Courts must not encroach upon executive’s domain: SC

Taking strong exception to the Peshawar High Court declaring the imposition of fuel charges as “unconstitutional”, the Supreme Court has ruled that the judiciary must not encroach upon the domain of the executive branch unless there was a violation of the fundamental rights guaranteed under the Constitution or it overstepped its legal and constitutional limits.

"[The] courts, while exercising constitutional jurisdiction, must do so on the touchstone of fairness, reasonableness and proportionality,” read a 34-page judgment authored by Justice Ijazul Ahsan, while setting aside the PHC’s 2013 judgment.

The PHC verdict had held that as the generation and production of electricity by Khyber-Pakhtunkhwa far exceeded its consumption, therefore the residents of the province should not be liable to pay charges.

The PHC had also ruled that K-P contributed copiously to the national grid and despite this, the province had not been paid its due share of the net hydel profit.

Furthermore, the high court had held that it was the statutory duty of the Water and Power Development Authority (Wapda) to disburse K-P’s net hydel profit on generation, however, despite a lapse of considerable time, it had failed to discharge its duties.

A three-judge bench of the Supreme Court, led by Justice Ahsan and comprising Justice Sayyed Mazahar Ali Akbar Naqvi and Justice Ayesha Malik, noted that the PHC had ‘arrogated to itself matters of executive policy”.

The judges further observed that by connecting two different matters --  lack of payment of profits of hydel power generation with the determination of tariff to be recovered from consumers -- including the component of fuel adjustment surcharge -- delved into a legal and constitutional area which at best related to the claim of a province against the federation.

“Even on that score, the high court lacked jurisdiction to do so. This was done by the high court by ignoring the various formulae devised by Nepra [National Electric Power Regulatory Authority] and, by ignoring the fact that an alternative remedy was available under the relevant law,” the verdict read.

The SC noted that the findings of the high court were erroneous and therefore, could not be upheld. “Irrespective of whether K-P generates the most hydel power or not, the said factor cannot be made a basis to determine [if] Nepra should deduct consumer-end tariff[s],” the judgment read.

“If at all, the province is aggrieved of the actions in respect of net profit not being given to K-P, then, the province can under the law and Constitution approach the relevant forum for [the] redressal of its grievances,” it added.

The judgment also noted that the high court appeared to have “arbitrarily” interfered in a policy matter that it should have been reluctant to do considering that such issues concerned complex factors, which had a direct impact on the economy of the country.

“Where the legislature has expressly provided an authority for determination in such matters in the shape of Nepra, then [it should be] allowed to perform its functions because it has [the] technical knowhow owing to the fact that it comprises members from various technical fields,” the verdict stated.

“It has been held by this court that in cases involving utilities and economic regulation, there are good reasons for judicial restraint and/or judicial deference to legislative judgment,” it added.

The court noted that it was not the responsibility of the judiciary to regulate economic policy and  limited to legal interpretation.

“The court is expected to enforce fundamental rights reasonably and not in a manner which creates hurdles and unnecessary complications,” the judgment read.

“In the instant case with all due respect, the learned high court has overstepped its jurisdiction under Article 199 of the Constitution and overridden the policy/framework of Nepra. [In] such a situation, the learned high court was required to exercise self-restraint and defer the matter for determination to Nepra,” it added.

The court also noted that the high court could not go against the judicial pronouncements of the Supreme Court in an emotive manner.

“The learned high court could not have declared the charges as ultra vires the Constitution on the basis that the province of K-P has not been paid its dues. The said matter relates to policy and governance and ought to be raised before the appropriate forum. The high court could not equate the failures of Wapda to stultify or restrict the authority of Nepra to perform its legal functions under the Act, 1997 and rules/guidelines made thereunder,” the verdict read.

“As stated earlier, Wapda is a licensee of Nepra under the Act, 1997. Thus, it could not have been held that the failures of Wapda could be attributed to Nepra since the two entities function entirely differently. As such, the findings of the learned high court in this respect are legally and factually unsustainable,” it added.

The court also noted that even if the Council of Common Interests devised guidelines for the imposition of tariffs, they could not contradict the legislation under which an authority functioned.

The judgment observed that the provinces could not legislate on the matter of electricity.