Muhammed A.A. vs State of Kerala
Muhammed A.A. vs State of Kerala
Non-Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal Nos._1498-1500 of 2022
(Arising out of SLP (Civil) Nos.9564-9566 of 2020)
Muhammed A.A. & Ors. .... Appellant(s)
Versus
State of Kerala & Ors. …. Respondent(s)
W I T H
Civil Appeal No.1501 of 2022
(Arising out of SLP (Civil) No.9760 of 2020)
Civil Appeal No.1502 of 2022
(Arising out of SLP (Civil) No.10226 of 2020)
J U D G M E N T
L. NAGESWARA RAO, J.
Leave granted.
1. Writ Petition (Civil) No. 6723/ 2019 (M) was filed in
the High Court of Kerala for a declaration that Regulation
116 of the Central Electricity Authority (Measures
relating to Safety and Electric Supply) Regulations, 2010
(for short “the Safety Regulations’) is ultra vires the
regulation making power of the Central Electricity
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Authority under the Electricity Act, 2003 (for short “the
Electricity Act”) and, therefore, void. The Petitionertherein also sought for a declaration that the State of
Kerala has no power to allow deviation under subregulation (1) of Regulation 116 in respect of
qualifications prescribed in Regulations 6 and 7 of the
Safety Regulations. A further relief of declaration that
the Order dated 13.02.2019 issued by the State of Kerala
as arbitrary, illegal, unreasonable and without
jurisdiction was sought in the Writ Petition. To the extent
that it permits the State Government to make deviations,
Regulation 116 was declared to be beyond the power
conferred on the Central Electricity Authority under the
Electricity Act by a learned Single Judge of the High
Court of Kerala. The order dated 13.02.2019 by which
exemption from acquiring qualification was granted to
erstwhile employees was held to be unsustainable. The
Kerala State Electricity Board Limited (KSEBL) was
directed to make promotions strictly in accordance with
the provisions contained in Regulations 6 and 7 of the
Safety Regulations. KSEBL, Respondent No.2 in Civil
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Appeal arising out of Special Leave Petition (Civil) No.
9564-9566/2020 had challenged the judgment of the
learned Single Judge of the High Court by filing an
appeal.
2. The Division Bench formulated the following points
for consideration: -
“1. Is Regulation 116 of the Central Electricity
Authority (Measures relating to Safety and Electric
Supply) Regulations, 2010, ultra vires the authority
and powers conferred on the Central Electricity
Authority on account of the Statutory Provisions in
the Electricity Act, 2003 and on account of
impermissible delegation or on account of being
manifestly arbitrary?
2. Can the provisions of a scheme framed under
Section 131 r/w Section 133(2) of the Electricity
Act, 2003 offer any protection to officers /
employees who do not possess the qualifications
required in terms of the Safety Regulations?
3. If the answer to the first issue is in the negative,
whether the order issued by the Government of
Kerala on 13-02-2019 suffer from the vice of nonapplication of mind or is otherwise arbitrary,
unreasonable or irrational?”
3. The Division Bench of the High Court held that the
Regulation 116 of the Safety Regulations is neither ultra
vires the Electricity Act nor manifestly arbitrary and that
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it is well in line with the objects and purpose of the
enactment. It held that the framing of Regulation 116 is
not ultra vires the provisions of the Electricity Act, 2003
and is not beyond the scope of the rule making power of
the Central Electricity Authority. Referring to Section
133(2) of the Electricity Act, the High Court was of the
opinion that the exemption from the applicability of
Regulation 6 & 7 of the Safety Regulations by the order
dated 13.02.2019 can be granted only in favour of
persons who were employed with the KSEBL on the date
of the formulation of the transfer scheme and such of
those employees who have joined service after
31.10.2013 were not entitled to such an exemption. For
this reason, the Government Order dated 13.02.2019
was partly set aside by the Division Bench to the extent
that it granted exemption to the employees/officers who
entered service after 31.10.2013.
4. Mr. V. Chitambaresh, learned Senior Counsel
appearing on behalf of the Appellants in Civil Appeal
arising out of Special Leave Petition (Civil) Nos. 9564-
9566/ 2020 submitted that Regulations 6 and 7 of the
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Safety Regulations prescribe qualifications for engineers,
supervisors and technicians, etc. He submitted that the
Division Bench of the High Court exempted all
employees who were working in the Board prior to
31.10.2013 from the qualifications as required under
Regulations 6 and 7 of the Safety Regulations which
results in compromising the safety of people and the
operation of power plants, grid and transmission lines.
