2018 (4) TMI 1945 - SC - Indian Laws

Electricity Act: High Court Judge not mandatory for State Regulatory Commissions Chair. Judicial member essential. Validity of Tamil Nadu State Commission upheld.

State of Gujarat and Ors. Versus Utility Users' Welfare Association and Ors.

The court clarified that Section 84(2) of the Electricity Act, 2003 does not mandate the appointment of a High Court Judge as Chairperson of State ... Interpretation of statute - appointment of the Chairperson - scope of the expression 'Chairperson 'may' be a Judge of a High Court for the State Commission, a Judge of the Supreme Court or the Chief Justice of a High Court for the Central Commission' - whether the expression 'may' should be read as 'shall', i.e., whether it is mandatory to have a judicial mind presiding over these Commissions in the form of a Judge? HELD THAT:- It is concluded as follows: i. Section 84(2) of the said Act is only an enabling provision to appoint a High Court Judge as a Chairperson of the State Commission of the said Act and it is not mandatory to do so. ii. It is mandatory that there should be a person of law as a Member of the Commission, which requires a person, who is, or has been holding a judicial office or is a person possessing professional qualifications with substantial experience in the practice of law, who has the requisite qualifications to have been appointed as a Judge of the High Court or a District Judge. iii. That in any adjudicatory function of the State Commission, it is mandatory for a member having the aforesaid legal expertise to be a member of the Bench. iv. The challenge to the appointment of the Chairman and Member of the Tamil Nadu State Commission is rejected as also the suo moto proceedings carried out by the Commission. v. Our judgment will apply prospectively and would not affect the orders already passed by the Commission from time to time. vi. In case there is no member from law as a member of the Commission as required aforesaid in para 2 of our conclusion, the next vacancy arising in every State Commission shall be filled in by a Member of law in terms of Clause (ii) above. Transfer petition allowed. Issues Involved:1. Interpretation of Section 84(2) of the Electricity Act, 2003 regarding the appointment of Chairperson of State Regulatory Commissions.2. Necessity of having a judicial member in the State Regulatory Commissions.3. Validity of appointments and actions taken by Tamil Nadu State Commission.Detailed Analysis:1. Interpretation of Section 84(2) of the Electricity Act, 2003:The core issue was whether the term 'may' in Section 84(2) should be read as 'shall,' making it mandatory to appoint a High Court Judge as the Chairperson of the State Regulatory Commissions. The judgment clarified that the word 'may' is permissive and not obligatory. The court emphasized that the plain reading of the statute indicates that the legislature intended to provide discretion to appoint a Judge but did not mandate it. The court stated, 'Section 84(2) of the said Act only gives the discretionary option to the State Government to appoint a Judge as the Chairperson of the State Commission. The said provision therefore, is not mandatory in nature.'2. Necessity of Having a Judicial Member in the State Regulatory Commissions:The judgment highlighted the importance of having a member with legal expertise in the State Commissions due to the judicial functions they perform, including adjudication of disputes under Section 86(1)(f). The court noted, 'It is mandatory to have a person of law as a Member of the Commission, which requires a person, who is, or has been holding a judicial office or is a person possessing professional qualifications with substantial experience in the practice of law, who has the requisite qualifications to have been appointed as a Judge of the High Court or a District Judge.' This ensures that the Commission has the necessary judicial expertise to handle its adjudicatory functions.3. Validity of Appointments and Actions Taken by Tamil Nadu State Commission:The court addressed the challenge to the appointments of the Chairman and Member of the Tamil Nadu State Commission, who were alleged to have financial biases due to their previous positions. The court found no merit in these allegations, noting that the appointments were made following the proper procedures and that the Selection Committee was presided over by a retired Judge of the High Court. The judgment stated, 'We, thus, find no merit in the plea sought to be advanced assailing either the appointment or the suo moto tariff revision.'Conclusion:1. Section 84(2) of the Electricity Act, 2003, is an enabling provision, not a mandatory one, for appointing a High Court Judge as the Chairperson of the State Commission.2. It is mandatory for the State Commission to have at least one member with legal expertise.3. Any adjudicatory function of the State Commission must include a member with legal expertise.4. The challenge to the appointments and actions of the Tamil Nadu State Commission is rejected.5. The judgment applies prospectively and does not affect past orders of the Commission.6. Future vacancies in State Commissions must be filled by a member with legal expertise if no such member is currently present.