2007 (9) TMI 617 - SC - Indian Laws

Whether Jindal Power was licensed to distribute electricity at any time? Without securing a license is it permissible for Jindal Power to distribute Power? Whether Jindal Power could claim that it is a deemed licensee entitled to distribute power after coming into force of The Electricity Act, 2003?

Summary

Issues:
1. Validity of the order granting license to M/s Jindal Steel and Power Limited.
2. Treatment of the period without legal authority for supply of power.
3. Requirement of license for distribution of electricity by Jindal Power.
4. Claim of being a deemed licensee under the Electricity Act, 2003.

Analysis:
Issue 1: The first issue involves the validity of the order granting a license to M/s Jindal Steel and Power Limited. The appellant in Civil Appeal No.4268 of 2006 challenged the order on various grounds, including non-compliance with statutory provisions such as Section 14, Section 43, National Electricity Policy, and Code of Conduct Rules. The Tribunal upheld the grant of license, stating that Jindal Power fulfilled all requirements for the license. The Supreme Court allowed the appeals, setting aside the Tribunal's order and remitting the matter for fresh consideration, emphasizing the need for a detailed examination of all grounds raised in the appeals.

Issue 2: The second issue pertains to the treatment of the period during which supply of power was made without legal authority. The Commission found that the applicant did not have the necessary legal authority to supply electricity, constituting a contravention of Section 12 of the Act. The Commission imposed a penalty on the applicant for this contravention. The Supreme Court directed that the matter be reconsidered by the Tribunal, emphasizing the importance of providing a fair opportunity for the applicant to be heard and the need for a detailed examination of the legal provisions involved.

Issue 3: The third issue revolves around the requirement of a license for distribution of electricity by Jindal Power. The appellant in Civil Appeal No.4529 of 2006 contended that as a generating company, Jindal Power could supply electricity without a license under Section 10(2) of the Act. However, the Tribunal did not address this contention adequately. The Supreme Court directed the Tribunal to reconsider the matter, stressing the importance of addressing all grounds raised in the appeals and providing a reasoned decision.

Issue 4: The final issue concerns the claim of being a deemed licensee under the Electricity Act, 2003. The Tribunal failed to address the specific issues framed regarding this claim, leading to a lack of clarity on the application of Section 10(2) of the Act. The Supreme Court emphasized the need for a thorough examination of all legal aspects and directed the Tribunal to reconsider the matter comprehensively, without expressing any opinion on the merits of the case.