Referring to Regulation 116 of the Safety Regulations
which permits deviation from the Regulations, the
learned Senior Counsel argued that the Government
does not have the power to grant exemption. Reliance
was placed on the judgments of this Court in R.B.I. v.
Peerless General Finance & Investment Co. Ltd.
1
,
M/s. Dhanrajamal Gobindram v. M/s. Shamji
Kalidas & Co.
2
and Glynn v. Margetson & Co.
3
in
support of the submission that the word “deviation”
cannot be interpreted to mean “exemption”. It was
contended on behalf of the Appellants that a wellconsidered judgment of the Single Judge which is also in
1 (1987) 1 SCC 424
2 (1961) 3 SCR 1020
3 (1893) A.C. 351
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larger public interest was interfered with by the Division
Bench on an erroneous consideration of law and facts.
Mr. K. Rajeev, learned counsel for the Appellants in Civil
Appeal arising out of Special Leave Petition (Civil) No.
10226/2020 submitted that the transfer scheme was
framed in the year 2013 after the Safety Regulations
came into force in 2010 and that the learned Single
Judge of the High Court correctly held that clause 2(c) of
the tripartite agreement is ultra vires the Electricity Act.
Ms. Aishwarya Bhati, learned Additional Solicitor General
appearing on behalf of the Central Electricity Authority
contended that there is no role for the Central Electricity
Authority in these Appeals, especially when the
Appellants have not made any submissions relating to
the vires of Regulation 116 of the Safety Regulations
before this Court. She contended that deviation is
permissible under Regulation 116 of the Safety
Regulations. The said deviation can be made by the
State Government as ‘Electricity’ falls in List IIIConcurrent List, Seventh Schedule of the Constitution of
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India, 1950. However, she contended that lump sum
exemption cannot be granted.
5. Mr. P.V. Surenderanath, learned Senior Counsel
appearing on behalf of the State of Kerala referred to
Section 133 of the Electricity Act which enables the State
Government to formulate a scheme providing for
transfer of officers and employees to the transferee
company on the vesting of the properties, rights and
liabilities in such transferee company. He drew the
attention of this Court to Section 133(2) which provides
for the terms and conditions of transferred personnel to
be in accordance with the transfer scheme. Reference
was made to the proviso to Section 133(2) according to
which the terms and conditions on transfer of such
employees would not in any way be less favourable than
those which would have been applicable to them if there
had been no such transfer under the transfer scheme.
The learned Senior Counsel argued that Regulation 116
of the Safety Regulations permits deviation in respect of
matters referred to in the Regulations. “Deviation” from
the Rules cannot be said to not include “exemption”.
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Taking into account the experience of such of those
employees who have been serving for a long period of
time, a decision was taken by the State of Kerala to
exempt the employees from acquiring qualifications
under Sections 6 and 7 of the Safety Regulations. The
State of Kerala has accepted the judgment of the
Division Bench that the exemption from qualification
under Regulations 6 and 7 of the Safety Regulations is
restricted only to those who were in service prior to
31.10.2013 and, therefore, no Appeal has been preferred
by the State against the judgment of the High Court. Mr.
Surender Nath, learned Senior Counsel relied upon the
judgments of this Court to submit that subordinate
legislation cannot be interdicted by this Court unless it is
manifestly arbitrary. He proceeded to submit that there
is no arbitrariness in the Regulations which would
warrant interference. KSEBL was represented by Mr. P.V.
Dinesh, learned counsel who submitted that the relief
that was granted to erstwhile employees of the Board
falls within the scope of Regulation 116 of the Safety
Regulations. The benefit which was given to the
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erstwhile employees by the order dated 13.02.2019
cannot be termed as a wholesale exemption. Relying
upon Section 133 of the Electricity Act, Mr. Dinesh
argued that all conditions of service, including promotion
of erstwhile employees of KSEB are protected according
to the proviso to Section 133(2) of the Electricity Act.
Insofar as the safety aspects raised by the Appellants are
concerned, Mr. Dinesh contended that the Appellants
have miserably failed to substantiate the point. He
submitted that qualified personnel are appointed to
crucial posts at generation, transmission and in the
power plants. Mr. P.N. Ravindran, learned Senior Counsel
appearing on behalf of the Respondent No. 6 in Civil
Appeals arising out of Special Leave Petition (Civil) Nos.
