Indian Drugs and Pharmaceuticals Ltd. v. Uttar Pradesh State Electricity Board
2008-09-15
PRAFULLA C.PANT
body2008
DigiLaw.ai
ORDER :- In both these writ petitions, similar issues are involved, as such both are being disposed of together by this common judgment. 2. Heard learned counsel for the parties and perused the impugned orders, affidavits filed by the parties and orders of Hon'ble the Supreme Court in the matter (including the order dated 11-7-2008, passed in Civil Appeal Nos. 4359-4361 of 2008, by which this Court is directed to decide the matter, within a period of eight weeks). 3. Brief facts of the case are that in Writ Petition No. 1369 (M/S) of 2008 (old No. 1118 (M/B) of 2000) (Allahabad High Court No. Writ Petitions 9632 of 1992), the petitioner Indian Drugs and Pharmaceuticals Limited (hereinafter referred as IDPL), a Public Sector Undertaking of Government of India, has sought writ in the nature of certiorari, quashing the Notification dated 18th January 1992, issued by the Uttar Pradesh State Electricity Board (hereinafter referred as the Board), whereby the rates of tariff of electricity are revised w.e.f. 10-1-1992. By way of amendment, another Notification dated 29th June, 1992 issued by respondent No. 1, relating to change in tariff, issued during the pendency of this writ petition, is also challenged. Prior to that, it appears that the petitioner filed Writ Petition No. 10705 of 1990 and Writ Petition No. 19967 of 1990, before the Allahabad High Court, challenging the change in the tariffs of electricity made by respondent No. 1, under Section 49 of the Electricity (Supply) Act, 1948, vide order dated October 17, 1989, and further modifying the same vide Notification dated 21st April 1990 w.e.f. 17-10-1989. After the dismissal of said writ. petitions by the Allahabad High Court, the petitioner appears to have challenged the orders of Allahabad High Court by filing Civil Appeal No. 4874 of 1993 and 4875 of 1993. The two appeals were decided by the Apex Court vide its judgment and order dated September 13, 1994, in which it was directed by Hon'ble the Supreme Court that the petitioner shall make a representation to the respondents, who shall decide the representation. The representation made by the petitioner was considered by the Board in compliance of the order date - 1994, passed by Hon'ble the Supreme Court and order dated 3-1-1995, passed by the Allahabad High Court in subsequent writ petition filed by the petitioner which was registered as Writ Petition No. 6938 of 1995.
The representation made by the petitioner was considered by the Board in compliance of the order date - 1994, passed by Hon'ble the Supreme Court and order dated 3-1-1995, passed by the Allahabad High Court in subsequent writ petition filed by the petitioner which was registered as Writ Petition No. 6938 of 1995. Said representation, after hearing the representatives/counsel for the parties, was rejected by the Board in its meeting held on 17-9-1995. Consequently, Writ Petition No. 30199 of 1995 (present No. 1370 (M/S) of 2008) (earlier No. 1020 (M/B) of 2001) was filed by the petitioner before Allahabad High Court, challenging the order dated 17-9-1995, passed by the Board of representation dated 8-10-1994. A mandamus is also sought by the petitioner that the electricity of the petitioner be not disconnected. A further direction is also sought in this writ petition that the Board be restrained from charging revised electricity tariff from the petitioner except the rate as notified vide Notification dated 28-1-1986. 4. The petitioner has challenged the revised tariff rates of electricity in the aforesaid writ petitions on the grounds that the order passed by the respondent Board under Section 49(3) of the Electricity (Supply) Act, 1948, is arbitrary. It is alleged that increase in the tariff is disproportionate with increase in the price of coal and railway freight. It has been further pleaded that since the Board was unable to arrest the heavy transmission and distribution losses, as such, levy of minimum consumption guarantee charge is illegal. The surcharge imposed by the respondent are also against the guidelines of the Board. It is further pleaded that petitioner company is a Undertaking of Government of India which manufactures life saving drugs for entire country and defence organization, as such, it cannot be equated with the other consumers of electricity and increase in the electricity tariff would hamper the manufacturing of life saving drugs and antibiotics, in the country. 5. On behalf of the petitioner, Mr. V. K. Bist, Senior Advocate, attention of this Court is drawn to the judgment and order dated 13th September, 1994, passed by the Apex Court in Civil Appeal No. 4874 of 1993, and Civil Appeal No. 4875 of 1993, and argued that the observations made by the Apex Court were ignored by the respondent Board in rejecting the representation of the petitioner.
