Madras High Court

Scotts Garments Ltd vs Tamil Nadu Electricity ... on 20 June, 2022

                                                                            W.P. Nos.709 to 711 of 2015

                                  IN THE HIGH COURT OF JUDICATURE AT MADRAS

                                               DATED : 20.06.2022

                                                         CORAM

                            THE HONOURABLE MR.JUSTICE MOHAMMED SHAFFIQ

                                            W.P. Nos.709 to 711 of 2015
                                          and M.P. Nos.1, 1 and 1 of 2015

                     Scotts Garments Ltd.,
                     HTSC No.29,
                     S.F.No.536/5, Veerapandy,
                     Veerapandy post, Tirupur-641 605.
                     Rep. by its General Manager,
                     A.Murali Krishnamoorthy               …Petitioner in W.P.No.709 of 2015

                     P.K.P.Processors,
                     HTSC No.116,S.F.No.415/2, Angeripalayam,
                     Tirupur-641 603.
                     Rep. by its Authorised signatory,
                     S.Paramasivam                     …Petitioner in W.P.No.710 of 2015

                     Thangamman Process,
                     HTSC No.126,Vadugan Thottam,
                     Kasipalayam, Vijayapuram post,
                     Tirupur-641 60r.
                     Rep. by its Authorised signatory,
                     S.Paramasivam                         ...Petitioner in W.P.No.711 of 2015

                                                           Vs.
                     1.Tamil Nadu Electricity Regulatory Commission,
                       Rep. by its Secretary, 19-A,
                       Rukmini Lakshmipathy Salai,
                       (Marshall's Road), Egmore, Chennai-600 008.

                     1/8

https://www.mhc.tn.gov.in/judis
                                                                               W.P. Nos.709 to 711 of 2015

                     2.Tamil Nadu Generation and Distribution
                       Corporation Limited (TANGEDCO),
                       Rep. by its Chairman and Managing Director,
                       144, Anna Salai, Chennai-600 002.

                     3.The Superintending Engineer,
                       TANGEDCO, Tirupur Electricity
                        DistributionCircle, Tirupur.         …Respondents in all W.Ps.

PRAYER in W.P.No.709 of 2015: Writ Petition filed under Article 226 of the Constitution of India, praying to issue a Writ of Certiorari calling for the records of the 3rd respondent in his impugned demand notice Lr.No.SE/TEDC/TPR/AAO/DFC/F.HT/BOAB/D./14 dated 23.12.2014 along with BOAB Audit slip no.214 both seeking refund of the encashment amount already paid to the petitioner towards unutilised banked wind energy for the periods 2011-12 and 2012-13 respectively, quash the same as illegal, arbitrary, without the authority of law, against the violation of principle of natural justice and against Electricity Act 2003.

PRAYER in W.P.No.710 of 2015: Writ Petition filed under Article 226 of the Constitution of India, praying to issue a Writ of Certiorari calling for the records of the 3rd respondent in his impugned demand notice Lr.No.SE/TEDC/TPR/AAO/DFC/F.HT/BOAB/D./14 dated 23.12.2014 along with BOAB Audit slip no.126 both seeking refund of the encashment amount already paid to the petitioner towards unutilised banked wind energy for the periods 2011-12, quash the same as illegal, arbitrary, without the authority of law, against the violation of principle of natural justice and against Electricity Act 2003.

PRAYER in W.P.No.711 of 2015: Writ Petition filed under Article 226 of the Constitution of India, praying to issue a Writ of Certiorari calling for the records of the 3rd respondent in his impugned demand notice Lr.No.SE/TEDC/TPR/AAO/DFC/F.HT/BOAB/D./14 dated 22.12.2014 along with BOAB Audit slip no.126 both seeking refund of the encashment amount already paid to the petitioner towards unutilised banked wind energy for the periods 2011-12, quash the same as illegal, arbitrary, without

https://www.mhc.tn.gov.in/judis W.P. Nos.709 to 711 of 2015

the authority of law, against the violation of principle of natural justice and against Electricity Act 2003.

