State Govt Can Give Exemptions Or Relaxations To Central Electricity Authority (Measures Relating To Safety And Electric Supply) Regulations 2010 : Supreme Court

A Bench comprising Justices L. Nageswara Rao and B.R. Gavai dismissed appeal filed assailing order of the Division Bench of Kerala High Court, which, inter alia, upheld the validity of Regulation 116 of the Central Electricity Authority (Measures relating to Safety and Electric Supply) Regulations, 2010 ("Regulations").

"116. Deviations. -

(1) The Central Government or the State Government, as the case may. be, by order in writing, allow deviations in respect of matters referred in these regulations except regulation 30.

(2) The Electrical Inspector or the inspector of mines may, by order in writing, allow deviations in respect of matters referred in regulations 12 to 17, 28, 35(2)(3) and (5), 36(3), 37(1) to (iv), 41(xii), 43, 44(2), 46, 52 to 54, 57 to 61, 65, 72, 74, 78 to 91,102,107(6), (8) and (10) and 114

Explanation- Every order allowing the deviations by the Electrical Inspector or the Inspector of Mines under sub-regulation (2) shall be placed before the Central or State Government which may disallow or revise such deviations."

Background

On 31.10.2013, the Government of Kerala notified a transfer scheme revesting all the functions, properties, interests, rights, obligations and liabilities than was with Kerala State Electricity Board ("KSEB"), in Kerala State Electricity Board Limited ("KSEBL") a company fully owned by the Government of Kerala. A tripartite agreement was entered into among the State of Kerala, KSEBL and Unions and Associations of KSEB workers to assure them that the terms and conditions of service shall continue to be regulated by the extant regulations.

On 13.02.2019, by a Government Order ("GO") exemption from acquiring qualifications stipulated under Regulations 6 and 7 of the Central Electricity Authority (Measures relating to Safety and Electric Supply) Regulations, 2010 ("Regulations") was granted to the erstwhile employees.

A Writ Petition was filed before the Kerala High Court challenging the vires of Regulation 116 of the Regulations. The petitioner sought declaration that the State had no power to deviate from qualifications prescribed in Regulation 6 and 7. The GO dated 13.02.2019 was also challenged for being arbitrary, illegal, unreasonable and without jurisdiction. The Single Judge passed order in favour of the writ petitioner.

In appeal, the Division Bench held that Regulation 116 was neither ultra vires the Central Electricity Authority under the Electricity Act, 2003 ("Act") nor manifestly arbitrary. It was of the view that exemption from the applicability of Regulation 6 and 7 could have only been granted to persons employed with KSEBL on the date of formulation of the transfer scheme and those employed after 31.10.2013 were not entitled to such an exemption. Consequently, the GO dated 13.02.2019 was set aside to the extent it granted exemption even to employees who entered after 31.10.2013.

Contentions raised by the appellants

Senior Advocate, Mr. V. Chitambaresh appearing on behalf of some of the appellants argued that in view of Regulation 116, which permitted deviation from the Regulations, the Government could not have granted exemption because "deviation" cannot be read as "exemption". To substantiate his argument he relied on R.B.I v. Peerless General Finance And Investment Co. Ltd. (1987) 1 SCC 424, M/s. Dhanrajamal Gobindram v. M/s. Shamji Kalidas And Co. (1961) 2 SCR 1020 and Glynn v. Margetson And Co. (1893) A.C. 351.

Advocate, Mr. K. Rajeev, appearing for other appellants submitted that the transfer scheme was framed in 2013, after the Safety Regulations came into force in 2010 and that the Single Judge of the High Court correctly held that clause 2(c) of the tripartite agreement was ultra vires the Electricity Act, 2003.

Contentions raised by the respondents

Additional Solicitor General, Ms. Aishwarya Bhati, appearing on behalf of the Central Electricity Authority submitted that the authority had no role in the appeals when the appellants had not made any submissions qua the vires of Regulation 116 before the Apex Court. She asserted that though deviation is permitted under the said provision, lump sum exemption cannot be granted.

Senior Advocate, Mr. P.V. Surendranath, appearing on behalf of the State of Kerala argued that Regulation 116 permits deviation in respect of matters covered by the Regulation of 2010. Placing reliance on a catena of decisions of the Apex Court, he contended that subordinate legislation cannot be interfered with unless it is manifestly arbitrary.

Advocate, Mr. P.V. Dinesh, appearing on behalf of KSEBL asserted that the relief granted to the erstwhile employees fall within the ambit of Regulation 116 as the benefit extended to such employees cannot be considered as lump sum exemption. He apprised the Court that the track record of personnel working with KSEBL was impeccable and the fact that the electrical accidents recorded in Kerala was much less compared to other States.

Senior Advocate, Mr. P.N. Ravindran, contended that reversal of the judgment of the Division Bench would adversely affect the interest of 17,367 employees. He also argued that deviation is equivalent to exemption.

Advocates, Mr. M.T. George and Mr. Venugopalan Nair emphasised that Regulations 6 and 7 related to safety conditions and not service conditions of employees of KSEBL.

Advocate Kaustubh Shukla appearing for the intervenors requested the Top court to not interfere with the appointments of the employees who were already appointed in terms of High Court and Supreme Court's order.

Analysis of the Supreme Court

The Court noted that Regulation 133 of the Indian Electricity Rules, 1956, which was in force prior to the Regulation of 2010 and was framed under Section 37 of the Indian Electricity Act, 1960, also empowered both State and Central Governments to grant 'exemption' from the safety provisions contained in it. On perusal of the G.O. dated 13.02.2019, the Court was of the opinion that it directed deviation from the implementation of the qualification stipulated in Regulations 6 and 7 and 'deviation' could amount to either exemption or relaxation.Therefore, the order was neither ultra vires Regulation 116 nor arbitrary. The Court observed that Section 131 and 133(2) of the Electricity Act, transfer scheme and tripartite agreement together provided for the transfer of the officers and employees to KSEBL and terms and conditions of their service upon transfer. According to the explanation to Section 133 the officers and employees referred to in the provision were those who were employed with KSEBL on 31.10.2013, the date of the transfer scheme. In view of the same, the High Court's decision to set aside GO dated 13.02.2019 to the extent it granted exemption even to employees who entered after 31.10.2013 was upheld by the Apex Court.

"As the exercise of power by the State Government in issuance of the order dated 13.02.2019 is well within its jurisdiction, grant of exemption in favour of erstwhile employees cannot be termed as arbitrary. However, the extension of the continuity to employees appointed after 31.10.2013 is not reasonable and only the transferred employees are entitled for protection of their service conditions", the Court held.

HeadNote

Central Electricity Authority (Measures relating to Safety and Electric Supply) Regulations, 2010 - Regulation 116 - The width and amplitude of Regulation 116 cannot be restricted by interpreting the word 'deviation' as having lesser scope than exemption. 'Deviation' from the Regulations would amount to either exemption or relaxation. Therefore, we are in agreement with the Division Bench that the order dated 13.02.2019 cannot be said to have been issued beyond the power conferred by Regulation 116 of 2010 Regulations.

Case Name: Muhammed A.A. And Ors. v. State of Kerala And Ors.

Citation: 2022 LiveLaw (SC) 188

Case No. and Date: Civil Appeal Nos.1498-1500 of 2022 | 18 Feb 2022

Corum: Justices L. Nageswara Rao and B.R. Gavai

Authored By: Justices L. Nageswara Rao

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