M/S Ultratech Cement Limited vs M.P. Poorv Kshetra Vidyut Vitaran ...
2025 Latest Caselaw 4051 MP

Madhya Pradesh High Court

M/S Ultratech Cement Limited vs M.P. Poorv Kshetra Vidyut Vitaran ... on 5 February, 2025

Author: Vivek Agarwal

Bench: Vivek Agarwal

                                                              1                                    WA-26-2021
                                        IN THE HIGH COURT OF MADHYA PRADESH
                                                     AT JABALPUR
                                                        WA No. 26 of 2021
                              (M/S ULTRATECH CEMENT LIMITED AND OTHERS Vs M.P. POORV KSHETRA VIDYUT VITARAN
                                                        COMPANY LTD. AND OTHERS )



                           Dated : 05-02-2025
                                 Shri Ravindra Shrivastava - Senior Advocate with Shri Abhishek
                           Munot, Shri Malcolm Desai, Shri Sharad Khare, Shri Sarabvir Singh Oberoi
                           and Ms. Sanya Shukla - Advocates for appellants.
                                 Shri Prashant Singh - Senior Advocate with Shri Amit Seth, Shri
                           Ritwik Parashar, Shri Yash Sharma - Advocates for respondent No.1.

Shri Shreyas Pandit - Advocate for respondent No.2. Shri Avinash Zargar - Advocate for respondent No.3.

This writ appeal is filed being aggrieved by the order dated 08.12.2020 passed in Writ Petition No.15889/2020 amongst UltraTech Cement Ltd. and Anr. and Madhya Pradesh Poorv Kshetra Vidyut Vitaran Company Ltd. and others.

Several issues have been raised, but the main issue is that learned Single Judge has remitted the parties to avail alternative statutory remedy as

contained in Section 86(1)(f) of the Electricity Act, 2003.

It is submitted that alternative remedy is not available to these petitioners because neither it is a licensee nor a generating company and therefore, petitioner is not entitled to invoke jurisdiction of the State Electricity Regulatory Commission in terms of the provisions contained in Section 86(1)(f) of the Act of 2003.

It is pointed out that the three requirements are to be essentially

2 WA-26-2021 fulfilled namely (i) there should be a dispute (ii) the dispute should be between a licensee and a generating company and (iii) the dispute can be adjudicated by the M.P. State Electricity Regulatory Commission or may be referred to an Arbitration.

Shri Prashant Singh - learned Senior Advocate assisted by Shri Ritwik Parashar in his turn draws attention of this Court to the reply filed in this writ appeal vide document No.5056 of 2021 and taking this Court through para Nos.4, 5, 6, 7 and 20 submits that petitioner is amenable to avail alternative statutory remedy and there is no escape from it.

When this Court wanted to know from Shri Prashant Singh -learned Senior Advocate that whether these objections were taken during hearing of

the writ petition, then it is fairly submitted by him that this aspect has been dealt with by the learned writ Court in its impugned order wherein it has categorically noted that such issues were not raised in the reply as can be seen from paragraph 5 onwards (impugned order).

When we wanted to know that when these objections were raised, because learned counsel for the appellant submits that firstly, there was no preliminary objection, when the company was taken off the guard to defend such objection taken at the spur of the moment during the argument, secondly, Section 86(1)(f) of the Act is not applicable as petitioner was yet not a Generating Company and thirdly, it was said that alternative statutory remedy is not binding in terms of the provisions as contained in Clause-b of Article 226 (3), it is evident that preliminary objection in regard to alternative statutory remedy to which recourse has been taken by the learned

3 WA-26-2021 Single Judge was never canvassed in writing before the learned Single Judge while filing the reply on behalf of the DISCOM.

As far as issue of applicability of Section 86(1)(f) of the Act of 2003 is concerned, it is evident that there are two aspects to the prayer clause as can be seen from the writ petition namely to quash the demand notice dated 27.06.2017 being Annexure-P/5 and all subsequent communications, to the extent of the respondent No.1 Licensee's claim from the petitioner towards recovery of JAL'S outstanding Electricity Duty dues for the period prior to 29.06.2017, which is the closing date.

Prayer is to direct the respondent No.1 to forthwith grant permission to the petitioner for synchronization and parallel operation of its 1x13 Megawatt Waste Heat Recovery System (WHRS), based captive generating plant with its existing 6.6 Kv bus of M/s. UTCL Bela Cement Works, Jaypee Puram, District Rewa and then also to declare that the petitioner is not liable to pay the electricity duty prior to the closing date i.e. 29.06.2017 and to further direct the respondent No.1. licensee to forthwith change the name of the petitioner's 132 kv consumer connection from that of M/s. Jaypee Bela Plant to Ultratech Cement Limited (Unit : Bela Cement Works), without requiring the petitioner to make payment of JAL's outstanding Electricity Duty dues (for the period prior to 29.06.2017).

