This is an appeal from an action brought by the appellee, City of Indianapolis, in the Superior Court of Marion County, to set aside and enjoin an enforcement of an order of appellant, Public Service Commission of Indiana. The history of this case is as follows:
The order of the Commission was the result of a proceeding originally commenced by the appellant, Indianapolis Water Company, on September 18, 1953, when it filed with the Commission its petition for the approval of a new rate schedule to be charged for service. The petition also asks for authority to change the rate on which its reserve for depreciation was computed. City of Indianapolis intervened in this original proceeding before the Commission. On March 18, 1954, after hearing, the Commission entered its order approving a new schedule of rates and fixing a new rate for depreciation.
*76The City thereupon, commenced this action against the Commission in the Superior Court of Marion County, to vacate that order and enjoin the Commission. The Indianapolis Water Company intervened as a defendant therein. Trial was commenced on September 20, 1954. At the close of the hearing on the application for temporary injunction, the trial court found no necessity to enjoin the Commission at that time but ordered that the amount collected as. the result of the new rate increase be held by the Company available for the final decision in the case.
Pursuant to the direction of the trial court the City perfected a statutory appeal from the Commission’s order and the same was consolidated with the injunction action. The consolidated action was heard by the Superior Court of Marion County in banc on the merits. At the conclusion of the hearing, the court found that evidence presented was materially different from that which had been offered during the proceedings before the Commission, and directed that all such additional and new evidence presented to the court be transmitted to the Commission for its reconsideration, as provided in Acts 1929, ch. 169, §8, p. 530, being §54-436, Burns’ 1951 Replacement.
The Commission, after reviewing the additional evidence which concerns solely the amount of return on the rate base used, affirmed its earlier determination of fair value and return, but found that the annual gross revenues under the new schedule of rates would be approximately $111,000 in excess of the amount required to produce the income to which the Commission found the Company was entitled. Accordingly, the Commission modified its order and directed the Water Company to file a schedule of rates designated to produce gross income in the amount estimated in the *77original order and duly certified and reported its action to the Superior Court of Marion County.
Thereafter, on February 7, 1954, the Superior Court of Marion County reconsidered the order of the Commission and there being no additional evidence introduced, the trial court set aside the Commission’s order, and rendered a decision in favor of the City, holding the modified order of the Commission to be unreasonable and unlawful. A judgment of the trial court was entered vacating the Commission’s order, permanently enjoining the Commission from enforcing such order or any modification thereof, permanently enjoining the Commission from charging the rates fixed by such order, and requiring the Company to refund to the consumer the amount collected in excess of the rates existing at the time the application was originally made to the Commission for an increase.
Upon the resubmission of the Commission’s modified order to the trial court, no additional evidence was introduced and the Commission moved that the pending action be dismissed on the ground.that there was no showing that it was not supported by substantial evidence. The trial court denied this motion, and entered a special finding of fact consisting of thirty-four items with conclusions of law thereon, and rendered judgment against the Commission and Water Company and in favor of the City, as stated above. Motions for a new trial were filed by the parties against whom the findings and judgments were rendered. The assignment of errors .is based upon the overruling of the motions for a new trial. The motion asserted that the decision of the trial court was not sustained by sufficient evidence and was contrary to law, and on the part of the Commission, that the court erred in overruling its motion to dismiss.
*78This is an action brought under the statutes by the City for the purpose of testing whether or not the Commission in fixing the rates and making the order in question kept within its jurisdiction, and conformed to the standards fixed by the statute.
The present case is brought by the appellee, under the following statutory provisions:
“Any person, firm, association, corporation, city, town or public utility adversely affected by any decision, ruling, order, determination, requirement or direction of the public service commission may commence an action in the circuit or superior court of any county in which that portion of the utility which is the subject-matter of the procedure before the public service commission operates or seeks to operate, against the commission to vacate or set aside or enjoin the enforcement of any such decision, ruling, order, determination, requirement or direction, on the ground that the same is insufficient, unreasonable, unlawful, or procured by fraud or other unlawful methods.”
Acts 1929, ch. 169, §1, p. 530, being §54-429 Burns’ 1951 Replacement.
“Any single municipality or any ten [10] consumers or any utility affected by a rate order may within thirty [30] days from the rendition thereof by the commission take an appeal de novo to the circuit court of the county in which the utility is located or the general term of the superior court of Marion County.”
Acts 1913, ch. 76, §9, p. 167; 1933, ch. 190, §4, p. 928; 1947, ch. 307, §1, p. 1251, being §54-203 Burns’ 1951 Replacement.
What, then, is the scope of the court’s statutory review? In other words, may the court impose its own idea of what is “insufficient” or “unreasonable” in the place of that of the Commission?