9564-9566/2020 contended that the reversal of the
judgment of the Division Bench of High Court would
adversely affect the interests of 17,367 employees. He
supported the submission on behalf of the State and
KSEBL that deviation is equivalent to exemption. The
employees of the KSEBL are so efficient that their
services are being utilized even by the neighbouring
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States. Mr. M.T. George, learned counsel appearing on
behalf of the Respondent No.4 in Civil Appeal arising out
of Special Leave Petition (Civil) Nos. 9564-9566/2020
submitted that there is a confusion in the minds of the
Appellants regarding the scope of Regulations 6 and 7 of
the Safety Regulations. He submitted that the said
Regulations pertain only to safety of the officers and
employees and do not concern their service conditions.
He also stated that the Appellants are bound by the
Tripartite Agreement. They cannot be permitted to
approbate or reprobate. Mr. Venugopalan Nair, learned
counsel appearing on behalf of the Respondent No.7 in
Civil Appeal arising out of Special Leave Petition (Civil)
No.9760/2020 supported the submissions of other
Respondents and contended that Regulations 6 and 7 of
the Safety Regulations have nothing to do with the
service conditions of the officers and employees of
KSEBL.
6. The Indian Electricity Act, 1910, the Electricity Act
(Supply) Act, 1948 and the Electricity Regulatory
Commissions Act, 1998 were replaced by the Electricity
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Act of 2003. The Electricity Act of 2003 was enacted to
consolidate the laws relating to generation, transmission,
distribution, trading and use of electricity and generally
for taking measures conducive to development of
electricity industry, promoting competition therein,
protecting interest of consumers and supply of electricity
to all areas, rationalization of electricity tariff, ensuring
transparent policies regarding subsidies, promotion of
efficient and environmentally benign policies,
constitution of Central Electricity Authority, Regulatory
Commissions and establishment of Appellate Tribunal
and for matters connected therewith or incidental
thereto. It is necessary to refer to the relevant
provisions of the Electricity Act and the Regulations
made thereunder for a better appreciation of the dispute
before this Court. Section 53 of the Electricity Act
relates to safety and electricity supply. The said Section
enables the Central Electricity Authority to undertake
appropriate measures in consultation with the State
Government for: –
“(a) protecting the public (including the persons
engaged in the generation, transmission or
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distribution or trading) from dangers arising from
the generation, transmission or distribution or
trading of electricity, or use of electricity supplied
or installation, maintenance or use of any electric
line or electrical plant;
(b) eliminating or reducing the risks of personal
injury to any person, or damage to property of any
person or interference with use of such property;
(c) prohibiting the supply or transmission of
electricity except by means of a system which
conforms to the specification as may be specified;
(d) giving notice in the specified form to the
Appropriate Commission and the Electrical
Inspector, of accidents and failures of supplies or
transmissions of electricity;
(e) keeping by a generating company or licensee
the maps, plans and sections relating to supply or
transmission of electricity;
(f) inspection of maps, plans and sections by any
person authorised by it or by Electrical Inspector or
by any person on payment of specified fee;
(g) specifying action to be taken in relation to any
electric line or electrical plant, or any electrical
appliance under the control of a consumer for the
purpose of eliminating or reducing the risk of
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personal injury or damage to property or
interference with its use.”
7. The Central Electricity Authority is constituted
under Section 70 of the Electricity Act for the purpose of
performing such functions as assigned to it under the
Act. Apart from the others, one of the functions of the
Authority under Section 73 of the Electricity Act is to
specify the safety requirements for construction,
operation and maintenance of electrical plants and
electric lines. The Authority is also empowered to make
Regulations under Section 177 of the Electricity Act
providing suitable measures relating to safety and
electricity supply under Section 53, technical standards
for construction of electrical plants, electric lines and
connectivity to the grid under clause (b) of Section 73
and for other matters of the Electricity Act as provided
for in the Section.
8. The Central Electricity Authority (Measure relating
to Safety and Electric Supply) Regulations, 2010, were
brought into force on 20.09.2010. The relevant
Regulations 6 and 7 relating to safety measures are as
follows: -
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“6. Safety measures for operation and maintenance
of electric plants: -
(1) Engineers and supervisors appointed to operate
or under take maintenance of any part or whole of
a thermal power generating station and a hydro
power plant together with the associated substation shall hold diploma in Engineering from a
recognized institute, or a degree in Engineering
from a university.
(2) The Technicians to assist engineers or
supervisors shall possess a certificate in
appropriate trade, preferably with A two years
course from an Industrial Training Institute
recognized by the Central Government or the State
Government.
