clause 21 stipulated the term relating to minimum guarantee in the following terms:
"21. (a) The consumer shall from the date of utilisation of electrical energy, or from the date of expiry of the three months' notice mentioned in clause 2 hereof guarantee such minimum consumption as when calculated at the tariff (excluding charges due to fuel adjustment clause, meter rent and miscellaneous charges) will yield an annual revenue of Rs. 5,40,000 (Rupees five lakhs forty thousand only) or pay this sum as a minimum. The deficit, if any, between the guaranteed minimum charges and the actual charges shall be payable by the consumer.
(b) The minimum guarantee specified in clause 21 (a) above shall at all times be without prejudice to realisation by the Board of the minimum prescribed under the tariff referred to in clause 19 hereof.
(c) It is hereby agreed further that the Board shall be entitled to fix and charge enhanced amount of annual revenue if the Board, on completion of all works for supply to the consumer, finds it has incurred higher expenditure than the pre-estimated cost and in that case the consumer shall pay to the Board the enhanced annual revenue so fixed by the Board without any objection and will not raise any dispute regarding the same." Clause 19 of the agreement reads as follows:
"The consumer shall pay to the Board every month, charges for the electrical energy supplied to the consumer during the preceding month, at the Board's tariff applicable to the class of service and in force from time to time. A copy of the. current HT Tariff No.1-A of Notification No. 5/GA/147-A dated 11.3.1 976 as amended applicable to the consumer is set out in the schedule attached to this agreement."
3. Under the notification issued for high tension for 132 KV/220 KV supply, the minimum tariff prescribed for cement factories is said to be as hereunder:
"The consumer will guarantee a minimum monthly consumption (KWH) equivalent to 40% load factor of the contract demand. The consumer will be required to pay the energy charges on the said minimum monthly consumption plus the demand charges on the billing demand for the month as minimum monthly payment irrespective of whether any energy is consumed or not during the month. An average pow
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