*79*78The City makes the contention that this is “an appeal de novo” under the statute and the trial court *79thereby has the opportunity to weigh the evidence and substitute its opinion for that of the Commission. We, as judges, are subjected to the same natural desires and to the same weaknesses that all men have to substitute our personal judgment for that of others, and we must guard against such inclinations. Where the legislature has created a fact-finding body of experts in another branch of the government, their decision or findings should not be lightly overridden and set aside because we, as judges, might reach a contrary opinion on the same evidence. So long as the experts act within the limits of the discretion given them by the statute, their decision is final. The question raised here was thoroughly reviewed and decided by Judge Treanor in the case of N. Y., C. & St. L. R. R. Co. v. Singleton (1935), 207 Ind. 449, 190 N. E. 761. (Cert. den. 296 U. S. 578, 56 S. Ct. 89, 80 L. Ed. 409.) This court declared that the expression “appeal de novo” as used in the act under which the City brings this action does not have the same meaning as used in cases of an appeal from the justice of peace, to a circuit court. In the latter situation the case on appeal stands in the circuit court as if it had been originally commenced • in that court. No legal aifect is given to the trial before the justice of peace. Just the opposite is true where an “appeal” is taken from the order of the Public Service Commission.
Acts 1941, ch. 101, §5, p. 255, being §54-112, Burns’ 1951 Replacement, creating the Commission, provides:
“The commission created by this act [§§54-102, 54-109 — 54-120] shall in all controversial proceedings heard by it be an impartial fact-finding body and shall make its orders in such cases upon the facts impartially found by it. The commission shall in no such proceeding, during the hearing, act in *80the role either of a proponent or opponent on any issue to be decided by it.”
Acts 1913, ch. 76, §84, p. 167, being §54-439, Burns' 1951 Replacement, provides:
“The burden of proof shall be on the party adverse to such commission or seeking to set aside any determination, ... or order of the commission complained of is unreasonable or unlawful, as the case may be.”
Another statute that is pertinent hereto reads as follows:
“All rates, tolls, charges, schedules- and joint rates fixed by the commission shall be in force and be prima facie lawful, and all regulations, practices and services prescribed by the commission shall be in force and shall be prima facie reasonable unless- finally found otherwise in an action brought for that purpose pursuant to the provisions of sections seventy-eight to eighty-five.”
Acts 1913, ch. 76, §77, p. 167, being §54-428, Burns’ 1951 Replacement.
The appellee, City of Indianapolis, has the burden, in the case before us, of overcoming the prima facie reasonableness of the Commission’s presumptive impartial finding and order, certified to the trial court below. It can overcome this burden only by demonstrating and showing to the trial court that the Commission’s order is not sustained by substantial evidence. This rule regarding “substantial evidence” is one adopted by the Supreme Court of the United States in Florida v. United States (1934), 292 U. S. 1, 12, 54 Sup. Ct. 603, 78 L. Ed. 1077, where the court said:
“. . . its (commission’s) findings of fact supported by substantial evidence are not subject to *81review. It is not the province of the court to substitute their judgment for that of the commission.”
This court has recognized this doctrine repeatedly: Public Service Commission v. Indiana Bell Telephone Co. (1955), 235 Ind. 1, 130 N. E. 2d 467; Pub. Serv. Comm. v. Ft. Wayne U. Ry. Co. (1953), 232 Ind. 82, 111 N. E. 2d 719; Pub. Serv. Commission v. City of LaPorte (1935), 207 Ind. 462, 193 N. E. 668; N. Y., C. & St. L. R. R. Co. v. Singleton, supra (1935), 207 Ind. 449, 190 N. E. 761.
The “substantial evidence” rule, in statutory appeals of this kind, leaves the function of fact-finding and rate-making with the Commission, where it belongs, and does not attempt to make it a responsibility or duty of the court, where it does not belong.
In the first place, rate-making is a legislative, not a judicial function, and even if a statute attempted to lodge such power in a court it would be unconstitutional. Although we have a constitutional system of government in which the judiciary is said to be supreme in determining the jurisdiction and limits on the powers of the other branches of the government, as fixed by the constitution and laws, yet this supremacy does not extend to the point where we may substitute our judgment for, or control the discretionary action of the executive or legislative branches, so long as their action is within the sphere and jurisdiction fixed by the statutes and constitution. Were it otherwise, the courts would usurp, thereby, all discretionary action in the government and in effect would be directing and supervising all branches. That, of course, was not, and is not the rationale under which our constitution was formed. Federal Radio Com. v. General Electric Co. (1930), 281 U. S. 464, 74 L. Ed. *82969, 50 Sup. Ct. 389; Keller v. Potomac Electric Power Co. (1923), 261 U. S. 428, 67 L. Ed. 731, 43 Sup. Ct. 445.
