Muhammed Ali Rawther M. v. Kerala State Electricity Regulatory Commission K. P. F. C. Bhavanam
2019-02-06
DEVAN RAMACHANDRAN
body2019
DigiLaw.ai
JUDGMENT : 1. From the plexus of the large volume of pleadings, materials and records available on the files of these cases, emerges a singular question as to whether the provisions in the Kerala Electricity Supply Code, 2014 (hereinafter referred to as the 'Supply Code' for short), inhibiting the Kerala State Electricity Board Ltd. ('KSEB' for short), to charge for the consumables and the materials required for shifting of an electric line or electric plant; though allowing them to charge the actual labour charges, is impermissible or illegal. 2. Under the stipulations of Regulation 95(4)(c) of the Supply Code, the KSEB is obligated to shift an electric line or electric plant if the consumer remits the labour charges alone required for such shifting, but they are expressly prohibited from charging the expenses or costs for the materials and consumables required for such purpose. 3. In the afore cases except W.P.(C)No.21864 of 2018, the Electricity Board or its Authorities are the petitioners; wherein they challenge this Regulation on several grounds but primarily that they have been made by the Kerala State Electricity Regulatory Commission (hereinafter referred to as 'Commission' for short) in excess of their jurisdiction, as vested in them by the Electricity Act, 2003 (hereinafter referred to as 'the Act' for short). 4. I have heard Sri.Raju Joseph, Senior Counsel assisted by Sri.Georgekutty Mathew appearing for the KSEB in W.P.(C)No.13138 of 2015, W.P.(C)No.23420 of 2016 and W.P. (C)No.25552 of 2018; Sri.Arunkumar, learned counsel appearing for the KSEB in W.P.(C)No.19868 of 2018; Sri.A.V.James, learned counsel appearing for the petitioner in W.P.(C)No.21864 of 2018 and Sri.George Poonthottam, the learned senior counsel assisted by Sri.Vishnu.J, learned counsel appearing for the 2nd respondent in W.P.(C)No.23420 of 2016; Sri.Sudheer Ganesh Kumar, the learned standing counsel for the KSEB appearing for the KSEB in W.P. (C)No.21864 of 2018; Sri.K.K.Rajeev, the learned counsel appearing for the 2nd respondent in W.P.(C)No.19868 of 2018; Sri.Kaleeswaram Raj, the learned counsel appearing for respondent No.2 in W.P.(C)No.13138 of 2015; Sri.Vipin.P. Varghese, the learned counsel appearing for the Kerala State Electricity Regulatory Commission in all these cases and the learned Government Pleader appearing for the State of Kerala and its functionaries. 5.
5. Sri.Raju Joseph, the learned Senior Counsel appearing for the KSEB in some of these matters, commenced his submissions by saying that the Supply Code has been brought into force by the Commission only under the provisions of Section 50 and 181 of the Electricity Act and asserts that even a glance through the provisions of these Sections would show that they would obtain no competence or jurisdiction to exempt any consumer from payment of the expenses for the various services being made available to them by the KSEB and therefore, that the impugned inhibition in 95 of the Supply Code is untenable and statutorily impermissible. 6. Sri.Raju Joseph, thereafter, draws my attention to the Central Electricity Authority Safety Regulation 2010 (hereinafter referred to as 'Safety Regulations' for short) and in particular to Regulation 63 thereof, to show that when a consumer seeks the change of alignment of an overhead electric line, subsequent to its erection, for the purpose of allowing him to carry on further construction or for such other purposes, he is obligated, under those Regulations, to remit the entire cost, both for the material and the labour required; and therefore, that there is no rational basis as to why the Regulatory Commission should have, in the Supply Code, exempted customers from doing so when they apply for change of alignment of electric line for their own benefit. 7. The learned senior counsel further says that the KSEB has been constrained to approach this Court because large number of applications are being made by the customers, some of them even for trivial reasons, presumably because the cost of such shifting/alteration is, in the absence of the cost of materials, virtually negligible. He thus asserts that Regulation 95(4)(c) of the Supply Code is forensically incorrect, beyond the jurisdiction of the Regulatory Commission and therefore, liable to be struck down by this Court. 8. Before I tread forward, I must also record that the various respondents in these cases, except in W.P.(C)No.21864 of 2018, are the beneficiaries of the impugned Regulation and they are persons who had applied for shifting of electric lines and against whom demand for cost of labour have been raised.
