2010 (5) TMI 819 - SC - Indian Laws

Whether the High Court of Uttarakhand did not find a case in favour of the respondent-KVSL on the ground which is now sought to be urged in the present appeal? Whether the plea of promissory estoppel is available to a consumer ? Whether there is no hesitation in repelling the contention that any promise was made by the U.P. State Power Corporation to the respondent- KVSL which could justify the grant of any mandamus in its favour for making good any such promise?

Summary

Issues Involved:
1. Validity of the 15% surcharge on consumers drawing power from independent feeders.
2. Interpretation and application of the tariff prescribed by the U.P. Electricity Regulatory Commission.
3. Application of the doctrine of promissory estoppel against the power corporations.

Detailed Analysis:

1. Validity of the 15% surcharge on consumers drawing power from independent feeders:
The Uttar Pradesh Electricity Regulatory Commission, through a notification dated 7th August 2000, stipulated that consumers drawing power from independent feeders emanating from 400/220/132 KV sub-stations would pay an additional surcharge of 15% on demand and energy charges, subject to a guaranteed supply of 500 hours per month. The U.P. Power Corporation issued a circular on 8th September 2000, allowing consumers to opt out of this guaranteed supply and thereby avoid the surcharge by notifying the Executive Engineer.

However, the High Court of Allahabad dismissed a writ petition challenging this surcharge, stating there was no ambiguity in the tariff and that consumers drawing power from independent feeders must pay the surcharge regardless of peak hour restrictions. The High Court of Uttaranchal initially allowed a writ petition by KVSL, exempting it from the surcharge based on the circular, but this decision was later challenged and overturned by the Supreme Court. The Supreme Court held that the circular modifying the tariff was without jurisdiction and that the surcharge was validly imposed according to the tariff prescribed by the Regulatory Commission.

2. Interpretation and application of the tariff prescribed by the U.P. Electricity Regulatory Commission:
The tariff schedule HV-2, as per the notification dated 7th August 2000, clearly delineated the conditions under which the 15% surcharge would apply. The Supreme Court emphasized that the tariff approved by the Regulatory Commission was unambiguous and did not provide for any option to avoid the surcharge for consumers drawing power from independent feeders. The High Court of Allahabad's interpretation that the surcharge was mandatory for such consumers was upheld, and the circular issued by the U.P. Power Corporation was deemed an unauthorized modification of the tariff.

3. Application of the doctrine of promissory estoppel against the power corporations:
The Supreme Court examined whether a promise had been made by the U.P. Power Corporation to KVSL that could invoke the doctrine of promissory estoppel. It was found that there was no specific promise made by the U.P. Power Corporation to supply energy without the surcharge. The agreements between the parties did not contain any promise regarding exemption from the surcharge. Furthermore, there was no evidence that KVSL had altered its position based on any such promise. The Court concluded that the plea of promissory estoppel was not substantiated by the material on record and could not be applied in this case.

Conclusion:
The Supreme Court allowed the appeal, setting aside the High Court of Uttaranchal's order that had exempted KVSL from the 15% surcharge. The Court held that the surcharge was validly imposed according to the tariff prescribed by the U.P. Electricity Regulatory Commission and that there was no valid promise made to KVSL that could invoke the doctrine of promissory estoppel. The appeal was allowed with costs of Rs. 50,000 imposed on KVSL.