(3) Engineers, supervisors and Technicians engaged
for operation and maintenance of electric plants
should have successfully undergone the type of
training as specified in Schedule-I provided that the
existing employees shall have to undergo the
training mentioned in sub-regulation (3) within
three years from the date of coming into force of
these regulations.
(4) The owner of every thermal power generating
station and hydro power plant together with their
associated substation shall arrange for training of
personnel engaged in the operation and
maintenance of his generating station along with
associated sub-station in his own institute or any
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other institute recognized by the Central
Government or the State Government provided
that separate training shall be given to the persons
engaged in operation and maintenance of thermal
power stations and hydro power stations including
associated sub-stations.
7. Safety measures for operation and maintenance
of transmission, distribution systems: -
(1) Engineers or supervisors engaged in operation
and maintenance of transmission and distribution
systems shall hold diploma in electrical,
mechanical, electronics and instrumentation
engineering from a recognized institute or
university.
(2) The Technicians to assist engineers or
supervisors shall possess a certificate in
appropriate trade, preferably with a two years
course from an Industrial Training institute
recognized by the Central Government or State
Government.
(3) Engineers, supervisors and Technicians engaged
for operation and maintenance of transmission and
distribution systems electric plants should have
successfully undergone the type of training as
specified in Schedule-II
Provided that the existing employees shall have to
undergo the training mentioned in sub-regulation
(3) within three years from the date of coming into
force of these regulations
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(4) Owner of every transmission or distribution
system shall arrange for training of their personal
engaged in the operation and maintenance of
transmission and distribution system in his own
institute or any other institute recognized by the
Central Government or State Government.”
9. Further, Regulation 116 of the Safety Regulations
empowers the Central Government or the State
Government to allow deviations in respect of matters
referred to in the regulations by an order in writing.
10. Part XIII of the Electricity Act pertains to
reorganization of KSEB. According to the statement of
objects and reasons of Electricity Act, one of the features
of the electricity Bill, 2001 relates to the incorporation of
a transfer scheme by which company/companies can be
created by the State Government. The State
Governments were given the option of continuing with
the State Electricity Boards which under the new scheme
of things would be a distribution licensee and a State
transmission Utility which would also be owning
generation assets. It provided that the service conditions
of the employees would, as a result of restructuring, not
be inferior.
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11. Section 131 of the Electricity Act provides for
vesting of property of the KSEBL in the State
Government. It states that after the property is vested
in the State Government by the State Electricity Board,
the State Government shall re-vest the property in a
Government company or in a company or companies in
accordance with the transfer scheme. Section 131(4) of
the Electricity Act contemplates the formulation of such
a transfer scheme. According sub-section (5) of Section
131 of the Electricity Act, the transfer scheme may:
“(5) x x x
(a) provide for the formation of subsidiaries, joint
venture companies or other schemes of division,
amalgamation, merger, reconstruction or
arrangements which shall promote the profitability
and viability of the resulting entity, ensure
economic efficiency, encourage competition and
protect consumer interests;
(b) define the property, interest in property, rights
and liabilities to be allocated –
(i) by specifying or describing the property, rights
and liabilities in question; or
(ii) by referring to all the property, interest in
property, rights and liabilities comprised in a
described part of the transferor's undertaking; or
(iii) partly in one way and partly in the other;
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(c) provide that any rights or liabilities stipulated or
described in the scheme shall be enforceable by or
against the transferor or the transferee;
(d) impose on the transferor an obligation to enter
into such written agreements with or execute such
other instruments in favour of any other
subsequent transferee as may be stipulated in the
scheme;
(e) mention the functions and duties of the
transferee;
(f) make such supplemental, incidental and
consequential provisions as the transferor
considers appropriate including provision
stipulating the order as taking effect; and
(g) provide that the transfer shall be provisional for
a stipulated period.”
12. Section 133 of the Electricity Act refers to
provisions related to officers and employees, and states
as follows:
“Section 133. (Provisions relating to officers and
employees):
(1) The State Government may, by a transfer
scheme, provide for the transfer of the officers and
employees to the transferee on the vesting of
properties, rights and liabilities in such transferee
as provided under section 131.
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(2) Upon such transfer under the transfer
scheme, the personnel shall hold office or service
under the transferee on such terms and conditions
as may be determined in accordance with the
transfer scheme:
Provided that such terms and conditions on the
transfer shall not in any way be less favourable
than those which would have been applicable to
them if there had been no such transfer under the
transfer scheme:
Provided further that the transfer can be
provisional for a stipulated period.
