Case Note & Summary
The Municipal Corporation of Greater Mumbai (MCGM), a statutory corporation and local authority, filed a writ petition under Article 226 of the Constitution of India challenging Regulation 4.10 read with Regulations 4.1 and 4.7 of the Maharashtra Electricity Regulatory Commission (Standards of Performance of Distribution Licensees, Period for Giving Supply and Determination of Compensation) Regulations. The MCGM, through its Brihanmumbai Electric Supply & Transport Undertaking (BES&T), is a distribution licensee. The impugned regulation requires distribution licensees to pay compensation to consumers for failure to provide new electricity connections within the stipulated time. The MCGM argued that Regulation 4.10 is ultra vires the Electricity Act, 2003, particularly Section 181, and that it imposes a penalty without authority. The respondents, including the Maharashtra Electricity Regulatory Commission (MERC) and Tata Power Company Limited, defended the regulation as a valid standard of performance under Section 57 of the Act. The court analyzed the scheme of the Electricity Act, 2003, noting that Section 43 imposes a duty on distribution licensees to supply electricity within one month of application. Section 57 empowers the State Commission to specify standards of performance, and Section 181 provides the rule-making power. The court held that Regulation 4.10 is a valid exercise of power under Section 181 read with Section 57, and is not ultra vires. The regulation provides for compensation, not a penalty, and is a mechanism to enforce the duty under Section 43. The court also noted that the regulation is not arbitrary or unreasonable. The petition was dismissed, and the rule was discharged.
Headnote
A) Electricity Law - Validity of Regulations - Ultra Vires Challenge - Regulation 4.10 of MERC (Standards of Performance of Distribution Licensees, Period for Giving Supply and Determination of Compensation) Regulations - The petitioner, MCGM, challenged Regulation 4.10 as being beyond the rule-making power under Section 181 of the Electricity Act, 2003. The court held that Regulation 4.10 is a valid exercise of power under Section 181 read with Section 57 of the Act, and is not ultra vires. The regulation provides for compensation to consumers for failure to provide new connections within the stipulated time, which is a legitimate standard of performance. (Paras 1-24) B) Electricity Law - Duty to Supply - Section 43 of Electricity Act, 2003 - The court held that Section 43 imposes a duty on distribution licensees to supply electricity to premises within one month of application. Regulation 4.10 is a mechanism to enforce this duty by requiring compensation for delay. The regulation does not impose a penalty but provides a remedy for consumers. (Paras 10-15) C) Electricity Law - Standards of Performance - Section 57 of Electricity Act, 2003 - The court held that Section 57 empowers the State Commission to specify standards of performance for licensees. Regulation 4.10 is a standard of performance and is within the scope of Section 57. The regulation is not arbitrary or unreasonable. (Paras 16-20)
Issue of Consideration
Whether Regulation 4.10 of the MERC (Standards of Performance of Distribution Licensees, Period for Giving Supply and Determination of Compensation) Regulations is ultra vires the Electricity Act, 2003 and the Constitution of India.
Final Decision
The petition is dismissed. Rule is discharged. No order as to costs.
Law Points
- Regulation 4.10 is intra vires the Electricity Act
- 2003
- Section 43 imposes a duty to supply electricity
- Section 57 empowers MERC to specify standards of performance
- Regulation 4.10 is a valid exercise of power under Section 181 read with Section 57
- Compensation for delayed supply is not a penalty but a remedy for consumer
- MCGM as a distribution licensee is bound by MERC regulations.
