Conditions of State in an agreement has to be fair and reasonable

Jharkhand State Electricity Board and Others vs. M/S Ramkrishna Forging Limited [Civil Appeal No.6145 Of 2010]

Brief: In the instant appeal of the Jharkhand State Electricity Board, the Hon’ble Supreme Court upheld the decision of the Hon’ble Jharkhand High Court allowing writ petition against order of the Board refusing to reduce the electricity load to 1325 KVM before the expiry of the term of agreement.

RELEVANT PARAGRAPH

15.  It   is   noteworthy   that   the   Jharkhand   State Electricity Board (‘the Board’) is a monopoly supplier of electricity   which   has   laid   down   its   own   terms   and conditions, regarding which the consumer has no say or choice but to sign on the dotted lines, if it wants of get electricity   load   varied   for   running   its   industry.   The Board is an instrumentality of the State. It has to be fair and reasonable. If the Regulations provide for contract load   to   be   varied   even   through   a   written communication,   then   in   our   considered   view,   in   all fairness,   though   fresh agreements   may   have   been executed at the stage of enhancement of load of the same electricity connection, the same cannot be treated as anything but an extension/amendment or modification   of   the   initial   agreement   granting   the electricity connection, which in the present case would be the agreement dated 14.04.2004. On the dictates of the Board, the consumer may have been required to sign fresh agreements for each enhancement of load, but   the   enhancement   being   for the same   electricity connection which still continues, it would merely be amendment of the initial agreement. This would also be in consonance with the provisions of the Regulations of 2005, which have to be liberally interpreted in favour of the consumer.