8. Before I tread forward, I must also record that the various respondents in these cases, except in W.P.(C)No.21864 of 2018, are the beneficiaries of the impugned Regulation and they are persons who had applied for shifting of electric lines and against whom demand for cost of labour have been raised. They, along with the writ petitioner in W.P.(C)No.21864 of 2018, predicate that they are not even liable to make payment of the labour charges and many of them appear to have approached either the Consumer Grievances Redressal Forum ('CGRF' for short) under the KSEB or the Electricity Ombudsman seeking that even the demand for payment of labour charges against them be struck down. 9. I notice that the CGRF as well as the Ombudsman in some of these cases have been, in fact, accepted that request, while in certain other cases they have rejected it. The party respondents in the afore cases and the petitioners in W.P. (C)No.21864 of 2018, therefore, contend that they are eligible to have the electric line shifted within their property without having to pay for the materials or consumables or even the labour charges since, it is on account of their magnanimity that the KSEB was able to install the line through their property, so as to benefit someone else. 10. Sri.George Poonthottam, the learned senior counsel, who appears for a consumer, has a different stand and he says that his client is willing to pay labour charges but that he has been additionally asked to pay the consumables and material charges, which he contends is impermissible going by the extant Regulations. The learned senior counsel, therefore, submits that the action of the Authorities in having demanded the material cost from his client, even when Regulation 95(4) (c) is still in force, amounts to gross illegality and therefore, that the CDGRF was fully justified in issuing the order allowing his clients to pay only the labour charges. 11. Sri.A.V.James, the learned counsel appearing for the petitioner in W.P.(C)No.21864 of 2018 also submits that his client is willing to pay the actual labour charges, but that the demand made in Ext.P4 produced in the said writ petition is excessive and not the actual. However, after alleging as afore, he says that his client has still paid the said amount so that the line could be shifted as requested by him.
However, after alleging as afore, he says that his client has still paid the said amount so that the line could be shifted as requested by him. He thus virtually says that no further orders are required in this writ petition, except that the KSEB be directed to shift the line in terms of Ext.P4 by charging only the labour but not the material cost. 12. Sri.K.K.Rajeev, learned counsel appearing for respondent No.2 in W.P.(C)No.19868 of 2018, however, has a different spin on the whole issue and says that since his client is unable to pay even the labour charges on account of his impecuniousness, the KSEB must be directed to shift the line without charging him anything. The learned counsel says that the CGRF permitted such shifting only because of the constraining factors being faced by the petitioner because they are unable to pay even the labour charges. He therefore, prays that the order of the CDGRF in the said case be maintained. 13. Sri.Vipin P. Varghese, the learned counsel appearing for the Kerala State Electricity Commission submits that the Commission was acting specifically within the contours of their powers, as vested in them under Sections 50 and 181 of the Electricity Act and that the provisions of Regulation 95(4)(c) are therefore, irreproachable. 14. He says that the Commission had been receiving several complaints from consumers that the KSEB was overcharging them for consumables and materials, which constrained them to conduct a public hearing, under the terms of the Act; and to thereafter issue the Supply Code, including the impugned Regulation therein, so as to allay such apprehensions and complaints. He asserts that the power to exempt customers from paying the cost for materials and consumables is derived from Section 50 of the Act which reads as under: “The Electricity Supply Code :- The State Commission shall specify an Electricity Supply Code to provide for recovery of electricity charges, intervals for billing of electricity charges, disconnection of supply of electricity for non-payment thereof, restoration of supply of electricity, measures for preventing tampering, distress or damage to electrical plant or electrical line or meter, entry of distribution licensee or any person acting on his behalf for disconnecting supply and removing the meter, entry for replacing, altering or maintaining electric lines or electrical plants or meter and such other matters.” 15.
