Holding

Section 49(1) of the Electricity Supply Act, 1948 expressly empowers the Board to lay down conditions of supply, including voltage, and to fix uniform tariffs, thereby permitting unilateral alteration of supply conditions.

Summary

The Supreme Court considered appeals by Hyderabad Engineering Industries Ltd. and other high‑tension consumers challenging a 1981 notification of the Andhra Pradesh State Electricity Board that required them to receive supply at higher voltages and imposed a surcharge for non‑compliance. The petitioners argued that the Board had no authority under the Electricity Supply Act, 1948 to unilaterally alter the conditions of supply, contending that Sections 26, 28, 29 and the Board’s duty under Section 18(A) barred such action. The Court examined the language of Section 49(1), holding that it expressly empowers the Board to lay down conditions of supply and to fix uniform tariffs, and that this power is sufficient without recourse to Section 18(c) or the procedures of Sections 28‑29. It rejected the contention that the Board’s duty to maintain transmission lines prevented it from requiring consumers to install their own step‑down equipment. The Court also noted that the Board may, in appropriate cases, waive the surcharge, but it declined to adjudicate the reasonableness of the six‑month period. Consequently, the appeals were dismissed, upholding the Board’s statutory authority.

Issues considered

Whether Section 49 of the Electricity Supply Act, 1948 authorises the Board to unilaterally alter conditions of supply, including voltage, and impose a surcharge.
Whether Section 18(c) is required to give effect to the power under Section 49, or Section 49 alone suffices.
Whether the procedural requirements of Sections 28 and 29 of the Act apply to the Board’s alteration of supply conditions.
Whether the Board’s duty under Section 26 and Section 18(A) to maintain transmission lines precludes it from shifting the burden of step‑down equipment to consumers.
Whether the six‑month period prescribed for consumers to comply with the new voltage requirement is reasonable (though not decided).

Legislation cited

Electricity (Supply) Act, 1948s. 18(A)(1), s. 18(A)(2), s. 18(c), s. 26, s. 2(7), s. 28, s. 29, s. 49
Indian Electricity Act, 1910

Subjects

Electricity Supply ActSection 49unilateral alterationvoltage changetariff surchargehigh tension consumersstatutory interpretationpower board authority

Judgment

y HYDERABAD ENGINEERING INDUSTRIES LTD.
A
ETC. ETC.
v.
A.P. STATE ELECTRICITY BOARD ETC. ETC.

MARCH 8, 1988
B
>-- [SABYASACHI MUKHARJI AND G.L. OZA, JJ.)

-
i~
Electricity Supply Act, 1948-Section 49-Scope of powers of
Electricity Board-Whether Electricity Board has power unilaterally to
alter the conditions of supply of electricity.
c
~- Electricity Supply Act, 1948-Sections 28 and 29 read with Sec·
tions 18 and 18A contemplate different function than the Electricity
'
Board unilaterally altering the conditions of supply of electricity under
Section 49.

On 21st July, 1981, the Respondent Andhra Pradesh State Electr· D
icity Board issued a notification exercising power under section 49 of
the Electricity Supply Act, 1948. By this notification the Board unilater·
ally altered the conditions of supply of electridty to high tension power
consumers. This notification stated that the industries will be supplied
the power for the contracted demands between 1501 KV A to 5000 KV A,
~ at 33 KV whereas industries whose contracted demand is above 5000 E
KV A shall avail supply at 132 KV or 220 KV.· To comply with this
requirement high tension consumers will either have to replace the
existing transformers and high tension control gears or to instal trans-
formers with control gears to step down supply from the now proposed
_. voltage to the existing voltaJ!e and these modifications have to be.made
by the industries concerned within a period of 6 months from the date F
of this notification. It was further provided that after the lapse of six
months. if the consumers have not made arrangements for receiving the
supply at the proposed voltage and continue to receive supply at the
voltage at which they were receiving on the date of the notification they
will have to pay additional surcharge ranging between 2.5% to 13% on
their power bills. The appellants which were consumers of high tension G
power challenged the validity of this notification by way of filing writ
-~. petitions before the High Court. A Single Judge allowed the writ peti·
lions. In app~al a Division Bench took the view that section 49 of the Act
coupled with section 18(c) of the same Act empower the electricity
board to unilaterally alter the terms and conditions of supply, and set
aside the judgment of the Single Judge. Hence these appeals by Special H
159
160 SUPREME COURT REPORTS [1988) 3 S.C.R.
y
A Leave against the Judgment of the Division Bench. The main con-
troversy was whether the board had power unilaterally to alter the
conditions of supply of electricity. Dismissing the appeals this Court,

