Mysore State Electricity Board vs Bangalore Woollen, Cotton and Silk Mills Ltd.

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeals Nos. 629-632 of 1961

Decision Date: 15 November 1962

Coram: S.K. Das, J.L. Kapur, A.K. Sarkar, M. Hidayatullah, Raghubar Dayal

In the case recorded as Mysore State Electricity Board versus Bangalore Woollen, Cotton and Silk Mills Ltd., the Supreme Court of India rendered its judgment on the fifteenth day of November, 1962. The opinion was authored by Justice S.K. Das, who was joined on the bench by Justices J.L. Kapur, A.K. Sarkar, M. Hidayatullah and Raghubar Dayal. The petitioner before the Court was the Mysore State Electricity Board, while the respondents comprised Bangalore Woollen, Cotton and Silk Mills Limited together with several other parties. The decision appears in the 1963 volume of the All India Reporter at page 1128 and in the 1963 Supplement to the Supreme Court Reporter at page 127. Subsequent citation of the case occurs in the reports identified as 1964 SC1230, 1964 SC1305 and 1991 SC 101. The dispute centred upon the power of the State Government and the successor electricity board to revise the rates payable for the supply of electricity after earlier contracts had expired. The statutory framework relevant to the controversy included the Electricity (Supply) Act of 1948, especially sections 49, 60 and 76, and the Indian Electricity Act of 1910, particularly section 52, which together governed the authority to alter rates and the procedure for referring such disputes to arbitration.

The factual matrix of the case began with the existence of agreements that, in 1945, the Government of Mysore had entered into with the respondents for the supply of electricity to their textile mills at rates fixed for a period of five years. Those agreements consequently lapsed in the financial year 1949‑50. After the expiry of the contracts, the Government exercised its power to raise the rates in March 1953 and again in April 1956. Because the provisions of the Electricity (Supply) Act of 1948 that authorized rate revision, such as section 49, did not become operative until 1957, the rate increases effected in 1953 and 1956 were not made under the authority of that section. The respondents objected to the higher charges and, invoking the extraordinary jurisdiction of the High Court under Article 226 of the Constitution of India, filed a petition seeking an injunction that would restrain both the Government and, after its creation in September 1957, the Mysore State Electricity Board from demanding the increased rates. In support of their petition, the respondents argued that the State Government lacked the legal authority to raise the rates after the expiry of the original agreements and that the controversy should be referred to arbitration in accordance with section 76 of the 1948 Act, which had become applicable in the State of Mysore on 30 December 1956. The High Court ruled that the Government possessed the power to revise the rates, thereby granting relief on the first point, but it declined to decide whether the matter was arbitrable under section 76. The respondents continued to withhold payment of the arrears calculated at the revised rates, prompting the Board to issue a notice of possible disconnection of the electricity supply. In response, the respondents appointed an arbitrator pursuant to section 76 of the Electricity (Supply) Act. Simultaneously, the Board moved before the District Judge, invoking section 33 of the Arbitration Act, to obtain a declaration that the dispute was not deferable to arbitration. The additional District Judge who considered the application concluded in favour of the Board, holding that the arbitration provision did not apply to the present controversy.

The respondents applied to the High Court seeking a revision of the rates. The High Court held that section 76 of the Electricity (Supply) Act, 1948 applied and that the respondents were therefore entitled to call for arbitration under that provision. The Board appealed this decision to the Supreme Court. On behalf of the Board it was submitted that, in view of the High Court’s earlier decision on the writ petition, any claim to refer the dispute to arbitration under section 76 was barred by the doctrine of res judicata. It was further contended that the phrase “other person” in sub‑section (1) of section 76, when read ejusdem generis, could not be interpreted to include a consumer of electrical energy, and that a consumer could not claim the benefit of sub‑section (2) of the same provision because no provision of the 1948 Act, read together with the Electricity Act of 1910, authorised the reference of such a dispute to arbitration.

The Court observed that it is well settled that, to determine whether a previous judgment operates as res judicata, the court must examine the nature of the earlier litigation, the specific issue that was raised, and the actual decision rendered. The right of the Government or the Board to revise rates and the right, if any, of the respondents to dispute the revised rates and seek arbitration were two distinct questions. The High Court had expressly left the latter question open; consequently, the decision on the former could not operate as res judicata with respect to the latter. The Court further examined the relevant provisions of the Electricity Act of 1910 and the Electricity (Supply) Act of 1948 read together. These statutes made it clear that between 1953 and 1956 the Mysore State Government was free to contract with electricity consumers and to supply electricity at rates it deemed appropriate. When the agreements with the respondents terminated in 1949‑50, the Government was not bound to continue supplying electricity at the old rates. The dispute therefore fell within the realm of contract law, whether express or implied, and could not be framed as a question under the 1948 Act that would invoke section 76. The Court rejected the proposition that sections 49 and 60 of the 1948 Act brought the dispute within the Act’s scope and therefore required arbitration under section 76(1). The revision of rates was not a purpose contemplated by section 60, and, when properly construed, section 49 did not attract section 76(1). The Court referred to Ryota of Garbandho v. Zamindar of Parlakimedi (1943) R. 70 I.A. 129. None of the provisions of either the 1910 Act or the 1948 Act, which designate certain questions for arbitration, mention the present dispute as a matter for arbitration under section 52 of the former or section 76(2) of the latter. Although the language of section 76(1) is wide, it plainly implies that the question must be one that arose under the Act or had a relation to it.

It would have been anomalous to treat a dispute concerning the revision of rates made by the Government before the Board was constituted as a dispute falling within the Electricity (Supply) Act, 1948. Because the dispute could not be said to have arisen under that Act, the Court did not need to decide whether the rule of ejusdem generis should be applied in interpreting the expression “other person” in section 76(1) of the Act. Justice Hidayatullah explained that the dispute relating to the revision of rates was not one that could be referred to arbitration under section 76 of the Electricity (Supply) Act, 1948. Consequently, it was unnecessary to invoke the rule of ejusdem generis to expand the meaning of “other person” so as to include a consumer disputing the rates, since no provision in the Act permitted such an inclusion. The decision also cited the precedent William v. Golding, (1865) L. R. I C P 69, holding it to be applicable. Although the language of section 76 is very wide, a necessary qualification must be read into it: the dispute it contemplates must relate to a matter within the purview of the Act. When the Electricity Act of 1910 and the Electricity (Supply) Act of 1948 are read together, they clearly demonstrate that a dispute between the Government or the Board on one side and a consumer on the other, concerning rates of supply apart from any contract, could not arise under the 1948 Act.

