Seafarer Fisheries (P) Ltd. v. Chennai Port Trust, Represented by its Chairman
2013-07-18
V.DHANAPALAN
body2013
DigiLaw.ai
Judgment : 1. All these Writ Petitions subsume one and only issue. Hence, they are being disposed of in common. 2. For the sake of disposal, let me take the facts in W.P.No.23396 of 2012. The challenge in this Writ Petition is to the Electricity Bill No.EE 77, dated 10.08.2012, issued by the second respondent, and to quash the same in so far as it imposes the electricity charge on the basis of commercial tariff and 20% service charge. 2.1. For the purpose of managing various fishing strollers and other fishing boats that use the Chennai Port, the Port of Chennai has constituted the Chennai Fishing Harbour Managing Committee. The Committee issued an advertisement calling for the applications to establish units for fishing or its allied activities in the year 1986. In response to the said advertisement, the petitioner submitted an application to establish ice factory. In the said advertisement, it is stated that they would provide electricity and water. After due formalities, the petitioner had been allotted land and he established the ice factory during September,1993. The electric supply extended to the petitioner was charged at low tension standard Tariff under L.T.III B (industrial tariff) which was in force at that time. 2.2. That being so, the first respondent tried to charge from the year 2002 more than L.T.Tariff III B in the name of compensation charges. It was resisted by the petitioner by making representations and also expressing grievances as it was a member of the committee objecting to the demand made in the name of compensation charges. The Chennai Fishing Harbour Users Association had given a representation to adhere to the Tamil Nadu Electricity Regulatory Tariff Order,2003, with relevant records. There was delay in taking decisions in spite of the issues being raised in several meetings and consequently the compensation charges continued in every electricity tariff. The petitioner and some other firms approached this Court and obtained orders with conditions not to disconnect. As per the conditions imposed, the petitioner paid entire current consumption charges and the issue of demanding compensation charges is still pending. There is an interim order restraining the respondents from demanding compensation charges. 2.3. By proceedings of Ministry of Agriculture vide letter No.33012-2/83-Fy(H), Central Government issued orders deciding to entrust the management of the Madras Fishing Harbour to the Trustees of the Port of Madras.
There is an interim order restraining the respondents from demanding compensation charges. 2.3. By proceedings of Ministry of Agriculture vide letter No.33012-2/83-Fy(H), Central Government issued orders deciding to entrust the management of the Madras Fishing Harbour to the Trustees of the Port of Madras. The Committee would function as a decision making body and it would devise its own procedure. 2.4. A meeting was held on 21.02.2006 and the said meeting was chaired by the Director of Fisheries and other participants, such as Chief Mechanical Engineer, Superintending Engineer and Manager of Fishing Harbour Management Committee. Again in the meeting held on 21.03.2006 under the same authorities, after discussions, a decision was arrived and it was conveyed to the ice plant operators that the authorities would issue no objection certificate to obtain electricity connection directly from Tamil Nadu Electricity Board. In the meantime, the petitioner had applied directly to the Board and his application was rejected on the ground that there was no NOC. 2.5. In such circumstances, the impugned bill was served on the petitioner claiming a sum of Rs.6,03,829/- under different heads. It states that the petitioner consumed 70,849 units and that a sum of Rs.4,95,888/-(up to 50 units 4.30 paise; more than 50 units Rs.7.00) is charged as consumption charges by invoking commercial tariff contrary to LT Tariff III B. The said demand is contrary to the demand of earlier bills at Rs.5.50 per unit. In addition to the said demand, a sum of Rs.1,00,638.20 is claimed as 20% service charge by relying on an order passed by Chennai Port Trust dated 12.07.2012 on CME's Note No.MEE/GC2/348/2010/Dy.CME (E.S.& CH), dated 16.06.2012. 2.6. Hence, this Writ Petition. 3. Respondents 1 to 3 have filed a common counter affidavit, stating as follows : 3.1. The 11/0.415 KV Sub-station installed at the fisheries harbour by the Chennai Port Trust receives High Tension Power from TANGEDCO which is being stepped down to Low Tension and the same is being distributed to various consumers like Ice Manufacturing Units, Fisherman Associations, Panchayat Sabhas, Fisheries Survey of India, FMHC, Petrol Bunks etc. 3.2. At present, there are 21 consumers receiving Low Tension power from the above said 11 KV Sub-station. Out of these 21 consumers, the electricity charges for 6 consumers are claimed under the industrial tariffs which are coming under small scale industries and the other 15 consumers are claimed under the commercial tariff.
