Havells Industries, a partnership firm at Jamshedpur through one of its v. 1.Jharkhand State Electricity Board, Dhurwa, Ranchi through its Chairman. 2.The General Manager cum Chief
Case Details
IN THE HIGH COURT OF JHARKHAND AT RANCHI W. P. (C) No. 3178 of 2005 Havells Industries, a partnership firm at Jamshedpur through one of its .... .. ... Petitioner(s) Partners, Sri Deepak Kumar Agarwal Versus 1.Jharkhand State Electricity Board, Dhurwa, Ranchi through its Chairman. 2.The General Manager cum Chief Engineer, Singhbhum Area Electricity Board, Bistupur, Jamshedpur. 3.The Electrical Superintending Engineer, Electric Supply Circle, Jamshedpur. 4.Assistant Electrical Engineer, MRT, Electric Supply Circle, Jamshedpur. 5.Assistant Electrical Engineer (Supply), Adityapur Division, Part-II, Jamshedpur. .. ... ...Respondent(s) ........... CORAM : HON'BLE MR. JUSTICE GAUTAM KUMAR CHOUDHARY ......... For the Petitioner(s) : Mr. M. S. Mittal, Sr. Advocate Mr. N. K. Pasari, Advocate For the JSEB : Mr. Sachin Kumar, Sr.S.C. …... C.A.V. ON 20.03.2024 PRONOUNCED ON 04.04.2024 Heard, learned counsel for the parties. 1. The instant Writ Petition has been filed for the following reliefs: a. Quashing the inspection report dated 10.06.2005 in which it had been found that certain seals were found broken. b. Restoration of electrical connection which had been disconnected by the respondent authorities pursuant to the said inspection dated 10th June, 2005. c. For a direction upon the respondent from not raising any penal bill
Legal Reasoning
as mentioned in the FIR lodged against the Petitioner. PETITIONER’S CASE 2. Petitioner is a partnership firm and engaged in small scale industry at Adityapur Industrial Area, Jamshedpur for manufacturing of Wire and Nails. 3. Petitioner was given High Tension line and energized on 01.02.2005 and he started the plant on 02.02.2005. 4. The details of bills received for the months of February to April, 2005 and paid for by the petitioner. The details of the bills are as hereunder :- Month No. of Days Units consumed Bill Amount February, 2005 March, 2005 April, 2005 18 42 30 12,238 34,079 20,471 Rs.66,524 Rs.1,36,316 Rs.99,302 2 5. On 10.06.2005, some of the officers of the Board came and inspected the premises of the petitioner and inspection report was drawn, in which it was alleged that the seals of the meter(s) were tampered although no allegation of tampering with metre was made in the said report. The inspection report (annexure-5) offered the basis for lodging FIR against the petitioner company and two phase current was found to be less, amounting to theft of electricity, resulting in loss of revenue to the tune of Rs.28,68,000/-. 6. The inspection report has been assailed on the ground that assessment of loss of revenue has been made without following the due process as laid down under the Electricity Act 2003 (Hereinafter called 2003 Act). 7. It is argued that mere breakage of seal without any allegation of tempering with meter does not amount to any offence. Rule 138 of the Indian Electricity Rule, 1956 provides for penalty for breaking of seals by Rs.50/- and Rs.200/-. The assessment of revenue of loss is not supported by the consumption pattern which will be apparent from the pleadings of the party(s) and has not been disputed by any manner. 8. It is contended that the inspection report which is the foundation of FIR, was based on mala-fide consideration as the meter rooms are totally sealed and it can be opened only by the officers of the Board. 9. Consumption pattern as stated above do not justify inference that there had been theft of electricity when the plant had very shortly been made operational. In view of average 22,262 unit consumption per month, there was no justification of imposing 28.00 lacs of penalty, when total bill of the Petitioner was approx 3.00 lacs. 10. Clause 16.9 of the Tariff Code 1993 for assessment of loss shall not be applicable, as the same becomes applicable when energy is being consumed by any artificial means or adopting any appliance or by creating obstruction in the running of the meter. Otherwise also, as per this clause the loss is to be assessed as per the formula L x F x H x D. L stands for load, H is the average number of hours per day if the supply is made available, F denotes the category of the consumer, D stands for number of days when the pilferage took place. If such days cannot be computed, a factor of 180 days can only be taken. Here bill was being regularly paid, and only the last meter reading made on 25.05.2005 should have been 3 taken into consideration for the purpose of calculation of number of days when nothing unusual was not found. Inspection was conducted 16 days thereafter which can be held to be the days for pilferage. Instead of this, loss of assessment has been made taking 180 days, when even the electric connection had not been taken by the petitioner. 