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Tuesday, May 1, 2012

Jaipur Vidyut Vitran Nigam Limited (‘JVVNL’ for short), Jodhpur Vidyut Vitran Nigam Limited (‘JDVVNL’ for short) and Ajmer Vidyut Vitran Nigam Limited (‘AVVNL’ for short), submitted separate applications before the Rajasthan Electricity Regulatory Commission (for short ‘Commission’) at Jaipur in terms of Sections 62 and 64 of the Electricity Act, 2003 for revision of tariff to be effective from December 1, 2004. The third situation with which we are concerned in the instant case is where the revision petition is filed before the Tribunal but the Tribunal refuses to interfere with the decree or order earlier made. It simply dismisses the review petition. The decree in such a case suffers neither any reversal nor an alteration or modification. It is an order by which the review petition is dismissed thereby affirming the decree or order. In such a contingency there is no question of any merger and anyone aggrieved by the decree or order of the Tribunal or Court shall have to challenge within the time stipulated by law, the original decree and not the order dismissing the review petition. Time taken by a party in diligently pursing the remedy by way of review may in appropriate cases be excluded from consideration while condoning the delay in the filing of the appeal, but such exclusion or condonation would not imply that there is a merger of the original decree and the order dismissing the review petition. 15. The decisions of this Court in Manohar S/o Shankar Nale and Ors. v. Jaipalsing S/o Shivalalsing Rajput (2008) 1 SCC 520 in our view, correctly settle the legal position. The view taken in Sushil Kumar Sen v. State of Bihar (1975) 1 SCC 774 and Kunhayammed and Ors. v. State of Kerala & Anr. (2000) 6 SCC 359, wherein the former decision has been noted, shall also have to be understood in that light only. 16. In the result, we dismiss these appeals as no substantial question of law arises for our consideration. The respondent shall also be entitled to cost of Rs.20,000/- in each case to be deposited in the SCBA Lawyers’ Welfare Fund within six weeks from today.


                                                   REPORTABLE

                         IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO. 3814 OF 2007




M/s. DSR Steel (P) Ltd.                            …Appellant

                 Versus

State of Rajasthan & Ors.                    …Respondents

(With Civil Appeal No.4393/2007 and No.4396/2007)









                                  O R D E R



T.S. THAKUR, J.

1.    These appeals under Section 125 of the Electricity Act, 2003  call  in
question the correctness of an order dated 23rd November,  2006,  passed  by
the Appellate Tribunal for Electricity whereby a batch of appeals  including
those filed by the appellants against an order dated 8th June,  2006  passed
by the Rajasthan Electricity Regulatory Commission, have been dismissed.

2.    Jaipur Vidyut  Vitran  Nigam  Limited  (‘JVVNL’  for  short),  Jodhpur
Vidyut Vitran Nigam Limited (‘JDVVNL’ for short)  and  Ajmer  Vidyut  Vitran
Nigam Limited (‘AVVNL’ for short), submitted  separate  applications  before
the Rajasthan Electricity Regulatory Commission (for short ‘Commission’)  at
Jaipur in terms of Sections 62 and 64  of  the  Electricity  Act,  2003  for
revision of tariff to be effective from December 1, 2004. Each one of  these
distribution companies (‘Discoms’ for short) had an existing tariff  but  in
their respective applications  they  sought  an  identical  tariff  revision
which requests were taken up by the Commission  for  consideration  together
and disposed of in terms of  a  common  order  dated  17th  December,  2004,
passed  after  notices  regarding  filing  of  the  said  applications  were
published in  different  newspapers  having  circulation  in  the  State  of
Rajasthan. Several objections were filed and suggestions made by nearly  100
individuals and organisations in the course of the  proceedings  before  the
Commission. All these objections were then considered by the  Commission  no
matter only 38 of those who  had  filed  the  same  had  complied  with  the
requirement  laid  down  by  the  former.  A  large  number  of  people  and
organisations even applied for personal hearing and were heard on  different
dates at different venues fixed for the purpose. Some  of  these  objections
also related to individual problems of the consumers  or  disputes  relating
to bills and other matters which were  directed  to  be  considered  by  the
Discoms and decision taken on the  same  under  intimation  to  the  persons
concerned. Other issues including those questioning the  maintainability  of
the  petitions  and  alleging  non-compliance  with  the   regulations   and
directions of the Commission were also raised.  Issues touching  reforms  in
power sector, non-determination of  the  Rajasthan  Vidyut  Utpadan  Nigam’s
tariff from whom the  Discoms  purchase  electricity,  poor  performance  of
Vidyut Vitran Nigams  were  also  agitated.   Similarly  objections  to  the
proposed increase in tariff, interest charges, depreciation  etc.  too  were
raised and examined by the Commission.  Suggestions  regarding  improvement,
objections relating to high T&D losses, inadequacy  of  staff,  continuation
of un-metered supply,  issue  of  deemed  licensee  and  tariff  for  deemed
licensee were also examined. Questions  relating  to  high  voltage  supply,
segregation of mixed load, billing  demand,  demand  based  tariff  for  MIP
consumers, power factor and shunt capacitor  surcharge,  vigilance  checking
of consumers, minimum billing, agriculture, domestic and  industrial  tariff
too were examined by the Commission apart from  several  other  issues  that
were placed before the  Commission  to  which  the  Commission  has  made  a
reference in its order dated  8th  June,  2006.  The  Commission  eventually
directed that the revised tariff determined  by  it  will  become  effective
from 1st January, 2005 and remain in force till the same is amended  by  the
Commission by a separate order passed by it.