3.2. At present, there are 21 consumers receiving Low Tension power from the above said 11 KV Sub-station. Out of these 21 consumers, the electricity charges for 6 consumers are claimed under the industrial tariffs which are coming under small scale industries and the other 15 consumers are claimed under the commercial tariff. 3.3. TANGEDCO is generating the HT bills for the fisheries harbour under High Tension Tariff III (Commercial) for which the Chennai Port trust is paying the charges regularly every month. Even though the Trust is paying the TANGEDCO under HT Tariff, the Trust is collecting the electricity charges from the consumers on LT Tariff III B, which is lower than the HT Tariff. So, the difference in amount from the electricity charges being paid to TNEB and the total recoverable charges from the end users is being collected from the end users as compensation charges which are proportionate to the individual consumption. By way of this, the Trust is not collecting any extra amount from the consumers. 3.4. All the consumers are paying compensation charges except the petitioners herein and as on date they are paying only their current consumption charges under industrial tariff without compensation charges in view of the order passed by this Court in W.P.No.15369 of 2003. As a result of this, the total compensation charges to be paid by the petitioners have accumulated to a sum of Rs.4.5 crores approximately up to March,2012. 3.5. There is no report related activity (import and export) in the fisheries harbour and the Trust is not earning any revenue from the fisheries harbour. The operation and maintenance of the 11 KV sub-station and all the electrical services are rendered by the Trust only for the benefit of the Ice Manufacturing Units, FHMC Office, FSI and the welfare of the fishermen community who are involved in the fishing trade. 3.6. In view of the above mentioned situation, an attempt was made by Member Secretary (FHMC) with a request to the erstwhile TNEB vide FHMC/016 /88/E/dt.16.04.2007 and 1502.2008 through the Commissioner of Fisheries, Government of Tamil Nadu to consider the HT connection at the fisheries harbour under industrial tariff instead of commercial tariff. The request for adoption of industrial tariff to the fisheries harbour was not considered by the Member (Distribution), TNEB, vide letter dated 20.08.2009. 3.7.
The request for adoption of industrial tariff to the fisheries harbour was not considered by the Member (Distribution), TNEB, vide letter dated 20.08.2009. 3.7. Due to the revision of tariff by TANGEDCO with effect from 01.04.2012, it was decided by the Trust to approach the TNERC and TANGEDCO once again to consider the request for the industrial tariff for the HT connection of the fisheries harbour. The Service Engineer (Ele.) in-charge for the fisheries harbour met the officials of TNERC and TANGEDCO on 16.05.2012. During the said meeting, it was stated by the Secretary, TNERC, that since Chennai Port Trust is receiving power from TANGEDCO under commercial tariff for the fisheries harbour, it can levy the charges from their consumers under the commercial tariff only. 3.8. The Secretary, TNERC, stated that they could not consider the request for adoption of industrial tariff for the fisheries harbour. Therefore, it was proposed to collect charges from all the consumers of the fisheries harbour uniformly under commercial tariff as revised by TANGEDCO, as it would avoid separate claim of compensation charges by the Trust and the Trust will not incur any further loss in future. 3.9. Pursuant to the revised TNEB tariff with effect from 01.04.2012, Chennai Port Trust is paying Rs.7/- per unit along with Rs.300/- per KVA as demand charges and 5% electricity charges on the actual consumption on commercial tariff. The cost per unit works out to approximately Rs.8.40 per unit. However, Chennai Port Trust is collecting Rs.4.50 (1 to 50 units) and above Rs.7/- per unit plus demand charges and electricity taxes as per TNEB tariff from all other users with LT supply on commercial tariff basis. In addition to these direct charges, the other indirect charges borne by Chennai Port Trust include provision of electrical infrastructure, laying and maintenance of cables, maintenance of sub-station, posting of employees exclusively in the sub-station to provide uninterrupted power supply round the clock to all the users. Taking into consideration all the above factors, it was decided to collect 20% service charges from all the port users uniformly, in addition to the bill amount for the consumption charges. 3.10. The proposal to revise the tariff was informed to the petitioners on 12.07.2012 itself.