Shri Shrivastava points out that there is an undertaking of 2017 furnished by M/s. JAL Annexure-A/2 dated 16.10.2017, wherein one Mr. Pankaj Verma, Joint President for Jaiprakash Associates Limited had given

an undertaking on behalf of M/s. Jaiprakash Associates Limited that they

4 WA-26-2021 shall make payment of electricity duty dues and vigilance recovery amount on final disposal of said writ petitions. The scheme under which JAL's Bela Unit was taken over by the petitioner is statutory in nature and that is binding on the parties. This scheme will operate in rem and, therefore, it is binding on all stake holders.

The first issue which emerges is that whether provisions of Section 86(1)(f) will be attracted or not because that is the core to the judgment of the learned Single Judge as submitted by Shri Shrivastava and though vehemently opposed by Shri Prashant Singh, but fact of the matter is that the provisions of Section 86 describe functions of State Commission. Section 86(1)(f) grants authority to the State Electricity Regulatory Commission to adjudicate upon the disputes between the Licensees and the generating companies and refer any dispute for Arbitration.

Now the definition of 'licensee' is given in Section 2(39) of the Act of 2003 which reads as under:

"licensee" means a person who has been granted a license under Section 14.

Generating Company is defined in Section 2(28) as under:

"Generating Company" means any Company or body Corporate or Association or body of individual whether incorporated or not, or artificial juridical person which owns or operates a generating station.

In the present case, the scheme Annexure-A/2, as has been approved by National Company Law Tribunal and Transfer Company Scheme No.338/2017 in DXE Company Petition No.881/2016 connected with company summons and directions number 772 of 2016 wherein Clause 5.2

5 WA-26-2021 and 7.1 reads as under :

"5.2 It is clarified that:(a) any liability including contingent liability disclosed in the balance sheet of the JAL Business and the JCCL Business on the Closing Date provided to the Transferee, other than those included in the JAL Financial Indebtedness, JCCL Financial Indebtedness, JAL Net Working Capital and the JCCL Net Working Capital;(b) any guarantees listed in Schedule III A and XI A or any similar instruments by whatsoever name and (c) any lability which is excluded in the definition of the JAL Business and the JCCL Business, shall not be acquired by the Transferee and shall not be included in the JAL Transferred Liabilities and the JCCL Transferred Liabilities. It is clarified that any capital commitment made by the Transferor 1 and/or the Transferor 2 at the request of the Transferee, upto the Closing Date, shall not be included in the JAL Financial Indebtedness and JCCL Financial Indebtedness and shall be paid by the Transferee.

7.1 All legal or other proceedings (whether civil or criminal, including before any statutory or Judicial or quasi-judicial authority or tribunal) by or against the Transferor l and/or the Transferor 2, initiated on or arising and pending before the Effective Date, and relating to the JAL Business and the JCCL Business shall remain with the Transferor 1 and/or the Transferor 2, as the case may be."

Thus, it is evident from a combined reading of the two clauses that "any liability" including "contingent liability" disclosed in the balance sheet of the JAL Business and the JCCL Business on the Closing Date provided to the Transferee, other than those included in the JAL Financial Indebtedness, JCCL Financial Indebtedness, JAL Net Working Capital and the JCCL Net Working Capital;(b) any guarantees listed in Schedule III A XI A or any similar instruments by whatsoever name and (c) any liability which is excluded in the definition of the JAL Business and the JCCL Business, shall not be acquired by the Transferee and shall not be included in the JAL Transferred Liabilities and the JCCL Transferred Liabilities. It is clarified

6 WA-26-2021 that any capital commitment made by the Transferor 1 and/or the Transferor 2 at the request of the Transferee, upto the Closing Date, shall not be included in the JAL Financial Indebtedness and JCCL Financial Indebtedness and shall be paid by the Transferee, therefore, we are of the opinion that the controversy is in two parts; one is to connect to the grid of the respondent DISCOM and therefore, the only dispute which is available before this Court in all fairness is in regard to transfer of the electricity connection in the name of the new entity permitting it to draw electricity from that new connection without incumbering new entity of the liability which is due on the previous entity namely JAL Associates Electricity Duty dues. In that context, neither the petitioner as a generating company because it is not seeking any relief in its capacity as a generating company but is only seeking a relief in the capacity of a consumer and therefore, this Court is of the opinion that provisions of Section 86(1)(f) will not be applicable. Hence, impugned order is set-aside. The matter is remitted to the learned Single Judge to decide the controversy within a period of 30 days from the date of receipt of certified copy of this order.

Registry is directed to list this case before the learned Single Judge on 13.02.2025 for which no separate notices will be required. The learned Single Judge is requested to complete the proceedings on or before 30.03.2025, if possible, and any observation made herein will not come in

the way of adjudication of the writ petition.

The pleadings are complete. The learned Single Judge is requested to hear the arguments and decide the case on its own merits expeditiously. The

7 WA-26-2021 Apex Court in CA/10662/2024 - UTCL Vs Mastram and others decided on 20.09.2024 has concluded that the Closing Date is the reference date and the scheme is akin to law and is operational in Rem. Thus, the scheme being operational, therefore, the rights and liabilities of the parties will be governed by the scheme.

The pendency of WA No.00728/2021 will not come in way of disposing of the writ petition.

                                 (VIVEK AGARWAL)                                (ANURADHA SHUKLA)
                                      JUDGE                                           JUDGE
                           NP