The judgment was delivered in civil appellate jurisdiction concerning Appeals Nos. 629 to 632 of 1961, which arose from the Mysore High Court’s orders dated 19 August 1960 in C.R.P. Nos. 611 to 613 and 622 of 1959. The Attorney‑General for India appeared for the State, while counsel for the appellants and respondents were listed respectively. The judgment, dated 15 November 1962, was pronounced by Justices S. K. Das, Kapur, Sarkar and Dayal, with Justice S. K. Das delivering the principal opinion and Justice Hidayatullah delivering a separate judgment. The case comprised four appeals on a certificate of fitness granted by the High Court of Mysore under Article 133(1)(c) of the Constitution. All four appeals were heard together and the resulting judgment applied to each. The appellant in all the appeals was the Mysore State Electricity Board, Bangalore, hereinafter referred to as the Board. The respondents were four separate textile mills, each being a respondent in one appeal: Bangalore Woollen, Cotton and Silk Mills Ltd., Bangalore; Minerva Mills Ltd., Bangalore; Sri Krishna Rajendra Mills Ltd., Mysore; and Mysore Spinning and Manufacturing Co., Bangalore.

The appeals presented a single legal question: whether, under section 76 of the Electricity (Supply) Act, 1948 (LIV of 1948), the textile mills were entitled to demand arbitration concerning an alleged dispute with the Mysore State Electricity Board over the revision of rates payable for electric energy supplied by the Board or its predecessor. To resolve this issue, it was necessary to examine two statutes, namely the Indian Electricity Act, 1910 (IX of 1910) and the Electricity (Supply) Act, 1948 (LIV of 1948). For convenience, the judgment referred to the former as the “1910 Act” and the latter as the “1948 Act”. The factual background leading to the four appeals was then set out. Both the 1910 Act and the 1948 Act were extended to the State of Mysore on 1 April 1951 by the Part B States (Laws) Act, 1951 (III of 1951). However, the provisions of the two Acts did not become operative in Mysore simultaneously; certain sections of the 1948 Act were brought into force on different dates. Specifically, section 76 of the 1948 Act became effective in Mysore on 30 December 1956, while section 5 of that Act commenced on 30 September 1957. By a government notification dated 27 September 1957, the Board was constituted under section 5, with the notification specifying that it would take effect from 30 September 1957.

Before the Board’s constitution, the Government of Mysore generated electric energy and supplied it to consumers of both high‑tension and low‑tension power. In 1945, on various dates, the Government entered into written agreements with each of the four textile mills for the supply of electric energy. Under those agreements, the mills were to be charged a rate of 0.55 anna per unit for day‑time power and 0.35 anna per unit for night‑time power, subject to certain monthly minimum charges. Each agreement was for a period of five years and consequently expired at different times in 1949‑1950. On 23 March 1953, the Government of Mysore issued an order revising the rates, raising them to 0.65 anna per unit for day power and 0.45 anna per unit for night power. Later, an expert committee chaired by Professor M. S. Thacker, then Director of the Institute of Science, Bangalore, was appointed to examine the rationalisation of power‑supply rates throughout the State. Acting on the committee’s recommendations, the Government again revised the rates, with effect from 1 April 1956, by an order dated 1 March 1956. Subsequently, on 26 April 1956, the four textile mills filed writ petitions in the High Court of Mysore, challenging the increased rates and seeking relief, a matter that would later be examined in the context of the arbitration provisions of section 76 of the 1948 Act.

Four writ petitions were filed in the High Court of Mysore by the four textile mills. In those petitions the mills asked that the State Government of Mysore and, after its constitution in 1957, the Board—added then as a second respondent—be restrained from levying or collecting the increased rates prescribed in the order dated 1 March 1956. The mills further requested that the parties be directed to continue to levy the rates for the supply of electric energy that had been fixed in the agreements executed in 1945. The writ petitions were supported by two arguments. The first argument contended that the State Government lacked legal authority to raise the rates for the supply of electric energy. The second argument asserted that a dispute existed between the textile mills on the one side and the Government, and subsequently the Board, concerning the rates, and that such a dispute should be resolved by arbitration under section 76 of the 1948 Act. The court noted that section 76 would be examined later, but observed that of the two points only the first had been addressed by the High Court. The High Court held that the Government of Mysore was legally competent to revise the rates for the supply of electric energy, and it declined to express an opinion on whether the mills’ contention that the dispute fell within section 76 of the 1948 Act was well‑founded. The court indicated that this question would have to be determined if and when the mills chose to enforce their rights under the procedure laid down in the Arbitration Act 1940 (Act X of 1940). Consequently, on the finding that the Government was competent to revise the rates, the four writ petitions were dismissed on 29 January 1958. By 31 March 1958 the textile mills were in heavy arrears with respect to the increased rates, although they had paid in full the amounts due under the old rates. After the Board was constituted in September 1957, it repeatedly demanded payment on the basis of the increased rates and asked the mills to clear all arrears accordingly. The mills failed to satisfy those demands, and the Board informed them that it would cut off the electricity supply in exercise of its power under section 24 of the 1910 Act. The mills then argued that a dispute had arisen between them and the Board and that the dispute must be referred to arbitration under section 76 of the 1948 Act. Accordingly, the four textile mills nominated an arbitrator, and on 13 November they proceeded with that nomination.

In 1958 the Board submitted four separate applications to the District Judge in Bangalore invoking section 33 of the Arbitration Act. In each application the Board sought a formal declaration that the controversy existing between the Board and the four textile mills could not be referred to arbitration under section 76 of the 1948 Act, and it also requested an order restraining the mills from invoking arbitration concerning the alleged dispute. These four applications generated four distinct miscellaneous proceedings, all of which were subsequently considered together by the learned Additional District Judge of Bangalore, who issued a single common order. The Additional District Judge allowed each of the Board’s petitions and concluded that the textile mills were not entitled to invoke the benefit of section 76 of the 1948 Act, because the conflict concerned the rates applicable to the supply of electric energy and, according to the Judge, such a matter was not within the scope of disputes that could be referred to arbitration under that provision. The order disposing of the four petitions was dated 17 April 1959. Following that order the textile mills each filed a petition for revision in the High Court of Mysore, resulting in four separate revision petitions corresponding to the four miscellaneous cases. By a common order dated 19 August 1960 the High Court allowed the revision petitions, holding that section 76 of the 1948 Act was applicable and that the respondent textile mills were therefore entitled to demand arbitration with respect to the disagreement over the revised rates. After this decision the Board applied to the High Court for a certificate of fitness, which it obtained, and on the basis of that certificate the four appeals from the High Court’s order of 19 August 1960 were brought before the Supreme Court.

