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Paschimanchal Vidyut Vitran Nigam Ltd. v. Adarsh Textiles

Civil Appeal · Neutral citation not assigned (Civil Appeal No. 10707 of 2014)Decided 3 Dec 2014
Civil Appeal No. 10707 of 2014
Justice J.S. Khehar · Justice Arun Mishra

Background

Uttar Pradesh introduced subsidised flat-rate electricity for power loom weavers in specified low-voltage categories. Larger textile industries with HV-2 connections sought the same benefit, and the Electricity Regulatory Commission initially extended it through a clarification. Several High Court orders accepted the industries' claims, while Vikas Textiles separately challenged a demand for unsubsidised charges.

Decision Breakdown

The Supreme Court allowed the four utility appeals and dismissed Vikas Textiles' appeal. The State had confined the subsidy to LMV-2 and LMV-6 consumers and had made no subsidy provision or assurance for HV-2 industries. The Commission could determine tariffs but could not unilaterally expand the State's subsidy commitment. Supply agreements following its clarification did not bind the State to an unauthorised subsidy, and promissory estoppel did not apply. The demand against Vikas Textiles for April to December 2007 was upheld.

Lesson Learnt

Eligibility for an electricity subsidy depends on the government's authorised scheme, including its consumer categories. A regulator's tariff decision or a distributor's agreement cannot by itself require the State to finance a subsidy it never granted.

Official source (sci.gov.in)View Judgment (PDF)

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