Taking into consideration all the above factors, it was decided to collect 20% service charges from all the port users uniformly, in addition to the bill amount for the consumption charges. 3.10. The proposal to revise the tariff was informed to the petitioners on 12.07.2012 itself. The respondents shall examine the issue of No Objection Certificate to the petitioners provided they have to pay entire amount of Rs.4.5 crores approximately up to March 2012 and, thereafter, the dues pending up to date towards the payment of compensation charges, to avail the electricity directly from TANGEDCO. 3.11. The impugned order has been passed by the respondents after due consideration in tune with the revision of tariff by TANGEDCO and the rejection of the request by TNERC and TANGEDCO to change the HT connection under industrial tariff. Therefore, the impugned order passed by the respondents is legally tenable. 4. Fourth respondent, Tamil Nadu Electricity Board, has filed a counter affidavit, stating as follows : 4.1. Chennai Port Trust has availed a High Tension supply under H.T.SC.No.1208 with a permitted maximum demand of 200 KVA on 13.03.1970 and only commercial tariff was levied. At present, permitted maximum demand is 800 KVA and the current consumption bills have been rendered under commercial tariff as per the order of Tamil Nadu Electricity Regulatory Commission's Tariff Order 1 of 2012, dated 30.03.2012. As per Tamil Nadu Electricity Supply Code, the H.T. bills have to be paid within 7 days from the date of the bill. Accordingly, the current consumption bill for 07/2012 was rendered and paid by Chennai Port Trust on 04.08.2012. 4.2. From 01.11.2008, the restriction and control measure has come into force. Accordingly, all H.T. consumers were permitted to draw energy and demand 60% of base energy and base demand but do not draw power during evening peak hours from 06.00 p.m. to 10.00 p.m. However, Chennai Port Trust has been exempted from power cut and hence they do not come under restriction and control measure. 4.3. The petitioner has been availing supply from Chennai Port Trust and charged by Port Trust under L.T.Tariff V i.e., commercial. Under Low Tension Tariff-V, for consumers with consumption above 50 units per month or above 100 units bimonthly, fixed charges of Rs.60/- and energy charges of Rs.7/- per kwh are charged.
4.3. The petitioner has been availing supply from Chennai Port Trust and charged by Port Trust under L.T.Tariff V i.e., commercial. Under Low Tension Tariff-V, for consumers with consumption above 50 units per month or above 100 units bimonthly, fixed charges of Rs.60/- and energy charges of Rs.7/- per kwh are charged. The petitioner has filed the writ petition before this court to fix the tariff rate for the energy consumed under L.T.Tariff III (B), but the petitioner has not availed the direct supply from TANGEDCO. 4.4. Chennai Port Trust has availed the H.T.supply. Bills are made by TANGEDCO for the last 42 years under commercial tariff and paid by the Port Trust, which, in turn, has raised the bill to the energy availed by the petitioner under L.T.commercial. The energy charges for L.T.commercial and H.T.commercial is one and the same. 4.5. Since there is no privity of contract between the petitioner and the fourth respondent, this Court may be pleased to delete the Tamil Nadu Electricity Board as the fourth respondent in this writ petition. 5. Learned Senior Counsel for the petitioners would contend that the action of the respondents in suddenly switching over from LT Tariff IIIB to commercial tariff without notice to the petitioners is arbitrary and violative of Articles 14 and 16 of the Constitution of India. They would further contend that imposition of compensation charges and service charges by the respondents on the petitioners are non-est in law and, therefore, the impugned orders are liable to be set aside. 6. On the other hand, the learned Standing Counsel for Chennai Port Trust would contend that Chennai Port Trust is availing the electricity from TANGEDCO for the fisheries harbour under High Tension Tariff III (Commercial), but the Trust is collecting the electricity charges from the consumers on LT Tariff III B, which is lower than the HT Tariff, as a result of which, the Trust is incurring huge loss, and, therefore, the difference in amount between the electricity charges being paid to TNEB and the total recoverable charges from the end users is being collected from the end users as compensation charges, proportionate to the individual consumption, by which act the Trust is not collecting any extra amount from the consumers. Hence, the impugned orders, according to the learned Standing Counsel, are perfectly in order and not to be interfered with. 7.
