Licensee Appointed As Telegraph Authority Can Determine Compensation For Using Land To Instal Electricity Transmission Line: Bombay High Court

The Bombay High Court recently held that a transmission licensee appointed as the Telegraph Authority also has the power to determine the compensation amount along with the power to pay compensation for using land for installing electricity transmission lines.

Justice Avinash G Gharote of the Nagpur bench observed that the power to pay compensation under section 10(d) of the Indian Telegraph Act, 1885 includes the power to determine compensation as without determination of compensation, there cannot be any payment.

“The contention of Mr. Kothari, learned counsel for the respondent No.4 (landowner) that section 10(d) of the Telegraph Act only contemplates a power to pay and not to determine the compensation and the compensation has to be determined by the District Collector, in my considered opinion is misconceived…”, the court held.

If the District Collector had the authority to determine the compensation, section 10(d) of the Telegraph Act would have contained such a provision, the court observed.

The court allowed a writ petition by Maharashtra Eastern Grid Power Transmission Company Ltd. challenging an order of the Sub-Divisional Officer (SDO) in Sindkhedraja dated September 05, 2018. The order determined compensation for using the land of one Dilip Bikaji Dhete for installing an electricity transmission line.

The petitioner had been appointed as a licensee by the Maharashtra State Electricity Regulatory Commission (MERC) to establish and operate transmission lines.

Advocate DV Chauhan for the petitioner relied on an order dated June 13, 2011, wherein the petitioner was bestowed with the powers of a Telegraph Authority. The petitioner was specifically made the Appropriate Authority to exercise powers of the Telegraph Authority section 164 (Exercise of powers of Telegraph Authority in certain cases) of the Electricity Act, Chauhan highlighted.

This, he argued, reinforced the exclusive authority vested in the petitioner to determine compensation under section 10(d) of the Telegraph Act. Thus, only the District Judge under section 16(3) of the Telegraph Act has jurisdiction to entertain a dispute over the compensation amount, Chauhan contended.

Rule 3(1) to 3(3) of the Maharashtra Electricity Work of Licensee Rules, 2012 (MEWL Rules) provide that the District Collector shall determine the compensation to be paid by the licensee for placing electric supply lines, subject to revision by MERC. However, Rule 3(4) preserves the licensee's powers under section 164 of the Electricity Act, Chauhan argued. Therefore, the SDO would not have any jurisdiction at all to determine the compensation, he argued.

Advocate JH Kothari for the landowner supported the SDO's order, arguing that the Telegraph Authority under section 10(d) of the Telegraph Act only has the power to pay the compensation and not to determine it.

He contended that the petitioner's powers were subject to exceptions outlined in a Government Resolution. He argued that the SDO, fortified by subsequent GRs, possessed the rightful authority to determine compensation. He said that as per the MEWL Rules, 2012, the District Collector or the officer authorized by him has the power to determine the compensation.

He also contended that since the order of the MERC directing the Collector to determine the compensation was not challenged, it has attained finality and therefore, only the Collector through the delegate i.e., the SDO in this matter, could determine the compensation.

The court noted that the jurisdiction conferred upon the licensee under section 164 of the Electricity Act by conferring the powers of the Telegraph Authority upon it by section 10(d) of the Telegraph Act is statutory in nature. Therefore, it would prevail upon any jurisdiction created in any other authority by way of any Rules such as the MEWL Rules, as Rules are always subservient to a Statutory provision, the court held.

“Once the licensee as appointed under section 14 of the Electricity Act is constituted as a Telegraph Authority by virtue of the exercise of powers under section 164 of the Electricity Act, 2003, the erection and maintenance of the transmission line will be governed by the provisions of the Telegraph Act and not by the Electricity Act, 2003”, the court further held.

The court concluded that the petitioner, as a transmission licensee recognized as the Telegraph Authority, held a statutory and exclusive power to determine and pay compensation under section 10(d) of the Telegraph Act. The court underscored that Rule 3(4) of the MEWL Rules preserved the powers of the licensee.

The compensation awarded to a person by the licensee acting as a Telegraph Authority can only be questioned by approaching the District Judge under section 16(3) of the Telegraphic Act and not otherwise, the court further held.

The court declared the SDO's order dated as devoid of jurisdiction and quashed it. The court categorized the proceedings initiated by the landowner before MERC as similarly lacking in jurisdiction.

Case no. – Writ Petition No. 469 of 2019

Case Title – Maharashtra Eastern Grid Power Transmission Company Ltd., v. Collector of Buldhana and Ors.