The Supreme Court has held that industries which had set up units in Uttar Pradesh accepting the offer of a development rebate of 10 per cent in electricity charges are entitled to it, though the state government had later withdrawn the benefit.
A division bench consisting of Justice S B Majmudar and Justice K T Thomas allowed the appeals of a large number of industries which had challenged the ruling of the Allahabad high court taking a contrary view on this controversy. Their grievance was that the government had gone back on its word to new industries seeking to establish units in different parts of the state, that they would be given the rebate for a three-year period from the date of commencement of supply of power.
However, after the establishment of the units, the government issued a notification withdrawing the benefit. The industries challenged the notification in the High Court which dismissed their petitions. Following this, the units appealed to the Supreme Court.
The industries argued that the government could not arbitrarily go back on its promise to the units which had already acted upon it. The board, on the other hand, contended that according to the terms of the contract between the board and the units, it was entitled to revise the tariff at any time.
Rejecting the boards stand, the Supreme Court stated that the new industries had merely undergone the formality of signing a standard contract to get electricity supply.
The terms only affirmed the powers of the board and by signing the form, the industries had not voluntarily or by even the remotest chance agreed to give up the benefit given to them in clear terms of the contract, the judgment clarified.
