Concessional electricity tariff under a rehabilitation scheme cannot be withdrawn on a wrong expiry assumption or without hearing the beneficiary.

A concessional electricity tariff granted to a sick industrial unit under a rehabilitation scheme was treated as running from the unit's recommencement of production, not from the date of the original Government Order. Withdrawal on the mistaken premise that the concession period had already expired was therefore unsustainable. The withdrawal was also invalid because it was issued without notice or an opportunity of hearing, even though it affected an existing benefit with civil consequences. A later justification raised in the counter could not cure the defect in the impugned withdrawal order.

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Issues: Whether the withdrawal of the concessional electricity tariff granted to the industrial unit could be sustained when the concession period had not been validly shown to have expired and no notice or opportunity of hearing was given before the withdrawal.

Analysis: The concessional tariff was granted as part of a rehabilitation package for revival of a sick industrial unit and was understood by the parties and reflected in the rehabilitation scheme to operate for a period of four years from the commencement of production. The record showed that the Electricity Board itself had treated the concession as effective from the reopening of the unit and not from the date of the original Government Order. The impugned withdrawal proceeded on an incorrect basis as to the starting point of the concession period. The order was also passed without notice to the petitioner, though withdrawal of an existing benefit carrying civil consequences required observance of natural justice. A new ground raised in the counter could not cure the defect in the impugned order.

Conclusion: The withdrawal of the concessional tariff was unsustainable and was set aside. The writ petitions were allowed in favour of the assessee.

Ratio Decidendi: A concession granted under a rehabilitation scheme cannot be withdrawn on an erroneous assumption about its duration and without affording the beneficiary an opportunity of hearing when the withdrawal has civil consequences.

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