Hence, the impugned orders, according to the learned Standing Counsel, are perfectly in order and not to be interfered with. 7. On the backdrop of the above pleadings, I have heard the learned counsel for the parties and also gone through the records. 8. With a view to managing various fishing strollers and other fishing boats that use the Chennai Port, the Port of Chennai has constituted the Chennai Fishing Harbour Managing Committee, the second respondent herein. The said Committee issued an advertisement calling for the applications to establish units for fishing or its allied activities in the year 1986. In response to the said advertisement, the petitioners submitted applications to establish ice factories. After due formalities, the petitioners were allotted land and they established the ice factories during September,1993. The electric supply extended to the petitioners was charged at low tension standard tariff under L.T.III B industrial tariff, which was in force at that time. 9. There is no dispute that the petitioners are liable to pay the consumption charges. While it is the case of the petitioners that they are liable to pay only L.T.Tariff consumption charges, it is the claim of the Port Trust that electricity power is availed from the Tamil Nadu Electricity Board in H.T.form and distributed to the ice manufacturing units of the petitioners in L.T.form, whereat the disparity occurs. In such a situation, the Port Trust is collecting the difference in amount of the electricity charges paid to the Tamil Nadu Electricity Board under H.T.Tariff, proportionate to the electricity consumption of the petitioners. The petitioners are in arrears of consumption charges for a long period, as a backlog. 10. Chennai Port Trust is receiving HT supply from TNEB and provides LT supply to port users. In view of the revised tariff by TNEB, Chennai Port Trust is paying Rs.7/-per unit along with Rs.300/- KVA as demand charges and 5% Electricity Tax on the actual consumption. The cost per unit works out to approximately Rs.8.40, however, the Port is collecting Rs.7/- per unit plus demand charges and electricity taxes as per the TNEB Tariff from H.T.users and from all the port users with L.T.supply on commercial basis.
The cost per unit works out to approximately Rs.8.40, however, the Port is collecting Rs.7/- per unit plus demand charges and electricity taxes as per the TNEB Tariff from H.T.users and from all the port users with L.T.supply on commercial basis. In addition to the direct charges, the other indirect charges borne by Chennai Port Trust include laying of cables, posting of employees in the sub-stations round the clock to maintain uninterrupted power supply to the port users, which, ultimately resulted in a huge loss to the Port. Taking into consideration all the above factors, the Port has proposed to collect 20% service charges from all the port users uniformly, in addition to the bill amount for the consumption charges, after obtaining the sanction of the Chairman so as to ensure that there is no loss or gain to the Port in that regard. However, the manufacturing units have filed cases in this Court against levying of service charges and obtained stay, due to which they are not paying the said charges, which sums by now mounted to crores of rupees. 11. The shifting of LT Tariff III B to Commercial Tariff has been intimated to the petitioners vide the Port Trust's letter No.MEE/EC2/318/2012/Dy.CME (EC&OS), dated 12.07.2012 before forwarding the consumption bill for the month of July,2012. 12. Service charges are imposed on the petitioners due to the men and material used for maintenance of the cables and electrical fittings being utilised for supplying of power supply to the petitioners. 13. In this connection, it is pertinent to note that though the petitioners have intended to avail power directly from TNEB and the same was consented by the management, the same was not possible because of the fact that the petitioners have not remitted pending old dues in the electrical consumption charges. Hence, they were not allowed to get direct connection from TNEB by obtaining No Objection Certificate from the management. 14. I have also gone through the Agreement entered into between the petitioner and the Chennai Port Trust. In the said agreement, nowhere, there is any clause as to the supply of electricity in general and the applicable rates in particular.
