Bombay High Court

Vinay Tilokchand Karnavat vs State Of Maharashtra And Others on 27 October, 2016

Bench: S.V. Gangapurwala

                                                                          wp4336-15.odt
                  IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                             BENCH AT AURANGABAD

                             WRIT PETITION NO. 4336 OF 2015




                                                                             
           Mr. Vinay Tilokchand Karnavat                     ...  Petitioner
           Age 50 years, Occu: Medical 




                                                     
           Practice, R/o Anand Hospital,
           Sillod, District Aurangabad

           VERSUS




                                                    
    1. The State   of Maharashtra, 
       through its Secretary, Power & 
       Energy Department, Mantralaya,
       Mumbai 400 032.




                                           
    2. Maharashtra Electricity    
       Regulatory Commission, 13th 
       Floor, Centre No.1,  World Trade 
       Centre, Cuff Parade, Mumbai
                                 
       Through its Chairman.

    3. Maharashtra State Electricity 
       Distribution Limited, Prakashgad,
       Bandra (East), Mumbai 
      


    4. Chandra Iyengar
   



       Age Major, Occu:  Chairperson of 
       Respondent No.2 Commission
       C/o Respondent No.2. 





    Mr.   R.   R.   Mantry,   Advocate   h/for   Mr.   R.   R.   Sancheti, 
    Advocate for the petitioner
    Shri B. A. Shidne, AGP for respondent No. 1 State
    Mr. Ratnakar Singh, Advocate for Respondent Nos. 2 & 4.
    Mr. Anil S. Bajaj, Advocate for respondent No.3.





                                 CORAM           : S. V. GANGAPURWALA & 
                                                  
                                                  K. L. WADANE, JJ.
                                  RESERVED ON    : 22nd October, 2016

                                 PRONOUNCED ON   : 27th October, 2016

    JUDGMENT (Per K. L. Wadane, J):

1. Heard the learned counsel for the parties.

wp4336-15.odt

2. Rule. Rule made returnable forthwith. With

consent of parties, the petition is taken up for final

disposal.

3. The petitioner has challenged the order passed

by respondent no.2, dated 5th September, 2013 along with

public notice dated 24.02.2015 and the proceedings of

advertisement No. 12/2014 by which respondent No.2 has

fixed tariff. The petitioner has further challenged

the order passed by respondent No.2 in Case No.

95/2013, dated 25.06.2015 by way of amendment in the

writ petition.

4. The petitioner is a consumer of respondent No.3-

Company. Respondent No.2 is a Regulatory Commission

established under the Electricity Act, 2003. It has

power to fix tariff and is expected to be a watchdog

of interest of the consumers and function

transparently.

5. According to the petitioner, on 16.08.2012,

respondent No.2 settled the tariff w.e.f. 1st August,

2012 in case No.19/2012. As per provisions of

Electricity Act, respondent No.3 has to apply to

respondent No.2 for increase in the tariff. On such

application, respondent No.2 Commission has to issue a

wp4336-15.odt public notice, it has to call and hear objections of

the consumers and then it has to take decision. On

05.09.2013, without any request or application of

respondent No.3, respondent No.2 Commission took up suo

moto proceedings and in total breach of the mandatory

provisions of public hearing etc., allowed respondent

No.3 Company to recover huge amount of Rs.3450.13

crore, practically increasing cost by 20% to the

consumers. The recovery was started from 7th September,

2013 and much more amount is recovered from the

consumers.

6. TATA Motor challenged the said order in Appeal

No. 295/2015 before the Appellate Tribunal for

Electricity. The Appellate Tribunal remanded the matter

to respondent No.2 for deciding the matter afresh. The

Appellate Tribunal also directed respondent No.2 to

decide the matter by following the procedure as

contemplated under Sections 63, 64 and 86(3) of the

Electricity Act, 2003.

7. On 24.02.2015, the Regulatory Commission, i.e.

Respondent No.2 put up a notice on its website without

disclosing any particulars as to how and why additional

burden is put up, its impact, necessity, etc. due to

wp4336-15.odt which, public at large could not understand adverse

affects and put objections etc. On 09.04.2013, date

was fixed at Aurangabad. The petitioner was personally

present and gave written representation, requesting to

publish public notice in newspaper, giving all details

to enable the public at large to raise effective

objections. Representation was received but not

answered nor detail publication was given on the

website.