It is relevant to note that after the Board’s constitution in 1957 an additional expert committee was appointed to rationalise the various electricity tariffs existing in the State of Mysore. Acting on the recommendations of this committee, the rates were revised for a third time, with the new rates taking effect on 1 July 1959, a date that coincided with the pendency of the revision petitions before the High Court. Before addressing the principal questions raised by these appeals, the Court considered the relationship between the two governing statutes, namely the 1910 Act and the 1948 Act. Section 70 of the 1948 Act provides that no provision of the 1910 Act or any rules made under it shall have effect to the extent that it is inconsistent with any provision of the 1948 Act; however, where the two Acts are not inconsistent, the provisions of the 1948 Act are to be read as an addition to, and not a derogation of, the 1910 Act. Accordingly, the Court found it necessary to refer to the relevant provisions of both statutes in order to determine the correct approach to the dispute.

The Court identified two principal issues that were relevant to the main question before it. The first issue concerned the authority of the Board, or of its predecessor Government, to revise the rates for the supply of electric energy and whether the textile mills could raise any dispute against such a revision. The second issue related to the provisions contained in the two Acts for the settlement of disputes by arbitration and to the identity of the persons who could be parties to an arbitration proceeding. In addressing these two issues, the Court emphasized that a clear distinction must be drawn between two separate time periods that were material to the present case. The first period extended from 1953 up to 30 September 1957, a span that preceded the formal constitution of the Board. The second period began on 30 September 1957, the date on which the Board came into existence, and continued until 13 November 1958, the date on which applications were filed under section 33 of the Arbitration Act. The Court reiterated that the rate revision that was the subject of the dispute had been effected during the first period, that is, before the Board was constituted. It also noted that a further, third revision of rates had come into force on 1 July 1959, while the revision petitions were still pending before the High Court. The Court considered it more convenient to refer to the pertinent provisions of the two Acts at a later stage, linking them directly to the two issues that required determination, and it found no merit in quoting the statutory sections at this point when they would not be directly related to the matters under consideration. Consequently, the Court refrained from reproducing the statutory language at this stage and instead focused on describing the structural differences between the 1910 Act and the 1948 Act. In brief, the 1910 Act was designed to empower the State Government, upon receipt of an application in the prescribed form and, where required, payment of the prescribed fee, to grant a licence to any person for the supply of electric energy within a specified area. The holder of such a licence was referred to as the “licensee.” The State Government also possessed powers to issue directions to the licensee concerning the supply, distribution and consumption of electric energy. Section 28 of the 1910 Act stipulated that no person other than a licensee could engage in the business of supplying energy to the public except with the prior sanction of the State Government and in accordance with conditions fixed by the Government. Accordingly, under the 1910 Act there were two categories of persons who could supply electric energy: licencees and sanction‑holders. The 1948 Act introduced substantial changes to this scheme, one of which was to expand the meaning of “licensee” so that it would include not only a licencee appointed under Part II of the 1910 Act but also a person who had obtained a sanction under section 28 of the 1910 Act.

In the 1910 Act the term “licensee” was expanded by the 1948 Act to include not only a person who held a licence under part II of the 1910 Act but also a person who had obtained a sanction pursuant to section 28 of the 1910 Act. The expanded definition expressly excluded the State Electricity Board, which was created for the first time under the 1948 Act. The 1948 Act also established two principal authorities: the Central Electricity Authority, constituted under section 3 of the Act, and the State Electricity Board, constituted under section 5. Section 26 of the 1948 Act, to which the Court will later refer in detail, provides that, subject to the 1948 Act, the Board, in relation to the State, shall possess all powers and obligations of a licence‑holder under the 1910 Act, and the provisions of the entire 1910 Act shall be deemed to constitute the licence of the Board for the purposes of that earlier legislation. A proviso in this section exempts the Board from complying with certain provisions of the 1910 Act. Chapter V of the 1948 Act lays down the nature of the works that the State Electricity Board may undertake and sets out its trading procedures; it grants the Board authority to establish its own generating stations for the supply of electric energy to licence‑holders and to any other persons who require such supply. Under the 1948 Act every licence‑holder is bound to follow such reasonable directions as the Board may give from time to time, for the purpose of achieving maximum economy and efficiency in the undertaking’s operations. Chapter VI deals with the Board’s finance, accounts and audit and contains section 60, which provides, inter alia, that all debts, obligations, contracts and matters that were incurred, entered into or undertaken by or for the State Government for any purpose of the 1948 Act before the Board’s first constitution shall be deemed to have been incurred, entered into or undertaken by, with or for the Board. Chapter VII contains miscellaneous provisions, one of which relates to arbitration under section 76. The Court quotes the relevant portion of that section as follows: “70. ARBITRATION.—(1) All questions arising between the State Government or the Board and a licence‑holder or other person shall be determined by arbitration. (2) Where any question or matter is, by this Act, required to be referred to arbitration, it shall be so referred (a) in cases where the Act provides, to the Authority and, on such reference, the Authority shall be deemed to have been duly appointed as arbitrators, and the award of the Authority shall be final and conclusive; or (b) in other cases, to two arbitrators, one to be appointed by each party to the dispute. (3) Subject to the provisions of this section, the provisions of the Arbitration Act, 1940 (10 of 1940) shall apply to arbitrations under this Act.” The Court then noted that the arguments presented before it…

The appellant’s arguments could be divided into two categories. The first category asserted that the question of the Government of Mysore’s power to revise the rate for supply of electric energy to the four textile mills for the period 1953 to 1956 had already been decided against the respondents by the High Court in the writ petitions, and that decision was binding under the principle of res judicata, preventing the respondents from raising the dispute again. The second category contended that a proper construction of subsection (1) of section 76 required the words “mother person” occurring therein to be read ejusdem generis or noscitur a socis with the term “licensee”, and consequently a consumer of electric energy would not be entitled to the benefit of that subsection; it further argued that subsection (2) of section 76 could not assist the respondents because no provision of the 1948 Act read with the 1910 Act mandated that a dispute of the nature alleged in the present case be referred to arbitration between the Government or the Board on one side and the textile mills on the other. The Court then proceeded to examine these two arguments in the order presented. Regarding the argument based on res judicata, the Court first looked at the pleadings in the writ petitions. Paragraphs 7 and 8 of the affidavits filed by the textile mills in support of the writ petitions set out two main contentions. The first contention was that the Government of Mysore had no right to increase the rates for supply of electrical energy in the manner it had done, asserting that prior agreements dated 1945 required the supply to continue at the same rates because both parties had observed the terms and conditions of those agreements. The second contention was that the rate increase was arbitrary and unfair under the provisions of the Sixth Schedule of the 1948 Act. The petitioners referred to section 26 of the 1948 Act and to the Sixth Schedule, which provides, inter alia, that a licensee shall adjust his rates for the sale of electricity by periodic revision so that his clear profit in any year does not, as far as possible, exceed the amount of “reasonable return” determined according to rules laid down in the Schedule. The textile mills argued that the rules allowed the maximum rate a licensee could charge to be determined, and that, in view of those rules, the revised rates fixed by the Government of Mysore were unfair and excessive. The prayer which was made in the writ petitions was in these terms.

