Malbar Hills Citizens Forum vs Best Undertaking And 2 Ors
2016 Latest Caselaw 2224 Bom

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                                       IN THE HIGH COURT OF JUDICATURE AT BOMBAY




                                                                                                                                               
                                          ORDINARY ORIGINAL CIVIL JURISDICTION




                                                                                                            
                                                         
                                          WRIT PETITION NO.1341 OF 2013


            Malabar Hills Citizens' Forum                                                                    ...Petitioner




                                                                                                           
                                vs
            BEST Undertaking & 2 Ors.                                                                        ...Respondents
                                                                               .....




                                                                                      
            Mr.   Navroz   Seervai,   Senior   Counsel,   a/w.   Mr.   Raj   Patel,   Mr.   Aditya 
            Khandeparkar and Mr. Jahaan Dastur, i/b. M/s. Hariani & Co., for the 
                                                         
            Petitioner.

            Mr.  A.B.   Ketkar,   a/w.   Mr.  Hetal   Master,   i/b.   M/s.   Ashwin   Ankhad   & 
                                                        
            Associates, for Respondent Nos. 1 and 2. 

            Mr. Umashankar Upadhyay, AGP, for the State-Respondent No.3.
                                          ......
                  


                                                            CORAM :  S.C. DHARMADHIKARI and
               



                                                                        S.C. GUPTE, JJ.

RESERVED ON: MARCH 18, 2016 PRONOUNCED ON: MAY 4, 2016

Oral Judgment (Per S.C. Gupte, J.) :

. This writ petition, filed under Article 226 of the Constitution of India, challenges bills raised on the Petitioner by Respondent No.1, which is an electricity distribution company. The challenge is based entirely on a claim of incorrect categorization of the electricity meters installed at the Petitioner's premises.

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2. The Petitioner is a public charitable trust running a public park and sports complex and has been consuming electricity distributed

by Respondent No.1. The park and the complex are situated on a plot of land, which is owned by the Government of Maharashtra and which was handed over by it to the Brihanmumbai Municipal Corporation ('BMC')

for creation of a garden and a playground. BMC, in turn, entered into an agreement of licence with the Petitioner for such development and maintenance. The whole park complex, known as 'Priyadarshini Park', is

divided into two areas, one a public garden and the other a sports

complex which has an athletic track, a gymnasium and a tennis court. Whereas no fee is charged from the public for entry into the garden,

which is open to all between 5.00 A.M. to 11 A.M. and 4 P.M. to 9 P.M., charges are recovered for use of the facilities in the sports complex, though the Petitioner claims these to be nominal, barely covering the

cost of maintenance of the complex and coaching provided therein. In

other words, the entire complex is run, according to the Petitioner, without a profit motive.

3. There are three electricity meters installed at the site, one in respect of the public garden and two for the sports complex. These three meters are placed under different categories. Whilst the meter in

respect of the public garden is classified and categorized under a category known as LT-VI (which is for public street lighting, lighting in public gardens, etc.), the other two meters are categorized as LT-II (a) (which is for non-residential, commercial and business purposes) and LT-II (b) (which is for combined lighting of power services for

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entertainment including recreation places).

4. It is the Petitioner's grievance in the present petition that all

three meters are used in common public places and for public services and as such, should be categorized as LT-VI and not as either LT II (a) or (b). It is submitted that the activities of the Petitioner at the site,

even as regards the sports complex, not being 'commercial', none of the meters could fall within the tariff item LT-II. It is submitted that within the broad category of "non-residential and commercial" are included

Sub-items (a) which is basically for commercial or business premises

including shopping malls and (b) which is for entertainment establishments such as film studios, cinema halls, multiplexes, etc.

Though recreation places are part of this latter category, the same cannot include public utility services such as athletic track, gymnasium and tennis court made available to public on payment of nominal fee on

a non-profit basis.

5. On the other hand, it is the case of Respondent No.1 that the categorization of the meters in the sports complex as LT-II is proper

and legal. It is submitted that the categorization of meters has nothing to do with whether the electricity is used for making available facilities free of charge or with no-profit motive. The distribution company is

entitled to charge tariff in accordance with categorization based on user. Respondent No.1 also disputes the Petitioner's claim of allowing facilities to the public on an open and free of charge basis. It is submitted that on inspection of the premises by the Officers of Respondent No.1, it was found that though the garden was open to general public, the activities

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of the sports complex including the Gymnasium were restricted to the

members of the Petitioner trust, who were charged separately. It is submitted that the activities at the sports complex were, accordingly,

very much commercial.

6. In the first place, the subject matter of the present writ

petition is nothing but a simple tariff dispute between a consumer and a licensee. The Electricity Act, 2003 provides for an application to the Consumer Forum for deciding such dispute under Section 42. There

being an effective remedy under the Act, this Court cannot be

approached in its extra-ordinary jurisdiction under Article 226 for redressal. Considering, however, that extensive arguments were

advanced on both sides on the merits of the categorisation adopted by Respondent No.1 for charging of electricity used by the Petitioner, we propose to decide that issue.

