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Electricity Act old and new sec.22,27, 86 and 111 of new Act= Himachal Pradesh State Electricity Regulatory Commission and another …Appellants Versus Himachal Pradesh State Electricity Board …Respondent published in http://judis.nic.in/supremecourt/imgst.aspx?filename=40845

Electricity Act old and new sec.22,27, 86 and 111 of new Act

JURISDICTION OF HIGH COURT TO HEAR APPEAL FILED PRIOR TO  ARRIVAL OF NEW ACT 2003:-

On the basis of the aforesaid analysis it  can  safely  be  concluded  that the conclusion of the High Court that  it  had  jurisdiction  to  hear the appeal is absolutely flawless.

 

JURISDICTION AND POWERS OF STATE COMMISSION :-

We find that the State Commission under Section  22(1)(d)  was

conferred power to address to various facets and we see no reason  that  the

terms, namely, “efficiency, economy  in  the  activity  of  the  electricity

industry” should be narrowly construed.  

That apart, it would not be  seemly

to say that under Section 22(1) of the 1998 Act the Commission had only  the

power to fix the  tariff  and  no  other  power.   

Had  that  been  so,  the

legislature would not have employed such wide language in Section  22(1)(d).

 At this stage, we may also note  that  the  powers  enumerated  under  sub-

section  (2)  of  Section  22  are  more  enumerative  in  nature  and   the

jurisdiction conferred comparatively covers more  fields.  

In  the  present

case, if  we  read  the  directions  issued  by  the  Commission  in  proper

perspective, the same really do not travel beyond the power conferred  under

Section 22(1)(d) of the 1998 Act.  

 

IMPOSING PENALTY IS CORRECT :-

In  this  factual

      backdrop, it was not correct on the part of the Commission to  impose

      penalty on the Board.  

However, we may hasten to add that  under  the

      2003 Act constitution of the State Commission is governed by  Section

      82.

Section 86 deals with the function of the State Commission.   On

      a reading of Section 86 we find that at present  no  notification  is

      required to be issued to confer any power on  the  State  Commission.

 It is conferred and controlled by the statute.  

If anything  else  is

      required to be done in praesenti, the Commission  is  at  liberty  to

      proceed under the provisions of the 2003 Act.  

Be it  clarified,  our

      grant of liberty  may  not  be  understood  to  have  said  that  the

      Commission can take any action arising out of its earlier order dated

      29.10.2001 or any subsequent orders passed thereon.

We have said so,

      for the Commission and a statutory Board can really work  to  achieve

      the objects and purposes of the 2003 Act.


  35. The appeals stand disposed of in the above terms leaving the  parties

      to bear their respective costs.

 

 

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 6128 OF 2009
Himachal Pradesh State Electricity Regulatory
Commission and another …Appellants

Versus

Himachal Pradesh State Electricity
Board …Respondent
WITH
CIVIL APPEAL NO. 6129 of 2009

WITH
CIVIL APPEAL NO. 6130 of 2009

WITH
CIVIL APPEAL NOS. 6131 of 2009

WITH
CIVIL APPEAL NO. 6132 of 2009

WITH
CIVIL APPEAL NO. 6133 of 2009

J U D G M E N T
Dipak Misra, J.
These appeals, by special leave, are directed against the common
Judgment and order dated 21.11.2007 passed by the High Court of Himachal
Pradesh in FAOs (Ord.) Nos. 489, 490, 491, 492, 493 & 494 of 2002 whereby
the learned Single Judge overturned the decision dated 17.08.2002 rendered
by the Himachal Pradesh State Electricity Regulatory Commission (for short,
“the Commission”) constituted under the provisions of Chapter IV of
Electricity Regulatory Commission Act, 1998 (hereinafter referred to as
“the 1998 Act”).

2. The controversy that has emerged for consideration being common to
all the appeals, we shall adumbrate the facts from Civil Appeal No.
6128 of 2009 for the sake of convenience.