In State ex rel. Public Service Com. v. Marion C. Ct. (1951), 230 Ind. 277, 100 N. E. 2d 888, 103 N. E. 2d 214, both the majority and the dissenting opinions take the same unequivocal stand on this fundamental tenet. Judge Emmert, in dissenting (on the denial of a writ of prohibition), quotes and reviews the opinions of the United States Supreme Court carefully, and says if the trial courts have the power to fix rates they “will have little time for anything else, in view of the complicated questions of value and rates- involved and the voluminous evidence proper in such hearings. Why have any Commission at all if this court is going to usurp its powers?” The “substantial evidence” rule is the only reasonable rule for avoiding such a Serbonian bog.
“The Supreme Court has, indeed, rejected as unconstitutional some statutory provisions in which the legislature has sought to impose broader duties of review upon the courts. Such duties, in the court’s view, would violate the constitutional provision for separation of the powers of government.”
28 Ind. L. J. 1 at page 5.
Under a strictly judicial review to which we are limited here, in addition to determining whether or not the order of the Commission is supported by substantial evidence, there is another matter in which the court may always properly inquire, and that is the question whether or not the order is contrary to law-. Is the order or finding the result of considering or failing to consider some factor or element which it is apparent improperly influenced the result or final determination? In other words, did the Commission stay within its jurisdiction and con*83form to the statutory standards and legal principles involved in producing its order? This is purely a legal question and a proper one for the courts to determine in any judicial review regardless of any statutory provision. These issues include questions of legality of the administrative procedure and violations of fixed legal principles as distinguished from questions of fact or expert judgment or discretion. In some jurisdictions the writ of certiorari performs this function. Ballman v. Duffecy (1952), 230 Ind. 220, 102 N. E. 2d 646; Staten Island Edison Corp. v. Maltbie (1947), 298 N. Y. 374, 73 N. E. 2d 705, 8 A. L. R. 2d 825; 73 C. J. S., Public Utilities, §65, p. 1173; 73 C. J. S., Public Administrative Bodies and Procedure, §168, p. 510; 10 Am. Jur., Certiorari, §10, p. 533.
It is established law in this state that there is an inherent right to appeal to the courts for relief against the violations of personal or property rights as a result of administrative action. The legislature may not absolutely deprive one of such relief or judicial review. However, where the statute provides for a procedure for such review or for a judicial remedy, it excludes any common law or equitable procedure to the extent such statutory provisions are adequate in protecting and preserving such substantive rights guaranteed by the constitution, the statutes or general principles of law. Such statutory procedure must be followed at least to the extent of the remedy available before resort is made to any common law or equitable remedy. Ballman v. Duffecy, supra (1952), 230 Ind. 220, 102 N. E. 2d 646; Joseph E. Seagrams & Sons v. Board of Com’rs. (1943), 220 Ind. 604, 45 N. E. 2d 491; State ex rel. White v. Hilgemann, Judge (1941), 218 Ind. 572, 34 N. E. 2d 129; Warren v. Indiana Telephone Co. (1940), 217 Ind. 93, 26 N. E. 2d 399.
*84Judge Shake, in a case reviewing a decision of the Industrial Board, said:
“Strictly speaking, there is no such thing as an appeal from an administrative agency. It is correct to say that the orders of an administrative body are subject to judicial review; and that they must be so to meet the requirements of due process. Such review is necessary to the end that there may be an adjudication by a court of competent jurisdiction that the agency has acted within the scope of its powers; that substantial evidence supports the factual conclusions; and that its determination comports with the law applicable to the facts found.” Warren v. Indiana Telephone Co., supra (1940), 217 Ind. 93, 105, 26 N. E. 2d 399.
To summarize what has been said:
(1) We are not concerned here with the general equity jurisdiction of the court in which it may weigh the evidence in determining- the fact as to any issue of confiscation of property.
(2) The trial court has no power to hear the statutory “appeal de novo” in the common law sense and weigh the evidence or arrive at its own independent ,opinion or judgment.
(3) For the trial court to stay within its constitutional jurisdiction and not infringe upon another branch of .the government, the judicial review of the order of the Public .Service .Commission in this case is limited to.:
(a) A determination of whether or not the order or finding of the Commission is unreasonable in the sense that it is not supported by substantial evidence.
(b) A determination of whether or not the order of the Commission is unreasonable or unlawful in the sense that it is contrary to law because of a violation of certain legal principles or statutory requirements or the consideration of or failure to con*85sider certain factors or elements which it is apparent improperly influenced the result or final order.
