GODHRA ELECTRICITY COMPANY LIMITED Vs. SOMALAL NATHJI SHIROIYA

JUDGEMENT

(1.) These two Second Appeals have been filed by the Godhra Electricity Company Ltd. ( hereinafter referred to as the company ) as both the Courts had decreed the suits filed by the consumers. Both these appeals raise common questions of law and so they are disposed off by this common judgment.

(2.) The short facts which have given rise to these appeals are as under :-

(3.) As far as the scheme of the two Acts is concerned as regards the increase or fixation of rates I need not consider the whole scheme elaborately as the relevant sections have been considered by the Supreme Court in Amalgamated Electricity Co. Ltd. v. N. 5. Bathena A I. R. 1964 S. C. 1958 His Lordship Ayyangar J. speaking for himself and Dasgupta J. had observed that they were unable to agree with the decision of the Bombay High Court in Babulal Chhaganlal v. Chopda Electric Supply Co. Ltd. A.I.R. 1955 Bom. 182. Their Lordship had observed that it was clear from para 1 of Schedule VI of the Supply Act as it originally stood and as amended that the adjustment of rates might by unilateral and that the licensee had a statutory right to adjust his rate provided he conformed to the requirements of that paragraph viz. the rate changed did not yield a profit exceeding 15% and the amount of reasonable return. In their Lordships opinion the provisions of the Supply Act were too strong to permit the construction that the maxima prescribed under the Electricity Act of 1910 survived as a fetter on the rights of the licensee under paragraph I of the VIth Schedule. It was further held that if there as any room for any argument of that kind on the terms of para I of the VIth Schedule as originally enacted the matter was placed beyond possibility of dispute by the 1956 amendment by the use of non-obstante clause as the opening paragraph provided that notwithstanding anything contained in the Indian Electricity Act and the provisions in the licence of a licensee the licensee could adjust the rates. It was therefore held that the provisions of paragraphs 1 and 2 of VIth Schedule gave a unilateral power to the licensee to adjust the rates and the only obligation which was imposed was the one in the proviso (4) under which if the licensee took a risk and it was ultimately found that the rates of supply fixed in pursuance of the recommendation of the rating committee constituted under sec. 57A were lower than these notified by the licensee the licensee was bound to refund to the consumers the excess amount recovered by him from them. The third Judge His Lordship Sarkar J. (as he then was) took the same view of this non-obstante clause in the commencement of para 1. As the Bombay decision was prior to this amendment it was not considered necessary to express any opinion as regards the said decision. The settled position of law therefore in view of this decision is that if there was any restriction or a fetter in any of the provisions of the Electricity Act by reason of the maximum prescribed in the licence or by reason of some conditions imposed by an order issued under the Electricity Act those restrictions no longer operated after the Supply Act. All those restrictions deemed to be incorporated in the licence granted under the Electricity Act 1910 which were inconstitent with the rate which a licensee could charge under para 1 of Schedule VI of the Supply Act would be superseded and the provisions of the Supply Act would prevail. This decision only settles the question of the right of the licensee for making a unilateral increase in accordance with the para I of Schedule VI notwithstanding any fetter imposed by the Electricity Act. The question which still remains for consideration and which has arisen in these appeals is as to whether the licensee is still bound by the fetter imposed by sec. 57 or the newly substituted sec. 57A of the Supply Act itself under which the Government is empowered to fix the charges to be made by the licensee on the recommendations of the rating committee.