HELD: The contention of the appellants that under section 49 the
respondent board had no authority unilaterally to alter the conditions
B of supply cannot be accepted. Suh-dause I of section 49 of the Electri-
city Supply Act, 1948 clearly provides that the board could lay down
conditions of supply and for purposes of such supply it may also frame
uniform tariffs. Sub-clause 1 therefore clearly authorises the Board to
lay down the conditions of supply and have to fix uniform tariffs is
providtd for in sub-clause 2. If there is any doubt sub-clause 4 makes it
clear that in exercise of powers under this section Board could fix the
c conditions of supply and also fix the tariffs. I168B-C; 167B-C)

The Division Bench relied on provisions contained in Section
18(c). It is no doubt true that under these provisions the Board exercises
control in relation to generation, distribution and utilisation of electric-
D ity and the learned Judges of the Division Bench felt that although
specified power is not there under Section 18(c) but it is wide enough to
authorise the board to alter the conditions of supply. It is no doubt
true that section 18(c) confers power of control on the hoard hut
in our opinion the specific power under section 49 Clause I is clear
enough wherein board has been anthorised to lay down conditions
E ofsupply. [168C:-EI

The contention that · the policy of the Board to change over of
supply of power at a high voltage which involves heavy expenditure will
fall within the scope of sections 28 and 29 and therefore it could not be
done without following the procedure indicated in these provisions has
F no substance. A perusal of sections 28 and 29 of the Act indicates that it
is altogether a different function rather than what is being done by the
Board in exercise of the powers under Section 49 Clause t. H71G]

As regards the imposition of the higher tariff on failure to receive
the supply at the voltage indicated in the notification from the date
G specified therein or not will be open to the Board for consideration and
the parties may approach the Board and it will be open to the Board in
the facts and circumstancl'S of each case not to levy the surcharge
indicated in the notification during a particular period and in so doing
the board will take into consideration the facts and circumstances of
each particular case [172A-B)
H
HYDERABAD ENGG. INDS. v. A.P. STATE ELECT. BOARD 161

The contention that the loss incnrred in respect of smaller con-
A
sumers is recovered from the present appellants, the high tension con-
sumer, has no substance. The transmission loss no doubt is on account
of low voltage when it travels long distance as it is related to distance
hut the qnantum of lciss also is proportional to the quantum of power that
travels through the transmission lines and it could not be disputed that
the power that has to travel to meet the requirements of small B
agricultural consumers is negligible as compared to the quantum of
p9wer that is supplied to these high tension consumers. I170H; 171A-B I

The eonte11tion that under section 18(A)(l) read alongwith section
iS(A)(2) of the Electricity Supply Act it is the duty of the board to
es.tablish and maintain sulH;tations and main transmissions lines and it.
is not open to the board to transfer this responsibility to the consumers C
by 'requiring them to make their own arrangements to step down electr-
icity after taking it at a high voltage has no substance. Section 2 sub--
clause 7 of the Act defines the main transmission lines but all this in
sub-clause 7 of section 2 refere to· is about transmiss,ion of electricity
from a generating station to another generating station or to sub- D
station. Apparently it refers to all the lines and equipments required to
be installed from the generating station to the distributing sulH;tation.
Apparently both being that of the Board itself it has to maintain it and
on this basis it could not be contended that if the consumer has to
receive powers at a high voltage and if he wants to utilise it at a low
voltage it is not his responsibility to instal equipments for stepping down E
the power from high voltage to low voltage. [171C-E]