Respondent No.2 Commission has denied the

material allegations in the petition and it is

contended that petition is not maintainable as

alternative remedy is available under the provisions of

the Electricity Act, 2013. The Appellate Tribunal,

has power to consider the aspect in appeal under

section 111 of the Electricity Act. By way of

additional affidavit it is contended that after remand

of the matter, respondent no.2, after giving proper

opportunity to these concerned parties, has passed

order on 26.03.2015. Respondent No.2 prays to reject

the petition.

9. We have heard the arguments of Mr. R. R. Mantri,

learned counsel for the petitioner, Mr. B. A. Shidne,

wp4336-15.odt learned AGP for respondent No. 1 State, Mr. Ratnakar

Singh, learned counsel for Respondent Nos. 2 & 4 and

Mr. Anil S. Bajaj, Advocate for respondent No.3.

10. During the course of argument, Mr. Mantri has

argued that respondent no.2 fixed and finalized the

tariff without request/application of respondent no.3.

The commission has took up the proceedings suo moto

which is in contravention of section 64 of the

Electricity Act. He further argued that respondent No.2

Commission has not followed the provisions of Section

64 of the Electricity Act nor gave a public notice.

Objections were not called from the Consumers and it

has decided the matter haphazardly in one day.

Further more, initial order dated 5th September, 2013

was assailed before the Appellate Tribunal,

Electricity and the learned Appellate Tribunal has

remanded the matter and directed respondent No.2 to

pass a consequential order. The Appellate Tribunal has

observed that respondent no.2 has not followed the

mandatory provisions. Therefore, according to Mr.

Mantri, respondent no.2 was not empowered to re-fix the

tariff. Only it has to pass consequential orders as

per directions of the Appellate Tribunal.

wp4336-15.odt

11. Mr. Mantri, the learned counsel further argued

that after remand of the matter, a public notice was

given. It was without any material particulars which

the common people can know. Giving of public notice and

hearing was a farce. Mr. Mantri further argued that the

work of the Commission/respondent No.2 is in the

regulatory nature and it should have safeguarded the

interest of the consumers but in the blatant violation

of the mandatory provisions, respondent No.2 has passed

the impugned order dated 25.06.2015.

12. Mr. Mantri, the learned counsel for the

petitioner has relied on the observations of the Apex

court in the case of Union of India & ors. Vs. Tantia

Construction Pvt. Ltd., reported in 2011(5) SCC 697,

which reads as under:

13."27. Apart from the above, even on the question of maintainability of the writ petition on account of the Arbitration Clause included in

the agreement between the parties, it is now well-established that an alternative remedy is not an absolute bar to the invocation of the writ jurisdiction of the High Court or the Supreme Court and that without exhausting such alternative remedy, a writ petition would not be maintainable. The various decisions cited by Mr. Chakraborty would clearly indicate that the

wp4336-15.odt constitutional powers vested in the High Court or the Supreme Court cannot be fettered by any alternative remedy available to the authorities.

Injustice, whenever and wherever it takes place, has to be struck down as an anathema to the rule

of law and the provisions of the Constitution. We endorse the view of the High Court that notwithstanding the provisions relating to the

Arbitration Clause contained in the agreement, the High Court was fully within its competence to entertain and dispose of the Writ Petition filed

on behalf of the Respondent Company. "

14. Mr. Mantri, the learned counsel also relied on

the judgment of the Apex Court in the case of M. P.

State Agro Industries Development Corporation Ltd. &

another Vs. Jahan Khan, reported in 2007 AIR SC 3133,

wherein it is observed that:

15."The rule of exclusion of writ jurisdiction

due to availability of an alternative remedy is a rule of discretion and not one of compulsion. In an appropriate case, in spite of the availability of an alternative remedy,

a writ court may still exercise its discretionary jurisdiction of judicial review, in at least three contingencies, namely, (i) where the writ petition seeks enforcement of any of the fundamental rights; (ii) where there is failure of principles of natural justice or (iii) where the orders or

wp4336-15.odt proceedings are wholly without jurisdiction or the vires of an Act is challenged. In these circumstances, an alternative remedy does not

operate as a bar."

16. Mr. Mantri, the learned counsel further submits

that Respondent No.4 has committed contempt of this

Court. This Court on 16.04.2015 had issued notice.

Respondent No.4 was served with the notice, had

appeared in the matter on 07.05.2015 and sought time.

