FACT LTD Vs. KSEB

JUDGEMENT

(1.) THIS appeal, by special leave, is by Messrs fertilizers & Chemicals Travancore Limited and is directed against the judgment and order dated 13-6-1973 of the Division Bench of the Kerala High court in Writ Appeal No. 103 of 1971 affirming the order dated 26-11-1970 of the learned Single Judge in O. P. No. 3772 of 1968. The High Court dismissed the appellant's writ-petition challenging the enhancement, of the electricity tariff from Rs. 110/-per K. W. per annum to Rs. 200/- per K. W. per annum. The enhancement was made by the kerala State Electricity Board ('board' for short) pursuant to the power reserved to it under Regulation. 11 of the Kerala State Electricity Board (General Tariffs) Regulation, 1966 ("regulation") framed under S. 79 0) read with S. 49 (1) of the Electricity (Supply) Act, 1948, ('act')- The enhancement was to take effect from 16-8-1968. The period to which the challenge pertains is between 16-8-1968 and 1-1-1970. The appellant assailed this enhancement before the High court on grounds, inter alia, that the terms for the supply of electricity to appellant's industrial unit manufacturing fertilizers were governed by an agreement dated 21-10-1948 entered into with the erstwhile Travancore State; that the agreement, in terms of S. 60 of the Act, should be deemed to have been entered into by the Board referable to statutory powers under S. 49 (3) of the act; that during the subsistence of the agreement the rates fixed therein were immune from any unilateral upward revision even if the purported enhancement was pursuant to the statutory regulations under S. 49 (2) and that, at all events, the enhancement, being selective and discriminatory, was violative of art. 14 of the Constitution.

(2.) WE may refer, briefly, to the factual antecedents: Appellant is a company registered under the Companies Act with its Registered Off ice at Eloor, Udyogamandal P. O. in the erstwhile State of Travancore, now part of Kerala. On 21-10-1948 an agreement was entered into between the appellant and the erstwhile princely State of Travancore for the supply of electrical energy by the latter to the former under terms and on conditions particularised in the agreement. The price was fixed at Rs. 110/- per K. W. per annum. Subsequently the State merged in and became part of the Kerala State and the Electricity Board was constituted for the State. On 10-5-1965 a supplementary agreement was entered into between the appellant and the Board for supply of additional power for a period of ten years at the rate of Rs. 140/-per K. W. per year. On 28-10-1966 the Board, in exercise of the powers under S. 79 0) of the Act, framed and promulgated what were called "kerala state Electricity Board (General Tariffs) Regulations, 1965", by which, inter alia, power was reserved to the Board to amend, from time to time, the terms and conditions of supply after issue of the prescribed notice to the consumer of the Board's intention so to do in that behalf. Regulation. 11 provided: "the board may amend the terms and conditions of supply from time to time provided that any amendment having the effect of enhancement of charges payable by the consumer shall come into force from such date as notified in the Gazette provided that there shall be at least 30 days between the date of publication and coming into force. " In exercise of the power so reserved to it, the Board issued a notification dated 16-7-1968 (Exhibit P/2) which provided: "in accordance with the provision contained in clause. 11 of the Kerala State Electricity Board (General Tariffs) Regulations issued in Kerala Gazette No. 47 dated 29-11-1966, it is hereby notified that the rates for the supply of 4200 K. W. of power at 66 K. V. to Messrs F. A. C. T. availed by them as per the agreement dated 21-10-1948 executed with the erstwhile Travancore Government, is hereby revised to Rs. 200/- per K. V. A. per year. This revision will take effect 30 days soon after the publication of this notification in the Gazette. " The supplemental agreement dated 10-5-1965 which pertained to the additional supply of power for a period of ten years at Rs. 140/- per K. W. per year was, however, left undisturbed. The case of the Board is that while the agreement, Exhibit P-1, was not an agreement which enjoyed the status of and protection as, one under S. 49 (3) of the Act, the supplemental agreement dated 10-5-1965, however, was entered into by the Board in exercise of the statutory powers under S. 49 (3) and was, therefore, immune from any alteration during its tenure. The principal controversy in this appeal is whether the agreement dated 21-10-1948 could be said to be one within the contemplation of s. 49 (3) of the Act; and whether the enhancement of the tariff under Exhibit P-2 was impermissible. Another contention which was not urged before the learned single Judge of the High Court, but which was permitted to be raised in appeal before the Division Bench was whether by the said enhancement appellant was subjected to a hostile and invidious discrimination. Both contentions have been repelled by the High Court. Appellant has come up by special leave.