11. It is further argued that mandatory provision of Section 126 of the Electricity Act has not been followed as there was no provisional or final assessment of loss. Inspection report is completely silent about the mode of assessment of loss. No provisional assessment was made, no notice was served and no opportunity was given to the petitioner before the final order of assessment could have been passed. The assessment of loss of revenue is based upon ipse dixit figure given in the FIR. 12. It is argued that merely because seals were found tampered, the same cannot be the basis for drawing a legal or factual presumption that it was a case of metre tampering in view of the ratio laid down in the cases :- (a) 2009 SCC OnLine Pat 702 (Kamaljeet Singh vs. The Bihar State Electricity Board & Ors.] (b) 2012 SCC OnLine Pat 1507 wherein it has been held that the assessment is to be made under Section 125 of the Electricity Act and not on any ipse dixit figure mentioned in the FIR or any criminal complaint. (c) AIR 1967 SC 349 13. Even in case of theft of energy under Section 135 of the Electricity Act, there is mandate of law that Section 126 of the Act shall apply in view of the ratio laid down by Hon’ble the Supreme Court reported in 2020 (18) SCC 588. 14. Supply Code 2005 expressly provides that breaking of seal does not amount to theft of energy. Even before the supply code came, law had been settled that mere breaking of seal do not amount to theft of energy. Reliance is placed on 2011 (122) DRJ 613. Reliance is also placed on the judgment of Hon’ble Supreme Court rendered in the case of Union of India & Ors. vs. Mahendra Singh passed in Civil Appeal No.4807 of 2022 [arising out of SLP (Civil) No.19886 of 2019] wherein it is held that the procedure as laid down by the Statute needs to be followed. CASE OF RESPONDENT
Legal Reasoning
15. Mr. Sachin Kumar, learned Sr. S.C. appearing for the Electricity Board has opposed the prayer. It is submitted that if disconnection was a sequel to theft of electricity and once theft is detected, electric supply cannot be 4 permitted unabated waiting for service of notice to the offender. Disconnection is accepted norm following theft of electricity as will be apparent from the following authorities: (a) 1999 SCC OnLine Pat 276 (b) 2020 (18) SCC 588 16. It is argued that the Supply Code 2005 will not apply in the present case, as the Code came into effect after the date of inspection and institution of case. Before the Code came into force in the Month of June, 2005, the mode of assessment was governed by 1993 Tariff Notification of State of Bihar. The said notification, Clause 16.9 specifically provided that the Board may estimate value of the electrical energy, so extracted, consumed or used as per the manner given in the said notification. In view of the fact that there was no other method for calculation of assessment of loss was in place before coming into force of Supply Code, 2005, 1993 Tariff will be applicable in view of Section 24 of the General Clauses Act.
Decision
17. It is further argued that the main pleading of the writ petitioner has raised only the issue of quantum of compensation that has been assessed and not regarding the other issues which have been raised at the later stage. ANALYSIS 18. During the course of argument, out of the reliefs prayed for, relief for restoration of electrical connection is not pressed, as it has already been restored. 19. Argument is confined to a direction upon the respondent from not raising any penal bill for loss of energy as mentioned in the FIR. 20. FIR is not under challenge in the instant petition. Whether there are materials to make out a prima facie case of theft of electricity in the present case is beyond the pale of consideration in the writ petition filed under Article 226 of the Constitution. 21. There cannot be any two view, that breakage of seals of meter simpliciter cannot amount to theft of electricity. Unless meter is tampered with so as to interfere with accurate registration of electric current, mere breakage of seal will not come within the meaning of theft of electric energy. In the present case the meter was not seized and sent for testing. No external device has been referred to in the inspection report to bypass the meter. 5 22. Short question that falls for consideration is whether Respondents can be restrained from raising penal bill on the basis of assessment of loss on account of theft of electric energy as shown in the FIR. 23. Matter pertains to 2005, therefore Electricity Act 2003 shall apply. Section 126 read as under, prior to the 2007 amendment: (1) If on an inspection of any place or premises or after inspection of the equipments, gadgets, machines, devices found connected or used, or after inspection of records maintained by any person, the assessing officer comes to the conclusion that such person is indulging in unauthorised use of electricity, he shall provisionally assess to the best of his judgment the electricity charges payable by such person or by any other person benefited by such use. (2) The order of provisional assessment shall be served upon the person in occupation or possession or in charge of the place or premises in such manner as may be prescribed. (3) The person, on whom a notice has been served under sub-section (2), shall be entitled to file objections, if