Hence, they were not allowed to get direct connection from TNEB by obtaining No Objection Certificate from the management. 14. I have also gone through the Agreement entered into between the petitioner and the Chennai Port Trust. In the said agreement, nowhere, there is any clause as to the supply of electricity in general and the applicable rates in particular. However, in the letter, dated 23.09.1993, addressed to the petitioner by the management/second respondent in response to the letter of the petitioner, dated 20.08.1993, it is categorically stated that supply will be charged at Low Tension Standard Tariff currently in force, which may be revised from time to time and which will be subject to levy of surcharge or other levies (Central or State) from time to time. That apart, in the letter of the Chennai Port Trust, dated 23.01.2003, addressed to Chennai Fishing Harbour Users Welfare Association, though it was stated that since the ice manufacturing units are availing L.T. power supply, the electricity charges are collected as per LT Tariff IIIB; it was made clear, that, in addition to that, line loss in the order of 3 to 5% of the electricity consumption is added in the monthly consumption and that Compensation Charges are being levied from July 2002 onwards instead of Maximum Demand Charges, as the Trust is incurring extra expenditure on H.T.Tariff to maintain the power supply distribution. In the said letter, it was also stated that in case any firm/consumer was not satisfied with the existing arrangement of power supply and tariff, he is free to avail electricity directly from TNEB, after paying all the dues to the Trust by the firm. (emphasis supplied) 15. When there is a non obstante clause as to the revision of charges from time to time and also as to the levy of surcharge or other levies both Central and State, the petitioners cannot stick to the demand of charging supply at Low Tension Tariff for ever. In this case, apparently, the management, namely, Chennai Port Trust, is receiving High Tension Supply from TNEB and supplying Low Tension Supply to the petitioners. Because of the interim order passed by this Court, the petitioners are paying current consumption charges only under industrial tariff i.e., LT Tariff IIIB but not commercial tariff, which is HT Tariff, as imposed by TANGEDCO.
Because of the interim order passed by this Court, the petitioners are paying current consumption charges only under industrial tariff i.e., LT Tariff IIIB but not commercial tariff, which is HT Tariff, as imposed by TANGEDCO. In this process, the management is incurring heavy loss to its exchequer and the total accumulated dues to be payable by the writ petitioners are to the tune of Rs.4,97,60,537/-, which is nearly rupees five crores. 16. Also, the Principal Accountant General (Civil Audit), in his letter dated 12.03.2012, addressed to the Financial Adviser and Chief Accounts Officer, Chennai Port Trust, stated that the monthly charges for supply of electricity to Fishing Harbour Management Committee and other users through HT Tariff are initially paid by Chennai Port Trust to TNEB and collected from actual users at a later date at LT Tariff B from Ice manufacturing units and commercial tariff from other business units. However, it was noticed that under LT Tariff III B, Rs.4.70 ps. was being collected as against Rs.5.00 per unit for consumption of more than 750 units. In respect of LT commercial tariff, Rs.4.30 per unit, the rate applicable for consumption of less than 50 units per month, was being collected from all consumers who consumed more than 50 units as against Rs.5.30 to be collected. Therefore, there was a wrong adoption of tariff rates, which had resulted in short recovery of Rs.0.30 per unit for LT Tariff and Rs.50 per month per firm for LT tariff. In addition, the electricity tax being levied at 5% by TNEB, a statutory recovery, was not being claimed from any of the firms, but fully met by the Chennai Port Trust, resulting in avoidable monthly expenditure. Hence, the Audit Officer had directed the Chennai Port Trust to take immediate remedial action. 17. Moreover, as per Tamil Nadu Electricity Regulatory Commission's Determination of Tariff for Generation and Distribution Order, dated 20.06.2013, for Low Tension Tariff III-B, the fixed charges for KW h per month are Rs.30 and Energy Charges per KW h are Rs.5.50 ps. Further, as per the revised Low Tension Tariff, for consumers with consumption of 50 units per month or 100 units bimonthly, the fixed charges per KW h per month are Rs.60 and energy charges for KWh are Rs.4.30 ps.