He, particularly, referred following observations of the Supreme Court in said judgment : "........... the appellant is a public undertaking and is exclusively manufacturing life saving drugs at the controlled rates prescribed by the Government of India. It is also undisputed fact that it is not a profit making industry. Considering these facts and also having regard to the location of the industry in hilly tribes and being a public undertaking, the Board should have considered these circumstances in fixation of special tariff under Sec. 49 sub-s. (3) of the Act ......... Regard being had to the aforesaid factual matrix, we find it expedient that the appellant shall make a representation within a period of four weeks from today to the electricity Board for consideration of the case for fixation of tariff having regard to the circumstances enumerated hereinbefore. On representation so made the Board shall dispose of the representation after giving an opportunity of hearing to the counsel for the appellant......... Suffice it to state that the Board will consider the desirability of fixing the special tariff for the appellants on and w.e.f. October 17, 1989 and onwards. The appeals are accordingly disposed of. No costs. This will not be treated as a precedent to any other private industry." 6. I have gone through the minutes of meeting held on 17-9-1995 of the Board in respect of the fixation of special tariff for IDPL, Rishikesh, and on perusal I do not find that the Board has not considered the points directed to be taken into account by the Apex Court. This Court feels it necessary to quote the relevant paragraphs of the minutes of meeting held on 17-9-1995, whereby the petitioner's representation was rejected : "........... M/s. IDPL was represented by Shri Sudhir Chandra, Senior Advocate, Sri Dilip Gupta Advocate, Shri R. K. Dewan Director Finance, Shri A. P. Jain Director (P. P. and C.), Sri N. Choubey General Manager (Rishikesh), Dr. S. S. Yadav Dy. General Manager (Rishikesh), Sri R. S. Mathur, Sr. Personnel Executive (Legal) and Sri V. K. Srivastava, Retainer......... In reply to whether Drug Price Control Order is applicable on I. D. P. L. only or also on other similar medicine manufactures, the representatives told that said order is applicable on all such manufacturers. Under this order there is no difference between Public Sector and Private Sector.........
Personnel Executive (Legal) and Sri V. K. Srivastava, Retainer......... In reply to whether Drug Price Control Order is applicable on I. D. P. L. only or also on other similar medicine manufactures, the representatives told that said order is applicable on all such manufacturers. Under this order there is no difference between Public Sector and Private Sector......... On the question of revision they told that review of controlled prices can be done by Government of India on the manufacturing cost data of the company and company's can request for such revision by submitting manufacturing cost data................... On the question of manufacturing cost being higher than controlled price, and about request to Government of India by IDPL for revision of controlled price, the representatives neither gave any satisfactory reply nor they submitted any papers, which could clarify that IDPL had requested Government of India for revision of price and Government of India did not accept it.............. On the query on the point that what is the basis of the statement that company is not a profit making industry, and what is the definition of profit making industry the representatives told that since company is running in loss, as such it is not a profit making industry. From 1962 to 1995, in which period they got profit and in which period losses occurred, in this connection neither profit and loss account, Balance Sheet etc. papers were presented nor Article of Association of Company was submitted in which principle of no profit no loss was adopted by the company. They also told that in the beginning there was profit for a long time to the unit........... On the query on the point of sickness, the representatives told that electricity dues of the Board have not been shown before BIFR......... For the manufacturing of antibiotics medicines only cold and pollution free climate, place Rishikesh was considered to be proper. I. D. P. L. was given land free of cost by the State Government and for giving them uninterrupted supply, the Board established sub-station, and residential colony on the land provided free of cost and after making alternative arrangement electricity was supplied on priority basis and exempting them from power cuts in comparison to other general consumers and power was supplied even in peak hours. Presently also they are being provided special facilities in supplying electricity.
Presently also they are being provided special facilities in supplying electricity. In addition to this, the company was given all rebate for five years from its establishment which were applicable to the industries in hill area.............. After deep consideration on all documents, facts and arguments and above analysis, the Board has reached to a conclusion that request of the firm for fixation of special tariff is not worth accepting, therefore, it is being rejected." 7. Above reasons given for rejecting the representation of the petitioner, in the opinion of this Court cannot be said to be unjust or improper. This Court is of the view that a sick Public Sector Undertaking of Central Government has no right to ask a Public Sector Undertaking of the State to share its losses and to make it sick by compelling it to reduce the tariff of electricity. As of right the petitioner cannot ask for reducing the tariff of electricity in this manner. 8. On behalf of the petitioner attention of this Court is drawn to para 3 and para 4 of the supplementary affidavit filed before this Court on 11th September 2008, in which it is reiterated that IDPL deserves concessional tariff of electricity as it is an Undertaking of the Government of India, and manufacturing life saving drugs. However, this Court is unable to accept the contention of learned counsel for the petitioner for the reasons already quoted above from the minutes of meeting dated 17-9-1995. 9. Apart from the above, what is material in this case is that in 1999, a Regulatory Commission was created under the Uttar Pradesh Electricity Reforms Act, 1999, for fixation of tariff of electricity and after 1999, the Board has no power under Section 49(3) of the Electricity (Supply) Act, 1948 to change the tariff, and it (respondent) cannot be directed to revise and fix special tariff for the petitioner, after 1999. Not only this, after creation of the State of Uttarakhand, and after enforcement of the Electricity Act, 2003, a new Regulatory Commission is functioning in the State of Uttarakhand, and neither said Commission is incorporated in these writ petitions as a party, nor any relief has been sought against the Commission, which is now empowered to revise the tariff under Section 62 of the said Act. 10.
10. For the reasons as discussed above, this Court does not find any force in the two writ petitions. Both the writ petitions are dismissed, accordingly. No costs. Petitions dismissed.