After saying so, the learned standing counsel for the Commission submits that Section 181 of the Act further gives large powers of the Electricity Commission to make provisions for any of the matters enumerated therein and therefore, that they were well within their powers to frame the Electricity Supply Code in the manner, as it has been presently done. 16. He thereafter, adds that there is no prejudice caused to the Electricity Board at all because, as has been stated by the Commission in their counter pleadings in W.P.(C)No.25552 of 2018, the loss that they may suffer on account of their inability to charge for the materials and consumables can be offset in the tariff to be fixed for the succeeding year and that such liberty has been offered to them by the Regulatory Commission on a year to year basis. He says that these amounts can be claimed by the KSEB as capital expenditure when they produce the Aggregate Revenue Requirement for the subsequent year. In effect, the learned counsel affirms that the decision of the Regulatory Commission, to exempt customers from making payment of the cost of materials and consumables, is a conscious decision and that they had done so only because they thought that the consumers are at least entitled to that benefit. 17. In the backdrop of the afore submissions made before me by various counsel as afore, it become enjoined on me to first consider whether the Electricity Commission would obtain jurisdiction to exempt customers from making payment of the actual cost of consumables and materials for shifting of a electric post/electric line/electric plant, even though such shifting is occasioned on their own request. As is conceded by all the parties herein, the only powers, under which the Electricity Regulatory Commission could have acted in bringing out the Electricity Supply Code, are contained in Sections 50 and 181 of the Electricity Act. 18. When one looks through the provisions of Section 50 extracted (supra), it is indubitable that the Regulatory Commission is authorized to specify an Electric Supply Code to provide for various things, including altering or maintaining electric lines or electric plants.
18. When one looks through the provisions of Section 50 extracted (supra), it is indubitable that the Regulatory Commission is authorized to specify an Electric Supply Code to provide for various things, including altering or maintaining electric lines or electric plants. Obviously, therefore, they are certainly within their powers to provide for the conditions and the manner in which electric lines and electric plants can be altered or maintained; but there is nothing in the said Section which empowers them to exempt customers from making payment of the actual expenses for such purposes. 19. Turning to Section 181 of the Act, it certainly provides for various matters in which the Commission can involve themselves; but pertinently, under Sub Clause x thereof, it provides for the bringing into force of an Electricity Supply Code under Section 50. Therefore, going by Section 181 also, the only power that can be invoked by the Regulatory Commission to bring out the Electricity Supply Code is under Section 50 of the Act and it become therefore, irrefragable that one will certainly have to rely fully on the provisions of that Section to analyze and assess the perlieus of the powers of the Regulatory Commission for that purpose. 20. As I have already indicated above, even a cursory glance of Section 50 would make it clear that the Regulatory Commission certainly has the power to provide for the alteration and maintenance of electric lines or electric plants but the power to exempt customers from making payment of the costs for such purpose is conspicuously absent therein. 21. The Electricity Act 2003, being an Act that was intended to consolidate the law relating to generation, transmission, distribution and use of electricity, no implied powers can be read into its provisions; and any exercise of power by any Authority under it will have to be manifestly and expressly permitted. I therefore, find substantial force in the submissions of Sri. Raju Joseph, the learned senior counsel, that the power to exempt customers from making payment of the actual cost of consumables and materials, being expressly not available to the Commission in the Electricity Act, their framing of the Supply Code and in particular the impugned Regulation therein, appears to be rather questionable. 22.