3. The facts requisite to be stated are that the Commission was
established for rationalization of electricity tariff, transparent
policies regarding subsidies, promotions of efficient and
environmentally benign policies and for matters connected therewith
or incidental thereto. In exercise of the power conferred on it
under Sections 22 and 29 of the 1998 Act the Commission vide order
dated 29.10.2001 determined the tariff applicable for electricity
in the State of Himachal Pradesh. While determining the tariff it
also issued certain directions which are as follows:-
a) “Furnishing of information and also periodical reports with respect
to the value of the assets and capital projects of the Board.

b) Replacement of all dead and defective meters by electronic meters
from 31st March, 2002 onwards and reporting the status, as on 31st
December, 2001 by 31st March, 2002.

c) To develop and implement a comprehensive public interaction
programme through Consultative Committees, preparation, publication
and advertisement of material helpful to various consumer interest
groups and general public on various activities of the utility,
dispute settlement mechanism, accidents, rights and obligations of
the consumers etc. Accordingly, the Board was directed on
September 22, 2001, to submit its plan for approval of the
commission and implement the same by 31st March, 2002.

d) Submission of plans, short term and long term, by 31st March, 2002,
for rationalization of existing manpower for improvements in
efficiency through scientific engineering resources management,
improving and updating the organization strategies and systems and
skills of human resources for increased productivity. The Board in
its affidavit of 3rd October, 2001 has agreed to comply and submit
the above study by the above-mentioned date.

e) Submission of a plan by 31st March, 2002, for reducing loss, both
technical and non-technical, together with relevant load flow
studies and details of investment requirement to achieve the
planned reductions. The Commission also observed in its interim
order of 20th September, 2001 passed in the course of public
hearing that investments must aim at reducing the T & D losses and
better quality of supply and service to the consumers as it
happened in the case of Palampur area which has mixed domestic and
commercial loading. The strategy can be considered for adoption
elsewhere also to produce similar results. The Board has confirmed
and undertaken to complete this study by 31st March, 2002

f) To do a comparison of the capital costs of Malana Plant with the
capital costs of HPSEB Plants and submit a report on this by 31st
March, 2002.”

4. Be it noted, the commission issued the directions as a part of the
tariff order and the said directions were contained in paragraphs
7.1, 7.4, 7.5, 7.6, 7.8, 7.9 and 7.13. The Commission in
paragraphs 7.31 and 7.32 had further stated as follows:-

“7.31 The Commission would monitor the progress in complying
with these directions. The Commission accordingly directs the Board
to furnish the information on milestones required in column 3 of the
Annex (7.1) by December 31, 2001. Subsequent reports should be sent
every quarter, providing the information required in columns 4, 5, 6
and 7. The first report should be submitted by January 15, 2002.

7.32 In the directions where the Board is to comply by the next
tariff petition and the same is not filed within next six months, the
directions should be complied within the next six months.”

5. Thereafter, the Commission while discharging its regulatory
functions proceeded to review the directions issued by it and found
that part of the tariff had not been complied with. In view of the
complaints, the Commission issued notice on 23.7.2002 under Section
45 of the 1998 Act. Pursuant to the aforesaid notice the Board
filed its reply raising the question of jurisdiction and competence
of the Commission to issue the aforesaid directions. The
Commission while dealing with the same framed number of issues and
thereafter came to hold that the Board had not fully complied with
the directions of the Commission, and accordingly imposed penalty
of Rs.5000/- on the Board with a further stipulation that the same
shall be deposited within a period of 30 days. The Board was
directed to submit further steps taken by it before the Commission.

6. Being aggrieved by the aforesaid order, the Board preferred an
appeal under Section 27 of the 1998 Act forming the subject matter
of FAO No. 489 of 2002.

7. During the pendency of the appeal, the 1998 Act was repealed and
the Electricity Act, 2003 (for short, “the 2003 Act”) came into
force. The 2003 Act was brought in to consolidate the laws
relating to generation, transmission, distribution, trading and use
of electricity and generally for taking measures conducive to
development of electricity industry, promoting competition therein,
protecting interest of consumers and supply of electricity to all
areas, rationalisation of electricity tariff, ensuring transparent
policies regarding subsidies, promotion of efficient and
environmentally benign policies, constitution of Central
Electricity Authority, Regulatory Commissions and establishment of
Appellate Tribunal and for matters connected therewith or
incidental thereto.

8. At this juncture, it is apt to state that the batch of appeals was
taken up for hearing by the learned Single Judge, learned counsel
for the respondent-Commission raised a preliminary objection about
the maintainability of the appeals. It was contended that as under
Section 110 of the 2003 Act the appellate tribunal has already been
established and an appeal would lie to the appellate tribunal as
contemplated under Section 111 of the said Act, the High Court had
lost its jurisdiction to hear the appeals. The learned Single
Judge took note of the fact that the appeals were preferred under
Section 27 of the 1998 Act and at that stage an appeal was
maintainable before the High Court. The High Court referred to the
repealed Act and the language employed under Section 185 of the Act
of 2003 and Section 6 of the General Clauses Act, 1897 and
analyzing the gamut of the provisions came to hold that the appeal
preferred under the 1998 Act could be heard by the High Court even
after coming into force of the 2003 Act.

