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Judgment
This appeal is directed against an Order dated 12.03.12 passed in WP No. 8691/11 by which the writ petition preferred by the respondent herein for award of interest on excess received amount was allowed, and the writ Court directed for payment of interest equivalent to the interest rate applicable to a scheduled bank for the period in question. The interest has been directed to be paid at the rate as notified by the Reserve Bank of India at the relevant time, within a period of three months from the date of receipt of certified copy of the order. This order has been assailed by the appellant on the ground that there was no deliberate intention on part of the appellants herein to withhold the payment, the payment was made immediately after the order passed by the High Court, so the appellants are not liable to make payment of interest to the respondent. Reliance is placed on a decision of the Apex Court in NTPC Ltd. Vs. M.P. State Electricity Board and Others, . The prayer of the appellants is opposed by learned counsel appearing for the respondent who submitted that looking to the controversy involved in this case, the learned Single Judge has rightly held that payment of the respondent was wrongly withheld by the appellants, so the respondent was entitled for interest. It is also submitted by him that the Apex Court has considered the controversy in two decisions, namely, M/s. Style (Dress Land) Vs. Union Territory Chandigarh and Another, and Rajasthan Housing Board and Ors. vs. Krishna Kumari 2005(13) SCC 151, and in the light of aforesaid decisions, the writ Court has rightly allowed the writ petition, this appeal is without any merits and it may be dismissed.
We have heard the learned counsel for the parties.
After perusing the record, we find that the factual position of the present case is as under:-
That, the respondent had entered into an agreement with the appellants on 24.01.83 for a contract demand of supply of electricity to the extent of 524 KVA. The respondent had filed an application on 24.7.91 with a request to enhance the contract demand from 524 KVA to 790 KVA. In the year 1999, the respondent had made a request to reduce the contract demand to 600 KVA in place of 790 KVA with effect from 1.3.99. The Board had rejected the application vide Order dated 4.10.99. Against the same, the respondent had filed an application before the M.P. Electricity Regulatory Commission (hereinafter referred to as "the Commission"). The Commission vide Order dated 5.1.02 had set aside the order of the Board and directed that the respondent''s contract demand be reduced from 790 KVA to 600 KVA from the date of the order passed by the Commission. The aforesaid decision of the Commission was challenged by the Board by filing an appeal u/s 27 of the Electricity Regulatory Commission Act, 1998, and under Clause-41 of the M.P. Vidyut Sudhar Adhiniyam, 2000 before the High Court. The appeal was registered as M.A. No. 506/02 and an interim order was passed in the matter on 3.7.02. However, the appeal was dismissed by the High Court on 23.03.10, and the order of Commission was affirmed. During this period, the appellants herein had demanded and collected the amount of electricity dues on the demand of 790 KVA though the respondent had consumed the electricity up to 600 KVA. After decision of the High Court, the respondent had demanded refund of the amount which was charged by the appellants above 600 KVA, for 790 KVA, but the amount was adjusted in subsequent bills. The respondent had also demanded for interest on the aforesaid amount which was retained by the appellants. The aforesaid claim of the respondent was declined by the appellants, so a writ petition was filed before the High Court claiming the aforesaid interest on the amount which was charged by the appellants from the respondent for the difference between 600 KVA and 790 KVA. The learned Single Judge has considered the question and held that the aforesaid recovery by the appellants herein was contrary to the order passed by the Commission while the respondent was not liable to make payment of the amount for the contract demand of 790 KVA, but was liable to make payment of contract demand up to 600 KVA. The learned Single Judge, relying on the aforesaid decisions, directed payment of interest on the aforesaid amount. This order is under challenge in this appeal.
The Apex Court has considered this aspect in aforesaid two decisions, namely, Rajasthan Housing Board and Ors. vs. Krishna Kumari and Style (Dress Land) vs. Union Territory, Chandigarh and Another (supra).
In Style (Dress Land) vs. Union Territory, Chandigarh and Another (supra) it has held thus:-
Regarding awarding of the interest by the High Court for the period of stay it is argued that as in Sahib Singh case no such direction was issued, the appellants could not be burdened with the liability of paying the interest and that at the rate of 18% per annum it was excessive and exorbitant. It is a settled principle of law that as and when a party applies and obtains a stay from the court of law, it is always at the risk and responsibility of the party applying. Mere passing of an order of stay cannot be presumed to be the conferment of any additional right upon the litigating party. This Court in Shree Chamundi Mopeds Ltd. v. Church of South India Trust Assn. held that the said portion of order by the Court means only that such order would not be operative from the date of its passing. The order would not mean that the order stayed had been wiped out from existence. The order of stay granted pending disposal of a case comes to an end with the dismissal of a substantive proceeding and it is the duty of the court in such cases to put the parties in the same position they would have been but for the interim orders of the court. Again in Kanoria Chemicals and Industries Ltd. v. U.P. SEB the Court held that the grant of stay had not the effect of relieving the litigants of their obligation to pay late payment with interest on the amount withheld by them when the writ petition was dismissed ultimately. Holding otherwise would be against public policy and the interests of justice. In Kashyap Zip Industries v. Union of India interest was awarded to the Revenue for the duration of stay under the Court''s order, since the petitioners therein were found to have the benefit of keeping back the payment of duty under orders of the Court.
The High Court was, therefore, not wrong in directing the payment of interest on the amount of arrears of rent for the period when the stay order was obtained till the period the writ petitions were dismissed. We, however, feel that awarding of interest @ 18% per annum from the aforesaid period was on the excessive side. The respondent authority could not be equated with private commercial institutions and conferred with an amount of compensation in the form of interest which, in the judicial parlance, may amount to penalty, despite the fact that the persons found to have jeopardised the process of law were rightly held liable to compensate the respondent authority by way of interest. In our opinion 15% per annum interest for the aforesaid period would have been just and proper. We, however, agree with the findings of the High Court that the respondents are free to charge appropriate interest on the amount of arrears of rent between 1-3-1992 to the date when the stay orders were passed by the High Court. We are sure that in determining such rate of interest the respondent authority would act fairly and justly.
Though the learned senior counsel appearing for the appellants has placed reliance on a judgment of the Apex Court in NTPC Ltd. (M/s.) v. M.P. State Electricity Board and others (supra), but the factual position in the aforesaid case was entirely different. In that case, the tariff was reduced as per the notification issued by the Government and differential amount was adjusted by the Company. It was held that the Electricity Company had not charged excess amount in an unjust way, therefore, was not liable to pay any interest on differential amount. But the factual position in the present case is entirely different. Here, the contract demand of the respondent was reduced to 600 KVA as per Order dated 5.1.02 by the Commission, and the respondent had not consumed the electricity above 600 KVA. In aforesaid circumstances, appellants herein were not entitled to recover the amount on 790 KVA and apparently the aforesaid recovery was not justified. In aforesaid circumstances, if the writ Court has allowed the writ petition, no fault is found. In the result, this appeal is found without merits and is dismissed with no orders as to cost.