The words “insufficient, unreasonable and unlawful” or terminology of like import, in the statute fixing the grounds of review, in this case, have only the limited content or meaning specified above. This is necessary in order to give such statute granting a judicial review constitutional life. Where the statutory terminology of “reasonable’ or “unreasonable” is used in this opinion it is in the limited sense referred to above. It might be said with some logic that any violation of a constitutional guaranty, particularly where the issue of confiscation is raised, could properly be classified also as unreasonable. However, since that issue is not raised here we see no reason for deciding such a question in this case.1 Public Service Comm. v. Indianapolis Rys. (1948), 225 Ind. 656, 76 N. E. 2d 841; Public Serv. Com. v. Ft. Wayne U. Ry. Co., supra (1953), 232 Ind. 82, 111 N. E. 2d 719; 73 C. J. S., Public Utilities, §66 (d), p. 1186.
*86The case of Public Service Commission v. Indiana Bell Telephone Company, supra (1955), 235 Ind. 1, 130 N. E. 2d 467, recently decided by this court, should be distinguished by reason of the fact that it was concerned with the constitutional question of confiscatory rates. In deciding that issue, the trial court, although conforming to certain statutory procedure, was acting under its general equity jurisdiction and was entitled to arrive at its independent judgment on the evidence presented, in determining the issue of confiscation of property, as in any ordinary suit in equity where an issue of fact is presented. In this case the order of the Commission may not be set aside if the finding or order of the Commission is supported by substantial evidence, regardless of whether or not the finding of the trial court is supported by evidence.
In such a case the finding of the Commission must prevail since its finding is made prima facie correct by the statute when the evidence is in conflict. The Commission is given this function by the statute as a legislative act and the court has no right to substitute its different opinion based upon conflicting evidence. For the court to do so would be in violation of the constitutional provisions for the separation of the powers of government.
On the other hand, the order of the Commission should be set aside if it is not supported by substantial evidence, or if it is found to be contrary to law in the sense used in this opinion. If any statute, any legal principle, or rule of substantive or procedural law has been violated in the composition of the final order, it cannot stand.
We have examined the forty-four special findings of fact of the trial court which formed the basis of the judgment setting aside the Commission’s order., The *87findings of the trial court and the contentions of the City in support thereof may be grouped and summarized as follows:
(1) That the Company received too great a rate increase in 1951. (Findings 5 to 10, both inclusive.)
(2) The Company has retained earnings which were excessive over and above dividends and this is evidence that the rates are unreasonable and unjust. (Findings 12-17, both inclusive, and No. 34.)
(3) The Company should have issued additional capital stock and bonds for expansion rather than retain earnings for that purpose. (Findings 20-24, both inclusive.)
(4) The valuation of used and useful property ($36,500,000) is unreasonable. (Findings 28 and 29.)
(a) Real estate valuation is improper. (Finding 30.)
(b) Customers’ deposit and advancement for construction included in valuation improper. (Findings 31, 32 and 33.)
(5) The income and the rates are unreasonable, unjust and unlawful (Findings 11 and 24-26, both inclusive), and the rate of return is excessive.
We shall discuss the first three above features of the findings together, since they are related.
A great amount of time and effort is expended by the City in attacking a former order of the Commission made in 1951 fixing the rates at that time, and attempting to demonstrate that such rates were unreasonable and exorbitant. The rates fixed in the 1951 order have been adjudicated and the court at this late date has no power or jurisdiction to go back and re-examine such an order. Assuming the Commission had erred in 1951 and granted excessive rates. *88of which there is no showing, there would not be the slightest justification for the Public Service Commission granting the Company, any rate other than that which would produce a reasonable return upon the present fair value of its used and useful property. The theory propounded by the City cuts both ways. If its contention were true, then a rate established in 1951 which was insufficient or caused a loss to the Company, would entitle the Company at this time to have a rate established by which it could recoup such a loss or deficiency.
Past losses of a utility cannot be recovered from consumers nor can consumers claim a return of profits and earnings which may appear excessive. 73 C. J. S., Public Utilities, §25 (d), p. 1045; 43 Am. Jur., Public Utilities and Services, §§162, 163, p. 678.
The chances of a loss or profit from operations is one of the risks a business enterprise must take. The Company must bear the loss and is entitled to the gain depending upon the efficiency of its management and the economic uncertainties of the future after a rate is fixed. Were it not so, a premium would be placed upon inefficiency, waste and negligence in management. It is better policy to encourage thriftiness, saving and frugality on the part of a utility management. Such incentive inures eventually to the benefit of the consumers in succeeding rate hearings.
