Hpseb and Another Vs. M/S. Jawalaji Alloys Steel Pvt. Ltd. and Another - Court Judgment

Deepak Gupta, J.

Oral:

1. The short question which arises for consideration in this case is whether the Chief Electrical Inspector had the jurisdiction to entertain the petition and decide the dispute regarding which appeal/reference was filed before it by respondent No.1 M/s Jawalaji Alloys Steel Pvt. Ltd (hereinafter referred to as the consumer).

2. According to the H.P.State Electricity Board (hereinafter referred to as the Board) the consumer at a time when peak load restrictions were in force had violated the peak load restrictions and therefore, was liable to pay peak load charges. The consumer filed a petition under Sections 32 and 24 of the Indian Electricity Act, 1910 (hereinafter referred to as the Act) before the Chief Electrical Inspector (CEI) claiming that the demand raised by the Board was unlawful and illegal. An objection was raised by the Board that the CEI had no jurisdiction to entertain the petition. The Chief Electrical Inspector held that he was entitled to decide the dispute in terms of Section 24(2) of the Act and allowed the petition of the consumer. Thereafter, the Board filed an appeal before the Secretary, M.P.P and Power, Government of Himachal Pradesh under Section 36(2) of the Act. One of the contentions raised was that the Chief Electrical Inspector had no power to decide the dispute. The appellate authority held that the Chief Electrical Inspector had been vested with powers to entertain the dispute under Sections 24(2) and 26(6) of the Electricity Act and under Clause 32 of the Sales Manual and therefore was entitled to decide the dispute. This order dated 24.10.2007 is under challenge in the writ petition.

3. Shri K.D. Sood, learned counsel for the Board has drawn my attention to the judgement of the Apex Court in Punjab State Electricity Board vs. Bassi cold Storage, Khara and another, AIR 1994 SC 2544. In that case the Apex Court was dealing with condition No. 29 of the Sales Manual issued by the Punjab State Electricity Board, which in sum and substance is virtually identical to condition No. 32, which reads as follows:-

“32. In the event of any difference or dispute arising between the Board and the consumer in respect of any matter connected with the supply, which cannot be determined by these conditions, or by the terms of any agreement between the Board and the consumer and in the event of any difference or dispute arising as to the interpretation of these conditions or of the terms of any agreement between the Board and the consumer, the matter shall be determined in accordance with the provisions of the act or by reference to the Chief Electrical Inspector. In the event of any difference or dispute arising that cannot be determined as aforesaid the provisions of the Indian Arbitration Act, as amended from time to time, shall apply.”

4. Condition No. 29 which was dealt with by the Apex Court has been quoted in para 13 and perusal of the same shows that the same is identical to condition No.32. A similar contention was raised before the Apex Court in that case and the question raised was whether the Chief Electrical Inspector had the jurisdiction to adjudicate upon the matter as an Arbitrator. The Apex Court dealt with various provisions of the Act and came to the conclusion that only those disputes which were covered under the terms of the Act could be referred to arbitration as provided in Section 52 of the Act. After quoting condition No. 29 of the Punjab Manual, the Apex Court held as follows:-

“14. A close reading of the aforesaid Condition shows that two types of differences or disputes come within its hold. These are: (i) difference or dispute arising between the Board and the consumer in respect of any matter connected with the supply; and (ii) difference or dispute arising as to the interpretation of the Conditions or the terms of any agreement between the Board and the consumer. If the dispute or difference be of the first nature, what has been stated in the operative part would come into play, if the same cannot be determined by the Conditions or the terms of any agreement between the Board and the consumer. In such a case, the first difference or dispute, and the second difference or dispute in any case shall be determined in accordance with the provisions of the Act or by reference to the Chief Electrical Inspector. In the event the aforesaid two disputes or differences cannot be determined in the manner indicated in the main part of Condition 29, the provisions of the Indian Arbitration Act shall apply qua that difference or dispute.

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17. It is because of the above that Shri Sibal contends that as the difference or dispute at hand cannot be determined as provided in the main part of Condition 29, the provisions of the Indian Arbitration Act would come into play and the dispute can be subject-matter of arbitration. We would have had no hesitation in accepting this contention of Shri Sibal but for the fact that what has been provided in Condition 29 has to be read along with provisions of the Act and in case provisions of the Act would not permit reference of the dispute at hand to arbitration, what has been laid down in the Act has to prevail over the remedy provided by Condition 29. Having found that the dispute of the present nature cannot be subject matter of arbitration being not covered by any of the sections of the Act dealing with arbitration; and having held that the provisions of the Act have to override what has been mentioned in the Condition, and having further held that the Act would prevail over the general law of arbitration now contained in the Arbitration Act of 1940, we would hold that though the present dispute would have been referable to arbitration because of what has been provided in Condition 29, it cannot be done, in view of the provisions in the Act which would override the stipulation contained in the aforesaid Condition.”

