M/S ARJUNA NATURAL PVT.LTD. v. KERALA STATE ELECTRICITY BOARD

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** # **`PRESENT`** ## **`THE HONOURABLE MR. JUSTICE AMIT RAWAL`** ``` TUESDAY, THE 1[ST] DAY OF NOVEMBER 2022 / 10TH KARTHIKA, 1944 ``` ## **`WP(C) NO. 34859 OF 2022`** ## **`PETITIONER:`** ``` M/S ARJUNA NATURAL PVT.LTD., BANK ROAD, ALUVA, KERALA 683101. REPRESENTED BY ITS MANAGING DIRECTOR, MR. P.J.KUNJACHAN. ``` ``` BY ADVS. P.BENNY THOMAS D.PREM KAMATH TOM THOMAS (KAKKUZHIYIL) ABEL TOM BENNY KURIAN OOMMEN THERAKATH JAIKRISHNAN.M.PISHARODI K.S.MUHAMMED SHEFIN ``` ## **`RESPONDENTS:`** - `1 KERALA STATE ELECTRICITY BOARD, REPRESENTED BY ITS SECRETARY, VYDYUTHI BHAVANAM, PATTOM PALACE P.O., THIRUVANANTHAPURAM-695004, REPRESENTED BY CHAIRMAN.` - `2 THE ASSISTANT ENGINEER, ELECTRICAL SECTION, EDAYAR SUB DIVISION, KERALA STATE ELECTRICITY BOARD, EDAYAR, KERALA, 683502.` - `3 THE ASSESSING OFFICER (ASSISTANT EXECUTIVE ENGINEER), KERALA STATE ELECTRICITY BOARD, ELECTRICAL SUB DIVISION, NEAR POWER HOUSE ROAD, ALUVA, 683101.` - `4 THE EXECUTIVE ENGINEER, KERALA STATE ELECTRICITY BOARD, ELECTRICAL DIVISION, ALUVA, -683101.` - `5 ELECTRICAL INSPECTOR, ELECTRICAL INSPECTORATE, THIRD FLOOR, REVENUE TOWER, PARK AVENUE. ERNAKULAM- 682 011.` ``` 2 ``` ## **`WP(C) NO. 34859 OF 2022`** ``` 6KERALA STATE ELECTRICITY APPELLATE AUTHORITY (CONSTITUTED UNDER SECTION 127 OF THE ELECTRICITY ACT 2003) CC 51152. NEAR 110 KV SUB STATION, VYTTILA, KOCHI 682019. ``` ## `SRI RIJI RAJENDRAN SC KSEB` ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 01.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ``` WP(C) NO. 34859 OF 2022 ``` ``` 3 ``` ## **JUDGMENT** Against the order of assessment dated 16.09.2022 Ext.P7 petitioner had preferred an appeal under Section 127 of the Kerala Electricity Act, 2003. Vide communication dated 26.10.2022, Ext.P12, it has been intimated to deposit 50% of the assessed amount. 2. Learned counsel appearing on behalf of the petitioner submits that in appeal the amount cannot be refixed as 50% of the assessed amount would be much more and the contention of the petitioner is that the respondent Electricity Board cannot be permitted to charge more amount than the fixed charges and in support of the aforementioned contention, relies upon the judgment of this Court dated 28.05.2018 rendered in W.P.(C).No.17190/2018 Ext.P14, wherein, by relying upon the judgment of this Court in _**Sulabha Marketing (P) Ltd**_ v. _**Kerala State Electricity board**_ [2017 (3) KHC 563], it has been held that the Kerala ``` WP(C) NO. 34859 OF 2022 ``` ``` 4 ``` State Electricity Board can only charge fixed charges and at the best, person can be allowed to pay penalty on fixed charges but not on other charges and in the absence of the same, there is likelihood that the appellate authority may uphold the order of the assessment. 3. Issue notice before admission. Sri.Riji Rajendran, the learned Standing Counsel for the Kerala State Electricity Board accepts notice. 4. Learned counsel for the respondent relied upon the judgment dated 25.10.2016 rendered in W.A.705/2014 wherein the constitutional validity of Section 127(2) of Electricity Act was challenged. It has been held that similar provisions are available in the Customs Act, Central Excise Act, Sales Tax Act and Income Tax Act ie., remittance of amount as a condition for maintaining appeals. Petitioner cannot rely upon the judgment of the Single Bench as it is on the merits of the matter and not for the interim purposes. 5. I have heard the learned counsel for the parties and ``` 5 ``` ## **`WP(C) NO. 34859 OF 2022`** appraised the paper book. 6. The Division Bench while dealing with the constitutional validity of Section 127(2) in paragraphs 6, 7, 8 ## held as under: “6. The second contention raised is regarding constitutional validity of Section 127(2). Section 127(1) and (2) of the Act read thus: ## _**“127. Appeal to Appellate Authority.