Explanation. – For the purpose of this section and
the transfer scheme, the expression “officers and
employees” shall mean all officers and employees
who on the date specified in the scheme are the
officers and employees of the Board or transferor,
as the case may be.”
13. In exercise of the powers conferred under subsections (1),(2),(5),(6) and (7) of Section 131 and Section
133 of the Electricity Act, the State of Kerala made
Kerala Electricity First Transfer Scheme, 2008 for vesting
of functions, properties, interests, rights, obligations and
liabilities of the KSEB in the State Government. In
exercise of the power conferred under Section 131(2) of
the Electricity Act, Government of Kerala notified a
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transfer scheme on 31.10.2013 revesting all the
functions, properties, interests, rights, obligations and
liabilities in KSEBL which is a company incorporated
under the Companies Act, 1956 and fully owned by the
Government of Kerala. Clause (6) of the scheme
provides for transfer of personnel by the State
Government. It is mentioned in the said clause that the
transfer shall be governed by the conditions enumerated
in Schedule- ‘B’ of the scheme and clause (8), which is
relevant to the present dispute, provides as follows: -
“(8) The State Government shall notify appropriate
arrangements in respect of the funding of the
terminal benefits to the extent they are unfunded
on the date of the transfer of the Personnel from
the erstwhile Board or KSEB. As per actuarial
valuation carried out by registered valuer, the
provisional figure of unfunded liability is
approximately, ₹ 7584 Crores (Seven thousand Five
hundred and Eighty Four crores) as on 30''
September, 2011. Actuarial valuation of terminal
liabilities at the time of transfer will be made as
provided under clause 9 (3) of the scheme. Till such
time arrangements are made, the Transferee and
the State Government shall be jointly and severally
responsible to duly such make such payments to
the existing pensioners as well as the personnel
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who retire after the date of transfer but before the
arrangements are put in place. The State
Government, Kerala State Electricity Board Limited
and employees’ unions may enter into a tripartite
agreement in consideration of the promises and
mutual conditions set forth therein. A model
Tripartite Agreement is appended as Schedule -C”.
14. Subsequently, a Tripartite Agreement was entered
into between the State of Kerala, Kerala State Electricity
Board Limited (KSEBL), and the Unions and Associations
representing workmen and officers of the erstwhile
Kerala State Electricity Board on 01.08.2014. The State
Government and KSEBL assured the existing employees
that the terms and conditions of service such as
promotions, transfers, wages, compensations, leave,
allowances, etc. upon transfer to KSEBL shall continue to
be regulated by existing regulations/ service rules in
vogue. Therefore, Sections 131 and 133 of the Electricity
Act in combination with the transfer scheme dated
31.10.2013 and tripartite agreement dated 01.08.2014
provided for the transfer of the officers and employees to
KSEBL and terms and conditions of their service upon
their transfer.
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15. While the implementation of the Safety Regulations
qua the transferred officers and employees was
underway, O.P. No.7/ 2016 was filed by one Shibu K.S.
before the Kerala State Electricity Regulatory
Commission, Thiruvananthauram alleging noncompliance of the provisions of Safety Regulations, 2010
relating to the qualification of engineers, supervisors and
technicians engaged in operation and maintenance of
electrical plants and installations. By the order dated
29.12.2016, the Commission held: -
“23. Considering the facts and circumstances of the
case, the Commission orders as follows:
1. In order to implement the Safety Regulations,
the authorities of KSEB Ltd. may have to adopt
strategies to ensure that, -
(1) From among the existing employees, only those
with the specified qualifications as per the Safety
Regulations, are deployed for operation and
maintenance of electrical plants and electrical
systems.
(2) Necessary and sufficient in-service trainings /
courses may be imparted to the willing existing
employees in the grades of lineman, overseer and
sub-engineer to make them eligible for deployment
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of duties in accordance with the Safety
Regulations.
(3) Future recruitments of employees are m tune
with the Safety Regulations.
2. The KSEB Ltd has, as per B.O (FTD) No.
2981/2016 (LD.1/1836/2016) dated 18.10.2016,
constituted a Committee to examine all the above
aspects and to submit recommendations for
implementation of the provisions of Safety
Regulations. Government has, in exercise of the
powers under Regulation 116 of the Safety
Regulations, issued GO (Rt) No. 206/2016/PD dated
26.10.2016, granting a period of six months to
implement the Regulations. In view of the above
facts the Commission is of the view that there is no
reason at present to impose on KSEB Ltd, a penalty
under Section 142 of the Act. The KSEB Ltd. is
directed to submit a copy of the report of the
Committee and an action taken report on the
recommendation of the Committee. The copy of
the report of the Committee shall be submitted on
or before 31.3.2017 and the action taken report on
the recommendation of the Committee shall be
submitted on or before 30.4.2017.”