The City makes the further statement (referring to earnings retained by the Water Company and not paid out in dividends), “this clearly indicates either an inflated rate base or unreasonably high and unjust rates and charges permitting an exorbitant and unlawful return to the Water Company or both.” Dr. Thatcher, the public’s witness on the side which the appellee, City, now defends stated, “I am not suggesting that there *89has been excessive earnings by the Company, especially in the latter years.” This testimony is uncontradicted.
The City argues that the earnings of the utility retained by it over and above what it - pays- out in dividends is some sort of trust fund for the benefit of the consumers, and in some vague way does not belong to the Water Company. These unorthodox contentions are made in the face of the fact that the financial expert, a witness for the public, stated, in fact, that the dividend rate of the Water Company was too low. Nevertheless, a further claim is made that the Company had excessive earnings which it wrongfully used for additional capital expansion and which should have been used to pay dividends on an increased capital stock issue; that the money received from the capital stock issue should have been used for capital expansion along with a bond issue, the interest on which could, also have been paid out of the alleged “excessive earnings.” This contention is nothing more than declaring that the dividend rate of the utility upon its outstanding capital stock, is a criterion, by which one may determine whether or not the income, returns and earnings of the Company, is exorbitant and unreasonable. Of course, it should be understood that the total net earnings of a utility based upon a fair valuation of its useful assets is an entirely different standard and principle.
To say that a utility’s rates are unreasonable because its pays large dividends or has a high per share earning rate, is a popular fallacy that seems to appeal to the public fancy. Such a statement is not that of which sound reasoning is made. It is only evidence of superficial thinking. The statute does not permit the Commission to fix rates based on the outstanding stock issue. The capitalization and the *90stock outstanding may not have any fair relationship to the actual invested property used by the utility, or its reproduction cost, or its fair value.
If capital stock could be kept in the same relationship to the “fair value” of the assets used in the utility at all times, by issuing new stock, or by the reduction of outstanding stock, the dividends or earnings on the outstanding stock might reflect the reasonableness or unreasonableness of the return. However, such a supposition is unrealistic in view of the continued changing values and costs in every day operations. Indeed, every day and every minute there is a change in the values in the utility or in any corporation for that matter. It would be impossible to keep the outstanding stock in any exact relationship with the assets. Some companies from past practices may have a watered or excessive issue of stock. Other companies, by conservative and efficient practices, may have an under issue of stock outstanding and have surplus accumulated and left in the Company by reason of unusually low dividend rates, which surplus may not be represented by any outstanding stock. Stockholders may see fit to leave their earnings in the corporation instead of drawing them out as dividends and thus build up the financial strength and prestige of the Company. As a result, a utility is able to borrow at cheaper rates. This ultimately benefits the rate payer as well as the Company. The latter situation seems to prevail here according to the testimony of all witnesses on the subject matter, including the financial expert testifying on the side of the City. The record shows the common stock has earned $1.87 per share and paid out as dividends only 80 cents and 50 cents per share on Class A and B, respectively. Earnings left in a business is the least expensive method of acquiring new capital. *91Such retained earnings belong to the corporation and the shareholders, and they are entitled to receive a return on such increased investment.
The unsoundness of the contention of the City that where either dividends or earnings on stock appear large per share, it is indicative that the rates charged are unreasonable, is self-evident. The appellee, City, would probably be, and should be, the first to object to a rate base measured by the outstanding stock of the utility.
The appellee, City, makes further complaint and the trial court’s finding was, that the Water Company should have issued an additional $9,000,000 in preferred stock at 5% or $9,000,000 in bonds at 3% for the purpose of expansion. No issue of the kind was raised before the Public Service Commission, and it made no such findings or order at any time that such financing take place. The Company is not permitted under the law, to engage in such reorganization of its capitalization and such financing without a hearing and an order permitting such operation by the Public Service Commission. (§54-505, Burns 1951 Replacement.) If the City or consumers felt that this should have been done, they should have petitioned the Public Service Commission for an order compelling the Company to engage in this financing and expand its service specifically as directed in the order. The Company cannot be charged in a rate hearing for failing to engage in a large scale financial operation that has never taken place and was never in issue by any pleadings and on which no specific order was ever made. The statute does not permit the fixing of rates on a hypothesis or a situation never in existence.
Chief Justice Bobbitt, said recently in Public Service *92Commission v. Indiana Bell Telephone Company, supra (1955), 235 Ind. 1, 130 N. E. 2d 467, 480.
“Appellants (commission) could not arbitrarily disallow federal taxes which appellee had paid or was obligated to pay by assuming a tax saving-under a capital structure which did not exist. This action was both arbitrary and unlawful.”
The findings of the court, therefore, with reference to the rate of dividend paid, earnings retained, or the failure to perform other financial operations of the Company has nothing to do with the fair rate of return in this case nor the fair valuation of the property of the Water Company used in its utility service.