The writ petitions asked the High Court to issue a writ of prohibition, a writ of mandamus, or any other appropriate writ, direction or order restraining the respondent. The respondent, meaning the Government of Mysore and later the Board, was to be restrained from levying or collecting the increased rates prescribed in the Government order dated 1 March 1956. The petitions further sought a direction that the respondent continue to levy the rates that had been agreed between the parties in the agreements of 1945. The High Court clarified that the textile mills raised only one contention. They argued that, under section 26 of the 1948 Act, the Board possessed all powers and obligations of a licensee under the Indian Electricity Act of 1910. They further contended that the Sixth and Seventh Schedules of the 1948 Act were deemed, by virtue of section 57, to be incorporated in every licensee’s authority. Accordingly, they argued that the Board could not demand electricity charges that were inconsistent with the principles laid down in those schedules. The High Court rejected this argument, holding that the Board was not a licensee within the meaning of the 1948 Act and therefore was not bound by the rules of the Sixth Schedule. Section 26 of the 1948 Act provides that the Board shall, subject to the Act’s provisions, have all the powers and obligations of a licensee under the Indian Electricity Act, 1910, throughout the State. The same section further declares that, for the purposes of the Act, the Act itself shall be deemed to be the licensee of the Board. The High Court observed that, because the definition clause in section 2(6) expressly states that the Board was not a licensee within the meaning of the 1948 Act, section 26 could not be used to assist the textile mills in their claim. Accordingly, the Court decided that the textile mills’ plea, which relied on section 26 read together with the Sixth Schedule of the 1948 Act, was unsound and could not be accepted. The Court then considered whether its earlier decision would operate as res judicata in a reference for arbitration under section 76 of the 1948 Act, noting that it had expressly left that question open. The learned Attorney General, appearing for the appellant, argued that section 26 of the 1948 Act came into force in Mysore only on 30 September 1957. He further submitted that the disputed revision of rates had been made by the Government of Mysore in 1956, when section 26 was not yet in force in that State. He further argued that, under section 60 of the 1948 Act, all matters and things to be done by the State Government for any purpose of the Act were deemed to be done by the Board. The same provision also treated actions taken with or for the Board as equivalent to actions taken by the State Government.

The Court observed that actions taken under the 1948 Act before the first constitution of the Board were to be treated as having been done by, with, or for the Board; consequently, the Board was entitled to demand payment of all arrears of electricity charges at the rates that had been revised by the State Government, provided that the State Government possessed the authority to revise the rates in 1956. The Court further held that, having recognised that the State Government held the right to revise the rates, that right could not be used to revive a reference to arbitration under section 76 of the 1948 Act. The respondents, the textile mills, argued that, considering the pleadings in the writ petitions and the High Court's decision, the only determination made by the High Court was that the Sixth Schedule of the 1948 Act did not apply to the Board and that the revised rates could not be contested on the basis of non‑compliance with the principles contained in that Schedule. The Court noted that the High Court had expressly left unresolved the question of whether the dispute should be resolved by arbitration under section 76 of the 1948 Act, and therefore that question could not be barred by the doctrine of res judicata. The Court did not think that the appeals could be decided solely on the narrow ground of res judicata. Counsel for the appellant argued, relying on the Full Bench decision in Province of Bombay v. Municipal Corporation of Ahmedabad, A. I. R. 1954 Bom. 1, that a judgment on a point of law does not necessarily bind the same parties when they are litigating a matter different from the one addressed in that judgment; however, such a legal decision would be binding as res judicata if the right claimed by a party in the later proceeding was the same as the right asserted in the earlier case. The Court considered it unnecessary to examine in the abstract the extent to which a decision on a question of law operates as res judicata between the same parties. It is well settled that, to determine whether a prior decision functions as res judicata, the court must examine the nature of the earlier litigation, the issues that were raised, and the precise matters that were decided. In the matters presently before the Court, the High Court, on the writ petitions, held that the Board was not a licensee within the meaning of section 26 of the 1948 Act and therefore was not bound by the principles laid down in the Sixth Schedule. That holding constituted the actual decision of the High Court. It is correct that res judicata applies to the matter that was actually decided, not to other issues.

The Court expressed difficulty in accepting the Attorney General’s view that the issue finally decided in the writ petitions automatically covered the question of whether the textile mills were entitled to invoke arbitration under section 76 of the 1948 Act. The Court observed that the power of the State Government or the Board to revise electricity rates and the possible right of the mills to contest those revised rates are distinct matters; a decision on one cannot operate as res judicata concerning the other. Regarding the mills’ entitlement to petition for arbitration, the High Court had expressly left that issue open. While the Court did not concur with the Attorney General’s suggestion that the present cases could be resolved solely on the narrow ground of res judicata, it identified a broader question that required examination. This broader question has two components: first, whether the alleged dispute over the rate revision made by the State Government in 1956 falls within the ambit of the 1948 Act; and second, if it does, whether the textile mills qualify as an “other person” within the meaning of section 76(1) of that Act. The Court first addressed the inquiry as to whether the dispute is covered by the 1948 Act. It noted that, for the period 1953‑1956, no provision of the 1910 Act, as then in force, imposed any limitation on the State Government’s authority to set charges for the electricity it supplied. Although section 23 of the 1910 Act and certain schedule provisions placed restrictions on a licensee’s charging power, the State Government was not a licensee under either the 1910 Act or the 1948 Act and consequently was not subject to those restraints. In general terms, the Board is deemed to stand in the place of the State Government under the 1948 legislation. Section 49 of the 1948 Act provides that, subject to the Act and any regulations made thereunder, the Board may supply electricity to any person who is not a licensee on such terms and conditions as the Board may determine, taking into account the nature and location of the supply and its intended purpose, provided that the Board does not show undue preference to any party. The Court pointed out that this provision became effective in Mysore on 30 September 1957, and therefore the rate revisions effected between 1953 and 1956 by the State Government were not made pursuant to the powers granted to the Board under section 49. Consequently, during the 1953‑1956 period the State Government of Mysore retained unfettered authority to contract with electricity consumers and to set rates as it deemed appropriate.

