GLOBAL ENERGY LTD. & ANR. versus CENTRAL ELECTRICITY REGULATORY COMMISSION

GLOBAL ENERGY LTD. & ANR. versus CENTRAL ELECTRICITY REGULATORY COMMISSION

Clauses (b) and (f) of Regulation 6A of the Central Electricity Regulatory Commission (Procedure, Terms and Conditions for Grant of Trading License and other related matters) (Amendment) Regulations, 2006 are ultra vires the Constitution of India as well as the Electricity Act, 2003, for want of objective guidelines, excessive subjectivity, vagueness, and perpetuation of injustice and uncertainty in licensing. Disqualifying statutes must have definite, rational, and objective standards. Delegated legislation cannot create substantive rights or liabilities not contemplated by the parent Act. Judicial review does not cure invalid subordinate legislation.

Parties
Appellant: Global Energy Ltd.; Respondent: Central Electricity Regulatory Commission
Jurisdiction
India
Judgment Date
11 May 2009
Procedural Posture
Civil Appeal / Appeal From High Court Judgment
Outcome
Appeals allowed
Legal Topics
Validity of Subordinate Legislation, Licensing Under Electricity Act, Parameters of Judicial Review, Doctrine of Legitimate Expectation
Constitutional Law Administrative Law Electricity Law Validity of Subordinate Legislation Licensing Under Electricity Act Parameters of Judicial Review Doctrine of Legitimate Expectation

Case Brief

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Parties

Global Energy Ltd.

Appellant

Central Electricity Regulatory Commission

Respondent

Procedural Posture

Civil Appeal / Appeal From High Court Judgment

Legal Issues

  1. 1 Whether clauses (b) and (f) of Regulation 6A of the Central Electricity Regulatory Commission Regulations, 2006 are constitutionally valid
  2. 2 Whether the clauses are ultra vires the Electricity Act, 2003 and the Constitution of India
  3. 3 What parameters must govern disqualification for electricity trading license under delegated legislation

Ratio Decidendi

Clauses (b) and (f) of Regulation 6A of the Central Electricity Regulatory Commission (Procedure, Terms and Conditions for Grant of Trading License and other related matters) (Amendment) Regulations, 2006 are ultra vires the Constitution of India as well as the Electricity Act, 2003, for want of objective guidelines, excessive subjectivity, vagueness, and perpetuation of injustice and uncertainty in licensing. Disqualifying statutes must have definite, rational, and objective standards. Delegated legislation cannot create substantive rights or liabilities not contemplated by the parent Act. Judicial review does not cure invalid subordinate legislation.

Court Disposition

Appeals allowed

Orders

  • Impugned High Court judgment set aside
  • Clauses (b) and (f) of Regulation 6A declared ultra vires the Constitution and Electricity Act