9. After dwelling upon the maintainability of the appeal the learned
Single Judge delved into the merits of the appeal and for the
aforesaid purpose, he studiedly scrutinized the language employed
in Section 22 of the 1999 Act and came to hold that when the
Commission was approached by the Board to determine the tariff for
electricity, the Commission was called upon to discharge the
functions mentioned in sub-Section 1 (a) of Section 22 of the 1998
Act and under the said provision it had the jurisdiction to issue
further directions. Thereafter, the learned Single Judge proceeded
with regard to the monitoring facet by the Commission, appreciated
the directions and, eventually, opined thus:-

“Commission’s observation that the directions were issued in the
larger interest of the Board and the consumers is also out of the
context. As already noticed, the Commission was approached by the
Board to fix the tariff of electricity. Once the tariff had been fixed
the job of the Commission was over. It became functus officio once
the function of determination of tariff had been performed. The
interests of the Board and the consumers were required to be borne in
mind and protected while fixing the tariff. The Commission could not
have arrogated to itself and superintendence and control of the Board
on the pretension of watching and protecting the larger interests of
the Board and the consumers.”

As stated earlier, the aforesaid judgment and order are the subject
matter of assail before us in these appeals.

10. Mr. Jaideep Gupta, learned senior counsel, questioning the
sustainability of the judgment of the High Court has raised the
following submissions:-

(a) The High Court has absolutely flawed by coming to hold that appeal
was maintainable before it despite a separate forum having been
created and provision for appeal being engrafted under Section 111 of
the 2003 Act. It is urged by him that the High Court has totally
misguided itself in interpreting the Repeal and Saving provision
contained in Section 185 of the 2003 Act.

(b) The High Court has erred in holding that despite the repeal of the
1998 Act and coming into force of the 2003 Act the right to prefer an
appeal under the old Act would still survive. It is urged by him that
from the schematic content of the 2003 Act it is graphically clear
that a contrary intention of the legislature is clear from the 2003
Act that the appeal has to lie to the appellate tribunal and the High
Court has been divested of its appellate jurisdiction to deal with the
pending appeals.

(c) The view expressed by the High Court that the Board had approached
the Commission to fix the electricity tariff and once the said tariff
had been fixed by the Commission it became functus officio and it
could not have arrogated to itself the power of superintendence and
control of the Board on the pretext of monitoring of larger public
interest, is sensitively susceptible. Learned counsel would submit
that the Commission had been conferred power under Section 22 (1) of
the 1998 Act by virtue of issuance of notification by the State of
Himachal Pradesh but the High Court failed to appreciate and
scrutinize the effect of conferment of power under the said provision
as a consequence of which an indefensible order came to be passed.

11. Mr. Anand K. Ganesan, learned counsel appearing for the respondent-
Board, resisting the aforesaid submissions contended as follows:-

(i) The conclusion arrived at by the High Court that the appeal can be
heard despite repeal of the 1998 Act and introduction of the 2003 Act
on the basis of Section 6 of the General Clauses Act 1897 and the
provision contained in Section 185(5) of the 2003 Act cannot be found
fault with, for there is no express provision to take away the vested
right of appeal and no contrary intention can be gathered from any of
the provisions of the new enactment.

(ii) The right of appeal before the High Court was a vested right and the
same has not been taken away by the 2003 Act and, therefore, the
opinion expressed by the High Court being impregnable deserves to be
concurred with by this Court. Right of forum as regards an appeal is
also a vested right unless abolished or altered by subsequent law and
in the case at hand the 2003 Act does not extinguish the said vested
right and hence, the judgment and order passed by the High Court are
impeccable.

(iii) The Commission under the 1998 Act could not have issued directions
inasmuch as the notification issued by the State had only conferred
powers under Section 22 (1) of the 1998 Act and not under any other
provisions, and hence, the directions issued travel beyond the power
conferred which have been appositely nullified. It is further argued
that though the finding of the High Court that the Commission had
become functus officio may not be a correct expression in law but
directions issued being without jurisdiction, the Commission could not
have been proceeded and imposed penalty. Alternatively, it is
submitted that even if the issue of jurisdiction is determined in
favour of the Commission. The directions issued by it having been
substantially complied with by the respondent and there being no
willful and deliberate non-compliance, on the facts and circumstances
imposition of penalty was not justified.