5. It is thus clear that the Apex Court held that condition No.29 is subordinate legislation and cannot overrule Section 52 of the Act. Even if condition No. 32 is read as a whole, if arbitration is not provided under the Act then a matter can be referred to the arbitration of the Chief Electrical Inspector only in a case the difference or dispute between the Board and the consumer cannot be determined under the terms and conditions of the agreement entered into between the parties. My attention has been drawn to Instruction No. 168 of this very Sales Manual which provides for different levels of dispute settlement committees established to settle the disputes arising out of consumer’s complaint regarding wrong billing. In case the consumer is of the opinion that he has been billed wrongly then he can raise the dispute before the appropriate committee. There are three levels of committees; (a) Circle Level Committee; (b) Zonal level Committee and (c) Board level Committee. The jurisdiction and constitution of these Committees have been changed from time to time.

6. The Apex Court in PunjabStateElectricity Board and another vs. Ashwani Kumar JT 1997(5) S.C. 182 was dealing with a case where the contention raised was that the Civil Court would not have the jurisdiction to entertain a complaint with regard to wrong billing and the appropriate remedy available to the consumer was to approach one of the disputes level committee so constituted. That case also relates to the Punjab State Electricity Board but the provisions are virtually similar. The Apex Court held as follows:-

“10. The question then arises whether the civil court would be justified in entertaining the suit and issue injunction as prayed for? It is true, as contended by Shri Goyal, learned Senior Counsel, that the objections were raised in the written statement as to the maintainability of the suit but the same were given up. Section 9 of the Civil Procedure Code provides that the civil court shall try all suits of civil nature, subject to pecuniary jurisdiction, unless their cognizance is expressly or by necessary implication is barred. Such suit would not be maintainable. It is true that ordinarily, the civil court has jurisdiction to go into and try the disputed questions of civil nature, where the fundamental fairness of procedure has been violated. The statutory circulars adumbrated above do indicate that a fundamental fairness of the procedure has been prescribed in the rules and is being followed. By necessary implication, the cognizance of the civil cause has been excluded. As consequence, the civil court shall not be justified in entertaining this suit and giving the declaration without directing the party to avail of the remedy provided under the Indian Electricity Act and the Indian Electricity (Supply) Act and the Instructions issued by the Board in that behalf from time to time as stated above.

11. Shri Goyal has contended that the authorities do not hear the parties, nor give a reasoned order. Therefore, the parties cannot be precluded to avail of the remedy of a suit. We cannot accept such a broad and generalised proposition. When the provision for appeal by way of review has been provided by the statutory instructions, and the parties are directed to avail of the remedy, the authorities are enjoined to consider all the objections raised by the consumer and to pass, after consideration, the reasoned order in that behalf, so that the aggrieved consumer, if not satisfied with the order passed by the Board/appellate authority, can avail of the remedy available under Article 226 of the Constitution. Therefore, by necessary implication, the appropriate competent authority should hear the parties, consider their objections and pass the reasoned order, either accepting or negativing the claim. Of course it is not like a judgment of a civil court. It is then contended that the respondent has been subjected to pay huge amount of bill in a short period; hence, it is a case for interference. We find no force in the contention. May be that due to the advice given by the counsel, the respondent obviously has availed of the remedy of the suit, instead of departmental appeal. In our view, by necessary implication the suit is not maintainable. Therefore, the respondent is at liberty to avail the remedy of appeal within six weeks from today and raise the factual objections before the Board and the Board/appellate authority would consider and dispose of them, as indicated earlier, on merits.”

7. In view of the aforesaid two judgements, it is apparent that the remedy available to the consumer was to approach the concerned dispute settlement committee and the Chief Electrical Inspector had no jurisdiction to decide the matter.

8. Under Section 26(2) of the Act the Chief Electrical Inspector can only decide the disputes relating to faulty meters. In the present case the dispute is not with regard to the faulty meter but the allegation is that the consumer is liable to pay peak load charges for violation of the peak load restrictions. Section 24(2) will also not come into operation in the present case since that section will come into force only if the difference of dispute is under the act required to be determined by the Electrical Inspector or has been referred to the Inspector in terms of the Act. The Apex Court has clearly held that only those disputes can be referred to the Electrical Inspector/Chief Electrical Inspector which are covered under specific provisions of the Act. Here an appropriate dispute redressal mechanism has been formulated by the Board in terms of the Act and in terms of the conditions. The dispute redressal settlement committees have been constituted in terms of Section 79(j) of the Electricity (Supply) Act, 1948 and the terms and conditions especially instruction No. 168 noted hereinabove.

9. Therefore, I am of the considered view that the Chief Electrical Inspector had no jurisdiction to decide the matter and therefore, the order passed by him is nonest and void. Even the appeal filed by the Board was not maintainable to the appellate authority under Section 32 of the Act. Therefore, both the orders i.e. order of the Chief Electrical Inspector and order of Additional Chief Secretary (Power) to the Government of Himachal Pradesh are quashed and set-aside. However, liberty is reserved to the consumer to approach the appropriate dispute redressal committee and in case the consumer files such a petition within two months from today the same shall be treated to be within limitation. The petition is disposed of accordingly. No costs.