M/S SAZON CASTINGS PRIVATE LTD. v. STATE OF KERALA & ORS.

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN MONDAY, THE 6TH OCTOBER 2008 / 14TH ASWINA 1930 OP.No. 25410 of 1999(Y) ----------------------- PETITIONER(S): - --------------- M/S. SAZON CASTINGS PRIVATE LTD., ELAPPULLI P.O., PALAKKAD DISTRICT, REP. BY ITS MANAGING DIRECTOR M. SASIKUMAR. BY ADV. SRI.P.R.VENKETESH RESPONDENT(S): --------------- 1. STATE OF KERALA, REP. BY THE COMMISSIONER & SECRETARY, POWER (A) DEPARTMENT, GOVT. OF KERALA, SECRETARIAT, TRIVANDRUM. 2. KERALA STATE ELECTRICITY BOARD, REP. BY ITS SECRETARY, VYDYUTHIBHAVANAM, PATTOM PALACE P.O., THIRUVANANTHAPURAM. 3. THE DY. CHIEF ENGINEER, ELECTRICAL CIRCLE, KERALA STATE ELECTRICITY BOARD, VYDYUTHIBHAVANAM, T.B. ROAD, PALAKKAD. 4. ASST. EXE. ENGINEER, ELECTRICAL MAJOR SECTION, KANJIKODE. ADV. SRI.T.G.RAJENDRAN SC FOR K.S.E.B. FOR R2 TO R4 SRI.C.K.KARUNAKARAN, SC FOR KSEB FOR R2 TO R44 THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 06/10/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: PETITIONER'S EXHIBITS: O.P.NO. 25410/1999. ---------------------------------------------------------------EXT.P1 COPY OF APPLICATION DT. 11-9-1996. EXT.P2 LETTER DT. 16-11-1996. EXT.P3 COMMUNICATION DT. 11-12-1996. EXT.P4 DO. DT. 10-12-1996. EXT.P5 ORDER DT. 23-12-1996. EXT.P6 COMMUNICATION DT. 26-3-1997. EXT.P7 REPRESENTATION DT. 9-4-1997. EXT.P8 DO DT. 15-4-1997. EXT.P9 NOTE DT. 8-8-1997. EXT.P10 COMMUNICATION DT. 29-1-1997. EXT.P11 PROCEEDINGS DST. 12-12-1997. EXT.P12 NOTIFICATION DT. 28-1-1997. EXT.P13 BOARD ORDER DT. 17-12-1996. [TRUE COPY] P.S TO JUDGE. S. Siri Jagan, J. =-=-=-=-=-=-=-=--=-=-=-=-=-=-=-=-=-= O.P. No. 25410 of 1999 =-=-=-=-=-=-=-=-=--=-=-=-=-=-=-=-=-= Dated this, the 6[th] October, 2008. **==> picture [102 x 12] intentionally omitted <==** The petitioner is the consumer of electricity supplied by the Kerala State Electricity Board. By Ext. P1 application dated 11-91996, the petitioner applied for power allocation. By Ext. P5 dated 23-12-1996, power was allocated to them. However, by Ext. P6 order dated 26-3-1997, Ext. P5 order of allocation was cancelled on the ground that the person who issued Ext. P5 did not have power to order power allocation, since the authority to do power allocation in respect of power intensive units is the Board itself. Subsequently, by Ext. P10 order dated 29-10-1997, the Board conveyed approval for allocation of power to the extent of 380 KVA to the petitionerCompany. In accordance with the same, by Ext. P11 dated 12-121997, power allocation was made to the petitioner, wherein the petitioner was classified as a power intensive unit. Even before that, by Ext. P13 order dated 17-12-1996, the Board laid down the criteria for classifying an industry as a power intensive industry. Ext. P13 included steel melting industry as a power intensive industry. Since the petitioner-Company, which was running a casting unit was doing steel melting also, the petitioner's unit was classified as a power intensive unit. Thereafter, by Ext. P12 dated 29-1-1997, the Board declared revised tariff for various industries. The same contains certain special conditions. Condition no. 3 of the special conditions stated thus: “3. Inspect of power intensive industries which are allotted power on or after 17-12-1996 the tariff will be 100% extra over the rates notified in this order.” The petitioner challenges the above said special condition in Ext. P12 on several grounds. The first is that the petitioner's industry is not a power intensive industry. The second is that the cut off date fixed as 17-12-1996 is arbitrary and discriminatory. The petitioner has got O.P. No. 25410/1999 -: 2 :- another contention also that special condition no. 3 is not applicable to the petitioner in so far as the petitioner applied for the power allocation prior to 17-12-1996. 2. The contention of the petitioner is that the petitioner is not a power intensive unit since the classification based on the product manufactured for the purpose of power tariff is clearly arbitrary and unreasonable. According to the petitioner, under clause 16 of Ext. P13, a company can be classified as a power intensive industry only where the cost of power is more than 25% of the cost of the product manufactured. The petitioner would contend that the power consumed by the petitioner is not more than 25% of the cost of the product manufactured and therefore the petitioner's industry is not a power intensive industry. 3. As regards the second contention, the petitioner would submit that the cut off date fixed in the special condition no. 3 has no nexus to the objects sought to be achieved for such classification, and therefore the same is arbitrary and discriminatory. Regarding the third contention, the petitioner would submit that since the petitioner has submitted application for allocation as early as on 11-9-1996, ie, before the cut off date, the special condition is not applicable to the petitioner. 4. A counter affidavit has been filed controverting the contentions of the petitioner in the original petition. 5. In answer to the contentions of the petitioner, counsel for the Board would contend that there is absolutely nothing arbitrary or discriminatory in the special condition no. 3. He submits that the Supreme Court has, in several decisions, upheld the classification of industries based on the product manufactured. Further, the Supreme Court has upheld the classification of power guzzlers as separate O.P. No. 25410/1999 -: 3 :- category of consumers. Learned counsel relies on the decisions of the Supreme Court in **Hindustan Zinc Ltd., etc.etc** . v. **Andhra Pradesh State Electricity Board and others** , (1991) 3 SCC 299, **Indian Aluminium Company Limited and another** v. **Karnataka Electricity Board and others** , (1992) 3 SCC 580 and the decision of the Andhra Pradesh High Court in **Ferro Alloys Corporation Ltd., Shreeramnagar and others** v. **A.P. State Electricity Board, Hyderabad** , AIR 1993 Andhra Pradesh 183 in support of the said contentions. In respect of the validity of the cut off date, counsel would