We next consider the findings of the trial court with reference to the valuation fixed by the Commission.
Finding 30 nf the trial court states that the appraised value of the Company’s real estate, exclusive of improvements, was fixed at $4,908,568 and it further finds that the maximum value could be only that assessed for taxation, which was $1,872,480. In the amended order of the Commission it is made clear that the Commission used the figure of $2,170,684 for its valuation which was the original cost figure of the land. There is a comparatively small difference between the total fair value figure used by the Commission and the taxation figure. Regardless of this, however, the finding of the trial court is contrary to law, in that it attempts to use for rate-making purposes a value for land fixed for tax purposes, which, by statute, is one-third of its market or sale value in 1949. The Acts of 1949, Ch. 225, §5, p. 724, being §64-1019n, provides:
“The rate of assessment on lands shall not exceed thirty-three and one-third per cent of the market or sale value as of March 1, 1949.”
*93No legislature may enact a law providing for a valuation of utility property for rate-making purposes at other than its full fair value. The provisions of §54-203, Burns’ 1951 Replacement with respect to any requirement based on the Acts of 1949 are no longer effective or applicable. To construe it otherwise would result in its unconstitutionality. 43 Am. Jur., Public Utilities and Services, §120, p. 656; Knott v. Chicago, B. & Q. R. Co. (1913), 230 U. S. 474, 57 L. Ed. 1571, 33 S. Ct. 975.
The findings 31, 32 and 33 of the trial court are also contrary to law and not supported by the evidence. In these findings the trial court states that the customers’ meter deposits and customers’ advances for construction “has been included in all estimates of value before the Commission and by the Commission itself in arriving at its findings of fair value.” These are not items included in the total which compose the figure fixed for the fair value of the utility's property. These deposits constitute an obligation which the Company owes to its customers the same as any other indebtedness, bonded or otherwise. It is not a deductible item any more than bonded indebtedness is a deductible item. The legal principle involved is well settled. Vincennes Water Supply Company v. Public Service Commission (7th Cir. 1929), 34 F. 2d 5; Plainfield Union Water Co. v. Board of Public Utilities Comm. (3rd Cir. 1929), 30 F. 2d 846, affirmed, 30 F. 2d 859.
Under findings 28 and 29 the trial court stated the fair valuation fixed by the Public Service Commission for the used and useful property of the Water Company, as a rate base was unreasonable. The standards to be used for the determination of the value is stated in the statute.
*94Section 54-203, Burns’ 1951 Replacement, supra, in part, provides:
“The commission shall value all property of every public utility actually used and useful for the convenience of the public at its fair value, giving such consideration as it deems- appropriate in each case to all bases of valuation which may be presented or which the commission is authorized to consider by the following provisions of this section. As one of the elements in such valuation the commission shall give weight to the reasonable cost of bringing the property to its then state of efficiency. ... No account shall be taken of good will for presumptive values growing out of the operation of any utility as a going concern. ... As an element in determining value the commission may also take into account reproduction costs at current prices, less depreciation, . . .”
The Commission has fixed a valuation of $36,500,000 as a fair value. The estimated original cost of the physical plant depreciated on September 30, 1953, was $33,565,000 and prior to the close of the hearing had been, by actual additions, increased to $36,700,000, to which should be added supplies and materials amounting to $410,000, and cash for working capital. It will be seen that this undisputed original cost figure exceeds the sum of $36,500,000 fixed by the Commission.
The figures on the fair valuation of the property of the Company on September 30, 1953, by the Water Company was $47,500,000. The public’s witness on the same matter testified to a figure of $32,400,000 as the fair value of the physical plant only, on the same date, to which would have to be added more than $3,280,000 as the actual increase made to the utility plant from September 30, 1953, to the date of trial with an additional sum for cash working capital. This would bring the minimum figure by the public’s witnesses for the *95fair valuation and for the original cost depreciated at the time of the trial court’s finding (October, 1954) to an amount in excess of that fixed by the Public Service Commission of $36,500,000.
The “fair value” testimony of the various witnesses is nothing more than their conclusions on an ultimate issue which is the duty of the Public Service Commission to determine from all the evidence presented. “Fair value” is a conclusion or final figure, drawn from all the various “values” or factors to be weighed in accordance with the statute by the Commission.
The fair value fixed by the Commission is below the reproduction cost less depreciation figures of $64,500,000 and $47,100,000 presented by the Water Company and public’s witnesses, respectively.
