Retrospective electricity charge adjustment upheld; limitation ran from approval of the rating report, but interest on the unpaid price was denied.

A tripartite electricity-supply agreement fixing provisional charges with retrospective adjustment was treated as a binding contract because it aligned with the statutory scheme for determining reasonable return and did not offend the Electricity (Supply) Act, 1948 or section 23 of the Contract Act. The claim for differential charges was held to fall under the residuary limitation provision, as the right to sue arose only when the Rating Committee's report was approved, so the suit was within time. Regular accounts and secondary evidence substantially proved the claim, subject to exclusion of two unsupported items. Interest was denied because electricity is not goods for the Sale of Goods Act, 1930.

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Issues: (i) whether the tripartite agreement fixing provisional electricity charges and providing for retrospective adjustment on the Rating Committee's report was a binding contract and whether it was void for inconsistency with the Electricity (Supply) Act, 1948 and the Contract Act; (ii) whether the claim for differential electricity charges was barred by limitation; (iii) whether the plaintiff proved the amount due; and (iv) whether interest was recoverable on the unpaid price.

Issue (i): Whether the tripartite agreement fixing provisional electricity charges and providing for retrospective adjustment on the Rating Committee's report was a binding contract and whether it was void for inconsistency with the Electricity (Supply) Act, 1948 and the Contract Act.

Analysis: The agreement was signed on behalf of the Government and was intended to regulate provisional collection and later adjustment of charges after examination of the reasonableness of the increased rate. The rate demanded by the company was already within the ceiling permitted under its licence, and after the Electricity (Supply) Act, 1948 came into force, the relevant inquiry was whether the charge represented a reasonable return under the Sixth Schedule. A term giving retrospective effect to the finally approved rate did not contradict Section 57(2)(c), because the agreed rate and the rate ultimately found reasonable were the same. The agreement was therefore not inconsistent with the statutory scheme and was not hit by Section 23 of the Indian Contract Act, 1872.

Conclusion: The agreement was binding on the Government and was not void.

Issue (ii): Whether the claim for differential electricity charges was barred by limitation.

Analysis: The suit was not one for goods sold and delivered at a settled price or on agreed credit terms. The price was provisional and depended on the Rating Committee's determination. No specific article other than the residuary article fit the claim. The right to sue arose when the Government approved the Rating Committee's report, and the suit filed thereafter was within the six-year period under the residuary provision.

Conclusion: The claim was not barred by limitation.

Issue (iii): Whether the plaintiff proved the amount due.

Analysis: The company maintained regular accounts and produced secondary evidence after the original bills sent to the Government were not traceable. The Government did not specifically dispute the individual items in the list, except two bills relating to bodies that were not shown to be Government consumers. Excluding those two items, the balance of the claim stood proved on the evidence of the accounts and bills.

Conclusion: The plaintiff proved the claim except for the two disputed items, and the recoverable amount was reduced accordingly.

Issue (iv): Whether interest was recoverable on the unpaid price.

Analysis: Electricity is not goods within the Sale of Goods Act, 1930 because it is not movable property. Consequently, the statutory provision enabling interest on price in suits for sale of goods was inapplicable.

Conclusion: Interest was not recoverable.

Final Conclusion: The dismissal of the suit was set aside, the limitation and statutory objections failed, the quantified balance claim was decreed, and no interest was awarded.

Ratio Decidendi: A retrospective adjustment clause in an electricity-supply agreement is enforceable where it accords with the statutory scheme for determining reasonable return, and a claim for provisional electricity charges so determined is governed by the residuary limitation provision rather than the article applicable to goods sold and delivered.

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