Maharashtra State Electricity Board v. Kalyan Borough Munici-
pality & Anr., [ 1968] 3 SCR 137; Bisra Stone Lime Company Ltd. &
Anr. etc., v. Orissa State Electricity Board and Anr., [1976] 2 S.C.R.
307 and Jagadamba Paper Industries (Pvt.) Ltd. Etc. Etc. v. Haryana F
State Electricity Board & Ors. Etc., [1984] 1S.C.R.165, referred to.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 793
of 1988 etc.

From the Judgment and Order dated 25.6.1987 of the Andhra G
Pradesh High Court in Writ Petition No. 8019 of 1987

F.S. Nariman, G.L. Sanghi, A.K. Sen, Dr. L.M. Siughvi, Anil B.
Diwan, K. Srinivasamurthy, Kailash Vasdev, K.K. Jain, K.S. Murthy,
U.K. Khaitan, Ajay K. Jain, Vipin Sanghi, Parveen Kumar, A.M.
· Singhvi, R.S. Yadav, H.M. Singh, N. Waziri, Viuoo Bhagat, Shree H
162 SUPREME COURT REPORTS [1988] 3 S.C.R.

A Narain and Sandeep Narain for the Appellants.

Shanti Bhushan, V.B. Reddy and K. Rajendra Chaudhary for
the Respondents.

The Judgment of the Court was delivered by
B
OZA, J. Leave granted.

These special leave petitions have been filed against the judg-
ment of the Division Bench of the Andhra Pradesh High Court
delivered on 25.6.87 wherein the learned Judges set aside the orders
C passed by learned Single Judg~ of the High Court in Letters Patent
Appeal. The petitioners had filed writ petitions before the High Court
which were heard by a learned Single Judge and who by his orders
quashed the notification issued by the respondent Board dated 21. 7.81
unilaterally altering the conditions of supply. The learned Single Judge
held that the Board had no authority unilaterally to alter the condi-
D lions of supply of electricity but on appeal the learned JudBes of the
Division Bench set aside the judgment passed by the Single Judge and
held that the Board respondent had the statutory authority under Sec-
tion 49 of the Electricity Supply Act, 1948 ('Act' for short) to lay down
the conditions of supply and if any doubt exists Section 18 clause (c) of
the Act confers powers on the Board. It is against this judgment of the
E Division Bench in all these petitions which were disposed of by a
common judgment that these special leave petitions have been filed
and therefore these matters are before us.

On 21.7.81 the respondent A.P. State Electricity Board issued a
notification exercising powers under Sec. 49 of the Act. By this notifi-
F cation the Board unilaterally altered the conditions of supply for the
high tension consumers of electricity. Admittedly these consumers are
the industries which consume high tension power. This notification
stated that the industries will be supplied the power for the contracted
demands between 1501 KVA to 5000 KV A, at 33 KV wher"'I"
. industries whose contracted demand is above 5000 KVA shall avail
G supply at 132 KV or 220 KV. To comply with this requirement high
tension consumers i.e. the present appellants before this Court will
either have to replace the existing transformers and high tension cow
trol gears or to instal transformers with control gears to step down
supply from the now proposed voltage to the existing voltage~d these
modifications have to be made by the industries concerned within a
H period of 6 months from the date of this notification. It was further
HYDERABAD ENGG. INDS. v. A.P. STATE ELECT. BOARD [OZA, J.] 163

r provided that after the lapse of six months if the consumers i.e. appel-
A
!ants have not made arrangements for receiving the supply at the pro-
posed voltage and continue to receive supply at the voltage at which
they were receiving.on the date of the notification they will have to pay
additional surcharge ranging between 2.5% to 13% on their power
bills.
I B
).. It is alleged that after this notification the appellants and other
similarly situated consumers made a representation to the Board and