—**_ (1) Any person aggrieved by the final order made under section 126 may, within thirty days of the said order, prefer an appeal in such form, verified in such manner and be accompanied by such fee as may be specified by the State Commission, to an appellate authority as may be prescribed. (2) No appeal against an order of assessment under sub-section (1) shall be entertained unless an amount equal to 3 [half of the assessed amount] is deposited in cash or by way of bank draft with the licensee and documentary evidence of such deposit has been enclosed along with the appeal.” 7. While Section 127(1) confers an appellate remedy against the final order passed under Section 126, subsection 2 thereof imposes a condition requiring the appellant, to deposit an amount equal to half of the assessed amount in cash or by way of demand draft with the licensee as a condition for entertaining an appeal. The question is whether such a condition is constitutionally invalid. Having considered this issue, we find that appeal is a statutory remedy and it is ``` WP(C) NO. 34859 OF 2022 ``` ``` 6 ``` always open to the Parliament to impose conditions for availing of the appellate remedy. Such conditions are liable to be upheld so long as the same passes the constitutional test of the reasonableness and non-arbitrariness. Such conditions requiring remittance of amounts as condition for maintaining appeals, are not unknown. Similar provisions are available in the Customs Act, Central Excise Act, Sales Tax Act, Income Tax Act and such other enactments. While in these enactments, power of waiver has been confined on appellate authorities, there are enactments such as Payment of Gratuity Act which require deposit of full amount ordered by the controlling authority as condition for maintaining appeal. These provisions have also stood the test of judicial scrutiny. Therefore, the provision of Section 127(2) requiring deposit of half of the assessed amount in the order under Section 126(1) cannot be said to suffer from any constitutional invalidity. Therefore, we are unable to hold that Section 127(2) suffers from any unconstitutionality for it being declared as such. 8. We do not find any illegality in the impugned judgment for interference in this appeal. Appeal fails and is dismissed accordingly.” ## Whereas the Single Bench while considering the judgment of _**Sulabha Marketing**_ in paragraph 4 has held under: “4. The issue whether the case of the petitioner is one covered by the decision of this Court in Sulabha Marketing (supra) is an issue that has to be resolved after adverting to the facts of the case in detail. As such, ``` WP(C) NO. 34859 OF 2022 ``` ``` 7 ``` according to me, it is only appropriate that the said issue be resolved by the appellate authority. In the circumstances, having regard to the facts and circumstances of the case as also the orders passed by this Court in similar matters, I deem it appropriate to dispose of the writ petition permitting the petitioner to prefer appeal challenging Ext.P5 order by remitting 50% of the penalty on fixed charges directed to be paid in terms of Ext.P5 order. Ordered accordingly. Needless to say that if the petitioner remits 50% of the penalty on fixed charges as directed above and prefers appeal within two weeks from the date of receipt of a copy of the judgment, the appellate authority shall treat the appeal as one properly instituted and dispose of the same on merits. Needless also to say that if the petitioner remits 50% of the penalty on fixed charges as directed above, the power supply to the premises of the petitioner shall not be disconnected till the disposal of the appeal.” ## 7. It is appropriate to extract the provisions of