12. First, we shall proceed to deal with the jurisdiction of the High
Court to hear the appeal after coming into force the 2003 Act.
The Board, as is manifest, was grieved by order imposing penalty.
The relevant part of the order of the Commission reads as follows:-

“The instant matter is one of the first incidents of the contravention
of the Commission orders/ directions attributable to the conduct of
Respondents / objectors. The commission has determined the quantum of
fine to be imposed after considering the nature and extent of non-
compliance and other relevant factor as per Regulation 51 (iii) of
HPERC’s Conduct of Business Regulations, 2001 under the overall
provision of Section 45 of the ERC Act, 1998. Penalty of Rs. 5,000/-
only is hereby imposed upon Respondent No. 7-HPSEB. The penalty be
deposited with the Secretary of the Commission within a period of 30
days from today. Additional penalty for continuing failure @ Rs. 300/-
only per day is further imposed on HPSEB and shall be ipso facto
recoverable immediately after January 15, 2002 until the date of
compliance to the Commission’s satisfaction to be so notified by the
Commission. The Board shall submit the Status / Action taken reports
on the fifteenth day of every month until compliance is made.”

13. By the time the order was passed by the Commission it was subject
to challenge in appeal before the High Court under Section 27 of
the 1998 Act, which reads as follows:-

“27. Appeal to High Court in certain cases. – (1) Any person aggrieved
by any decision or order of the State Commission may file an appeal to
the High Court.

(2) Except as aforesaid, no appeal or revision shall lie to any
court from any decision or order of the State Commission.
(3) Every appeal under this section shall be preferred within sixty
days from the date of communication of the decision or order of the
State Commission to the person aggrieved by the said decision or
order.

Provided that the High Court may entertain an appeal after the expiry
of the said period of sixty days if it is satisfied that the aggrieved
person had sufficient cause for not preferring the appeal within the
said period of sixty days.”

14. It is not in dispute that when the appeals were preferred under
Section 27 of the 1998 Act pending before the High Court awaiting
adjudication the 2003 Act was enacted. Chapter XI of the 2003 Act
deals with “Appellate Tribunal for Electricity”. Section 110 deals
with establishment of appellate tribunal. The said provision reads
as under:-

“110. Establishment of Appellate Tribunal. – The Central Government
shall, by notification, establish an Appellate Tribunal to be known as
the Appellate Tribunal for Electricity to hear appeals against the
orders of the adjudicating officer or the Appropriate Commission
[under this Act or any other law for the time being in force].”

15. Section 111 provides for an appeal to the appellate tribunal. Sub-
Sections (1) and (2) being relevant for the present purpose are
reproduced below:-

“111. Appeal to Appellate Tribunal – (1) Any person aggrieved by an
order made by an adjudicating officer under this Act (except under
section 127) or an order made by the Appropriate Commission under this
Act may prefer an appeal to the Appellate

Tribunal for Electricity: Provided that any person appealing against
the order of the adjudicating officer levying and penalty shall, while
filling the appeal , deposit the amount of such penalty: Provided
further that where in any particular case, the Appellate Tribunal is
of the opinion that the deposit of such penalty would cause undue
hardship to such person, it may dispense with such deposit subject to
such conditions as it may deem fit to impose so as to safeguard the
realisation of penalty.

(2) Every appeal under sub-section (1) shall be filed within a period
of forty-five days from the date on which a copy of the order made by
the adjudicating officer or the Appropriate Commission is received by
the aggrieved person and it shall be in such form, verified in such
manner and be accompanied by such fee as may be prescribed:

Provided that the Appellate Tribunal may entertain an appeal after the
expiry of the said period of forty-five days if it is satisfied that
there was sufficient cause for not filing it within that period.”

16. From the aforesaid provision it is clear as crystal that a
different forum of appeal has been created under the new
legislation with certain conditions.

17. At this stage, we may usefully refer to Section 185 which deals
with Repeal and Saving. It reads as follows:-

“185. Repeal and saving. -(1) Save as otherwise provided in this Act,
the Indian Electricity Act, 1910 (9 of 1910, the Electricity (Supply)
Act, 1948 (54 of 1948) and the Electricity Regulatory Commissions Act,
1998 (14 of 1998) are hereby repealed.

(2) Notwithstanding such repeal, –

(a) anything done or any action taken or purported to have been done
or taken including any rule, notification, inspection, order or notice
made or issued or any appointment, confirmation or declaration made or
any licence, permission, authorisation or exemption granted or any
document or instrument executed or any direction given under the
repealed laws shall, in so far as it is not inconsistent with the
provisions of this Act, be deemed to have been done or taken under the
corresponding provisions of this Act.