Raju Joseph, the learned senior counsel, that the power to exempt customers from making payment of the actual cost of consumables and materials, being expressly not available to the Commission in the Electricity Act, their framing of the Supply Code and in particular the impugned Regulation therein, appears to be rather questionable. 22. Further, the reasons stated by the Regulatory Commission in having made a provision akin to Regulation 95(4) (c), that the KSEB can always claim the loss suffered by them, on account of their incapacity to charge for the actual consumables and materials from the consumers, as capital expenditure when they make their Aggregate Capital Requirement for the subsequent years, clearly, is to my mind, unfair to the other customers, because this an impel to increase in tariff for the subsequent year if the Electricity Board suffers too much on the previous year on account of such shiftings. I am not sure if this is permissible, since this would construe as if the KSEB is sub-sidising certain customers leading to a greater burden to all other consumers subsequently. 23. The upshot of the above discussion is that, prima facie, in my view, Regulation 95(4)(c) suffers from the vice of lack of competence for the Regulatory Commission and also that is unfair and inequitable to the customers at large of the KSEB. I fail to understand why a few consumers must be given such benefits even though the shifting of the line is at his/her request, thus adding burden into the capital expenditure for the subsequent year thereby causing an increase in tariff. 24. Even though I say so and even though this is my prima facie view, I am of the opinion that it will not be justified for this Court, while acting under Article 226 of the Constitution of India, to strike down this Regulation at the first instance and am of the view that the Regulatory Commission must have a re-look at this and take a decision as to whether this Regulation requires modification, after following imperative and mandatory procedural processes under the Act, including by conducting public hearings, if it is so necessary. 25.
25. With this in mind, I order these writ petitions and direct the Kerala State Electricity Regulatory Commission to reconsider the requirement of Regulation 95(4)(c) in the Supply Code and as to whether the exemption from payment of the cost of consumables and materials to customers seeking alteration or shifting of electric lines/plants should be maintained, after adverting to my observations above as also the various contentions raised by the learned senior counsel and the counsel appearing for the KSEB. I am sure that if this exercise is completed by the Regulatory Commission within a specified time frame, then the dialectical disputes between the parties in these cases can find a proper resolution. 26. That said, as regards the beneficiaries, who are respondents in the various cases and the petitioner in W.P.(C) No.21864/2018 are concerned, since they have applied for shifting of the electric lines on an earlier date, the KSEB certainly, will be obligated to do so after charging them only the labour charges but not the cost of consumables or materials, since the decision to be taken by the Regulatory Commission in terms of this judgment can only act prospectively and therefore, the beneficiaries of the earlier orders cannot be disturbed in any manner whatsoever. 27. I also notice that some of them further complain that even though the bill given to them is stated to be only the labour charges, it is so large and unconscionable that a legitimate suspicion arises it is not the actual but grossly exaggerated. They, therefore, pray that some mechanism be directed to be devised by the Regulatory Commission in the Supply Code as to the manner in which the bills raised for the purpose of shifting of the electric lines/plants be allowed to be disputed. This is certainly a valid apprehension voiced by the various party respondents in these cases and I am, therefore, in approval of that the Regulatory Commission should, in addition to the exercise afore mentioned, consider as to how the bill of charges, whether towards labour or consumables/materials, as they may decide consequent to the directions herein, be disputed and the mechanism that the customers can avail of for doing so. 28.
28. That said, as an interim measure, until the Regulatory Commission takes a final decision on this, I am of the view that any person, who has been served with a bill towards labour charges under Regulation 95(4)(c) of the Supply Code, should have the option of disputing the quantum of the bill before the officer next higher in hierarchy over the other who issued it and that such officer should deal with that complaint, after affording an opportunity of being heard to the consumers within a specified period. 29. Finally, as regards respondent No.2 in W.P.(C) No.19868/2018, his case certainly is a singular one and will have to be considered by the concerned authorities of the KSEB as an exceptional one adverting to his stated impecuniousness. The directions of the CGRF in that case is modified to this extent. In summation, I order the above writ petitions as under: (a) The Kerala State Regulatory Commission is ordered to complete the exercise afore directed, both as regards Regulation 95(4)(c) of the Supply Code as also the mechanism for raising disputes regarding the bills raised by the KSEB for shifting/altering electric line/plant, within a period of six months from the date of receipt of a copy of this judgment. If after such exercise, the Commission decides it necessary to modify Regulation 95(4)(c), then they will also specify the date from which it will prospectively come into force. (b) The beneficiaries, including the various respondents in these cases and the petitioner in W.P.(C) No.21864/2018 will be allowed the benefit of shifting or altering their electric lines by the KSEB after receiving payment from them solely to the extent of the labour charges and they will not be mulcted with any other cost, including the cost of consumables or materials. This shall be done by the KSEB as expeditiously as is possible but not later than four months from the date of receipt of a copy of this judgment. (c) As far as fresh application for shifting/alteration of electric lines/plants are concerned, namely those which are done after the date of this judgment, the KSEB will charge them only the actual labour charges as per the extant Regulation 95(4)(c) but will intimate the customers suitably that the matter is pending before the Regulatory Commission.