In this connection, the City contends that the Commission should not take into consideration the cost of reproduction less depreciation; that this measure of value has been eliminated by the Supreme Court of the United States in Federal Power Com. v. Hope Nat. Gas Company (1944), 320 U. S. 591, 64 Sup. Ct. 281, 88 L. Ed. 33. An examination of that case shows that it held that reproduction costs less depreciation is not the sole or controlling criterion by which a rate base is established but that other factors may be considered, including original cost. This latter item, considered in the light of established facts and surrounding conditions, may be more controlling with the Commission who are experts in that field rather than the court. The case in effect says that the courts will not limit the Commission to any one or more methods of valuation, be it prudent investment, original cost, present value, or cost of reproduction. This court has held that 'cost of reproduction depreciated, is a *96proper item to be considered under the statute in arriving at a fair value figure. Public Service Comm. v. Indianapolis Rys., supra (1948), 225 Ind. 656, 76 N. E. 2d 841.
The rate-making process involves a balancing of all of these factors and probably others; a balancing of the owner’s or investor’s interest with the con-sumer’s interest. On the one side, the rates may not be so low as to confiscate the investor’s interest or property; on the other side the rates may not be so high as to injure the consumer by charging an exorbitant price for service and at the same time giving the utility owner an unreasonable or excessive profit. Regardless of the weight to be given the factor of reproduction cost, it seems the figure for fair valuation fixed by the Commission could be sustained alone upon the evidence of original cost depreciated. Of this the City cannot complain, since it is the lower figure. St. Joseph Stockyards Co. v. United States (1936), 298 U. S. 38, 56 Sup. Ct. 720, 80 L. Ed. 1033; Ohio Valley Water Co. v. Ben Avon Borough (1920), 253 U. S. 287, 40 Sup. Ct. 527, 64 L. Ed. 908; 48 Colum. L. Rev. 1.
The trial court’s- findings Nos. 28 and 29 that the fair valuation of the used and useful property of the Water Company fixed by the Commission at $36,500,000 is unreasonable, and excessive is not supported by any evidence; on the other hand, the Commission’s finding -is based on substantial evidence.
We come now to a consideration of the trial court’s finding and the City’s claim that the rate of return is unreasonable. The testimony and briefs all refer to “gross” income or return, as the revenue remaining after subtracting all expenses of operation and other deductible items except the interest or debt cost. This seems to us a misnomer and in order to be more concise *97we shall, where necessary, refer to this figure as “net” income or return.
The City relies heavily in its brief, upon the testimony of the public’s witness, Dr. Thatcher, on the question of adequacy of the net return on the fair valuation figure. In fact, he was the only witness to testify on the public’s or City’s side of the case on that matter. We shall, therefore, accept his testimony as the most favorable in examining the trial court’s finding in that respect.
Dr. Thatcher approaches the problem of a reasonable return by using the capital structure of the Water Company on December 31, 1952, as a base for his calculations, rather than a fair value figure of the assets used and useful as provided by the statute. The result is that his capitalization figure is nothing more than a book value of the property of the Water Company. It could be relevant on only two theories:
1. For the purpose of determining what income should be received by the utility in order that the financial strength of the Company be maintained, such that its securities would be attractive to investors, and thus give it the opportunity to develop and expand as the needs of the community require; in other words, to find the reasonable cost of capital.
2. As a rate base, upon which to figure a return, but only on the assumption that it represents the original cost depreciated, and then only on the further assumption that the accounting practice has been accurate.
The first ground is incidental here compared with the second, which is a major issue directly involved in this case.
The capitalization he uses is $33,978,300 taken from the statement of the Company on December 30, 1952. *98This is composed of the stock equity (common, preferred and surplus accounts) plus the debt. He reaches the determination of a reasonable return by estimating what he believes to be a fair average overall cost of the capital. He finds the present actual cost (dividends and interest) to be 3.31% for the Water Company, and says:
“The overall rate of 3.31% is the result in a large part of the low dividend paid on common stock. . . . The 3.31% cash cost of capital may be considered the bare bone cost and should not be confused with my estimated capital or rate of return. In order to carry on a business successfully and attract capital necessary to finance needed additions, a utility must have earnings in excess of bare interest cost and low dividend requirements.”
He states the overall cost of capital of the Water Company should be increased to 5.13% for a reasonable return. He said that additionally, there should be sufficient earnings to create a reasonable surplus to take care of the risk involved in the investment and unforeseen contingencies. Under his recommendation the owners would receive five to six per cent upon their equity. He condemns the present low dividend payout rate of the Water Company which has averaged approximately 30% of the earnings on Class B common and less than 45% of the earnings on Class A common, during recent years. He recommended that there should be a 70% dividend payout ratio. The public’s witness finally recommended that the capitalization as of September 30, 1953, in the amount of $34,436,900 used as a rate basis should yield a return of 5y%% in the amount of $1,894,030 as a net return. This is the minimum figure as shown in all the evidence as to the return to which the Water Company would be entitled *99and is based purely on the book or original cost value depreciated.