(b) the provisions contained in sections 12 to 18 of the Indian
Electricity Act, 1910 (9 of 1910) and rules made thereunder shall have
effect until the rules under section 67 to 69 of this Act are made;

(c) The Indian Electricity Rules, 1956 made under section 37 of the
Indian Electricity Act, 1910 (9 of 1910) as it stood before such
repeal shall continue to be in force till the regulations under
section 53 of this Act are made;

(d) all rules made under sub-section (1) of section 69 of the
Electricity (Supply) Act, 1948 (54 of 1948) shall continue to have
effect until such rules are rescinded or modified, as the case may be;

(e) all directives issued, before the commencement of this Act, by a
State Government under the enactments specified in the Schedule shall
continue to apply for the period for which such directions were issued
by the State Government.

(3) The provisions of the enactments specified in the Schedule, not
inconsistent with the provisions of this Act, shall apply to the
States in which such enactments are applicable.

(4) The Central Government may, as and when considered necessary, by
notification, amend the Schedule.

(5) Save as otherwise provided in sub-section (2), the mention of
particular matters in that section, shall not be held to prejudice or
affect the general application of section 6 of the General Clauses
Act, 1897 (10 of 1897), with regard to the effect of repeals.”

18. It is submitted by Mr. Jaideep Gupta, learned senior Counsel that
when the 1998 Act has been repealed and a new legislation has come
into force the intention of the legislature is clear to the effect
that the appeals are to be heard by the newly constituted appellate
tribunal. Learned senior counsel would also contend that if the
interpretation placed by the High Court is accepted then there
would be two appellate authorities after the enactment of the 2003
Act which would lead to an anomalous situation. In this context
Mr. Gupta has commended us to the authorities in State of Punjab v.
Mohar Singh[1], Brihan Maharashtra Sugarsyndicate Ltd. v. Janardan
Ramchandra Kulkarni and Others[2], Manphul Singh Sharma v. Ahmedi
Begum (Smt) (since deceased) through her alleged legal
representative/successors (A) M.A. Khan (B) Delhi Wakf Board[3],
Commissioner of Income Tax, Bangalore v. R. Sharadamma[4] and
Commissioner of Income Tax, Orissa v. Dhadi Sahu [5].

19. In Mohar Singh (supra), the Court has ruled thus:-
“Whenever there is a repeal of an enactment, the consequences laid
down in section 6 of the General Clauses Act will follow unless, as
the section itself says, a different intention appears. In the case of
a simple repeal there is scarcely any room for expression of a
contrary opinion. But when the repeal is followed by fresh legislation
on the same subject we would undoubtedly have to look to the
provisions of the new Act, but only for the purpose of determining
whether they indicate a different intention. The line of enquiry would
be, not whether the new Act expressly keeps alive old rights and
liabilities but whether it manifests an intention to destroy them. We
cannot therefore subscribe to the broad proposition that section 6 of
the General Clauses Act is ruled out when there is repeal of an
enactment followed by a fresh legislation. Section 6 would be
applicable in such cases also unless the new legislation manifests an
intention incompatible with or contrary to the provisions of the
section. Such incompatibility would have to be ascertained from a
consideration of all the relevant provisions of the new law and the
mere absence of a saving clause is by itself not material. It is in
the light of these principles that we now proceed to examine the facts
of the present case.”
[Underlining is ours]

20. In Messrs. Hoosein Kasam Dada (India) Ltd. v. The State of Madhya
Pradesh and others[6], this Court was considering the effect of
amendment of provisions of Central Provinces and Berar Sales Tax
Act. Section 22(2) prior to the amendment of the Act stipulated
that no appeal against an order of assessment with or without
penalty could be entertained by the appellate authority unless it
was satisfied that such amount of tax or penalty, or both, as the
appellant had admitted due to him had been paid. The amended
provision laid a postulate that appeal had to be admitted subject
to the satisfaction of proof of payment of tax in appeal to which
the appeal had been preferred. It was contended that the appellant
was covered under the unamended provision and that he had not
admitted any tax and hence, he was not liable to deposit any sum
along with the appeal. It was urged before this Court that the
restriction imposed by the amending Act could not affect his right
to appeal as the same was a vested right prior to the amendment at
the time of commencement of the proceeding under the Act. Dealing
with the said contention, the Court opined that a right of appeal
is not merely a matter of procedure but a matter of substantive
right. It was also held that the right of appeal from the decision
of an inferior tribunal to a superior tribunal becomes vested in a
party when proceedings are first initiated and before a decision is
given by the inferior Court. It has been further observed that
such a vested right cannot be taken away except by express
enactment or necessary intendment and an intention to interfere
with or to impair or imperil such a vested right cannot be presumed
unless such intention is clearly manifested by express words or
necessary implication. Eventually, the Court ruled that as the old
law continues to exist for the purpose of supporting the pre-
existing right of appeal and that old law must govern the exercise
and enforcement of that right of appeal and there is no question of
applying the amended provision preventing the exercise of that
right.

