View Case Study

Case Study Title SC Judgement gives Relief for Electricity Consumers in Mumbai
Case Study Description Case Reference: Brihan Mumbai Electricity Supply & transport under taking Versus Maharashtra Electricity Commission (MERC) & others Civil Appeal No. 4223 of 2012 in the Supreme Court of India.
Case Study Details In Mumbai BEST (Brihan Mumbai Electricity Supply & transport under taking) was enjoying a kind of monopoly in retail electricity supply even though Tata power also has the license to supply electricity in the same area. Due to various subsidies offered by the State Government and inefficient management of their transport business BEST was making big losses. But all those losses were made up by BEST by increasing the unit cost of electricity. The unit rate of electricity of BEST was 100% more than the unit rate of Tata-power. Our client Mr. Guru Prasad Shetty who is a restaurant owner was the customer of BEST. He wanted to switch over to Tata power to save on electricity bills. Tata power asked our client to get NOC from BEST to give the Tata electricity connection. BEST refused to give NOC on the ground that they are a “local authority under the Electricity Act and hence in their area nobody can supply electricity to retail customers. In short BEST wanted to maintain monopoly to supply to retail customers. The contention of the consumer was accepted by the Maharashtra electricity Regulatory commission and directed Tata Power Company to create its own infrastructure since BEST refused to wheel the power and give supply to Mr. Shetty by an order dated 22.02.2010. BEST went on an appeal to Electricity Appellate tribunal and challenged the directions of the Maharashtra Electricity Regulatory commission. Appellate Tribunal for Electricity also confirmed the order of the MERC and decided in favour of the consumer. BEST again filed an appeal before the Hon’ble Supreme Court of India. Mr. Dushyant Dave & Naphde Senior Counsels argued the case of BEST. Mr. Dhuruv Metha Senior counsel appeared for Tata power. Mr. S. Ravi Shankar Advocate Supreme Court of India (Senior Partner- Law Senate Law Firm) appeared for the consumer Mr. Guru Prasad Shetty. He argued that Tata-power has to adhere to its universal supply obligation. It cannot run away from the responsibility of establishing their own infrastructure in the license area and supply electricity to the customers. Mr. S. Ravi Shankar further argued that if the monopoly of BEST is allowed it defeats the objective of the Act to create competition among the electricity suppliers. If competition is not encouraged and ensured efficiency cannot be achieved. Hon’ble Supreme Court Bench comprising Hon’ble Justice Mr. Surinder Singh Nijjar and Mr. A. K. Sikri by a detailed Judgment dated 08.05.2014 accepted the contentions of Mr. S. Ravi Shankar and dismissed the appeals Civil Appeal No.4223 of 2012 filed by M/S. Brihan Mumbai Electricity Supply & transport under taking (BEST) and upheld the rights of the retail electricity consumers to choose the electricity supplier on the basis of the service quality and price.