Summary
The Court held that the State Electricity Commission lacked power under Section 86(1)(f) to refer this open-access consumer dispute to arbitration. Although the company owned a captive generating plant, the dispute concerned wheeling electricity to its own units in their capacity as consumers. That provision governed disputes between licensees and generating companies. Consent did not cure the inherent jurisdictional defect. The award was non est, but the High Court’s merits observations would not obstruct other lawful remedies.
Issues
- Whether the Commission could refer an open-access consumer dispute to arbitration under Section 86(1)(f).
- Whether consent or failure to raise jurisdiction before the Commercial Court precluded the objection.
Provisions considered
- Section 86(1)(f), Electricity Act, 2003The adjudicatory and arbitral-reference power was confined to disputes between licensees and generating companies and did not cover this consumer dispute. (¶¶ 13, 17, 20, 21, 22)
- Section 42(5)–(8), Electricity Act, 2003The Act separately provided consumer-grievance mechanisms, including representation to the designated Ombudsman. (¶¶ 13, 18, 19)
Held
- An inherent absence of jurisdiction could be raised at any stage, including collateral proceedings. The parties’ consent to the reference could not validate an appointment outside the Commission’s statutory power. (¶¶ 14, 15, 16, 17)
- For these open-access agreements, the company acted as consumer in supplying its own units through the distribution system. Section 86(1)(f) did not extend to licensee-consumer disputes, for which separate mechanisms existed. (¶¶ 3, 7, 11, 17, 18, 19)
- Reading the conjunction in Section 86(1)(f) as permitting adjudication or reference did not enlarge the categories of parties covered. The arbitrator’s appointment was invalid and the resulting award non est. (¶¶ 20, 21, 22)
- The High Court’s additional observations on the award’s merits would not stand in the appellant’s way if it pursued another remedy available in law. (¶ 23)
Result
Appeal disposed of. Award held non est for want of jurisdiction in the Commission’s appointment of the arbitrator. High Court’s merits observations not to obstruct any other remedy the appellant may pursue in law.