3.    Aggrieved by the order passed by the Commission, the appellants and  a
large number of other consumers in  that  category  filed  review  petitions
under Section 94 (1)(f) of the Electricity  Act,  2003  seeking  review  and
continuation of the incentive scheme. These review petitions were  dismissed
by the  Commission  in  terms  of  its  order  dated  8th  June,  2006.  The
Commission noted the contention urged on  behalf  of  the  petitioners  that
they were affected by the withdrawal of the incentive scheme.  It  was  also
urged that these  consumers  had  made  investments  on  the  basis  of  the
incentive scheme bona fide believing that the same  would  continue  for  at
least three years. The review petitioners,  therefore,  sought  continuation
of the said scheme by suitable review of the Commission’s order  dated  17th
December, 2004. The Commission also noted the opposition of the  Discoms  to
the said prayer and the contention that  the  incentive  scheme  was  to  be
effective upto 31st March, 2003 or  till  the  Commission  issued  a  tariff
order                 whichever                 was                 earlier.


4.    The Commission noted the submissions made on  behalf  of  the  Discoms
that the tariff petitions had been filed in August 2004 and the  details  of
the scheme had been published in newspapers including the  incentive  scheme
which was deliberated in the course of the public hearing and dealt with  in
the Commission’s tariff order dated 17th December, 2004. It was also  argued
on behalf of the Discoms that the modified incentive scheme  was  free  from
any legal flaw.

5.    Consideration of the rival  submissions  led  the  Commission  to  the
conclusion that its  order  dated  17th  December,  2004  had  examined  the
question raised  by  the  petitioners  regarding  the  continuation  of  the
incentive scheme and found that the scheme had a limited  validity  and  its
withdrawal did not offend the principles of  promissory  estoppel.  It  also
held that the modification of the scheme was not without public  notice  and
the  discontinuance  of  the  old  incentive  scheme  had  been  given  wide
publicity pursuant to which  large  industries  and  associations  had  been
heard on the question of introduction of a new scheme in place of  the  old.
The Commission also held that the question of  applicability  of  Promissory
Estoppel had been raised before the Commission at the hearing of the  tariff
petitions and that the material sought to be introduced in  support  of  the
said plea at the stage of review could not be taken into consideration.  The
Commission, accordingly, concluded  that  there  was  no  mistake  or  error
apparent on the face of the record in the order passed by it to call  for  a
review of the same. In support the Commission  noted  several  decisions  of
this Court on the question of Promissory Estoppel including those  delivered
in M/s Motilal Padampat Sugar Mills Co. Ltd. v. State of Uttar  Pradesh  and
Ors. (1979) 2 SCC 409, Kasinka Trading and Anr. v. Union of  India  an  Anr.
(1995) 1 SCC 274, Shrijee Sales Corporation  and  Anr.  v.  Union  of  India
(1997) 3 SCC 398, Union of India  &  Ors.  v.  Godfrey  Philips  India  Ltd.
(1985) 4 SCC 369.