Further, as per the revised Low Tension Tariff, for consumers with consumption of 50 units per month or 100 units bimonthly, the fixed charges per KW h per month are Rs.60 and energy charges for KWh are Rs.4.30 ps. Similarly, for consumers with consumption above 50 units per month or above 100 units bimonthly, the fixed charges for KW h per month are Rs.60 and energy charges for KW h are Rs.7/-. 18. Under the circumstances, the Chennai Port Trust, pursuant to its meeting held on 21.03.2006, informed the petitioners vide its letters, dated 28.06.2006, that it was decided to issue No Objection Certificate to all the Ice Plant Owners for obtaining individual power connections directly from TNEB, subject to the condition that they should pay the lease rent regularly plus arrears as per the Court order, but the same was not heeded to by the petitioners, who, instead, again approached this Court and got interim injunction orders with regard to payment of arrears, including service charges. 19. It is also to be noted in the above connection that the Member Secretary of the second respondent vide his letter FHMC/016/88/E/dt.16.04.2007 and 15.02.2008 through the Commissioner of Fisheries, Government of Tamil Nadu, made a request to TNEB to consider the HT connection at the Fisheries Harbour under industrial tariff instead of commercial tariff, but the said request was rejected by TNEB vide its letter, dated 20.08.2009. 20.
20. In the absence of any specific provision in the Agreement as to the fixed charges of electricity supply to the petitioners and following the clarification given by the second respondent, in the letter, dated 23.09.1993, in reply to the letter of the petitioner, dated 20.08.1993, that supply will be charged at Low Tension Standard Tariff currently in fore, which may be revised from time to time and which will be subject to levy of surcharge or other levies (Central or State) from time to time, coupled with the information furnished by the Chennai Port Trust in its letter, dated 23.01.2003, addressed to Chennai Fishing Harbour Users Welfare Association that since the ice manufacturing units are availing L.T. power supply, the electricity charges are collected as per LT Tariff IIIB, and, in addition to that, line loss in the order of 3 to 5% of the electricity consumption is added in the monthly consumption and that Compensation Charges are being levied from July 2002 onwards instead of Maximum Demand Charges, as the Trust is incurring extra expenditure on H.T.Tariff to maintain the power supply distribution, in the considered opinion of this Court, the petitioners cannot shirk the liability much less the statutory liability imposed on them by the respondents. Since it is the grievance of some of the petitioners that there was delay in sending the electricity bills by the third respondent during a particular point of time, as a result of which the arrears were accumulated and much hardship is caused, it is to be stated, that, already, there was an interim direction by this Court to the petitioners to pay Rs.50,000/- per month towards arrears along with current consumption charges in order to not to disconnect the electricity supply by the respondents, which arrangement, in the considered opinion of this Court, holds good. It is pertinent to note that had the petitioners taken the electricity connection directly from TNEB, they would have to pay the same price as is being charged presently by the respondents. In other words, what is being demanded by the respondents on the petitioners by virtue of the impugned orders is only the difference in amount from the electricity charges being paid to TNEB and the total recoverable charges, proportionate to the individual consumption, whereby the respondents are not collecting any extra amount from the consumers, including the writ petitioners.
In other words, what is being demanded by the respondents on the petitioners by virtue of the impugned orders is only the difference in amount from the electricity charges being paid to TNEB and the total recoverable charges, proportionate to the individual consumption, whereby the respondents are not collecting any extra amount from the consumers, including the writ petitioners. If the petitioners are aggrieved over the charges being collected by the respondents, it is open for them to avail direct electricity supply from TNEB, as mooted by the Chennai Port Trust in its letter, dated 23.01.2003. It is also open for the petitioners to approach the respondents for making payment of arrears in instalments. If such a request is made, the respondents may consider the same, taking in account the pendency of the Writ Petitions and the interim order therein and also the difficulty faced by the petitioners due to the accumulation of amount. 21. Writ Petitions are dismissed with the above observations. No costs. Consequently.