submit that unless the petitioner shows some capricious motive in fixing the cut off date simply because a cut of date is fixed, a rule or prescription does not become unconstitutional. Counsel relies on the decisions of **Ramrao and others** v. **All India Backward Class Bank Employees Welfare Association and others** , (2004) 2 SCC 76 and **University Grants Commission** v. **Sadhana Chaudhary and others** , (1996) 10 SCC 536. Learned counsel also points out that in this case, the cut off date has been fixed by taking into consideration relevant facts which have direct nexus to the object sought to be achieved by the special condition. In the year 1996, the State of Kerala was experiencing acute power shortage and therefore it was necessary to impose stringent conditions in the matter of power allocation on the basis of consumption. It is further pointed out that it was by Ext. P13 dated 17-12-1996 that the Board had classified industries as power intensive industries for the first time and that is why 17-12-1996 was taken as a cut off date for the purpose of special condition no. 3. Counsel would further argue that the petitioner has not pleaded and proved that the cut off date fixed would adversely affect the petitioner particularly, in the matter of implementation of special condition no. 3 in so far all power intensive industries to O.P. No. 25410/1999 -: 4 :- whom power has been allocated on or after 17-12-1996 are bound by the clause. Counsel points out that as early as in 1988 in the decision of **Bharat Singh and others** v. **State of Haryana and others** , (1988) 4 SCC 534, the Supreme Court has held that if facts are not pleaded or the evidence in support of such facts is not annexed to the writ petition, the court will not entertain contentions of the parties. Counsel would therefore submit that in so far as the petitioner has not pleaded and proved any special damage to the petitioner on account of the cut off date, such plea cannot be entertained. 6. I have considered the rival contentions in detail. 7. As far as the first contention to the effect that the petitioner is not a power intensive industry is concerned, I am of opinion that it is too late in the day for the petitioner to contend so. The power allocation of the petitioner was as per Ext. P11, wherein the petitioner has been specifically classified as a power intensive unit and power has been allocated to the petitioner on that basis. That was as early as on 12-12-1997. The petitioner did not choose to challenge Ext. P11 at any time, not even in this original petition. In any event, in view of Ext. P13, wherein at item no. 13, steel melting units are classified as power intensive unit and the manufacturing process in the petitioner's industry involves steel melting, the petitioner cannot be heard to contend that it is not a power intensive unit. Further, having acquiesced in classification of the petitioner's unit as a power intensive unit for the purpose of power allocation, the petitioner cannot now turn around and contend that petitioner's industry cannot be classified as power intensive unit. For the above reasons, I do not find any merit in the contention raised by the petitioner that petitioner's unit is not a power intensive unit. 8. I also find considerable merit in the contentions of the O.P. No. 25410/1999 -: 5 :- counsel for the Board on the basis of the Supreme Court decisions justifying the classification as power intensive units. I need not separately go through each and every decision for arriving at that conclusion in so far as in any event, the petitioner is now estopped from contending that their unit is not a power intensive unit. 9. Next, I shall consider the third contention of the petitioner that the petitioner having applied for power allocation by Ext. P1 dated 11-9-1996, special condition no. 3 of Ext. P12 is not applicable to them. Going by the special condition no. 3, what is relevant is not the date of application for power allocation. The words used are “power intensive industries which are allotted power on or after 1712-1996 . . . . .”. That being so, the relevant date for the purpose of application of special condition no. 3 is the date of power allocation. Even if the original date of power allocation itself is taken as 23-121996, then also the special condition no. 3 is applicable to the petitioner since the cut of date is 17-12-1996. Therefore, I do not find any merit in the third contention of the petitioner. 10. Then comes the contention that the fixation of the cut off date is arbitrary and discriminatory. In view of the Supreme Court decisions referred to by the learned counsel for the Board, I am satisfied that the cut off date fixed is perfectly valid. In this case, the petitioner has no allegation of capricious or unjust motive by the Board in fixation of cut off date as 17-12-1996. At this juncture, I must note that Ext. P12 order containing the special condition was issued as early as on 29-1-1997, which is challenged by the petitioner only on 11-10-1999, ie, almost three years after Ext. P12 has been published. That alone is sufficient to to non-suit the petitioner in this case. Even otherwise, I find considerable merit in the contention of the counsel for the Board that cut off date has been fixed taking into O.P. No. 25410/1999 -: 6 :- account very relevant considerations. As pointed out by the learned counsel for the Board, 1996 was an year in which State of Kerala was experiencing very acute shortage of electricity. Therefore, it was necessary to impose very stringent conditions on consumers, especially those who are power intensive. Further, it was on 17-121996, by Ext. P13, the Board classified industries as power intensive industries. Therefore, there is nothing wrong in fixing that date as cut off date for the purpose of application of special condition no. 3. In the above circumstances, I do not find any merit in the last contention of the petitioner also. In view of the above findings, there is no merit in the original petition and accordingly the same is dismissed. Sd/- S. Siri Jagan, Judge. Tds/