16. Pursuant to the power conferred in the State
Government by Section 131 of the Electricity Act, a
transfer scheme was prepared in 2008 vesting the
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functions, properties, interests, rights, obligations and
liabilities of the KSEB in the State Government.
Thereafter, another scheme was prepared on 31.10.2013
transferring (re-vesting) of the functions, properties, all
interests, rights and properties, all rights and liabilities of
the Kerala State Electricity Board to Kerala State
Electricity Board Limited, a company fully owned by the
Government of Kerala. As contemplated in the transfer
scheme, a tripartite agreement dated 01.08.2014 was
entered into between the Government of Kerala, Kerala
State Electricity Board Limited and the associations
representing workmen and officers of erstwhile Kerala
State Electricity Board in order to facilitate smooth
implementation of the revesting scheme. By an order
dated 13.02.2019, Government of Kerala ordered
deviation from the implementation of qualifications
prescribed under Regulation 6 and 7 of the Safety
Regulations for the existing employees of KSEBL, in
exercise of the power conferred on the State
Government under Regulation 116 of the Safety
Regulations. The deviation was applicable to employees
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working with the KSEBL on the date of the order dated
13.02.2019 and for all future appointments and
promotions, the qualifications prescribed in the 2010
Regulations were to be strictly followed. The grievance
of the Appellants is that they possess the necessary
qualifications required under Regulation 6 and 7 of the
2010 Regulations and the decision of the Government to
deviate from the requirements of Regulation 6 and 7
would make ineligible employees fit for promotion to the
higher posts which would be detrimental to the interests
of the Appellants. The main contention raised by the
Appellants is that the deviation permitted by the order
dated 13.02.2019 would amount to compromising the
safety norms prescribed by the Central Electricity
Authority which would adversely affect larger public
interest.
17. Re-organisation of the Electricity Board has been
done in terms of the Electricity Act by preparation of a
transfer scheme as contemplated in Section 131 of the
Act. According to Section 133 (2) of the Electricity Act,
the transferred personnel are to be governed by terms
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and conditions as may be determined in accordance with
the transfer scheme. The proviso to Section 133 (2)
protects the interest of the transferees in so far as the
conditions of their service are not to be less favorable
than those which would have been applicable to them
had no transfer taken place. Clause 6 of the transfer
scheme provides that the transfer of personnel shall be
subject to the terms and conditions contained in Section
133 and 134 of the Act, though promotion and seniority
have not been specifically mentioned in the transfer
scheme. The transfer scheme in Clause (8) contemplates
the execution of a tripartite agreement between the
State Government, KSEBL and employees’ union. The
parties entered into such a tripartite agreement on
01.08.2014 in which it was agreed that promotions of the
existing employees shall continue to be governed by
existing Regulations/service rules in vogue. It is clear
from the above discussion that the service conditions of
the erstwhile employees of KSEB are protected by the
proviso to Section 133 of the Electricity Act. After the
transfer scheme was formulated, the erstwhile
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employees were entitled to claim that the conditions of
their service cannot be altered to their detriment in view
of the tripartite agreement dated 01.08.2014.
18. After the formulation of the first transfer scheme in
2008 whereby all the properties, rights and interests of
KSEB were vested in the Government of Kerala, and
before the re-vesting of all such properties, rights and
interest was done by the State of Kerala in favour of
KSEBL on 31.10.2013, the Safety Regulations were
framed by Central Electricity Authority in 2010. The
Safety Regulations were framed by the Central Electricity
Authority in exercise of its power under Sections 53 and
73 read with Section 177 of the Electricity Act. Section
177 (2) of the Act empowers the Central Electricity
Authority to frame Regulations providing for suitable
measures relating to safety and electricity supply as
contemplated in Section 53 and the technical standards
for construction of electrical plants, electrical lines and
connectivity to the grid as provided in clause (b) of
Section 73 of the Electricity Act. Section 53 of the
Electricity Act deals with safety measures and electricity
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supply over which the authority has jurisdiction and on
which it acts in consultation with the State Government.