Mr. Frank J. Travers, testifying for the Water Company, stated that $3,000,000 should be added to the capitalization figure of Professor Thatcher because of additional bank credit increase and additions to the plant in that amount since September 30, 1953 (the date of Professor Thatcher’s figures). With a figure of $37,337,037 he stated that the average cost of maintaining the Company’s financial standing would be 6.09% resulting in a net income of $2,426,907. His calculations included 3%% for the debt, 5% for the preferred stock and 11% for the common equity money. It is undisputed that the capitalization figure Dr. Thatcher used in the amount of $34,-436,900 on September 30, 1953, had increased materially ($3,280,000) as shown by the Company’s statement at the time of the trial in the lower court. At that time it exceeded the valuation of $36,500,000 fixed by the Commission. It would, therefore, appear, using the figures of the City’s witness (increased by the time of the trial), with a 5%% return as recommended by the same witness, that the return should be $2,074,000 instead of $1,894,030 since the latter figure was not based on the addition to the Water Company investment which occurred during the subsequent year of 1954. The highest figure recommended as a return in the evidence was $2,426,907. The Commission found the net income on the rates fixed would approximate $2,070,000 to $2,140,000 before it modified its order reducing the gross return in the amount of $111,000. The final figure is between the highest and lowest figure, resulting from the testimony. In fact, it is slightly below a median and is supported by substantial evidence. The actual experience under the proposed rate *100during the draught period in the summer of 1954 showed the rates would produce an income of approximately $2,037,994 on an annual basis instead of the highest estimate of the Commission. On this basis this income would produce a return of very close to, if not, 5%% on the value of $36,500,000. The public’s witness testifying on the side of the appellee, City, stated in this connection: “I believe that 5.5% is a very reasonable rate of return and that that amount of earnings would maintain the financial integrity of the company. . . .” This is the lowest rate of return recommended by any witnesses before the Commission or trial court. The highest rate of return upon which there was any testimony was 6%% upon the valuation. There not only is substantial evidence to support the Commission’s finding of a reasonable return, but it is not contradicted by any evidence presented by the City’s side of the issue.
Finally, finding No. 11 of the trial court says in substance that the present 1954 order grants an increase in rates over the 1951 order from 25 to 37.5%. Evidence before the Commission (and also the trial court) upon which it acted showed among other things during this same interval the Water Company had a payroll cost increase of 25% ; taxes increase of 80% ; other general operating costs increase of 31%. The evidence further shows that since the valuation fixed in the 1951 order of $30,500,000, there has been added $8,491,498 in further expansion by the Water Company bringing the total valuation to a figure of $39,000,000.
From the examination of the testimony and evidence it is quite apparent that there is no evidence to support the finding of the trial court that the order of the Commission granted the Water Company excessive *101earnings; on the other hand, substantial evidence supports the final order and findings of the Commission.
We have gone into considerable detail with reference to evidence presented before the Commission and trial court, mainly because of the rather unorthodox findings of the trial court and the contentions of the City. Such examination and investigation of the evidence, it should be understood, was not done for the purpose of weighing it, or substituting our opinion for that of either the trial court or Commission. This was done purely for the purpose of determining if the finding of the Commission was supported by substantial evidence. That it is so supported, is amply demonstrated. The Commission has performed its legislative function within its proper sphere. It has not stepped outside the statutory or constitutional limitations placed upon it. The Public Service Commission then should be permitted to determine the facts as provided by the legislature.
The judgment and orders thereunder, of the trial court, is reversed and this cause is remanded for such proceedings as are consistent with this opinion.
Bobbitt, C. J., concurs; Achor, J., concurs with separate opinion; Emmert, J., concurs with separate opinion ; Landis, J., concurs in result.
. It might be urged with some realism on the side of the consumer that “unreasonableness” of an order or rate means also one that is confiscatory as to the rate payer who is forced to pay a rate which is excessive, extortionate or beyond the value of the services rendered. Under our present urban social order the consumer has no choice but to pay to get water. He cannot dig his own well. Thus, extortionate or excessive rates might seem confiscatory as to the rate payer. Likewise, the rate if too low is confiscatory as to the utility, because the law compels it to serve all without discrimination. Under such rationale the Commission is bound at the extremes on each side (the rate payer and the utility) by constitutional safeguards against confiscation, thus giving each the same standards and safeguards.
Terre Haute Gas Corporation v. Johnson (1943), 221 Ind. 499, 45 N. E. 2d 484; 73 C. J. S., Public Utilities, §30, p. 1051; 16 C. J. S., Constitutional Law, §602, p. 1202; 43 Am. Jur., Public Utilities and Services, §67, p. 615.