ORISSA FIBRE Vs. ORISSA STATE ELECTRICITY BOARD

JUDGEMENT

(1.) A partnership firm -- M/s. Orissa Fibre runs a factory near Sakhigopal in the district of Puri for manufacture of coir products and fibre materials. It entered into an agreement with the Orissa State Electricity Board -- opposite party No, 1 for supply of electric energy to the factory. The agreement was dated 9-7-1964 and was to be enforced for three years. In terms of that agreement, the petitioner undertook to consume a minimum quantity of energy being 131. 75 KVA at the rate of Rs. 5-50 per KVA which amounted to Rs. 722/- per month. In January, 1965, supply of energy began. In November. 1966, the petitioner was required to pay the minimum charge of Rs. 2,093,28 per month. The petitioner protested against the revision of rates made unilaterally by the Board. When the Board took the stand that the higher rate was the outcome of the revised tariff, the petitioner raised a dispute and wanted the matter to be referred to arbitration in terms of the agreement. On 15-11-1967. a fresh agreement was executed for supply of energy to -the petitioner and the agreement came into force with effect from 112-1967 for a period of 15 years. According to the petitioner it has paid all the demands raised for supply made under the new agreement. It called upon the board to refer the dispute arising out of the revised tariffs under the old agreement in respect of the supply made between November. 1966 and november, 1967. The opposite party Board instead of getting the dispute resolved in the manner indicated in the agreement threatened to discontinue the supply and ultimately issued a notice on 11-1-1970, in terms of Section 24 (1) of the indian Electricity Act, 1910. Thereupon the petitioner came before this Court with the present petition asking for a writ a mandamus not to give effect to the notice of disconnection.

(2.) THE State Electricity Board in Its affidavit of opposition does not dispute the fact that the non-payment of the dues leading to the notice of disconnection relates to the period between August, 1966 and November, 1967 -- a period under the old agreement. It is stated that the rate of tariff was revised from 1-8-1966 by the board. Under the Act as also the agreement in question unilateral revision of tariffs is provided and the petitioner is not entitled to question the revision of tariffs. Even though there is no provision in the new agreement that arrears of energy charges under the old agreement can be realised, by necessary implication, the terms dealing with default would equally apply to default in respect of the demands raised under the old agreement. Again, on the admitted position that the petitioner is a defaulter, action under Section 24 (1) of the Indian Electricity Act can be taken by the opposite party-Board,

(3.) IT is conceded by both sides that the provisions of Section 24 (2) of the Indian electricity Act. 1910. do not apply to the present case. The Board exercises statutory powers. It is not disputed that the Board is a licensee within the meaning of the Act. Statutory powers are vested in the Board. It is well settled in law that a public body invested with statutory powers must take care not to exceed or abuse such powers. It must keep itself within the limits of the authority committed to it and it must act reasonably. (See Westminster Corporation v. London and North western Rly. 1905 AC 426 ). The power conferred under Section 24 (1) of the indian Electricity Act of 1910, is intended to be exercised as a coercive measure to force the consumer to pay the charges to the licensee, Arrear dues in respect of energy bills are certainly claims recoverable through Court. The power vested under Section 24 (1) of the Act is to ensure payment of the energy charges without forcing the licensee to resort to a suit. While the intention of the statute in providing for discontinuance of supply to consumers neglecting to pay charges is clear it cannot be overlooked that such power because it vests cannot be abused.