Similarly, one of the functions of the Central Electricity
Authority under Section 73 of the Act is to specify the
safety requirements for construction, operation and
maintenance of electrical plants and electrical lines and
connectivity to the grid. In furtherance to these Sections
and as per the specific power vested in the Central
Electricity Authority, it framed the Safety Regulations,
Regulation 6 and 7 of which prescribe the educational
qualifications required for appointment to the posts of
engineers, supervisors and technicians in thermal power
generating stations and hydro power plants as well as for
the operation and maintenance of transmission and
distribution systems. The dispute that arises for our
consideration in these appeals is whether these
prescribed educational qualifications in Regulation 6 and
7 can be deviated from by an order of the State
Government. Such a power is traceable to Regulation
116 of the Safety Regulations which enables the Central
Government or the State Government to allow deviations
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in respect of matters referred to in the Safety
Regulations, including the ones in Regulations 6 and 7.
19. The principal contention of the Appellants which
found favour with the learned Single Judge of the High
Court is that Regulation 116 is ultra vires the Electricity
Act, 2003. The Division Bench reversed such findings of
the Single Judge. As the learned counsel appearing for
the Appellants have not made any submission relating to
the said point, it is not necessary for us to adjudicate on
the issue of the validity of Regulation 116. The
contention of the Appellants is that the wholesale
exemption granted to the officers and employees from
possessing the requisite educational qualifications as
prescribed in Regulation 6 and 7 is impermissible in
exercise of the power under Regulation 116 of the Safety
Regulations. The argument is based on the language of
Regulation 116 which permits the concerned
Government only to ‘deviate’ from the regulations which,
according to the Appellants, cannot be read as ‘exempt’.
Mr. V. Chitambaresh, learned Senior Counsel, appearing
for the Appellants placed reliance on the dictionary
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meanings of ‘deviation’ and ‘exemption’ and submitted
that the scope of deviation is completely different from
exemption. According to him, exemption from operation
of the Regulation 6 and 7 of the Safety Regulations is
impermissible and the State Government has a very
limited power to deviate from the rules, as and when
found necessary. In other words, he submitted that all
existing employees cannot be exempted from possession
of the requisite educational qualifications under
Regulation 6 and 7 in exercise of power under Regulation
116 of the Safety Regulations.
20. The Appellants have relied upon Glynn v.
Margetson & Co. (supra) which is a judgment of the
House of Lords in which a clause in the bill of lading
mentioning the term ‘deviation’ was to be interpreted.
The dispute in the said case was in relation to the
damage caused to perishable goods loaded in a ship
headed towards Liverpool. Compensation was sought on
the ground that the vessel proceeded to the port in the
north east of Spain and not west-ward in the direction of
Liverpool. The House of Lords was of the opinion that the
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primary intent and object of bill of lading must be
considered and the general / printed words therein must
be construed so as to not conflict with that intent and
object. We are afraid that this judgment is of no
assistance to this Court in interpreting the import of the
word ‘deviation’ as the House of Lords has specifically
interpreted the term / clause in context of the object and
intention of the bill of lading.
21. The other judgment relied upon by the Appellant is
the judgment in M/s. Dhanrajamal Gobindram v. M/s.
Shamji Kalidas & Co. (supra). The question that fell for
consideration in this case pertains to the interpretation
of the words ‘exemption’ and ‘permission’ used in
Section 5 and 21 of the Foreign Exchange Regulation Act,
1973. In context of the dispute that arose in the said
case, this Court was of the opinion that the word
‘exemption’ shows that a person is put beyond the
application of law while ‘permission’ shows that he is
granted leave to act in a particular way. This Court
further held that the word ‘permission’ is a word of wide
import as it means leave to do some act while
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‘exemption’ is just one way of giving leave. The ratio of
this judgment cannot be of any help to the Appellants in
this case. The point raised by the Appellant in this
Appeal is that the term ‘deviation’ used in Regulation
116 of the Safety Regulations cannot be construed in a
manner that it would include ‘exemption’ within its
ambit. The context and the analysis of this Court in M/s.
Dhanrajamal Gobindram v. M/s. Shamji Kalidas &
Co. (supra) with respect to the specific terms in the
background of that context cannot be applied by this
Court in the case at hand. The Appellants have
themselves cited the judgment of this Court in RBI v.
Peerless General Finance & Investment Co. Ltd.
(supra) to contend the word ‘deviation’ has to be
interpreted by following the principle laid down in the
said judgment which is as follows: -
“33. Interpretation must depend on the text and
the context. They are the bases of interpretation.