-~ they were told that as the transmission and transformation losses in
respect of supply to these high tension consumers is very much it has
been decided by the Board to minimise these transmission losses and it
is for that purpose that it has been decided to supply at high voltage as
i c
t- transmission of high voltage current results in lesser losses of transmis-
sion and by this process energy which is lost in the transmission will be
saved and it was for this purpose that this policy has been adopted by
the Board. According to the appellants consumers their grievance was
that for the purpose of receiving power at a high voltage they will have
. to instal their own transformers which would involve heavy capital D
investments and for supply of power at high voltage even the Board
will have to lay new lines of supply and all this would not be economi-
cal as compared to the contemplated loss of power on account of
I
transmission but as Board did not accept the representation, the
.... \
petitioners filed their petitions before the High Court and the learned
Single Judge of the Andhra Pradesh High Court by his judgment dated E
24.9.82 allowed the writ petitions against the judgment of the learned
Sin[le Judge, in appeal before the Division Bench the judgment of the
learned Single Judge was set aside and the Division Bench took the
view that Sec. 49 of the Act coupled with Sec. 18(c) of the same Act
---1 empowered the electricity board to unilaterally alter the terms and
conditions of supply and it is against this judgment of .the Division F
Bench that these appeals are before us. Before this notification the
electricity was being supplied to high tension consumers at 11000
Voiles or 33000 Voiles. By this notification they were expected to
receive.supply at higher voltage specified in the notification. I

The main contention advanced before the High Court in the writ G
I petitions was that it was not open to the Board to direct the existing
~- consumers to take the supply at a higher voltage then the voltage at
which they were receivirig supplies or to impose an additional charge
on the supply.
\
It was contended before us that in view of Sec. 26 read with H
164 SUPREME COURT REPORTS [1988) 3 S.C.R.

clause 6 of the schedule to the Indian Electricity Act, 1910. it is not
A
open to the Board to unilaterally impose supply at a higher voltage.
According to the learned counsel as a particular customer has re-
quisitioned supply of power at a particular voltage and Board had
agreed to do, it was not permissible now to alter the conditions. On the
contrary on behalf of the Board it was contended that Sec. 26 of
B Electricity Supply Act no doubt puts an obligation on the Board to
supply power as were the obligations of the licensee under the 1910
Act and also the provisions of Clause 6 of the Schedule will apply to
the Board but it was contended that it has not been provided anywhere ·
in Clause 6 that it is the choice of the consumer to require supply at a
particular voltage. It was also contended that clause 6 sub-clause 5
C provides the requisition to be in the form and the prescribed form does
not indicate that it is open to the consumer to require the supply at any
particular voltage. It was also contended that in fact Sec. 26 itself talks
of subject to the provisions of this Act and Sec. 49 of the Act confers
power on the Board to lay down the conditions of supply. It was also
contended on behalf of the respondent Board that the Board chose ,to
D switch over to supply of high voltage in order to minimise the transmis-
sion losses as according to them if the electricity is transmitted at 33000
volts instead of 11000 volts the transmission loss will be reduced to
1/ 19th and if the supply is further increased to 132 KV the transmission
loss will be further reduced to l/44th with the result that the transmis-
sion losses could be reduced to 99.3%. lt was also contended on behalf ·)...
E of the petitioners that in case of some industries the question of trans-
mission losses is not substantial as some of them are situated just near
the supply station and even if there is some loss it is negligible as
compared to the heavy cost of installation which will have to be put up.
An attempt was also made to suggest that when the distance is very
short the transmission loss will be very low but one fact to be kept in
F consideration which was lost sight of at some stage that transmission
loss is not only related to the distance that the power travels but also ·
the quantum of power that travels. Admittedly all these petitioners are
consumers who are consuming huge quantities of power which is
clearly indicated from the bills, charts of which were filed by the
petitioners themselves before this Court indicating that their yearly
G power bills which run into crores and it is in this context that the
question of transmission loss will have to be considered.

