DARBHANGA LAHERIASARAI ELECTRIC SUPPLY CORPORATION LTD Vs. STATE OF BIHAR

JUDGEMENT

(1.) This is an application in revision against an order dismissing the appeal filed by the petitioner against an order refusing to grant ad interim injunction during the pendency of the suit filed by the petitioner.

(2.) The petitioner is a public company registered under the Indian Electricity Act, having its registered office at Darbhanga. The Company filed a suit (Title Suit No. 244 of 1967) in the Court of the Subordinate Judge. Darbhanga for a declaration that the notice issued by the Government of Bihar in the Department of Electricity dated the 21st July 1967 under Section 4 (3) of the Indian Electricity Act (hereinafter referred to as 'the Act') asking the petitioner to show cause as to why its license should not be revoked under Section 4 (1) of the Act, is without jurisdiction, illegal and mala fide. A further prayer was made in the suit for grant of a permanent injunction restraining the opposite party from revoking the licence of the petitioner.

(3.) Briefly stated the case of the plaintiff-petitioner is that on the 3rd March 1937. the State Government had granted a license to one Padma-nabh Prasad for supplying electrical energy to the town of Darbhanga. According to the terms of the license, the State Government had reserved to themselves an option to purchase the undertaking after the lapse of thirty years and to exercise the said option at the end of every ten years thereafter. In case of exercise of such option, the State Government is to pay to the licensee over and above the purchase price, a further amount of fifteen per cent as compensation for compulsory acquisition. The Company was. accordingly, floated and is since then supplying electrical energy within the municipal limits of the town of Darbhanga. Before the expiry of thirty years on the 3rd March 1967. the State Government served a notice on the Company on the 7th January 1966, intimating that they would exercise their option to purchase the undertaking after the expiry of thirty years. The petitioner made a representation. Presumably on that account and also on account of the fact, as disclosed from the statement made in the Bihar Legislature, of financial stringency with which the State Government were faced, the aforesaid notice was withdrawn. It is said that during the general elections in February 1967, the managing agent of the Firm. K. K. Bai-roliya. incurred the wrath of the communist party being a strong supporter of the congress party. On this account the communist workers of Darbhanga influenced the then Minister of Electricity Sri T. N. Jha, to acquire the Company's undertaking. The Chief Electrical Engineer of the Government of Bihar was sent to Darbhanga and he made some sort of an inquiry, and the communist party workers moved in the town making announcements with the aid of mike and loud-speaker about this fact and inviting the consumers to lodge grievances with the communist party. Soon thereafter, on the 21st July 1967 the Deputy Secretary to the Government of Bihar in the Electricity Department sent a notice under Section 4 (3) of the Act to the Company to show cause why the petitioner's license shall not be revoked under Section 4 (11 of the Act on various grounds under (a) to (e) of that section. The petitioner challenged the right of the Government to issue such notice in violation of Article 166 of the Constitution of India by its letters dated the 16th October 1967 and the 20th October 1967. It, however, filed a petition showing cause which was received by the State Government on the 21st of October 1967. It is further said that soon after the issue of the notice aforesaid, i. e. on the 27th July 1967. the State Minister Sri T. N. Jha, held a meeting in front of the Power House and gave out that the plaintiff-Company would be acquired by the State Government after the expiry of the period granted by the show cause notice. The petitioner, further said that the aforesaid notice did not disclose any ground of public interest nor any good ground justifying the revocation of the license, but the same was actuated by malice on the part of the aforesaid State Minister and the communist party workers and the petitioner, therefore, had reasonable apprehension that in spite of these facts the State Government were determined to take over the Company and revoke its license. Hence, the present suit was filed.