(c) As far as fresh application for shifting/alteration of electric lines/plants are concerned, namely those which are done after the date of this judgment, the KSEB will charge them only the actual labour charges as per the extant Regulation 95(4)(c) but will intimate the customers suitably that the matter is pending before the Regulatory Commission. (d) Until the Regulatory Commission makes provisions in the Supply Code, any consumer who is aggrieved by the bill, raised by the KSEB for shifting electric line/plant, will be entitled to object to it before the officer next higher to the one who issued it and such Authority will be obligated to consider it, after affording the complainant-consumer an opportunity of being heard, and to issue appropriate orders/proceedings within a period of thirty days thereafter. (e) As regards W.P.(C) No.19868/2018, the KSEB will consider the request of the second respondent therein for exemption from even labour charges for shifting of the line on account of his impecuniousness after affording an opportunity of being heard to him and will thereafter issue an appropriate proceedings within a period of two weeks from the date of receipt of a copy of this judgment. 30. After I dictated this judgment, Sri.Raju Joseph, learned Senior Counsel, submits that in W.P.(C)No.13138/2015 there is an additional issue as to the competence of the Regulatory Commission to punish an officer of the KSEB, purportedly under Section 142 of the Kerala Electricity Act, for the reason that the said officer has raised a bill including the cost of materials and consumables on a consumer in violation of Regulation 95(4)(c) of the Supply Code. The learned Senior Counsel asserts that the action initiated by the Commission against this officer is egregiously improper because, for one, it was not he who had raised the bill but his subordinate officers and for the second, there is no power vested in the Regulatory Commission to do so and consequently prayed that Exhibits P7, P17 to P20 and P22 therein be quashed. 31. In response to this, the learned counsel for the second respondent in this writ petition says that an amount of Rs.54,148/- was recovered from him towards cost of labour as well as materials and consumables and therefore, that he had no other option but to make a complaint to the Regulatory Commission.
31. In response to this, the learned counsel for the second respondent in this writ petition says that an amount of Rs.54,148/- was recovered from him towards cost of labour as well as materials and consumables and therefore, that he had no other option but to make a complaint to the Regulatory Commission. He says that the Regulatory Commission has acted well within its powers in having taken action against the officer concerned. 32. Sri.Vipin Varghese, learned counsel appearing for the Regulatory Commission also sought to support this order by saying that under Section 142 of the Act, the Regulatory Commission can punish 'any person' who acts in violation of its directions. He says that since the officer concerned had acted clearly in violation of Regulation 95(4)(c), he was liable for such action. 33. Even when I hear the learned counsel for the respondents as afore, since, in view of the directions in paragraph 29(d) of this judgment, the second respondent will be now entitled to approach the higher officer higher than the one who issued the disputed bill, I do not think that the action against the second petitioner should be allowed to now go forward. This is particularly because the consumer appears to have approached the Regulatory Commission directly even when, as is clear from the explanation given by the second petitioner before the Commission, there is a real dispute as regards the provisions under which the bill was raised, with the second petitioner asserting that it was issued under Regulation 63 of the Safety Regulations, which expressly permit charging of the cost for consumables/materials along with labour charges. 34. I, therefore, quash Exhibits P7, P17 to P20 and P22 in W.P.(C)No.13138/2015 and permit the second respondent to make a representation to the Chief Engineer of the KSEB detailing all his objections against the bill in question, within a period of two weeks from the date of receipt of a copy of this judgment; in which event, the said authority will consider it, after affording an opportunity of being heard to the second respondent as also to the concerned officer of the KSEB and issue an apposite order, as expeditiously as possible but not later than one month thereafter. Needless to say, the second respondent will be at full liberty to invoke all legal remedies against the resultant order, if he is so desirous.