The Court observed that the Government of Mysore possessed the authority to enter into contracts with electricity consumers and to fix the rates it deemed appropriate. The agreements that the State Government had concluded with the four textile mills in 1945 had terminated in the period 1949‑1950, and consequently the State was under no obligation to continue supplying electricity to those mills at the earlier rates. The issue therefore fell within the realm of contract – whether express or implied – and could not be characterised as a matter arising under the 1948 Act; consequently section 76 of that Act would not be attracted. Counsel for the respondents attempted to overcome this difficulty by advancing a different line of reasoning. He first referred to section 60 of the 1948 Act and deemed it necessary to quote subsection (1) of that provision, which states: “All debts and obligations incurred, all contracts entered into and all matters and things engaged to be done by, with or for the State Government for any of the purposes of this Act before the first constitution of the Board shall be deemed to have been incurred, entered into or engaged to be done by, with or for the Board; and all suits or other legal proceedings instituted or which might be instituted for the issue of the notification under Sub‑section (4) of section … have been instituted by or against the State Government may be continued or instituted by or against the Board.” The argument advanced by the respondents’ counsel was that the rate revision effected by the State Government in 1956, whether regarded as a contractual adjustment between the parties or as an exercise of the State’s power to set rates as it saw fit, should be treated under subsection (1) of section 60 as having been carried out by the Board. Accordingly, if a dispute had arisen at the time of the revision and the Board later demanded arrears calculated at the revised rates, that dispute would be said to arise under the 1948 Act and therefore should be resolved by arbitration pursuant to section 76(1). Counsel further contended that even if the Board had revised the rates exercising its authority under section 49 – a provision previously quoted – such power would nevertheless be subject to the provisions of the 1948 Act and would invoke section 76. Hence, the respondents’ counsel maintained that the combined effect of sections 60 and 49 rendered the dispute one that arose under the 1948 Act and that it must be determined by arbitration as mandated by section 76(1). The Court expressed doubt about the correctness of this line of argument. Firstly, with respect to section 60 of the 1948 Act, the revision of rates that had been made by the State Government in the period 1953‑1956 …

In this case, the Court observed that the rate revision rested, as previously indicated, either on a contract or on a unilateral act of the State Government. In either circumstance the action lay outside the 1948 Act and could not be referred to any provision of that Act. The Court explained that for Section 60 to apply, the contract made by the State Government—or any act done by it—must be for a purpose covered by the 1948 Act. If such a contract or act were for a purpose of the Act and were entered into or performed by the State Government before the Board was first constituted, then the law would treat that contract or act as having been made or done by the Board, and any suit or other proceeding that could have been brought against the State Government could instead be brought against the Board. The Court noted that, at the relevant time, the 1910 Act contained no provision that regulated the State Government’s rates for supplying electricity to consumers. Likewise, the 1948 Act contained no section that regulated the amount the State Government could charge for electric energy it supplied. Because of this, the Court questioned how the revision of rates by the State Government could give rise to a question within the scope of the 1948 Act. Turning to Section 49, the Court observed that this provision came into force in Mysore on 30 September 1957 and applied to the Board only after the Board had been constituted. Consequently, the provision had no effect in 1956, and the Court could not see how a dispute concerning the State Government’s 1956 rate revision could be said to arise under the 1948 Act. Although the learned Attorney General accepted that the Board succeeded the State Government in interest and that the supply of electricity was one of the purposes of the 1948 Act, the Court held that this did not transform the 1956 rate revision or any dispute arising from it into a question governed by the 1948 Act merely because the Board demanded arrears based on the revised rates. The essential issue in 1956 remained the State Government’s right to revise rates, a right that had no reference to the 1948 Act. Finally, the Court rejected the respondents’ argument that the phrase “Subject to the provisions of this Act” in Section 49 invoked Section 76. The Court explained that Section 49 merely conferred on the Board the power to supply electricity to any person who is not a licensee on such terms and conditions as the Board may fix from time to time, taking into account the nature and geographical position of the supply and the purposes for which it is required.

The Court observed that Section 49 authorized the Board to supply electricity to any person who was not a licence‑holder, provided that the Board fixed terms and conditions having regard to the nature and geographical position of the supply and the purposes for which it was required. It further noted that the proviso to that section imposed a duty on the Board not to show undue preference to any person when fixing those terms and conditions. The Court rejected the argument advanced by counsel for the respondents that the provision contemplated a right for consumers to raise a dispute concerning the terms and conditions and that, once such a dispute was raised, it would be determined by arbitration pursuant to Section 76(1) of the 1948 Act. According to the Court, the phrase “Subject to the provisions of this Act” simply meant that, should there exist any statutory provisions governing the Board’s supply of electricity to non‑licencees, the Board’s actions would be subject to those provisions. The Court added that it had not been shown any provision that regulated the Board in respect of the charges it might fix for supplying electricity. The respondents had argued that the expression “having regard to the nature and geographical position of the supply and the purposes for which it is required” implied that a dispute could arise if a consumer alleged that the Board had not taken such factors into account when fixing charges. The Court examined the judicial construction of the phrase “have regard to” and referred to the Privy Council decision in Ryots of Garbandho v. Zamindar of Parlakimedi, where the Council held that the expression carries no technical meaning beyond its ordinary usage and merely requires that the relevant considerations be taken into account. Consequently, the Court concluded that the wording did not create a ground for a consumer to challenge the Board on the basis that it failed to give due regard to the nature, location or purpose of the supply. The Court then referred to the arbitration provisions in the 1910 and 1948 Acts, noting that those statutes only required arbitration for matters expressly designated to be determined by arbitration, such as the specific sections listed. None of those sections related to the rates for electricity supply by the State Government, and therefore the Board’s power to fix charges remained outside the arbitration scheme.

The Court explained that the provision quoted from the Arbitration Act, 1940 required that any matter which, by or under the 1910 Act, was directed to be determined by arbitration must be resolved in accordance with the procedure set out in that section. The effect of the provision was that arbitration could be invoked only when the 1910 Act expressly directed a particular matter to arbitration. The Court noted that several sections of the 1910 Act – namely section 7A, section 13(2), section 14(3), section 15(5), section 16(3), section 19(2), section 21(4), section 22, sections 22‑A(2) and section 32(3) – each required certain questions to be referred to arbitration. However, the Court observed that none of those sections concerned the rates charged for the supply of electricity by the State Government.

Turning to the 1948 Act, the Court pointed out that the principal provision dealing with arbitration was section 76, which had already been reproduced earlier in the judgment. The Court highlighted that the scheme of section 76 differed in certain respects from that of section 52 of the 1910 Act. Section 76 was divided into two parts. The first subsection, in broad terms, declared that all questions arising between the State Government or the Board on one side and a licensee or any other person on the other side were to be determined by arbitration. The second subsection specified that where the 1948 Act required a particular question or matter to be referred to arbitration, the reference must be made to the persons named in clauses (a) and (b). Clause (a) designated the authority named by the Act itself as the arbitrator, while clause (b) provided that two arbitrators could be appointed, one by each party to the dispute.

