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2025 Supreme(Online)(Kar) 33419
KARNATAKA HIGH COURT
MR. SACHIN SHANKAR MAGADUM, J
SHRISHAIL IRAPPA KEMPWAD – Appellant
Versus
STATE OF KARNATAKA DEPARTMENT OF ENERGY – Respondent
WRIT PETITION NO. 103671 OF 2021 (GM-KEB)
For the Appellants/Petitioners: SRI. SHRIDHAR PRABHU
For the Respondents: SRI. ASHOK T. KATTIMANI, SRI. B.S. KAMATE, SRI. SHIVARAJ P. MUDHOL
The denial of agricultural power subsidies to farmer societies based solely on collective consumption constitutes an irrational and arbitrary classification, violating Article 14 of the Constitution and undermining equitable support for small farmers.
Headnote:(A) Electricity Act, 2003 - Section 55 - Constitution of India - Article 14 - Agricultural power subsidy - Denial of power tariff subsidies to registered farmer societies based on collective consumption exceeding a specified limit constitutes an irrational and unconstitutional classification violating the principle of equality. The practice discriminates against collectives, undermining the objectives of agricultural support schemes. (Paras 44-54)
(B) Subsidy scheme - Scope of subsidy for individual farmers versus societies - The classification made by the government’s policy fails to provide equitable treatment and support to farmer societies which aim to improve efficiency and resource sharing among marginal farmers. (Paras 17-23)
Facts of the case:
The petitioners, registered cooperative societies, contend that the denial of agricultural power tariff subsidies solely on the basis of collective consumption exceeding the limit is discriminatory. They argue that this violates their rights under Article 14 of the Constitution, especially as the state has historically supported cooperative farming practices. (Paras 2-8)
Findings of Court:
The Court found the government policy to be unconstitutional, discriminatory and contrary to the principles of equality, confirming that the denial of subsidies to farmers' societies based solely on arbitrary classifications undermines the support intended for small and marginal farmers. The Court directed a review of the policy to ensure fair treatment of farmer societies. (Paras 43-49)
Issues: 1) Whether the denial of subsidies solely on the basis of collective consumption constitutes an unreasonable classification under Article 14? 2) Should the demand notice be set aside considering the petitioners' claims regarding Force Majeure? (Paras 15-19)
Ratio Decidendi: The Court ruled that the arbitrary distinction made between individual farmers and societies based on consumption is unconstitutional. The subsidy policy must be amended to reflect per capita usage rather than collective totals to uphold equitable treatment of all farmer entities. (Paras 44-56)
Result: Writ petition is allowed in part; demand for subsidy revised to permit farmer societies - Prayers for quashing demand notice rejected.
| Table of Content |
|---|
| 1. writ petition filed by secretaries of cooperatives. (Para 1 , 2 , 3) |
| 2. allegations of discrimination in subsidy for societies. (Para 4 , 5 , 6 , 7 , 10) |
| 3. arguments for judicial review of state policy. (Para 8 , 12 , 14) |
| 4. issues of equality under article 14. (Para 15 , 16 , 17 , 18) |
| 5. rationale for agricultural subsidies. (Para 19 , 20 , 21) |
| 6. need for equitable treatment in subsidy distribution. (Para 22 , 23 , 36) |
| 7. statutory requirements for metered installations. (Para 30 , 32 , 33) |
| 8. discrepancy in subsidy claims and disbursals. (Para 34 , 35 , 38) |
| 9. constitutional analysis of subsidy discrimination. (Para 43 , 44 , 45) |
| 10. government's obligation to redistribute subsidies. (Para 46 , 49 , 50) |
| 11. court's directive for policy amendment. (Para 51 , 54 , 58) |
ORAL ORDER
The petitioners who are secretary of the respective Cooperative Societies have filed captioned writ petition seeking the following reliefs.
A. Call for records from the Respondents;
B. Writ of Certiorari or any other writ, order or direction to quash the demand notice bearing No.A/ AKANIA (V)/SALE/K/HS/2020-21/7531-32 dated 16th January, 2021 issued by the 3rd respondent produced herein as Annexure-A;
C. Issue writ of Mandamus or in the nature of Mandamus or any other appropriate writ, order or direction thereby directing the 3rd respondent not to disconnect the Petitioners’ installations bearing No.RR Nos. HT-104 and HT-106 (1st Petitioner and HT-38 and HT-40 (2nd Petitioner);
D. Issue a Writ of Mandamus or any other Writ, Order or direction and declare that period 24th March, 2020 to 31st May, 2020 as the Force Majeure Event and consequently, direct the 3rd Respondent HESCOM Limited to withdraw the bills for the said period;
E. Issue writ of Mandamus or in the nature of Mandamus or any other appropriate writ, order or direction thereby declaring that exclusion of the Petitioners from the eligibility of receipt of subsidy as per Government Order Bearing No. EN 55 PSR 2008 dated 4th September, 2008 produced herein as Annexure-B results in hostile discrimination to the Petitioners;
F. Issue writ of Mandamus or in the nature of Mandamus or any other appropriate writ, order or direction thereby directing the 1st Respondent to grant subsidy to the Petitioners’ installations bearing No.RR Nos. HT-104 and HT-106 (1st Petitioner) and HT-38 and HT-40 (2nd Petitioner) serviced under HT-3A(II) as TA Tariff Category by suitably amending the Government Order Bearing No.EN 55 PSR 2008 dated 4th September, 2008 as per Annexure-B to include the Petitioners society as the eligible entity for receipt of subsidy from the 1st Respondent; and
G. pass such other and incidental Orders as may be appropriate under the facts and circumstance of the case, including an order as to costs.
2. Brief facts of the case are as that, petitioner Nos.1 and 2-society are registered under the Karnataka Societies Registration Act, 1960 , with 13 and 17 number of members respectively by respective authorized representatives as per Section 15 of the Karnataka Societies Registration Act. These two societies assert that they are the registered consumers of respondent No.3- HESCOM. Petitioners assert that both the societies are assigned with respective meter numbers as serviced under HT-3A(II) as TA Tariff Category. Respondent No.3 accordingly sanctioned power supply to both the petitioner societies to an extent of 90HP + Additional 100 HP under HT 3(a)(ii) tariff, which is applicable to Lift Irrigation Scheme/Lift Irrigation Societies respectively.
3. Petitioners assert that they have constructed the lift irrigation project (scheme) on river Krishna for the benefit of 200 acres of land and 103 acres of land in Parthanahalli and Madhabhavi villages of Athani Taluk at approximate cost of Rs.5,79,65,417/-.
4. The petitioner citing Section 55 of the Electricity Act, 2003 would contend that there is statutory duty on respondent No.3 to supply power only through the metered installation. Petitione