The main controversy which was before the High Court was as to
whether the Board has power unilaterally to alter the conditions of
supply. On behalf of the petitioners it was contended that Sec. 49 only
H confers powers on the Board to revise the tariffs periodically and it was
HYDERABAD ENGG. INDS. v. A.P. STATE ELECT. BOARD [OZA, J.} 165

r contended that a little before the present disputed notification was
issued the tariffs were revised and that revision of tariffs was done
A
keeping in view all the relevant consideration including all losse• in
transmission and transformation and therefore immediately after the
revision of the tariffs there was no occasion for exercise of power
under Sec. 49 by issuing the impugned notification. It was contended
that Sec. 26 read with clause 6 of the Schedule is an obligation on the B
j.. Board to supply the power as requested by the consumer. Sec. 26
reads:

-A "26. Board to have powers and obligations of licensee
under Act 9 of 1910. Subject to the provisions of this Act,
the Board shall, in respect of the whole State, have all the
c
~- powers and obligations of a licensee under the Indian
Electricity Act, 1910 (9 of 1910) and this Act shall be
deemed to be the licence of the Board for the purposes of
that Act:

Provided that nothing in Sections 3 to 11, sub-sections (2) D
and (3) of Section 21 and Section 22, sub-section (2) of
Section 22-A and Sections 23 and 27 of that Act or in
Clause I to V, Clause VII and Clauses Ix to XII of the
Schedule to that Act relating to the duties and obligations
--i of a licensee shall apply to the Board:
E
(Provided further that the provisions of Clause VI of the
Schedule to that Act shall apply to the Board in respect of
that area only where distribution mains have been laid by
the. Board and the supply of energy through any of them
--f has commenced.')"
F
It is clear from a perusal of this provision that the obligation
under Sec. 26 is subject to the provisions of this Act. Clause 6 pertain-
ing to requisition for supply to owner and occupiers of the electricity
provides for conditions under which a licensee will be bound to supply
and sub-dause 5 of clause 6 of the Schedule under 1910 Act requires
the requisition to be in a form prescribed and the form prescribed does G
; not indicate that the consumer is free to ask for the supply at a particu-
r~
• Jar voltage only .

On behalf of the petitioners it was vehemently contended that
Sec. 49 confers powers on the Board only to revise the tariffs and it has
not conferred any power on the Board to alter unilaterally the supply H
166 SUPREME COURT REPORTS [1988] 3 S.C.R.

A at a particular voltage. The main contention on behalf of the petitioner
was that Sec. 49 only empowered the Board to fix uniform tariffs and
in support of the contention reliance was-Placed on the case of
Maharashtra State Electricity Board v. Kalyan Borough Municipality &
Anr., [1968] 3 SCR 137 and Bisra Stone Lime Company Ltd. & Anr.
Etc. v. Orissa State Electricity Board & Anr., [1976) 2 SCR 307. In
B these cases no doubt Sec. 49 has been considered but the only question ~
in these cases was pertaining to tariff and there was no occasion to
consider the scope of Sec. 49 Clause I which empowers the Board to
lay down conditions of supply.

Sec. 49 reads:
-
c "49. Provision for the sale of electricity by the Board to
persons other than licensees. ( 1) Subject to the provisions
4·
of this Act and of regulations, if any, made in this behalf,
the. Board may supply electricity to any person not being a
licensee upon such terms and conditions as the Board
D thinks fit and may for the purposes of such supply frame
uniform tariffs.

(2) In fixing the uniform tariffs, the Board shall have re-
gard to all or any of the following factors, namely:

E (a) the nature of the supply and the purposes for which it is
required;

(b) the CG-Ordinated development of the supply and
distribution of electricity within the State in the most
efficient and economical manner, with particular refer-
F ence to such development in areas not for the time
being served or adequately served by the licensee;

(c) the simplification and standardisation of methods and
rates of charges for such supplies;

G (d) the extension and cheapening of supplies of electricity
to sparsely developed areas.