21. In this context, we may refer with profit to the Constitution Bench
judgment in Garikapati Veeraya v. N. Subbiah Choudhry and
others[7]. In the said decision, the Constitution Bench referred
to the leading authority of the privy council in Colonial Sugar
Refining Company Ltd. v. Irving[8]. The Constitution Bench
observed that the doctrine laid down in the decision of the privy
council in Colonial Sugar Refining Company Ltd. (supra) has been
followed and applied by the Courts in India. The passage that was
quoted from the Privy Council’s judgment is as follows:-
“As regards the general principles applicable to the case there was no
controversy. On the one hand, it was not disputed that if the matter
in question be a matter of procedure only, the petition is well
founded. On the other hand, if it be more than a matter of procedure,
if it touches a right in existence at the passing of the Act, it was
conceded that, in accordance with a long line of authorities extending
from the time of Lord Coke to the present day, the appellants would be
entitled to succeed. The Judiciary Act is not retrospective by express
enactment or by necessary intendment. And therefore the only question
is, was the appeal to His Majesty in Council a right vested in the
appellants at the date of the passing of the Act, or was it a mere
matter of procedure? It seems to their Lordships that the question
does not admit of doubt. To deprive a suitor in a pending action of an
appeal to a superior tribunal which belonged to him as of right is a
very different thing from regulating procedure. In principle, Their
Lordships see no difference between abolishing an appeal altogether
and transferring the appeal to a new tribunal. In either case there is
an interference with existing rights contrary to the well-known
general principle that statutes are not to be held to act
retrospectively unless a clear intention to that effect is
manifested.”

22. Thereafter, the larger Bench referred to number of authorities and
proceeded to cull out the principles as follows:-

“23. From the decisions cited above the following principles clearly
emerge:

(i) That the legal pursuit of a remedy, suit, appeal and second
appeal are really but steps in a series of proceedings all connected
by an intrinsic unity and are to be regarded as one legal proceeding.

(ii) The right of appeal is not a mere matter of procedure but is a
substantive right.

(iii) The institution of the suit carries with it the implication
that all rights of appeal then in force are preserved to the parties
thereto till the rest of the career of the suit.

(iv) The right of appeal is a vested right and such a right to
enter the superior court accrues to the litigant and exists as on and
from the date the lis commences and although it may be actually
exercised when the adverse judgment is pronounced such right is to be
governed by the law prevailing at the date of the institution of the
suit or proceeding and not by the law that prevails at the date of its
decision or at the date of the filing of the appeal.

(v) This vested right of appeal can be taken away only by a
subsequent enactment, if it so provides expressly or by necessary
intendment and not otherwise.”

23. On a proper understanding of the authority in Garikapati Veeraya
(supra), which relied upon the Privy Council decision, three basic
principles, namely, (i) the forum of appeal available to a suitor in
a pending action of an appeal to a superior tribunal which belongs to
him as of right is a very different thing from regulating procedure;
(ii) that it is an integral part of the right when the action was
initiated at the time of the institution of action; and (iii) that if
the Court to which an appeal lies is altogether abolished without any
forum constituted in its place for the disposal of pending matters or
for lodgment of the appeals, vested right perishes, are established.
It is worth noting that in Garikapati Veeraya (supra), the
Constitution Bench ruled that as the Federal Court had been
abolished, the Supreme Court was entitled to hear the appeal under
Article 135 of the Constitution, and no appeal lay under Article 133.
The other principle that has been culled out is that the transfer of
an appeal to another forum amounts to interference with existing
rights which is contrary to well known general principles that
statutes are not to be held retrospective unless a clear intention to
that effect is manifested.