any, against the provisional assessment before the assessing officer, who may, after affording a reasonable opportunity of hearing to such person, pass a final order of assessment of the electricity charges payable by such person. (4) Any person served with the order of provisional assessment may, accept such assessment and deposit the assessed amount with the licensee within seven days of service of such provisional assessment order upon him. Provided that in case the person deposits the assessed amount, he shall not be subjected to any further liability or any action by any authority whatsoever. (5) If the assessing officer reaches to the conclusion that unauthorised use of electricity has taken place, it shall be presumed that such unauthorised use of electricity was continuing for a period of three months immediately preceding the date of inspection in case of domestic and agricultural services and for a period of six months immediately preceding the date of inspection for all other categories of services, unless the onus is rebutted by the person, occupier or possessor of such premises or place. (6) The assessment under this section shall be made at a rate equal to 1 ½ times the tariff applicable for the relevant category of services specified in sub-section (5). Explanation. —For the purposes of this section,— (a) “assessing officer” means an officer of a State Government or Board or licensee, as the case may be, designated as such by the State Government; (b) “unauthorised use of electricity” means the usage of electricity— (i) by any artificial means; or (ii) by a means not authorised by the concerned person or authority or licensee; or (iii) through a tampered meter; (iv) for the purpose other than for which the usage of electricity was authorised. 6 24. Once the inspection team notices unauthorised use of energy by tampering the meter, the authorities can disconnect the power supply immediately and make immediate assessment for loss of energy. Authorities under the 2003 and 2007 Act are empowered to make a provisional and final assessment under Section 126(1) of the Act, even in cases where electricity is unauthorisedly used by way of theft. There is apparent distinction between Section 126 and Section 135 of the Act. Section 126 forms part of the scheme which authorises electricity supplier to ascertain loss in terms of revenue caused to it by the consumer by his act of “unauthorised use of electricity” whereas Section 135 deals with offence of theft if he is found to have indulged himself in the acts mentioned in clauses (a) to (e) of sub-section (1) of Section 135 of the Electricity Act. The Special Court, in cases, where a criminal complaint is lodged, is also empowered to determine civil liability under Section 154(5) of the Act. Merely because the Special Court is empowered to determine civil liability under Section 154(5) of the Act, in cases where a complaint is lodged, it cannot be said that there is no power conferred on authorities to make provisional assessment/final assessment under Section 126 of the Act. (Refer to W.B. State Electricity Distribution Co. Ltd. v. Orion Metal (P) Ltd., (2020) 18 SCC 588 ) 25. The liability of a person in default either in case of unauthorized use of electricity or by way of theft is to be determined by the statutory authorities or the Assessing Officer under Section 126 of the Act and/or by the Special Court under Section 154 of the 2003 Act. Such liability so assessed is to be paid by the consumer, subject to appellate remedy as provided under Section 127 of the Act. In cases of unauthorized use of electricity amounting to theft, liability so assessed is subject to final determination of liability by the Special Court under Section 154 (5) of the 2003 Act. 26. From the pleadings and on the materials on record it is indisputable that assessment of loss as reflected in the FIR has been made in utter violation of the procedure as envisaged under Section 126 of the Electricity Act. There was no provisional or final assessment of loss of energy, no opportunity was given to the petitioner to raise any objection. Inspection report is silent about the loss assessment, but the same does figure in FIR which was lodged on the same day of inspection. There is nothing on 7 record to suggest that order of provisional assessment was passed, and served to the Petitioner in terms of Section 126(2). It has been argued on behalf of the Respondent that loss has been assessed as per clause 16.9 of the tariff 1993. But this cannot be a ground to bypass the procedural safeguards under Section 126 of the 2003 Act. For the reasons as discussed above, Respondent Authorities are restrained from raising any penal bill as mentioned in the FIR lodged against the Petitioner. It is however clarified that this order will not come in the way of Special Court in seisin with the theft of electricity case against the Petitioner in assessing the liability under Section 154 of the 2003 Act. Writ Petition is accordingly allowed. I.A., if any, stands disposed of. (Gautam Kumar Choudhary, J.) Jharkhand High Court, Ranchi Dated 04th April, 2024 sandeep/ Uploaded.