INDIAN METALS AND FERRO ALLOYS LTD Vs. STATE

JUDGEMENT

(1.) In these two writ petitions petitioners, M/s. Indian Metals and Ferro Alloys Limited, a Company incorporated under the Indian Companies Act, 1956 and one of its shareholders, challenge the orders of the State Government in the Irrigation and Power Department and the Orissa State Electricity Board (hereinafter referred to as the 'Board') imposing restrictions in supply of electric energy to their factories, refusing to permit the Company divert the energy allotted to one of its units to be used in other units and charging additional tariff for the alleged excess drawal of power by it.

(2.) The facts which are not in controversy in the case may be stated thus : The petitioner-Company which manufactures ferrochrome has four different factories located in Koraput district. The units the shall be hereinafter referred to as "11 KV. IMFAL", "33 KV IMFAL", "IMCL" and "132 KV IMFAL". The Company has entered into separate agreements with the Board for supply of electricity to the different units and the rate of tariff to be charged for such supply. All these units are classified by the Board as power intensive industries since they use electricity as a raw material. The unit of time for supply of electricity is the "water year" of which begins from Ist of July of a year and ends with 30th of June next year. The dispute in O.J.C. No. 1549 of 1985 relates to water year 1984-85 while that in O.J.C. No. 2496 of 1985 relates to water year 1985-86. Due to acute shortage of power in the State, the State Government and the Board have been imposing restrictions in supply of electricity under the arrangement commonly referred to as 'power cut' since 1979. During the previous years the authorities were permitting the petitioner Company and other consumers owning/controlling more than one industrial unit to amalgamate the quantity of energy allotted for different units and use it in one or more of the units without exceeding the total allotment. This arrangement is referred to by the parties as 'clubbing'.

(3.) The petitioners allege that in view of the rationing imposed by the opposite parties, they have to suffer severe power cuts and the energy allotted is about 25 per cent of the quantity contracted for. With such meagre supply of power it is not possible to run any units efficiently and economically. Therefore, they sought permission from the authorities to club the power supply so that at least some of the units could be run successfully. The 132 KV IMFAL, an export oriented unit, needs a very large quantity of energy and if it is made to run with the low and irregular" supply of power the furnace would get damaged. To avoid the situation the petitioner Company have been diverting the power meant for this unit to their other units, that is, 11 KV IMFAL and 33 KV IMFAL. As noticed earlier, this arrangement was continuing with the permission of the authorities during the year 1983-84 and even prior thereto. But suddenly in the midst of the water year 198485, in January, 1985, the petitioner-company was intimated by the Chairman of the Board that clubbing of power supplied to its different units is not permitted as per Govt. decision (Annexure-1) and each unit would be dealt with separately. As a consequence of this decision the bills for the energy consumed during the period commencing from July, 1984 were recast on the basis that the petitioner-company had overdrawn electricity in respect of its units 11 KV IMFAL, 33 KV IMFAL and IMCL (Annexure-2 series). The petitioners also challenge the reduced quota of power sanctioned to its different units under letter dated 22nd January, 1985 of the Irrigation and Power Department for the water year 1984-85 (Annexure-3). It is pertinent to note here that in the annexure to the said letter three of the petitioners' units viz. 11 KV IMFAL, 33 KV IMFAL and IMCL, Therubali, are together allotted 57.60 million Kwh of power while the quantity allotted to 132 KV IMFAL is 52.56 million Kwh.