- (1.) Leave granted in SLP(C) No.4596 of 1999.
(2.) These appeals involve the interpretation of a tariff provision in the provisional supply and distribution Licence issued under the Orissa Electricity Reform Act, 1995 ('Act' for short). 2. The State of Orissa enacted the said Act, to restructure and rationalize the generation, transmission, distribution and supply of electricity in the state. 2.1) Section 3 of the Act provided for the establishment of the Orissa Electricity Regulatory Commission ('Commission' for short), to discharge functions including the issue of licences in accordance with the Act and determine the conditions of such licences. 2.2) Chapter VI of the Act deals with licensing of transmission and supply. Section 14(iv) of the said Act authorized the State Government to grant provisional licences for a period not exceeding twelve months, for carrying on the business of transmission or supply of electricity, as a transitional measure till the establishment of the Orissa Electricity Regulatory Commission ('Commission' for short). 2.3) Section 13 of the Act provided that the Grid Corporation of India Ltd. ('GRIDCO' for short, the appellant herein) incorporated with the main object of engaging in the "business powers" of the state government under section 12 of the Act, would be the principal company to undertake the planning and co-ordination in regard to transmission and to determine the electricity requirements in the state in co-ordination with various stakeholders. 2.4 Chapter VIII of the Act dealt with tariffs. It contained two sections - section 26 dealing with licencee's revenues and tariffs and section 27 dealing with finances of licencees.
(3.) In exercise of the power under section 14(iv) of the Act, the State Government, by notification dated 30.3.1996, issued three licences to the appellant - the Provisional Orissa Transmission Licence 1996, Provisional Orissa Supply Licence (Bulk Supply) 1966 and the Provisional Orissa Supply Licence (Retail Supply and Distribution), 1996 -- authorising the appellant to engage in the business of transmission, bulk supply and retail supply and distribution of electrical energy within the State of Orissa, upon the terms and conditions mentioned in those licences. In pursuance of such licences, the appellant took over the transmission, distribution and supply of electricity from the Orissa State Electricity Board ('OSEB' for short) with effect from 1.4.1996. Part III of the Retail Supply and Distribution Licence (similar provisions were contained in the Provisional Transmission Licence and Provisional Bulk Supply Licence also) related to "Tariffs" and it is extracted below : "9. Basis of Charges 9.1 The charges made by the licensee shall not exceed on average 117% of those permitted under the interim tariffs issued by the State Government and in force on 1st April 1996. 9.2 The authority granted in clause 9.1 expires with the expiration of this license." The "interim tariffs in force as on 1.4.1996 issued by the state government", referred to in the said clause 9.1 were the tariffs which came into effect on 5.11.1995, contained in the Notification dated 28.10.1995 issued by the Orissa State Electricity Board, predecessor of GRIDCO.;