Messrs KARACHI STEEL MILLS and others vs WAPDA and others
This matter concerns a series of writ petitions filed by consumers against WAPDA and other electricity distribution entities challenging the imposition and collection of Fuel Adjustment Charges (FAC). The core legal question addressed is whether electricity distributors can arbitrarily levy FAC as arrears with retrospective effect and whether the Regulatory Authority has a statutory obligation to protect consumer interests against such demands. The Court held that the levy and demand of Fuel Adjustment Charges as arrears with retrospective effect are unconstitutional and violate principles of natural justice. The Court ruled that the Regulatory Authority is statutorily obligated to protect consumer interests rather than permitting distributors to raise FAC demands mechanically. Furthermore, the scope of FAC is strictly limited to actual variations in fuel prices. The Court directed distributors to issue amended bills and adjust any excessive amounts already collected from consumers, emphasizing that all consumers must be treated equally. The judgment establishes that the Constitution of the Islamic Republic of Pakistan prohibits exploitation and mandates the High Court to protect citizens from arbitrary executive actions and illegal financial demands.
- Is the levy and demand of Fuel Adjustment Charges as arrears with retrospective effect constitutional?
- Does the Regulatory Authority have a statutory obligation to protect consumer interests regarding Fuel Adjustment Charges?
- Can electricity distributors demand Fuel Adjustment Charges in a mechanical fashion?
- Are electricity distributors required to adjust excessive amounts collected from consumers through Fuel Adjustment Charges?
- Constitution of the Islamic Republic of Pakistan 1973
ORDER
1. ' SHAUKAT AZIZ SIDDIQUI, J.--- For the reasons, to be recorded later on, all above captioned writ petitions are allowed through instant single order, to the following effect:
(i) It is declared that Regulatory Authority is under statutory obligation to protect the interest of consumer as well, instead of allowing the distributors to raise demand of FAC in a A mechanical fashion. The Constitution of the Islamic Republic of Pakistan does not permit exploitation of any kind or form, therefore, it casts duty upon the High Court to protect any person from being exploited and to provide shield to the Socio B Economic fibre of the country, from being disrupted at the hands of executive functionaries. The consumers/citizens cannot be left at the mercy of bodies at advantageous position, as arbitrary exercise of authority, mala fide actions and illegal demands have always been checked by the superior Courts.
(ii) Levy and demand of Fuel Adjustment Charges as arrears with retrospective effect is declared as unconstitutional, besides the law applicable principles of natural justice and dictums laid down by the superior courts of the country.
(iii) The scope of levy/demand of Fuel Adjustment Charges cannot be expanded and has to remain within the variations in the prices of fuel.
(iv) The distributors of electricity are directed to issue amended bills and in case consumers had already paid the bills, excessive amount received be adjusted accordingly, which has to be reflected in the bills of coming month. All persons/consumers whether before this Court, or not, must be treated equally.
Cited by 3 cases
- Messrs UNITED ETHANOL LIMITED and 6 otherss vs ENVIRONMENTAL 2015 CLD 1079
- Messrs BOLAN STEEL INDUSTRIES (PVT) LTD. through Managing Director and others vs WATER AND POWER DEVELOPMENT AUTHORITY (WAPDA) through Chairman and others 2014 PLD Balochistan 173
- Haroon Zakaria and Company Chartered Accountants vs The Director