Orissa Electricity Regulatory Commn vs Western Electricity Company of Orissa Limited and Ors.
- CitationAIRONLINE 2009 SC 460
Ratio decidendi
The rule this decision rests on
Where a regulator issues a show cause notice under Section 24(1) of the Electricity Act, 2003 proposing suspension of a licensee's licence, the notice itself is a valid step in the prescribed statutory procedure and is not rendered wholly void merely because the regulator took an ancillary action (such as appointing special officers) that exceeded its powers at the same time; the proper remedy is to annul only the excess action while preserving the notice to allow the licensee an opportunity to file representations before the regulator proceeds to pass a final order. An appellate tribunal hearing appeals against a regulator's order in the course of a show cause proceeding should not set aside the entire order on the ground that an ancillary action was ultra vires, but should instead confine its quashing order to the specific action that was without authority, leaving the regulator free to proceed with the substantive matter in accordance with the prescribed procedure.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
By an order dated 27th January, 2006, Orissa Electricity Regulatory Commission (for short `the Regulatory Commission') directed issue of notice to the respondents under proviso to Section 24(1) of the Electricity Act, 2003 (for short `the Act'), requiring them to file representations against proposed suspension of their licences. Simultaneously, the Regulatory Commission appointed three special officers to over see working of the respondents. The appeals filed by the respondents against that order were allowed by the Appellate Tribunal for Electricity (for short `the Appellate Tribunal') vide its order dated 13th December, 2006. The Appellate Tribunal set aside the order impugned in the appeals but observed that if the Regulatory Commission proposes to continue or initiate fresh action under Section 24 of the Act, then it shall do so strictly in accordance with the relevant statutory provisions and follow the procedure prescribed therein.
...2/-
-2- We have heard the learned counsel for the parties and perused the record. In our view, in the facts and circumstances of the case, the Regulatory Commission was justified in issuing notice to the respondents calling upon them to file representations against proposed suspension of their licences, but there was no warrant for appointment of special officers to over see their work. Therefore, the Appellate Tribunal had rightly annulled the appointment of the special officers. However, it could not have set aside the order of the Regulatory Commission in its entirety without properly appreciating that only show cause notice had been issued to the respondents and final order was yet to be passed by the Regulatory Commission.
Accordingly, the appeal is allowed in-part. The impugned order of the Appellate Tribunal is quashed so far as it annuls the show cause notice issued by the Regulatory Commission under Section 24(1) of the Act. Now, it would be open to the respondents to file their representations/ objections before the Regulatory Commission, which shall proceed to decide the matter in accordance with law without being influenced by the observations made in the order impugned in these appeals.
Needless to say that we have not gone to the question as to whether while issuing notice under Section 24(1) of the Act proposing suspension of the licence, the Regulatory Commission could pass an order for appointment of special officer and this question is left to be decided in appropriate case.
...3/-
-3- Civil Appeal No.2309 of 2007:
In view of the order passed in Civil Appeal No.946 of 2007, it is not necessary to pass any further order in this appeal, but we clarify that any observation made against the appellants in the impugned order shall not prejudice their cause before the Regulatory Commission.
......................J. [B.N. AGRAWAL]
......................J. [G.S. SINGHVI] New Delhi, January 05, 2009.
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