Sudha Agro Oil And Chemical v. Eastem Power Distribution
2021-07-13
A.V.SESHA SAI
body2021
DigiLaw.ai
JUDGMENT Heard Sri Challa Gunaranjan, learned counsel for the petitioner and Sri Metta Chendrasekhar Rao, learned Standing Counsel for the respondents, apart from perusing the material available on record. 2. According to the petitioner, it is a company incorporated under the provisions of the Companies Act, 1956, and is engaged in business of manufacturing and sale of various edible oils and fatty acids, having its manufacturing unit at Samalkot, East Godavari District, and the petitioner herein also has a 4 MW biomass co-gen power plant at Edible Oils Division, Samalkot, East Godavari District and the petitioner herein also established a separate spinning unit at Valuthimmapuram village in the name and style of Sudha Agro Oil & Chemical Industries Limited, Spinning Division, Valutimmapuram, Peddapuram Mandal, East Godavari District and availing power supply from the 1st respondent with a connected maximum demand of 1550 KVA with HT Service Connection No.RJY-970 and to that effect, the petitioner has entered into HT agreement dated 29.01.2011 with the 1st respondent. It is further stated that the petitioner’s power plant is a non-conventional energy project based on biomass to generate 4 MW on an average basis using rice husk and bagasse and the Non-Conventional Energy Development Corporation of Andhra Pradesh Limited (NEDCAP) accorded approval to the said proposal, vide letter No.NEDCAP/ PD/1497/98-99/2138 dated 28.09.1998. 3. The 2nd respondent herein, vide Lr.No.SE/O/RJVM/ SAO/AAO/JAO/HT/D.No.1/3101.12/2020 dated 24.12.2020, demanded a sum of Rs.1,81,83,960/- from the petitioner towards grid support charges from 04/2002 to 03/2009 as per APERC tariff orders as indicated in the enclosed month wise statement. In the last paragraph of the said letter, the Superintending Engineer, Operation, Rajamahendravaram-2nd respondent herein also made it clear that in the event of seeking any clarification or reconciliation, the petitioner herein would depute their personal along with the material. 4. According to the pleadings in the writ affidavit, the petitioner herein submitted its objections to the said demand and the said objections read as under: "1) Grid Support charges are to be raised on Captive Power Plants only. The definition of Captive Generating plant means a power plant set up by any person, association, or any company to generate electricity primarily for his or her own use.
The definition of Captive Generating plant means a power plant set up by any person, association, or any company to generate electricity primarily for his or her own use. It is also very clear from section 3 of the Ministry of Power Notification Date: 08.06.2005, a Plant can qualify to be a Captive Power Plant only if: i) not less than twenty six percent of the ownership is held by the captive user(s). AND ii) not less than fifty one percent of the agreement electricity generated in such plant, determined on an annual basis, is consumed for the captive use. It is clear from the above definition that we are not a captive plant and therefore the grid support charges do not apply to us. 2) We would also like to bring it to your notice that we are process plant with a load of around 450 KVA which use spent steam from the power plant. Would like to make it clear that our process plant can not run without steam and hence will be shutdown when our Power Plant goes offline and hence we do not use/require any grid support to run the process plant when the power plant is offline. We can also furnish the production records of the process plant for the days when the power plant was offline as proof of the same. Therefore, grid support Charges do not apply to us. 3) By your own submission, EPDCL insists that we have a contracted capacity of 4MW for wheeling of power. If so the contract capacity of 4MW needs to be subtracted from the installed capacity of 4MW leaving the Grid support capacity at ZERO. Therefore, the charges raised by you are erroneous.” 5. Thereafter, the 2nd respondent, vide letter bearing Lr.No.SE/O/RIVM/SAO/AAO/JAO/HT/D.No.1/313957/2020 dated 18.01.2020, asked the petitioner to pay the above said sum indicated in the letter dated 24.12.2020 by threatening action, rules and the terms and conditions of the supply, including initiation of proceedings under the Andhra Pradesh Revenue Recovery Act, 1864. 6. According to the learned counsel for the petitioner, the said action on the part of the 2nd respondent herein is highly illegal, arbitrary and violative of Article 14 of the Constitution of India and also violative of the principles of natural justice.
6. According to the learned counsel for the petitioner, the said action on the part of the 2nd respondent herein is highly illegal, arbitrary and violative of Article 14 of the Constitution of India and also violative of the principles of natural justice. It is further submitted that the 2nd respondent, though received the objections on 02.01.2021, did not consider the said objections and passed an order on 18.01.2021, demanding to pay the amount indicated in the order dated 24.12.2020. 7. On the other hand, it is strenuously contended by Sri Metta Chendrasekhar Rao, learned Standing Counsel that there is no illegality nor there exists any infirmity in the impugned proceedings and in the absence of the same, the petitioner is not entitled for any relief under Article 226 of the Constitution of India. It is further submitted, in elaboration, by the learned Standing Counsel that since the respondent- authorities acted strictly in accordance with law, the impugned action does not warrant any interference of this Court. 8. A perusal of the material available on record would disclose, in vivid and clear terms, that the 2nd respondent herein, vide letter dated 24.12.2020, demanded the petitioner herein to pay a sum of Rs.1,81,83,960/- towards the grid support charges for the period from 04/2002 to 03/2009. In response to the said demand, the petitioner herein submitted objections on 02.01.2021 in the manner mentioned in the preceding paragraphs. A perusal of the said objections also clearly indicates that the said objections were received by the office of the 2nd respondent on 02.01.2021 and the endorsement made by the office of the 2nd respondent also indicates the same in clear and candid terms, but the letter dated 18.01.2021 states that the 2nd respondent herein did not receive any response from the petitioner. When the office of the 2nd respondent herein acknowledged the receipt of the objections dated 02.01.2021, this Court does not find any justification on the part of the 2nd respondent herein in not considering the objections submitted by the petitioner on 02.01.2021 and in the opinion of this Court, the impugned action is in total violation of the principles of natural justice. Therefore, the impugned action is liable to be set aside only on the ground of violation of principles of natural justice and this Court does not propose to deal with other merits of the matter. 9.
Therefore, the impugned action is liable to be set aside only on the ground of violation of principles of natural justice and this Court does not propose to deal with other merits of the matter. 9. For the aforesaid reasons, the Writ Petition is partly allowed, setting aside the letter Lr.No.SE/O/RIVM/SAO/AAO/ JAO/HT/D.No.1/313957/2020 dated 18.01.2021 of the 2nd respondent, leaving it open for the 2nd respondent herein to pass appropriate orders after considering the objections, dated 02.01.2021, submitted by the petitioner herein, strictly in accordance with law. It is also made clear that till a decision is taken in the said direction, the interim order dated 05.02.2021 passed by this Court shall remain in operation. There shall be no order as to costs of the Writ Petition. Miscellaneous petitions, if any pending in this Writ Petition, shall stand closed.