The Court further observed that subsection (2) of section 76 corresponded, more or less, to section 52 of the 1910 Act, but subsection (1) of section 76 was broader in scope. In addition to section 76(1), the Court identified other provisions of the 1948 Act that mandated arbitration for certain matters. These included section 19(4), section 40, section 44(3), section 45(3), section 55(2) and various clauses of the First and Fourth Schedules. Some of these provisions made the Central Electricity Authority – established under section 3 of the 1948 Act – the arbitrating authority.

Regarding section 19(4), the Court explained that it required any question arising under subsection (1) of that section concerning the reasonableness of terms, conditions or time limits to be determined pursuant to section 76. The Court noted that section 19(1) dealt with the Board’s power to supply electricity to any licensee or person within an area covered by a scheme sanctioned under Chapter V. Consequently, the Court concluded that section 19(4) did not apply to the present dispute. The Court added that if section 19(4) were applicable, the respondents might have been entitled to seek arbitration under subsection (2) of section 76. Finally, the Court summarized that, based on the analysis set out above, none of the provisions of either the 1910 Act or the 1948 Act rendered the present dispute a matter that must be referred to arbitration under section 52 of the 1910 Act or section 76(2) of the 1948 Act.

The Court observed that neither the provisions of the 1910 Act nor those of the 1948 Act render the present controversy a matter that must be referred to arbitration under section 52 of the 1910 Act or under section 76(2) of the 1948 Act. Consequently, the respondents could only invoke arbitration under section 76(1) of the 1948 Act if they were able to demonstrate that the question in dispute arose under that Act. The Court noted that the language of section 76(1) is indeed broad, as it provides that “all questions arising between the State Government or the Board and a licensee or other person shall be determined by arbitration.” Yet the Court held that the provision implicitly requires the question to be one that originates under the 1948 Act. It would be unreasonable to assume that the legislature intended every possible dispute between the State Government on one side and any individual or entity on the other to be settled by arbitration; such an interpretation would obligate all litigation involving the State Government to be referred to arbitration, which the Court found implausible. Accordingly, when the provision speaks of “all questions arising between the State Government etc.,” it must be understood to refer only to questions that arise under or are connected with the 1948 Act. Disputes between the Government and a private citizen, or between the Government and an employee, that have no relation to the 1948 Act, cannot fall within the scope of arbitration contemplated by this subsection. Under this interpretation, the respondents would first have to prove that the dispute concerning the revision of rates made by the State Government in 1956 is a question that arises under the 1948 Act. The Court regarded it as anomalous to treat a rate‑revision or rate‑fixing decision made by the Government before the Board’s constitution as a matter arising under the 1948 Act, especially when even a rate revision made by the Board under section 49 of the same Act is not referable to arbitration. Hence, the Court concluded that the present dispute does not arise under the 1948 Act. Turning to the next issue, the Court considered whether, assuming the dispute did arise under the 1948 Act, the four textile mills sought to be treated as “other person” within the meaning of section 76(1). The learned Attorney General argued forcefully that the scheme of section 76(1) places the State Government or the Board on one side of the dispute and the licensee or other person on the opposite side, and that, in the context of the whole Act, the phrase “other person” must be read as taking its meaning from the preceding term “licensee.”

In the submission, counsel for the Attorney General argued that the term “licensee” in both the 1910 Act and the 1948 Act should be understood as a genus or category of persons, and that, applying the principle of ejusdem generis, the expression “other person” therefore refers to persons belonging to the same genus or category. He pointed out that, under the 1910 Act, a “licensee” is defined as a person licensed under Part XI of that Act to supply electric energy, while a “consumer” is defined as any person who receives energy from a licensee, from the Government, or from any other person engaged in the business of supplying energy to the public under the 1910 Act or any other law then in force. He further noted that another class of persons—those designated as sanction‑holders under section 28 of the 1910 Act—may also supply electric energy.

The Attorney General continued that the 1948 Act incorporates both of these classes within its definition of “licensee,” but expressly excludes the Board from that definition. Accordingly, he maintained that the word “licensee” denotes a broad category of persons who supply electric energy to consumers. He then identified a third class of persons, distinct from the Board, who may also supply electricity, and asserted that this third class is the group intended to be captured by the phrase “other person” that follows “licensee” in section 76(1). He cited section 49 of the 1948 Act, which permits the Board to supply electricity to any person who is not a licensee, on such terms and conditions as the Board may from time to time prescribe. Similar powers, he observed, are granted to the Board under sections 18(c) and 19(1) of the same Act. The persons who receive electricity from the Board under these provisions may, in turn, supply electricity to consumers on terms laid down by the Board.

From these provisions, the Attorney General argued, it is clear that the 1948 Act envisages a class of persons—other than licensees—who obtain electricity from the Board and may subsequently supply it to consumers within the meaning of the term “consumer” in the 1910 Act. He therefore submitted that this class of persons is the one intended by the expression “other person” in subsection (1) of section 76. To reinforce his position, he emphasized that section 76(1) does not contemplate a situation where a dispute arises directly between a licensee and a consumer that could be referred to arbitration. He said that the scheme of section 76(1) places the licensee or the “other person” on the same side as the State Government or the Board, and that it would be incongruous to hold that the provision excludes a dispute between a licensee and a consumer while allowing a dispute between the State Government or the Board on one side and a consumer on the other.

In his submission, the Attorney General argued that section 76(1) does not envisage a dispute between a licensee and a consumer, but rather contemplates a dispute in which the State Government or the Board stands on one side and a consumer stands on the other. He warned that interpreting the provision in that manner would place the Government or the Board in a considerably weaker position than the licensee. The Attorney General then referred the Court to the proviso to section 26 of the 1948 Act, which removes the Board from certain clauses of the Schedule to the 1910 Act and consequently exempts the Board from being compelled to submit to arbitration for the matters enumerated therein. He contended that, because of that proviso, the Legislature could not have intended to subject the Board to a less favorable position than a licensee. The Attorney General further directed attention to sections 75 and 77 of the 1948 Act. He maintained that subsection (3) of section 75 illuminates the meaning of the phrase “other person” used in section 76(1). Sub‑section (3) of section 75 provides, inter alia, that the Board may require any licensee or any person who supplies electricity for public or private purposes, or who generates electricity for his own use, to furnish information and accounts relating to such supply or generation in the form and manner specified by notice. According to the Attorney General, that provision demonstrates that persons other than licensees may, when directed by the Board, supply electricity for public or private purposes or even generate electricity for their own use, and that those persons are the “other persons” referred to in section 76(1). The Attorney General pointed out that section 77, read with section 4, establishes a penal regime and makes clear that there exists a third category of persons besides licensees or sanction‑holders who may supply electricity for public or private purposes. Section 4 imposes a duty on each State Electricity Department, any other licensee, or any person who supplies electricity for public or private purposes or generates electricity for his own use, to furnish to the Central Electricity Authority such accounts, statistics and returns as may be required. These provisions, he argued, indicate that in addition to licensees holding licences under Part II of the 1910 Act and sanction‑holders holding sanctions under section 28 of that Act, there is a third class of persons empowered to supply electricity for public or private purposes. That third class, he said, is subject to control by the State Government, the Central Electricity Authority or the Board. Consequently, the Attorney General submitted that a dispute between this third class of persons on one side and the State Government or the Board on the other is the dispute envisaged by the phrase “other person” in subsection 1 of section 76. He relied on the decision in Williams.