(3) Nothing in the foregoing provisions of this section shall
derogate from the power of the Board, if it considers it
necessary or expedient to fix different tariffs for the supply
H of electricity to any person not being a licensee, having
HYDERABADENGG. INDS. v. A.P.STATEELECT. BOARD [OZA, J.J 167
'i
regard to the geographical position of any area, the nature
A
of the supply and purpose for which supply is required and
any other relevant factors.

(4) In fixing the tariff and terms and conditions for the
supply of electricity, the Board shall not show undue pre-
ference to any person.'' B
}-- ,
Sub--dause 1 of this Section clearly provides that the Board could lay
...... down conditions of supply and for purposes of such supply it may also

A
I
frame uniform tariffs. Sub-section 1 therefore clearly authorises the
Board to lay down the conditions of supply and have to fix uniform
tariffs is provided for in sub-clause 2. If there is any doubt sub-clause
c
I 4 makes it clear that in exercise of powers under this Section Board
could fix the conditions of supply and also fix the tariffs and it was
therefore contended on behalf of the respondent Board that although
the Division Bench referred to Sec. 18(c) still the Board has enough
power under Sec. 49 itself to lay down the conditions of supply. This
question about the conditions of supply specifically came up before D
this Court in the case of Jagadamba Paper Industries (Pvt.) Ltd. Etc.
Etc. v. Haryana State Electricity Board & Ors. Etc., I 1984] 1 SCR 165
and it was observed at page 172:
,
~ "We are of the view that the Board has been conferred
statutory power under S. 49(1) of the Act to determine the E
conditions on the basis of which supply is to be made. This
Court in Bisra Stone Lime Company Ltd. & Anr. etc. v.
Orissa State Electricity Board & Anr., [1976] 2 SCR 307
I
took the view that enhancement of rates by way of sur-
charge was well within the power of the Board to fix or
~ revise the rates of tariff under the provisions of the Act. F
What applied to the tariff would equally apply to the secu-
rity, that being a condition in the contract of supply. Each
of the petitioning consumers had agreed to furnish security
in cash for payment of energy bills at the time of entering
into their respective supply agreements. There was no
challenge in these writ petitions that the demand of security G
{ at the time of entering into supply agreements has to be
,--\
struck down as being without jurisdiction. Section 49( J) of
the Act clearly indicates that the Board may supply electri-
city to any person upon such terms and conditions as the
Board thinks fit. In exercise of this power the Board had
initially introduced the condition regarding security and H
168 SUPREME COURT REPORTS 11988] 3 S.C.R.

each of the petitioners had accepted the term."
A

It is not disputed that although under the. original agreement the
electricity Board was bound to supply power at a particular voltage but
after the lapse of that agreement by lapse of time subsequent agree-
ment provided the clause where the right has been reserved by the
B Board to alter the conditions of supply and that is why the on)y conten-
tion advanced by the petitioners was that under Sec. 49 the respondent
Board had no authority unilaterally to alter conditions of supply and as
discussed above this contention cannot be accepted. -·-
The Division Bench relied on provisions contained in Sec. 18
C sub-clause ( c) which reads:

"to exercise such control in relation to the generatio!l, dis-
tribution and utilisation of electricity within the State as is
provided for by or under this Act."
D
It is no doubt true that under these provision,s the Board exer-
cises control in relation to generation, distribution and utilisation of
electricity and the learned Judges of the Division Bench felt that
although specific power is not there under Sec. 18(c) but it is wide
enough to authorise the Board to alter the conditions of supply. It is ).__
E no doubt true that Sec. 18(c) confers power of control on the Board
but as indicated above, in our opinion the specific power under Sec. 49
clause I is clear enough wherein Board has been authorised to lay
down the conditions of supply.

