Prospective withdrawal of tariff concessions and survival of pre-existing electricity dues under later limitation provisions.

A policy withdrawal of concessional electricity tariff for tourism units was held to operate only prospectively, because retrospective curtailment would defeat accrued benefits already acted upon by beneficiaries and required clear authority. Dues for electricity charges that had accrued before the Electricity Act, 2003 were not barred by Section 56(2), since that provision applies to liabilities governed by the later Act and does not extinguish earlier liabilities preserved by the saving and general saving rules. The judgment therefore protected accrued tariff benefits while confirming recoverability of pre-2003 electricity dues.

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Issues: (i) Whether the withdrawal of concessional electricity tariff granted to tourism units could operate retrospectively and defeat accrued benefits. (ii) Whether bills for electricity dues arising before the Electricity Act, 2003 could be barred by Section 56(2) of that Act.

Issue (i): Whether the withdrawal of concessional electricity tariff granted to tourism units could operate retrospectively and defeat accrued benefits.

Analysis: The concessional tariff was part of a policy framework intended to support tourism as an industry and had been acted upon by the beneficiaries by making investments and obtaining classification certificates. The State was competent to alter policy and withdraw concessions in public interest, but an administrative or policy direction is ordinarily prospective unless retrospectivity is expressed or necessarily implied. The Board acted under policy directions binding upon it under the governing electricity statute, yet the withdrawal could not be used to take away benefits already enjoyed without clear authority. A retrospective curtailment of the concession would unsettle accrued benefits and offend the presumption of prospectivity.

Conclusion: The withdrawal of concessional tariff could not validly be given retrospective effect and was effective only prospectively; this issue was decided in favour of the appellants.

Issue (ii): Whether bills for electricity dues arising before the Electricity Act, 2003 could be barred by Section 56(2) of that Act.

Analysis: The liability for electricity charges had already arisen under the earlier legal regime. Section 56(2) of the Electricity Act, 2003 operates in relation to dues governed by that Act and does not extinguish liabilities that accrued earlier. The saving provision in Section 185(5) and the effect of Section 6 of the General Clauses Act, 1897 preserved the earlier liability. Therefore, the limitation bar under Section 56(2) was not available against pre-existing dues.

Conclusion: Section 56(2) did not bar the bills for dues that had accrued before the Electricity Act, 2003; this issue was decided against the appellants.

Final Conclusion: The judgment partly protected the appellants against retrospective withdrawal of concessional tariff, while upholding the recoverability of pre-2003 electricity dues and leaving the connected appeal on instalments dismissed.

Ratio Decidendi: A policy or administrative direction withdrawing a concession is presumed prospective and cannot defeat accrued benefits retrospectively without clear authority, and limitation provisions in a later statute do not extinguish liabilities that accrued under the earlier law unless the statute so provides.

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