                                              For Petitioner      : Mr.S.Parthasarathy
                                              in all W.Ps.

                                              For Respondent 1 : No appearance
                                              in all W.Ps.

                                              For Respondents : Mr.Abul Kalam
                                              in all W.Ps.      Standing Counsel
                                                                for TANGEDCO

                                                     COMMON ORDER

The issue involved in all these writ petitions are one and the same and

therefore a common order is passed.

2. The petitioners in all these writ petitions are a continuous process

industry having High Tension Electricity Supply in H.T.Sc.Nos.29, 116 and

126 respectively, under the 3rd respondent, Tiruppur EDC.

3. The power scenario in State of Tamil Nadu was very bad during

the period 2007 onwards. As the respondent/ Board was unable to manage

the demand, they imposed a number of restrictions and control measures to

various categories of consumers with effect from 01.11.2008, insofar as

https://www.mhc.tn.gov.in/judis W.P. Nos.709 to 711 of 2015

H.T. consumers are concerned, the following restrictions were imposed,

namely:

a. There was allocation only to the extent of 60%.

b. There were peak-hour restrictions and scheduled load shedding.

c. There was compulsory power holidays, in the case of petitioner, it

is stated to be on Fridays and Sundays.

4. Rule 3(1)(a)(ii) of the Electricity Rules, 2005 requires that to

qualify as a "captive generation power plant" under Section 8 read with

Clause 8(2), power of not less than 51% of aggregate electricity generated

on such plant determined on annual basis, must be consumed for captive

use. During the period 2011-12 and 2012-13, the petitioners having not

complied with the above requirement, consequently, impugned notices were

issued seeking refund of the amount already paid to the petitioners towards

unutilised banked energy.

5. It is submitted by the learned counsel for the petitioners that the

above issue is no longer res-integra and stands resolved by a judgment of

https://www.mhc.tn.gov.in/judis W.P. Nos.709 to 711 of 2015

this Court in W.P.No.6112 of 2017 dated 25.01.2002 wherein reference was

made to the order passed by the Tamil Nadu Electricity Regulatory

Commission in D.R.P.No.18 of 2013 wherein similar demands were set

aside on the premise that non-compliance with the requirement of 51% of

electricity consumption for captive use under Rule 3(1)(a)(ii) of Electricity

Rules, 2005 was only in view of the restrictions and control measures

implemented by the respondent/ Board, over which the petitioner had no

control nor can be found fault with. Relevant portion of the order of this

Court wherein the order of Tamil Nadu Electricity Regulatory Commission

was referred to is extracted below:

"5..... At this juncture, it would be appropriate to extract the order passed by the Tamil Nadu Electricity Recovery Commission in D.R.P.No.18 of 2013. The relevant portion of the said order is reproduced hereunder:

"11.15.8. The Commission is of the ell considered view that when the Government of Tamil Nadu, on the one hand, directed all the generating stations to operate at their maximum capacity to receive the power, and at the same time limited the allocation to the extent of 60% / 70% level with peak hour restriction and scheduled load shedding vide its letter dated 22.10.2008, we find that a consumer cannot be penalised. When a consumer is not given even 51% of his requirement, as stated supra, the Distribution licensee in our view cannot expect fulfilment of the conditions of 51% of

https://www.mhc.tn.gov.in/judis W.P. Nos.709 to 711 of 2015

consumption as required under Rule 3(1)(a).

11.15.9. Rule 3(1)(a) stipulates a power plant to satisfy both the conditions stated therein to qualify as a Captive Generating Plant "it is applicable under normal circumstances when the distribution/ transmission grid is open to the captive user without any restriction and not when there is no fault on the part of the captive user in consuming power on its side and at a time when stringent measure was imposed both in the form of restricted Quota as well as grid restrictions. We find no merit in insisting on adherence of conditions under Rule 3 of the Electricity Rules, 2005 for a captive generating plant in such conditions.