6.    Aggrieved by the orders dated 17th December, 2004 and 8th  June,  2006
passed by the  Commission,  the  appellants  and  few  others  filed  Appeal
Nos.180-197 of 2006 and Appeal No.226 of 2006 before the Appellate  Tribunal
for Electricity, at New Delhi which were as noticed above  dismissed by  the
Tribunal by the order impugned in these appeals.  The  Tribunal  noted  that
there was no challenge before it as to the  revision  of  the  tariff  order
issued by the Commission.  It also  found  that  the  Regulatory  Commission
could exercise its power of review in  terms  of  Section  94(1)(f)  of  the
Electricity Act, 2003 read with Order XLVII of the Civil Procedure Code  and
that it could review an order, provided a case for any such review was  made
out. The Tribunal rejected the contention urged on behalf of the  appellants
that the doctrine of Promissory Estoppel was attracted in the facts  of  the
case.  It  concurred  with  the  view  taken  by  the  Commission  that  the
incentive scheme was applicable only upto  31st  March,  2007  or  till  the
Commission issued  a  tariff  order  whichever  was  earlier.  The  Tribunal
observed:

         “As has been held in Pawan Alloys & Casting Pvt.  Ltd.,  Meerut  v.
         U.P. State Electricity Board And Others,  (1997)  7  Supreme  Court
         Cases 251, in this case,  no  promise  was  held  out  to  any  new
         industries nor there was an invitation  for  investments  of  large
         scale fund but it only imposed a condition that existing industries
         could avail of the incentive subject to  the  stipulations  in  the
         scheme and nothing  more.   The  tariff  fixation  is  a  statutory
         function in terms of The Electricity Act 2003 and tariff is  to  be
         fixed in the larger interest of consumer  public  at  large.   That
         being the position and when in the very tariff scheme, it has  been
         specifically provided that the  scheme  will  come  to  an  end  on
         31.03.2007   or   when   the   Regulatory   Commission   determines
         distribution tariff which ever is earlier.  This is only meaning it
         is not known as to  how  the  appellants  could  advance  the  said
         contention that the scheme is to be  given  any  other  meaning  is
         impermissible.  This sentence which is incorporated in  the  scheme
         is fatal to the claim of the appellants and none of the  precedents
         pressed into service by the appellants will come to  their  rescue.
         It will be  sufficient  to  answer  this  point,  however,  as  the
         appellants on all the contentions pressed for a decision.”


7.    We have heard learned counsel for the parties at considerable  length.
An appeal under Section 125 of the Electricity  Act,  2003  is  maintainable
before this Court only on the grounds specified in Section 100 of  the  Code
of Civil Procedure. Section 100 of the C.P.C. in turn permits filing  of  an
appeal only if the case involves a substantial question of law. Findings  of
fact recorded by the Courts below, which would in the  present  case,  imply
the Regulatory Commission as the Court of first instance and  the  Appellate
Tribunal as the Court hearing the first appeal, cannot be  re-opened  before
this Court in an appeal under Section 125  of  the  Electricity  Act,  2003.
Just as the High Court cannot interfere  with  the  concurrent  findings  of
fact recorded by the Courts below in a second appeal under  Section  100  of
the Code of Civil  Procedure,  so  also  this  Court  would  be  loathed  to
entertain any challenge to the concurrent findings of fact recorded  by  the
Regulatory Commission and the Appellate  Tribunal.  The  decisions  of  this
Court on the point are a legion. Reference to Govindaraju v. Mariamman  (AIR
2005 SC 1008), Hari Singh v. Kanhaiya Lal  (AIR  1999  SC  3325),  Ramaswamy
Kalingaryar v. Mathayan Padayachi (AIR 1992 SC 115),  Kehar  Singh  v.  Yash
Pal and Ors. (AIR 1990 SC 2212), Bismillah Begum (Smt.) (Dead)  by  LRs.  v.
Rahmatullah Khan (Dead) by LRs. (AIR 1998 SC 970) should, however,  suffice.


8.    The Regulatory Commission has, in the case at hand  recorded  a  clear
finding of fact that the old incentive scheme was  limited  only  upto  31st
March, 2007 or till the Commission  issued  a  tariff  order  whichever  was
earlier. It has also recorded a finding that while considering  revision  of
tariff it had gone into  the  proposals  regarding  introduction  of  a  new
incentive scheme and approved the same, effectively bringing to an  end  the
existing scheme and introducing a new scheme in its  place.  The  Commission
had declined to accept the  contention  that  the  appellant  companies  had
altered their position to their detriment by making  additional  investments
or that there was any specific representation or promise made to  them  that
the old  scheme  would  inevitably  continue  till  31st  March,  2007.  The
additional material which the appellants had sought to  introduce  belatedly
at the review stage had also been declined by the Commission. In  its  order
dated 17th December, 2004 revising tariff the Commission had dealt with  the
question relating to the incentive scheme in the following words:

         “70.     The incentive scheme was  proposed  by  the  Nigams  as  a
         stopgap  arrangement  to   arrest   the   decline   in   industrial
         consumption.   The  Commission  while  conveying  its  approval  to
         extension of the incentive scheme clearly stipulated that it  shall
         be valid till 31.3.07 or revision of tariff whichever was  earlier.
         The scheme itself had a limited validity  and  therefore,  did  not
         attract the principle of promissory estoppel.  The  Commission  had
         envisaged  review  of  incentive  scheme  at  the  time  of  tariff
         revision, as the proceeding  would  have  provided  opportunity  to
         public to express their views  to  enable  appropriate  changes  in
         incentive scheme or tariff.