When this Court was seized of the matter, then

respondent No.4 ought not to have decided the

proceedings. The said act amounts to contempt of this

court.

17. As against this, Mr. Singh, the learned counsel

for respondent No.2 has argued that the respondent

No.2, after remand of the matter has observed the

relevant mandatory provisions of the Electricity Act

and after giving public notice and after hearing the

objections, passed appropriate orders. Further more,

it was submitted by the learned counsel that the

petitioner has efficacious remedy under the provisions

of Section 111 of the Electricity Act. Therefore the

writ petition is not maintainable. The learned counsel

has further argued that when the efficacious remedy

wp4336-15.odt of appeal is available to the petitioner, it is not

desirable to exercise jurisdiction under Article 226

of the Constitution of India. The learned counsel

further relied on the provisions of the Maharashtra

Electricity (Conduct of Business) Regulation, 2004 and

stated that the Commission may, suo moto or on petition

by any affected person, initiate proceedings. The

learned counsel has relied on the following case laws:

(1) (1983) 2 Supreme Court Cases 433, Titaghur Paper

Mills Co. Ltd. and another vs. State of Orissa and

others, wherein it is held that:

"Where a right or liability is created by a

statute which gives a special remedy for

enforcing it, the remedy provided by that statute

alone must be availed of."

(2) (1998) 8 Supreme Court Cases 1, Whirlpool

Corporation Vs. the Registrar of Trade Marks, Mumbai

and another, wherein the it is held that:

"14. The power to issue prerogative writs under Article 226 of the Constitution is plenary in nature and is not limited by any other provision of the Constitution. This power can be exercised by the High court not only for issuing writs in the nature of habeas corpus, mandamus,

wp4336-15.odt prohibition, quo warranto and certiorari for the enforcement of any of the Fundamental Rights contained in Part III of the Constitution of

also for "any other purpose."

18. Before going to consider the merit of the case,

it is material to note that when the present petition

was pending before this Court, respondent No.2 decided

the tariff by its order dated 25.06.2015. In fact, it

was expected from respondent No.2 to await the decision

of this court. The propriety required so. Therefore,

it was expected from it to stay away its hand. However,

respondent No.2 was exercising quasi-judicial power.

This Court had not passed any prohibitory order

against the respondent. As such act of the respondent

passing order during pendency of the present petition

may not amount to contempt of Court in strict sense.

19. In view of submissions of Mr.Mantri, it is

necessary to refer to relevant observations of the

Tribunal i.e. summary of findings, which reads as

under:

(a) The impugned order has been passed in violation of Sections 62, 64 and 86(3) of the Electricity Act, 2003. The State Commission should have followed the mandatory procedure contemplated under section 64 and 86(3) of the Electricity Act,

wp4336-15.odt 2003 by issuing public notice and giving opportunity to the consumers to raise objections/suggestions on the retail supply of tariff proposed and only after

considering these objections/suggestion, should have determined the tariff.

(b) As per section 62(4)of the Act, the tariff may not ordinarily be amended more frequently than

once. However, the tariff can be amended more than once in a financial year in respect of any changes in terms of fuel surcharge formula as may be

specified by the State Commission. This Tribunal has

held earlier that the tariff can be revised without following the procedure u/s 64 provided the revision

in tariff is in terms of the Fuel surcharge Formula as specified by the State Commission through Regulations or by the tariff Order. The Impugned

Order was not an amendment in tariff as per the Scheduled specified Fuel Surcharge Formula.

(c) we, therefore, set aside the impugned order and remand the matter to the State commission to give

opportunity to the parties concerned as per the provisions of Section 64 of the Electricity act and hear the matter in a transparent manner and pass the

final order uninfluenced by its earlier findings, as expeditiously as possible. we want to make it clear that we are not giving any opinion on the merits."

20. Looking to the above observations, it appears

that the Appellate Tribunal has directed respondent

no.2 to pass order after following relevant provisions

wp4336-15.odt of the Electricity Act and further it was clarified

that the Tribunal has not given any opinion on the

merits of the case.

21. We have perused the order dated 25.06.2015

impugned by way of amended pleadings. On perusal of

the same, it appears that the issue of fixation/

revision of tariff is an issue to be examined and

determined by the Experts. Furthermore, in view of the

provisions of Section 111 of the Electricity Act, there