In the case of Golding the Court examined the interpretation of the phrase “or other person” that occurs in section 108 of the Metropolitan Building Act, 1855 (18th and 19th Vict. c. 122). The Court held that the expression “or other person” referred to persons ejusdem generis with a district surveyor, that is, persons who performed an official duty, and it cited the decision in Golding (1865 1 L.R.C.P. 69) as authority for that meaning. The Court then referred to the decision in United Towns Electric Co. v. Attorney‑General‑Newfoundland, which explained the principle of ejusdem generis and concluded that the principle could not be applied when the statute mentions only a single species and no broader genus, because a single specific reference does not create a generic class for the rule to operate.

Against the submissions of the learned Attorney General, counsel for the respondents argued that the proper approach was to give each word of section 76 its ordinary, common meaning and that the ejusdem generis rule was not automatically applicable. They contended that invoking that rule would imply a restriction on the language of section 76 that the Legislature had not intended, and that no such restriction could be read into the provision to exclude a consumer from the phrase “other person” in subsection (1). Furthermore, they submitted that the word “licensee” placed before “other person” does not denote a generic category of electricity suppliers that would trigger the ejusdem generis rule. In support of their position, the respondents pointed to sections 28, 34, 39, 41 and 43 of the 1948 Act, noting that these provisions show that the statute does not create a genus that would limit the meaning of “other person.” The Court observed that the arguments raised by both sides would merit detailed analysis in a case that actually arose under the 1948 Act. However, because the present dispute did not arise under that Act, the Court considered the question of whether ejusdem generis applied to the interpretation of section 76 to be purely academic and declined to decide that theoretical issue.

Before concluding, the Court addressed another argument advanced by the learned Attorney General. He submitted that if every dispute between the Board and a consumer were required to be referred to arbitration, then in circumstances where the Board itself supplies electricity there could be thousands of consumers each lodging a separate dispute, leading to thousands of arbitrations, a situation the legislature could not have contemplated. The Court characterized this line of reasoning as based on inconvenience and held that inconvenience is not a decisive factor in statutory construction. Counsel for the respondents then drew the Court’s attention to section 51‑A of the 1910 Act, which provides that when the State Government engages in the business of supplying energy to the public, it shall possess all the powers and obligations of a licensee under that Act.

The Court observed that the provision which made the State Government a licensee under the 1910 Act contained a proviso, similar to the proviso to section 26, that excluded the State Government from the operation of certain provisions of that Act. The Court noted that this provision held no material relevance for the matters before it because it had been inserted into the 1910 Act only in 1959. Accordingly, for the reasons set out earlier, the Court allowed the appeals, set aside the orders of the High Court dated 19 August 1960, and restored the orders of the Additional District Judge, Bangalore dated 17 April 1959. The appellant was ordered to be entitled to its costs throughout, together with one hearing fee.

Justice Hidayatullah then expressed his agreement that the appeal should be allowed. He stated that, in his view, the dispute raised by the parties did not fall within section 76 of the Electricity (Supply) Act, 1948. Section 76 read: “Arbitration.—(1) All questions arising between the State Government or the Board and a licensee or other person shall be determined by arbitration.” The Justice held that the rule of ejusdem generis relied upon by the appellant to construe the phrase “other person” was unnecessary, because the generality of the expression need not be limited; a consumer disputing rates could not be captured by the term “other person” when the provisions of the Act were considered.

The facts of the case, as set out exhaustively by his fellow Judge Das, were summarized for brevity. The respondents were four companies that obtained electrical energy for use in their mills from the appellant. Earlier, a contract had fixed the rates for that supply, but the contract had expired in 1949‑50, after which the State Government fixed higher rates. The respondents had paid for the energy consumed at the old rates, resulting in large arrears equal to the difference between the old and the new rates. The first rate revision had occurred in 1953 and the second in 1956. The present appellant had been constituted in 1957 and had been joined in all proceedings referenced in the earlier judgment. The respondent companies acknowledged liability for the energy consumed under the expired agreements but objected to paying the newly fixed rates, thereby creating a dispute which they claimed must be referred to arbitration under section 76.

The short question before the Court was whether such a dispute was mandatorily referable to arbitration. The Court noted that if the dispute fell within the scope of section 76 and the respondent companies, as consumers, were proper parties to invoke that provision, then the dispute would have to be referred to arbitration. However, the Court emphasized that the language of section 76, though broad and complex, did not compel arbitration of every dispute. A dispute that did not fall within the ambit of section 76 need not be sent to arbitration, and the Court indicated that the section could not be readily invoked where consumers did not qualify as “other person” within the meaning of the provision.

The Court observed that the statutory provision could scarcely be invoked if consumers, such as the respondents, did not fall within the expression “other person” when that expression was interpreted on the principle of ejusdem generis or by any other construction. The Electricity (Supply) Act, 1948 (54 of 1948) was enacted in that year, and, as the long title and pre‑amble indicate, its purpose was to rationalise the production and supply of electricity and, more generally, to adopt measures conducive to the development of electrical infrastructure. The Act governs the supply of electrical energy and its rationalisation, irrespective of whether the energy is generated by a State Government, a State Electricity Board, a licence holder under the Indian Electricity Act, 1910 (9 of 1910), or a person who, having obtained sanction under section 28 of the 1910 Act, engages in supplying electrical energy. The Electricity (Supply) Act of 1948 does not address other matters relating to the supply and use of electrical energy that are covered by the earlier Indian Electricity Act of 1910. The 1910 Act deals with the grant of licences for the production of electrical energy and contains provisions concerning the supply, transmission and use of electrical energy by both licence‑holders and non‑licence‑holders, and more generally with matters connected with electricity. Both statutes must be read together, but where a conflict exists the later 1948 Act prevails. Both Acts contain provisions for the resolution of disputes by arbitration. The 1910 Act provides for arbitration in section 52, which reads: “52. Where any matter is, by or under this Act directed to be determined by arbitration, the matter shall, unless it is otherwise expressly provided in the licence of a licence‑holder, be determined by such person or persons as the State Government may nominate in that behalf on the application of either party; but in all other respects the arbitration shall be subject to the provisions of the Arbitration Act, 1940. Provided that where the Government or a State Electricity Board is a party to a dispute, the dispute shall be referred to two arbitrators, one to be appointed by each party to the dispute.” This provision obliges arbitration only in those disputes that are expressly directed by the 1910 Act to be settled by arbitration, and the Court noted that none of those specific provisions applied to the present case. Section 76 of the 1948 Act, by contrast, is broader. It mandates that “all questions” arising between the State Government or the Board on the one side and a licence holder or other person on the other side shall be determined by arbitration. Although the wording does not expressly limit the scope, the Court held that the question must be one that can arise under the Supply Act. The section does not, despite its wide language, require that disputes unrelated to the Supply Act or its provisions be resolved by arbitration; to read it so would effectively preclude the State Government or the Board from suing or being sued in the courts. Consequently, the Court concluded that a necessary qualification must be read into the section: the dispute must concern a matter that falls within the ambit of the Supply Act. Certain categories of disputes are, in fact, required by the Act to be referred to arbitration.