         71.      After considering the petitioners’ proposal and the  views
         expressed before us, the Commission is of the view that no separate
         scheme is called for at this stage. The need to  provide  incentive
         to promote consumption of electricity  by  large  industrial  power
         (LIP) consumers should be taken care of by the tariff  itself.   An
         incentive which  encourages  better  load  factor  will  serve  the
         purpose.  Consequently, an incentive scheme linked  to  consumption
         per KVA of contract demand is proposed.  Accordingly we direct that
         the incentive shall be available to  all  LIP  consumers  including
         railways and public water  works,  and  eligibility  for  incentive
         shall be as follows:


             (i)       The annual  consumption  of  the  consumer  for  the
                current financial year shall not be  less  than  his  annual
                consumption of the previous financial year.
             (ii)      In respect of new LIP  consumers  and  existing  LIP
                consumers who reduce their contract demand, incentive  shall
                be admissible from the quarter following six months from the
                date of new connection or reduction of contract  demand,  as
                the case may be.
             (iii) Consumer should have no arrear outstanding against him.


         72. Incentive shall be allowed to eligible consumers  provisionally
         on quarterly basis provided that consumption during the quarter  is
         not less than his  consumption  during  the  corresponding  quarter
         during the previous year.  Incentive so allowed shall be subject to
         final assessment at the end of the year, on year-to-year basis.  If
         consumption of a consumer in any quarter is less than that  of  the
         corresponding  quarter  of  the  previous  year  but   the   annual
         consumption is more than that of the previous  year,  he  shall  be
         eligible for the incentive for the  year  as  a  whole.   Incentive
         shall be as under on energy charges:-


       |(i)         |Energy consumption of 250 KWh per|               |
|            |month per kVA of contract demand |               |
|            |and upto 400 KWh per month per   |               |
|            |kVA of contract demand.          |1.0%           |
|(ii)        |Energy consumption exceeding 400 |               |
|            |KWh per month per kVA of contract|               |
|            |demand and upto 550 KWh per month|               |
|            |per kVA of contract demand.      |4.0%           |
|(iii)       |Energy consumption in excess of  |               |
|            |550 KWh per Month per kVA of     |7.0%           |
|            |contract demand.”                |               |




9.    The Tribunal concurred with the above view  taken  by  the  Commission
and repelled the contention based on the principle  of  promissory  estoppel
not only on the ground that there had  been  no  unequivocal  representation
regarding continuation of the scheme till 31st March, 2007 but also  on  the
ground that there was  no  material  to  support  the  contention  that  the
appellants had indeed made any  investment  or  changed  their  position  to
their detriment so as to attract the doctrine  of  promissory  estoppel.  In
coming to that conclusion  the  Commission  has  also  relied  upon  several
decisions of this Court to which we have made a mention above.   We  do  not
see any perversity  in  any  one  of  those  findings  nor  do  we  see  any
substantial question of law arising in the fact situation of these  appeals.
We have, therefore, no hesitation in  dismissing  these  appeals  on  merits
although the same have been filed  beyond  the  period  stipulated  for  the
purpose under Section 125 of the Electricity Act, 2003.

10.   We may before parting mention that in Civil  Appeal  No.3814  of  2007
filed by DSR Steel (P) Ltd., one of the questions that was urged  before  us
was whether the period of limitation would start running from  the  date  of
pronouncement of the order or the date  of  communication  thereof.  Relying
upon the decision of this Court in Chhattisgarh State Electricity  Board  v.
Central Electricity Regulatory Commission and Ors. (2010) 5 SCC  23  it  was
contended on behalf of the respondent that the date on which the  order  was
pronounced would also be the date on which the same is deemed to  have  been
communicated.