24. In Dhadi Sahu (supra), it has been held thus:-

“18. It may be stated at the outset that the general principle is that
a law which brings about a change in the forum does not affect pending
actions unless intention to the contrary is clearly shown. One of the
modes by which such an intention is shown is by making a provision for
change-over of proceedings, from the court or the tribunal where they
are pending to the court or the tribunal which under the new law gets
jurisdiction to try them.

xxx xxx xxx
21. It is also true that no litigant has any vested right in the
matter of procedural law but where the question is of change of forum
it ceases to be a question of procedure only. The forum of appeal or
proceedings is a vested right as opposed to pure procedure to be
followed before a particular forum. The right becomes vested when the
proceedings are initiated in the tribunal or the court of first
instance and unless the legislature has by express words or by
necessary implication clearly so indicated, that vested right will
continue in spite of the change of jurisdiction of the different
tribunals or forums.”

25. At this stage, we may state with profit that it is a well settled
proposition of law that enactments dealing with substantive rights
are primarily prospective unless it is expressly or by necessary
intention or implication given retrospectivity. The aforesaid
principle has full play when vested rights are affected. In the
absence of any unequivocal expose, the piece of Legislation must
exposit adequate intendment of Legislature to make the provision
retrospective. As has been stated in various authorities referred
to hereinabove, a right of appeal as well as forum is a vested right
unless the said right is taken away by the Legislature by an express
provision in the Statute by necessary intention.

26. Mr. Gupta has endeavoured hard to highlight on Section 111 of the
2003 Act to sustain the stand that there is an intention for change
of forum. It is the admitted position that Legislature by expressed
stipulation in the new legislation has not provided for transfer of
the pending cases as was done by the Parliament in respect of service
matters and suits by financial institutions/banks by enactment of
Administrative Tribunal Act, 1985 and Recovery of Debts due to Banks
and Financial Institution Act, 1993. No doubt right to appeal can be
divested but this requires either a direct legislative mandate or
sufficient proof or reason to show and hold that the said right to
appeal stands withdrawn and the pending proceedings stand transferred
to different or new appellate forum. Creation of a different or a
new appellate forum by itself is not sufficient to accept the
argument/contention of an implied transfer. Something more
substantial or affirmative is required which is not perceptible from
the scheme of the 2003 Act.

27. It is urged by Mr. Gupta that Section 6 of the General Clauses Act
would not save the vested right of forum in view of the language
employed in Section 185(2) of the 2003 Act. In this context, we may
usefully refer to Ambalal Sarabhai Enterprises Ltd. v. Amrit Lal &
Co. and Another[9] wherein the learned Judges referred to the opinion
expressed in Kolhapur Canesugar Works Ltd. v. Union of India[10] and
distinguishing the same observed as follows:-

“18. In Kolhapur Canesugar Works Ltd. v. Union of India, this Court
held: (SCC p. 551, para 37)

“37. The position is well known that at common law, the normal effect
of repealing a statute or deleting a provision is to obliterate it
from the statute-book as completely as if it had never been passed,
and the statute must be considered as a law that never existed.”

19. Relying on this the submission for the tenant is, if the repealing
statute deletes the provisions, it would mean they never existed hence
pending proceedings under the Rent Act cannot continue. This
submission has no merit. This is not a case under the Rent Act, also
not a case where Section 6 of the General Clauses Act is applicable.
This is a case where repeal of rules under the Central Excise Rules
was under consideration. This would have no bearing on the question we
are considering, whether a tenant has any vested right or not under a
Rent Act.”

28. We have referred to the aforesaid paragraphs as Mr. Gupta has
contended that when there is repeal of an enactment and substitution
of new law, ordinarily the vested right of a forum has to perish. On
reading of Section 185 of the 2003 Act in entirety, it is difficult
to accept the submission that even if Section 6 of the General
Clauses Act would apply, then also the same does not save the forum
of appeal. We do not perceive any contrary intention that Section 6
of the General Clauses Act would not be applicable. It is also to be
kept in mind that the distinction between what is and what is not a
right by the provisions of the Section 6 of the General Clauses Act
is often one of great fitness. What is unaffected by the repeal of a
statute is a right acquired or accrued under it and not a mere hope,
or expectation of, or liberty to apply for, acquiring right (See M.S.
Shivananda v. Karnataka State Road Transport Corporation and
Others[11]).

29. In this context, a passage from Vijay v. State of Maharashtra and
Others[12] is worth noting:-

“….It is now well settled that when a literal reading of the
provision giving retrospective effect does not produce absurdity or
anomaly, the same would not be construed to be only prospective. The
negation is not a rigid rule and varies with the intention and purport
of the legislature, but to apply it in such a case is a doctrine of
fairness.”

30. We have referred to the aforesaid passage to hold that tested on the
touchstone of doctrine of fairness, we are also of the opinion that
the legislature never intended to take away the vested right of
appeal in the forum under the 1998 Act.