7. At the outset it is important to note that any category of tariff fixed under the Electricity Act, 2003 is on the basis of 'usage' of electricity. The State Electricity Commission fixes tariff on the basis of

such usage, namely, residential or non-residential including commercial or industrial. For the purposes of supply of electricity by Respondent No.1, the State Commission has fixed tariff for various classes of

customers based on such usage. Broadly, there are two main categories, namely, Low Tension ('LT') and High Tension ('HT'). Separate categories are fixed within the broad categories of LT and HT. In LT tariff, separate categories are made for Residential (LT I), Non- residential or Commercial (LT II), Industry upto 20 KW load (LT III),

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Industry above 20 KW load (LT IV), Advertisements and Hoardings (LT

V), street lights (LT VI), Temporary supply (LT VII), Crematorium and Burial Grounds (LT VIII) and Hospitals and Educational Buildings (LT

IX). We are primarily concerned with two categories here, namely, LT VI - Street Lights and LT II -Non-residential or Commercial. The applicability of these categories is described as below :

"LT II: LT-Non-Residential or Commercial

Applicability

Electricity used at Low/Medium Voltage in all non-residential,

non-industrial premises and/or commercial premises for commercial consumption meant for operating various appliances used for purposes such as lighting, heating, cooling,

cooking, washing/cleaning, entertainment/leisure, pumping in following places:

a) Non-Residential, Commercial and Business premises, including Shopping malls

b) Combined lighting and power services for Entertainment

including film studios, cinemas and theatres, including multiplex, Hospitality, Leisure, Meeting Halls and Recreation places.

c) Electricity used for the external illumination of monumental/historical/heritage buildings approved by MTDC.

LT VI: LT-Street Lights Applicability

Electricity used at Low/Medium Voltage for purpose of public street lighting, lighting in public gardens, traffic island, bus shelters, public sanitary conveniences, police chowkies, traffic lights, public fountains, other such common public places, irrespective of whether such facilities are being provided by the

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Government of the Municipality, or Port Trust or other private parties."

8. As far as the public garden maintained by the Petitioner is

concerned, the electricity used therein has been correctly categorised under LT-VI, which includes lighting in public gardens. Even if the

garden contains public utilities such as lavatories, security cabin, etc., considering the predominant use of electricity for lighting in public garden, it squarely falls under LT-VI, which is for the broad category of

'Street Lights'. The controversy concerns the two other meters recording use of electricity in the sports complex, which are categorized as non-

residential or commercial, falling within LT-II. The argument of Mr. Seervai, learned Senior Counsel for the Petitioner, is that even these

meters should be categorized under LT-VI, since the electricity recorded in these meters is used for public amenities such as an athletic track, gymnasium and tennis court, which are accessed by general public and

operated at a nominal fee on a non-profit principle. As we have noted

above, the categorisation of electricity tariff is on the basis of 'usage' and not 'the terms of usage'. If a gymnasium uses electricity, it is usage for running a gymnasium, irrespective of the terms of such usage, namely,

whether for a charge or not and whether on a profit motive or no profit principle. It is usage clearly falling within 'Non-residential or Commercial' usage. A non-residential or commercial establishment for

the purposes of electricity tariff does not cease to be non-residential or commercial if it is run on a no profit basis. Even the usage of electricity categorized as commercial is not because there is a profit motive, but because the activity is commercial as opposed to residential or individual.

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9. The judgments relied on by Mr. Seervai are of no assistance to him. Queen's Educational Society vs. Commissioner of Income

Tax1 was a case involving interpretation of Section 10(22) of the Income Tax Act, which provided for exemption of income of a university or educational institution existing solely for educational purposes and "not

for purposes of profit". The question was, when can an activity be said to be 'not for profit'. It was held that if the activity is primarily for educating persons, the fact that the institution makes a surplus/profit

does not make the institution as one existing for the purposes of profit.

The law stated therein has no bearing on our facts. Krishan Lal Gera vs. State of Haryana2 considered the distinction between a recreation

club and a sports club - again a matter which has no bearing on the controversy in this petition. Director of Income Tax (Exemption) vs. Goregaon Sports Club3 was also a matter arising under the Income Tax

Act and considered whether the assessee was a charitable organization.

As we have noted above, the character of the organization or its activity in our case is completely immaterial.

10. In the premises, electricity used by the Petitioner for the Sports Complex, which houses an athletic track, a gymnasium and a tennis court is correctly assessed and charged under the tariff item LT-II,

which is for 'Non-residential or Commercial' use. No fault can be found with respect to such categorization or billing.

1 (2015) 8 Supreme Court Cases 47 2 AIR 2011 Supreme Court 2970 3 Itxa-6301-2010 dated 14 February 2012, Coram : Dr. D.V. Chandrachud & M.S. Sanklecha, JJ.

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11. Accordingly, there is no merit in the petition and the same is

dismissed with no order as to costs.

       (S.C. GUPTE, J.)                                                   (S.C. DHARMADHIKARI, J.)




                                                                                                 
                                                                           
                                               
                                              
        
     






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