Section ## 127 of the Electricity Act, 2003: ## **“Section 127. (Appeal to Appellate Authority)** : - (1) Any person aggrieved by the final order made under section 126 may, within thirty days of the said order, prefer an appeal in such form, verified in such manner and be accompanied by such fee as may be specified by the State Commission, to an appellate authority as may be prescribed. (2) No appeal against an order of assessment under subsection (1) shall be entertained unless an amount equal to ``` WP(C) NO. 34859 OF 2022 ``` ``` 8 ``` [half of the assessed amount] is deposited in cash or by way of bank draft with the licensee and documentary evidence of such deposit has been enclosed along with the appeal. (3) The appellate authority referred to in sub-section (1) shall dispose of the appeal after hearing the parties and pass appropriate order and send copy of the order to the assessing officer and the appellant. (4) The order of the appellate authority referred to in subsection (1) passed under sub-section (3) shall be final. (5) No appeal shall lie to the appellate authority referred to in sub-section (1) against the final order made with the consent of the parties. (6) When a person defaults in making payment of assessed amount, he, in addition to the assessed amount shall be liable to pay, on the expiry of thirty days from the date of order of assessment, an amount of interest at the rate of sixteen per cent, per annum compounded every six months.” 8. For maintaining an appeal, the provisions provided under the statutes are required to be complied with. The directions contained in the judgment Ext.P4 basically was on the basis of the findings rendered in _**Sulabha Marketing**_ which would have a far-reaching effect on the findings of the appellate authority in pending appeal. If such interim order is passed, it may prejudice the Kerala State Electricity Board in ``` WP(C) NO. 34859 OF 2022 ``` ``` 9 ``` making assertions with regard to charging of amounts, which will be always subject to the final order. Thus, I do not rely upon the opinion expressed by the Single Bench and relies upon the Division Bench judgment whereby the petitioner is to deposit 50% as per the provisions of Section 127 of the Electricity Act. Writ petition stands dismissed. **Sd/-** **AMIT RAWAL JUDGE** nak ``` 10 ``` ## **`WP(C) NO. 34859 OF 2022`** ## **`APPENDIX OF WP(C) 34859/2022`** ``` PETITIONER EXHIBITS ``` ``` Exhibit P1TRUE COPY OF THE COVERING LETTER DATED 12.09.2022. ``` - `Exhibit P2 TRUE COPY OF THE COVERING LETTER DATED 10.10.2022.` - `Exhibit P3 TRUE COPY OF THE APPLICATION SUBMITTED BY THE PETITIONER.` - `Exhibit P4 RUE COPY OF THE ORDER DATED 14.01.2022 NO. B3 18085/21/EIE.` - `Exhibit P5 TRUE COPY OF THE PROVISIONAL ORDER 30.08.2022 DB 36/ELECTRICITY ACT 126/ESD - ALVT/2022-23/139 WITH ITS ENGLISH TRANSLATION.` - `Exhibit P6 TRUE COPY OF THE REPLY DATED 06.09.022 SUBMITTED BY THE PETITIONER.` - `Exhibit P7 TRUE COPY OF THE ORDER 16.09.2022 DB 36/ELECTRICITY ACT 126/ESD-ALVT/202223/160 WITH ITS ENGLISH TRANSLATION.` - `Exhibit P8 TRUE COPY OF THE RELEVANT PAGES OF THE GO ORDER NO.297/D(T)/2022/KSERC DATED 25.06.2022.` - `Exhibit P9 TRUE COPY OF THE JUDGMENT DATED 7.10.2022 IN WP(C) 31879 OF 2022 OF THIS HON'BLE COURT.` - `Exhibit P10 TRUE COPY OF THE APPEAL MEMORANDUM WITHOUT ANNEXURES DATED 20.10.2022 FILED BY THE PETITIONER BEFORE 6TH RESPONDENT.` - `Exhibit P11` ``` TRUE COPY OF THE REQUEST LETTER DATED ``` ``` WP(C) NO. 34859 OF 2022 ``` ``` 11 ``` ``` 20.10.2022. ``` ``` Exhibit P12TRUE COPY OF THE ORDER DATED 26.10.2022 ISSUED BY THE 6TH RESPONDENT T THE PETITIONER. ``` ``` Exhibit P13TRUE COPY OF THE JUDGMENT DATED 28.03.2020 IN WP(C) 10476/2020 OF THIS HON'BLE COURT. ``` ``` Exhibit P14TRUE COPY OF THE JUDGMENT IN DATED 28.05.2018 IN WP(C) 17190/2018 OF THIS HON'BLE COURT. ```