11.   Section 125 of the Electricity Act, 2003  makes  it  abundantly  clear
that the period of limitation commences from the date  of  communication  of
the decision or order and not from the date  of  its  pronouncement.   As  a
matter of fact, Rules 94 and 98 of the Rules framed under  the  Act  make  a
clear distinction between intimation regarding pronouncement  of  the  order
on the one hand and the communication of the  order  so  pronounced  to  the
parties on the other. While Rule 94 appears to us to provide for  notice  of
pronouncement of an order, it makes no mention about the ‘communication’  of
such an order as is referred to in Section 125 of the Act.  Transmission  of
the order by the Court Master to the Deputy Registrar of  the  Tribunal  and
its onward communication to the parties is dealt with  by  Rule  98  of  the
said Rules which communication alone can be  construed  as  a  communication
for purposes of Section 125 of the Electricity Act, 2003.  The  decision  of
this Court in the Chattisgarh State Electricity Board’s case (supra) may  in
that view require reconsideration if the same were to be  understood  to  be
laying  down  that  the  date  of  pronouncement  is  also   the   date   of
communication of the order.  We would have, in the ordinary course,  made  a
reference to a larger Bench for that purpose but having regard to  the  fact
that we have dismissed the appeals on merits, we consider it unnecessary  to
do so in the present case.

12.   So also the question whether  an  order  passed  by  the  Tribunal  in
appeal merges  with  an  order  by  which  the  Tribunal  has  dismissed  an
application for review of the said  order  was  argued  before  us  at  some
length. Learned counsel for the appellants contended  that  since  a  review
petition had been filed by two of the  appellants  namely,  J.K.  Industries
Ltd. (Now known as J.K. Tyres and Industries Ltd.)  and  J.K.  Laxmi  Cement
Ltd. in this case, the orders made by the Tribunal  dismissing  the  appeals
merged with the orders passed by it in the said review applications so  that
it is only the order dismissing the review application that  was  appealable
before this Court.  If that were  so  the  period  of  limitation  could  be
reckoned only from the date of the order passed in the review  applications.


13.   Different situations may arise in relation to review  petitions  filed
before a Court or Tribunal. One of the situations could be where the  review
application is allowed, the decree or order passed by the Court or  Tribunal
is vacated and the appeal/proceedings in which the  same  is  made  are  re-
heard and a fresh decree or order passed in the same.  It is  manifest  that
in such a situation the subsequent decree alone is  appealable  not  because
it is an order in review but because it is a decree  that  is  passed  in  a
proceeding after the earlier decree passed in the very same proceedings  has
been vacated by the Court hearing the review petition. The second  situation
that one can conceive of is where a Court or Tribunal makes an  order  in  a
review  petition  by  which  the  review  petition  is   allowed   and   the
decree/order under review reversed or modified.  Such an  order  shall  then
be a composite order whereby the Court not only vacates the  earlier  decree
or order but simultaneous with  such  vacation  of  the  earlier  decree  or
order, passes another decree or order or  modifies  the  one  made  earlier.
The decree so vacated reversed or  modified  is  then  the  decree  that  is
effective for purposes of a further appeal, if any, maintainable under  law.


14.   The third situation with which we are concerned in  the  instant  case
is where the  revision  petition  is  filed  before  the  Tribunal  but  the
Tribunal refuses to interfere with the decree or  order  earlier  made.   It
simply dismisses the review petition.  The decree in  such  a  case  suffers
neither any reversal nor an alteration or modification.  It is an  order  by
which the review petition is  dismissed  thereby  affirming  the  decree  or
order.  In such a contingency there is no question of any merger and  anyone
aggrieved by the decree or order of the Tribunal  or  Court  shall  have  to
challenge within the time stipulated by law, the  original  decree  and  not
the order dismissing  the  review  petition.   Time  taken  by  a  party  in
diligently pursing the remedy by way of review may in appropriate  cases  be
excluded from consideration while condoning the delay in the filing  of  the
appeal, but such exclusion or condonation would not imply that  there  is  a
merger of the original decree and the order dismissing the review petition.

15.   The decisions of this Court in Manohar S/o Shankar Nale  and  Ors.  v.
Jaipalsing S/o Shivalalsing Rajput (2008) 1 SCC 520 in our  view,  correctly
settle the legal position.  The view taken in Sushil Kumar Sen v.  State  of
Bihar (1975) 1 SCC 774 and Kunhayammed and Ors. v. State of  Kerala  &  Anr.
(2000) 6 SCC 359, wherein the former decision has  been  noted,  shall  also
have to be understood in that light only.

16.   In the result, we dismiss these appeals as no substantial question  of
law arises for our consideration.  The respondent shall also be entitled  to
cost of Rs.20,000/- in each case  to  be  deposited  in  the  SCBA  Lawyers’
Welfare      Fund       within       six       weeks       from       today.





                                                        ……………………..……………..…J.
                                                               (T.S. THAKUR)



                                                          ……………………………….………J.
                                                          (GYAN SUDHA MISRA)
New Delhi
May 1, 2012