On the merits of the contention various controversies were )--
F raised in respect of the calculations and mathematics of calculating the
transmission loss. An attempt was also made on behalf of petitioners
to suggest that the way of calculations suggested by the respondent
Board does not appear to be correct but it is not disputed .and it can not be
disputed that where power travels through the transmission lines there
is always some loss of power. It is also a fact which could not be
G disputed that loss of power will be related to.the ·quantum of power
which travels through the transmission line and the distance through ~.
which power has to travel. It is also a fact which could not be disputed
that if power is transmitted at high voltage the loss during transmission
is less as compared to the loss when the power is transmitted at a low
voltage and in view of these accepted scientific facts it is not necessary
H for us to go into the calculations and mathematical part of it to find out
HYDERABAD ENGG. INDS. v. A.P. STATE ELECT. BOARD [OZA, J.J 169
'(
as to whether the calculations submitted by the Board is correct or A
those suggested on behalf of the petitioners are correct. The fact re-
mains that lower the voltage ;,igher the transmission loss, higher the
voltage lower the transmission loss and it is also not in dispute that
these appellants are high tension consumers consuming substantial
power and therefore when power travels through transmission lines B
even for short distancesit is not smaller quantities of power but heavy
f. quantities of power is transmitted and in this view of the matter it
could not be said that the policy decision taken b" the Board to supply
these high <tension consumers power at high voltage so that transmis-
.... sion loss and transformation loss should be minimised could not be
-~ said to be any wrong decision or a decision not supported by scientific
reasoning. c
~ .
It was also contended that 6 months' time granted was too short
in view of the fact that these cons.µmers were expected to instal trans-
formers and equipments which ordinarily are not easily available in
this country and which involved high capital investment. It was also
D
suggested that even the respondent Board has not been ab!~ to lay
lines for supply at high voltage as during the course of this litigation
most of the appellants have accepted to receive the supply at the high
voltage and therefore it was contended that the enhanced rate for
supply at low voltage which was brought into force immediately after
-~
six months of the issue of this notification is not only justified as it was
E
termed by teamed counsel for the petitioners to be penal but it was
contended that it is not reasonable as in spite of the fact that the
petitioners accepted to receive supply at high voltage and soine of
them have even installed the transformers and other equipments but
still Board was not in a position to lay supply lines for the high voltage
supply of power and on this basis in substance it was vigorously con-
~ tended that this enhanced rate should not be made chargeable from
F
the date immediately after the expiry of six months after the issue of
this notification.

In one of the case i.e. AP. Paper Mills which has been specifi-
cally alleged that inspite of the fact that the petitioner has installed a
G
transformer but the respondent Board could not lay down the lines as
there was some injunction issued against the Board when the work for
r-\ laying the lines started still although the Board is not in a position to
supply the power at high voltage still the appellant is compelled to pay
the higher rate as he is not receiving power at the high voltage indi-
cated in the notification. H
170 SUPREME COURT REPORTS I1988] 3 S.C.R.

A So far these aspects of the matter are concerned admittedly they
were not before the High Court. Originally what was challenged in the
High Court was the power of the Board to unilaterally alter the condi-
tions of supply. This question about from what date the higher rates
should be charged and as to whether grant of six months time to
complete the preparation for receiving the supply at a higher voltage is
B reasonable or not were not before the High Court (Smgle Judge) nor
before the Division Bench and in fact, tacts in respect of each peti-
tioner on the basis of which these questions could be considered are
also not before us although an attempt has been made by some of the
appellants by additional affidavits and documents to place it before us.
But it is .not sufficient nor it is proper to decide these questions. After
all the respondent Board is an authority under a Statute and if the
C appellants are able to satisfy the authority that the time of six months
in the context of the circumstances when this notification was issued
was not reasonable it is open to the Board to consider from what date 0

to enforce the enhanced rates for supply at lower voltage taking into
consideration all the cases and also keeping in view the circumstances
D in connection with installation of transformers and laying the lines
which have come during the course of these hearings. It is also open to
the Board that in the special facts of any particular case to provide a
separate date for enforcement of the higher rate. But all these ques-
tions can not be decided in the scope of the present appeals.