One may well say if the text is the texture, context
is what gives the colour. Neither can be ignored.
Both are important. That interpretation is best
which makes the textual interpretation match the
contextual. A statute is best interpreted when we
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know why it was enacted. With this knowledge, the
statute must be read, first as a whole and then
section by section, clause by clause, phrase by
phrase and word by word. If a statute is looked at,
in the context of its enactment, with the glasses of
the statute-maker, provided by such context, its
scheme, the sections, clauses, phrases and words
may take colour and appear different than when
the statute is looked at without the glasses
provided by the context. With these glasses we
must look at the Act as a whole and discover what
each section, each clause, each phrase and each
word is meant and designed to say as to fit into the
scheme of the entire Act. No part of a statute and
no word of a statute can be construed in isolation.
Statutes have to be construed so that every word
has a place and everything is in its place. It is by
looking at the definition as a whole in the setting of
the entire Act and by reference to what preceded
the enactment and the reasons for it that the Court
construed the expression “Prize Chit” in Srinivasa
[(1980) 4 SCC 507: (1981) 1 SCR 801: 51 Com Cas
464] and we find no reason to depart from the
Court's construction.”
Therefore, by applying the above principle to this
case, reliance placed on the interpretation of Court in the
cases of Glynn v. Margetson & Co. (supra) and M/s.
Dhanrajamal Gobindram v. M/s. Shamji Kalidas &
Page 33 of 37
Co. (supra) for interpretation of Regulation 116 of the
Safety Regulations is misplaced.
22. In the facts of the present case, we are not in
agreement with the Appellants that granting exemption
to the erstwhile employees of the KSEB from possessing
the qualifications provided in Regulations 6 and 7 is an
impermissible exercise of power under Regulation 116 of
the Safety Regulations. Prior to the 2010 Regulations,
the Indian Electricity Rules, 1956 framed under Section
37 of the Indian Electricity Act, 1960 were in force. Rule
133 of the said Rules would show that State
Governments/Central Government were empowered to
grant exemption from the safety provisions contained
therein. The power of exemption has been in existence
even prior to Electricity Act. A perusal of the order dated
13.02.2019 would demonstrate that the State
Government directed deviation from the implementation
of qualifications prescribed under Regulations 6 and 7 of
the Safety Regulations. Though the word exemption was
not employed in the order dated 13.02.2019, the effect
of the direction issued by the Government was to
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exempt the employees from the prescribed
qualifications. In other words, Regulations 6 and 7 were
relaxed in favour of the erstwhile employees. 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.
23. The next question that requires to be examined is
regarding the exercise of powers by the Government of
Kerala in issuing order dated 13.02.2019. Drawing from
the interpretation of the relevant provisions as discussed
above, promotion and other service conditions of the
officers and employees transferred to KSEBL under the
transfer scheme are protected under Section 131 and
133(2) of the Electricity Act in conjunction with the
transfer scheme and the tripartite agreement. The
explanation to Section 133 makes it clear that “officers
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and employees” referred to in the section are only those
officers and employees of the Board on the date of
transfer scheme, i.e. on 31.10.2013. By no stretch of
imagination can this protection be extended to the
employees who were engaged by KSEBL after
31.10.2013. The High Court was right in setting aside the
order dated 13.02.2019 which permitted deviation from
Regulations 6 and 7 to all appointments made till the
date of issuance of order dated 13.02.2019, even after
the transfer scheme dated 31.10.2013. By the
impugned judgment, the High Court restricted the
applicability of the order dated 13.02.2019 to such of
those employees transferred from KSEB prior to
31.10.2013.
24. Safety is an important issue which the Central
Electricity Authority has dealt with in the Safety
Regulations enacted in 2010. Mr. P.V. Dinesh, learned
counsel for the KSEBL submitted that the track record of
the personnel working in the Board has been exemplary
and their support was even sought by the States of
Orrisa and Tamil Nadu in the past. He submitted a chart
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to bolster his submission that the electrical accidents are
much less in Kerala compared to the other States. Mr.
Dinesh further stated that efforts would be made to
appoint eligible and qualified personnel in the generating
stations, electrical plants and key positions in
transmission and distribution lines. 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.
Therefore, we approve the findings recorded by the
Division Bench of the High Court of Kerala.
25. For the aforementioned reasons, the Appeals are
dismissed.
.....................................J.
[ L. NAGESWARA RAO ]
.....................................J.
[ B.R. GAVAI ]
New Delhi,
February 18, 2022.
Page 37 of 37
Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले
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