The Central Electricity Authority was vested with the duty to act as an arbitrator in matters arising between the State Government or the Board and a licence holder or any other person, as provided by section 3(1)(II) of the relevant Act. For other disputes the statute required that they be decided by two arbitrators, one appointed by each party. Accordingly, the four companies involved each nominated an arbitrator and served notice on the Board. The Board responded by filing four separate applications in the District Court under section 33 of the Arbitration Act, seeking a declaration that the disputes in question were not subject to referral to arbitration. The Additional District Judge of Bangalore granted the declaration, but the High Court of Mysore set aside that order on revision. The High Court then issued certificates, upon which the present appeals were filed.

Before addressing the submissions, the Court found it necessary to briefly examine the scheme of the two statutes to determine whether a dispute concerning rates could arise between the State Government or the State Electricity Board on one side and a consumer on the other, thereby invoking the arbitration mechanism. The Electricity Act of 1910 regulated the supply of electrical energy by licencees, as well as its transmission and use. It authorised the Government to grant licences and conferred upon it the power to control distribution, supply and consumption of electricity. In addition, section 28 of the 1910 Act empowered the State Government to sanction generation, supply, transmission and use of electricity by persons who were not licencees. The Act also contained provisions for supervising the activities of licencees and of persons sanctioned under section 28 to ensure compliance with its requirements. The schedule to the 1910 Act was, at present, divided into sixteen clauses; originally it comprised eighteen clauses, including clauses XI and XI A, which were omitted by the Indian Electricity (Amendment) Act 1959 (Act 32 of 1959). Clauses IX, X, XI, XI A and XII dealt with charges for the supply of electricity and the determination of rates. Under the Electricity (Supply) Act of 1948, the State Electricity Board possessed all the powers and obligations of a licencee under the 1910 Act, and section 26 of the 1948 Act deemed the Act itself to be the Board’s licence for the purposes of that legislation. However, two exceptions applied. The first, contained in the proviso to section 26, excluded from the Board certain provisions of the 1910 Act, specifically clauses IX to XII concerning charges and rates. The second exception related to the definition of “licencee” in the 1948 Act, which expressly excluded the Board from that definition.

In this matter, the Court observed that, notwithstanding the provisions of section 26, the term “licensee” used in the Supply Act of 1948 was held not to include the State Electricity Board. The Court explained that although the Board performed functions that a licensee would perform for the purposes of the 1910 Act, it was not a licensee in the true sense of the word. Consequently, the duties and obligations that normally attached to a licensee with respect to the charging of fees and the fixing of rates for the consumption of electrical energy were not applicable to the Board. The Court therefore concluded that no dispute could arise between a consumer and the State Electricity Board under the 1948 Act on the question of the rates at which the Board supplied electrical energy. The Court noted that, in the present cases, an even stronger reason existed for reaching this conclusion because the rates in question had been fixed by the State Government in the years 1953 and 1956, whereas the Board itself had not been created until 1957. When the Court questioned Mr Vishwanath Sastri about his claim that a dispute had arisen under the 1948 Act, he referred to section 60 of the Supply Act, which purported to make the Board a successor to the State Government for matters to which the Act applied. He argued that if the State Government had been incompetent to revise the rates in 1953 and 1956, the Board, as its successor, would be the appropriate respondent for any dispute. The Court, however, expressed the opinion that a dispute between the State Government or the Board on one side and a consumer on the other concerning the rates of electrical energy – apart from any contract that might have been entered into – did not arise under the 1948 Act at all. No provision of the 1948 Act had been identified that would encompass such a dispute, and the Court reiterated that only disputes arising under the 1948 Act could be compulsorily referred to arbitration. The next issue before the Court was whether a consumer fell within the expression “other person”. The Attorney‑General attempted to apply the ejusdem generis rule, contending that the phrase “other person” must take its meaning from the word immediately preceding it, namely “licensee”. He examined two statutes to show which persons could be said to belong to the genus “licensee”, and submitted that persons who generated electricity with the sanction of the State Government under section 28 of the 1910 Act formed another class within that same genus. The Attorney‑General relied on the case of William V. Golding to support the proposition that even a single category could be regarded as a genus for limiting the scope of the general words that follow. The Court recorded this argument for consideration.

The Court observed that the earlier decision accorded only a narrow meaning to the ejusdem generis rule. It noted that the provision under consideration protected persons exercising official duties and functioned as a clause safeguarding public authorities; consequently, the phrase “other person” could not be extended to include a private party that did not perform official duties. The Court expressed doubt that the earlier ruling could be applied to the present matter. It reiterated that a dispute must be one that can arise under the 1948 Act, and a comprehensive reading of the Act showed that consumers did not have a place within its scheme. Whenever the Act employed the expression “other person,” it consistently referred to persons who generate and supply electrical energy, not to those who consume it. The only section that attracted the Court’s attention as potentially giving rise to a dispute between the Electricity Board and a possible consumer—who is not a licensee as defined in the Act—was section 49. That section permits the Board to supply electricity “to any person not being a licensee” on such terms and conditions as the Board may from time to time fix, taking into account the nature and geographical position of the supply and the purposes for which it is required, provided the Board does not show undue preference to any person. Counsel for the respondent, Mr Vishwanath Sastri, argued that a dispute could arise if the Board unreasonably refused to supply electricity to a private consumer or showed undue preference to another party, and that such a dispute could be referred to arbitration under section 76. The Court declined to express any opinion on that argument because the present controversy was not of that character. For these reasons, the Court concluded that the Additional District Judge of Bangalore had correctly granted the declaration sought by the appellants. Accordingly, the Court set aside the order of the High Court, restored the order of the Additional District Judge, and awarded costs against the respondents throughout, together with one hearing fee. The appeals were allowed.