E It was also contended by the appellants that by altering this
condition of supply the appellants will have to undergo huge capital
investment burden. On the other hand on behalf of the Board it was
contended that if the bills of supply of power of these appellants are
looked at it will indicate that what they are supposed to spend on the
installation in stepping down power is not so heavy and it was con-
F tended that ultimately if this is not done by the Board the loss incurred
on account of transmission has to be borne not only by these consum-
ers who are substantially responsible for the transmission loss but by
those also who are not at all responsible for heavy transmission losses.

An attempt was made to suggest that when power is supplied to
G the rural consumers mainly agriculturists and small consumers the
power has to be supplied at long distance and that is also to be supplied
at low voltage and therefore it was contended that in fact the long
distance supply to smaller consumers is really responsible for the loss
during transmission for which these high tension consumers i.e. the
present appellants are being penalised as they are being called upon to
H pay at a higher rate but this argument suffers from a fallacy. As indi-
HYDERABAD ENGG. INDS. v. A.P. STATE ELECT. BOARD [OZA, J.] 171

cated above transmission loss no doubt is on account of low voltage
A
when it travels long distance as it is related to distance. but. the
quantum of loss also is proportional to the quantum of power that
travels through the transmission lines and it could not be disputed
that the power that· has to travel to meel'the requirements of small
agricultural consumers is negligible as compared to the quantum
of power that is supplied to these high tension consumers, the B
·~· present appellants and therefore th!J,re is no substance in the con-
tention that the loss incurred in supply to the smaller consumers is

- being recovered from the present appellants, . the high tension
consumers.

It was also contended that under Sec. 18(A)(l) read alongwith
Sec. 18(A)(2) of the Act, it is the duty of the Board to establish and c
maintain sub-stations and main transmission lines and it is not open to
the Board to transfer this responsibility to the consumers by requiring
them tb make their own arrangemeltls to step down electricity after
taking it at a high voltage. Section 2 sub-clause 7 of the Act defines the
main transmission lines but.. &II this in sub-clallile 7 .of Section 2 refers D
to is about transmission of electricity from a generating <itation to
another generating station or lo a ·sub-station, Apparently it refers to
all the lines and equipments required t<1 be installed from the generat-
ing station to the distributing sub-station:· Apparently both being that
of the Board itself it has to maintain it and on this basis it could not be
contended that if the consumer has to receive power at a high voltage E
and if he wants to utilise it at a low voltage it is not his responsibility to
. instal equipments for stepping down the power from high voltage to
low voltage. ·

It was also contended that Sections 28 and 29 read ~ Sections
18 and 18A of the Act indicate that where any ;cheme as contemplated F
under Sections 28 and 29 is to be formulated the procedure prescribed
therein had to be followed and it was suggested that as the policy of the
Board to change. over of supply of power at a high voltage involves
heavy expenditure it will fall within the scope of Sections 28 and 29 ar'ld
therefore it could not be done without following the procedure indi-
cated in these provisions. A perusal of these sections 28 and 29 of the G
Act.indicates that it is altogether a different function rather than what
is being done by the Board in exercise of the powers under Section 49
clause 1 and therefore this contention that the procedure indicated in
Sections 28 and 29 has to be followed, is of no substance.

In the light of discussions above therefore, in our opinion, there H
172 SUPREME COURT REPORTS I1988) 3 S.C.R.
A is no substance in these appeals. But as indicated earlier as regards the
imposition of the higher tariff on failure to receive the supply at the
voltage indicated in the notification from the date specified therein or
not will be open to the Board for consideration and the parties may
approach the Board and it will be open to the Board in the facts and
circumstances of each case not to levy the surcharge indicated in the
B
notification during a particular period and in so doing the Board will
take into consideration the facts and circumstances of each particular
case. The appeals are therefore dismissed. In the circumstances of the
case, parties are directed to bear their own costs.

H.S.K. Appeals dismissed. :i,
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