31. On the basis of the aforesaid analysis it can safely be concluded
that the conclusion of the High Court that it had jurisdiction to
hear the appeal is absolutely flawless.

32. The next aspect that emanates for consideration is that whether the
finding recorded by the High Court that the Commission has no
authority to issue directions or to impose penalty as it had become
functus officio is correct or not. We may state here that the
learned counsel appearing for the parties very fairly stated that the
High Court was not correct in using the expression that the
Commission had become functus officio. Learned counsel for the
parties, however, urged that the High Court, by stating that the
Commission had become functus officio, it meant after the Commission
had fixed the tariff it had no power to give directions or proceed
with monitoring for the purpose of compliance of the directions. It
is submitted by Mr. Ganesan, learned counsel for the respondent, that
Section 22 occurring in Chapter V of the 1998 Act deals with powers
and functions of the State Commission and for exercise of power of
Board under Section 22(2) a notification in the official Gazette by
the State Government is required to be issued, but the same was not
issued when the Commission passed the order and hence, it is bereft
of jurisdiction. In oppugnation of the said submission, Mr. Gupta,
learned senior counsel appearing for the Commission, has submitted
that though no notification under Section 22(2) of the 1998 Act has
been issued, yet the directions which had been issued can fall within
the ambit of Section 22(1)(d) of the 1998 Act.

33. To appreciate the said submission we may refer to Section 22(1)(d) of
the 1998 Act. It reads as follows: –

“22. Functions of State Commission. – (1) Subject to the provisions
of Chapter III, the State Commission shall discharge the following
functions, namely: –

xxx xxx xxx

d) to promote competition, efficiency and economy in the activities of
the electricity industry to achieve the objects and purposes of
this Act.”

The language employed in Section 22(1)(d) has to be understood in its
proper connotative expanse. It enables the State Commission to carry out
the function for promoting competition, efficiency and economy in the
activities of the electricity industry to achieve the objects and purposes
of the Act. We find that the State Commission under Section 22(1)(d) was
conferred power to address to various facets and we see no reason that the
terms, namely, “efficiency, economy in the activity of the electricity
industry” should be narrowly construed. That apart, it would not be seemly
to say that under Section 22(1) of the 1998 Act the Commission had only the
power to fix the tariff and no other power. Had that been so, the
legislature would not have employed such wide language in Section 22(1)(d).
At this stage, we may also note that the powers enumerated under sub-
section (2) of Section 22 are more enumerative in nature and the
jurisdiction conferred comparatively covers more fields. In the present
case, if we read the directions issued by the Commission in proper
perspective, the same really do not travel beyond the power conferred under
Section 22(1)(d) of the 1998 Act. We are inclined to think so as all of
them can be connected with the tariff fixation and with the associated
concepts, namely, purpose to promote competition, efficiency and economy
in the activities of the electricity industry regard being had to achieve
the objects and purposes of the Act.

34. It is not inapposite to take note of the fact that the Board had
agreed to comply and submit the report. Though the Commission later
on has found some fault with the Board, yet we factually find on a
close perusal of the explanation by the Board that there has been
real substantial compliance with the directions. In this factual
backdrop, it was not correct on the part of the Commission to impose
penalty on the Board. However, we may hasten to add that under the
2003 Act constitution of the State Commission is governed by Section
82. Section 86 deals with the function of the State Commission. On
a reading of Section 86 we find that at present no notification is
required to be issued to confer any power on the State Commission.
It is conferred and controlled by the statute. If anything else is
required to be done in praesenti, the Commission is at liberty to
proceed under the provisions of the 2003 Act. Be it clarified, our
grant of liberty may not be understood to have said that the
Commission can take any action arising out of its earlier order dated
29.10.2001 or any subsequent orders passed thereon. We have said so,
for the Commission and a statutory Board can really work to achieve
the objects and purposes of the 2003 Act.

35. The appeals stand disposed of in the above terms leaving the parties
to bear their respective costs.
………………………..J.
[Anil R. Dave]
………………………..J.
[Dipak Misra]

New Delhi;
October 03, 2013.
———————–
[1] (1955) 1 SCR 893
[2] AIR 1960 SC 794
[3] (1994) 5 SCC 465
[4] (1996) 8 SCC 388
[5] 1994 Supp (1) SCC 257
[6] AIR 1953 SC 221
[7] AIR 1957 SC 540
[8] 1905 AC 369
[9] (2001) 8 SCC 397
[10] (2000) 2 SCC 536
[11] (1980) 1 SCC 149
[12] (2006) 6 SCC 289

 

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