1. Dispute over the validity of a supplementary electricity bill and whether the demand for payment was barred by a three-year limitation period. (Para 2 )
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1997 Supreme(SC) 107
1997(2) Supreme 439
SUPREME COURT OF INDIA
K. Ramaswamy and G.T. Nanavati, JJ.
M/s. Swastic Industries -Petitioner
versus
Maharashtra State Electricity Board -Respondent
Special Leave Petition (C) No. 765 of 1997
Decided on 24-1-1997
Counsel for the Parties :
For the Petitioner : Shankar Divate, Naresh Kaushik and Ms. Lalitha Kaushik, Advocates.
For the Respondent : A.S. Bhasme, Advocate.
Important Points
IMPORTANT POINT
Section 24 of the Indian Electricity Act, 1910 gives power to the Electricity Board to issue the demand by way of supplementary bill and to discontinue the supply without recourse to filing of the suit to recover the same when a consumer neglects to pay the charges.
Section 24 of the Indian Electricity Act, 1910 gives power to the Electricity Board to issue the demand by way of supplementary bill and to discontinue the supply without recourse to filing of the suit to recover the same when a consumer neglects to pay the charges.
Subject
Consumer Law - Electricity Bill Dispute
Act Referred
Headnote
Indian Electricity Act, 1910-Section 24-Electricity (Supply) Act, 1948-Section 60A-Demand by way of supplementary bill-Electricity Board empowered to disconnect supply without recourse to filing of suit when consumer neglects to pay charges-There is no deficiency in service in making supplementary demand for escaped billing-Negligence or collusion by subordinate staff in not properly recording reading or allowing pilferage to consumers-That would be deficiency of service under Consumers Protection Act.
Held that the right to recover the charges is one part of it and right to discontinue supply of electrical energy to the consumer who neglects to pay charges is another part of it. The right to file a suit is a matter of option given to the licensee, the Electricity Board. Therefore, the mere fact that there is a right given to the Board to file the suit and the limitation has been prescribed to file the suit, it does not take away the right conferred on the Board under Section 24 to make demand for payment of the charges and on neglecting to pay the same. They have the power to discontinue the supply or cut-off the supply, as the case may be, when the consumer neglects to pay the charges. The intendment appears to be that the obligation are mutual. The Board would supply electrical energy and the consumer is under corresponding duty to pay the sum due towards the electricity consumed. Thus the Electricity Board, having exercised that power, since admittedly the petitioner had neglected to pay the bill for additional sum, was right in disconnecting the supply without recourse to filing of the suit to recover the same. (Para 5)
Legal Category Hierarchy
Table of Contents
2. Whether the three-year limitation for filing suits under Section 60-A of the Electricity (Supply) Act, 1948, applies to demands made via supplementary bills. (Para 2 )
3. The right to file a suit is an option; limitation for suits does not extinguish the power to demand payment or disconnect supply under Section 24. (Para 4 , 5 )
4. Limitation prescribed for filing recovery suits does not restrict the licensee's power to demand payment or disconnect supply for unpaid electricity charges. (Para 5 )
5. Special Leave Petition dismissed. (Para 6 )
6. Does the limitation period for filing a recovery suit apply to the issuance of a supplementary bill for electricity charges?
No. The right to file a suit is an option for the licensee. The limitation period for filing such a suit does not take away the power conferred under Section 24 of the Indian Electricity Act, 1910, to make a demand for payment or disconnect the supply. (Para 5 )
7. What is the distinction between the right to recover charges by suit and the right to disconnect supply?
The right to recover charges via suit is one part of the licensee's power, while the right to discontinue supply for non-payment is another. The former is an option subject to limitation, whereas the latter is a power to ensure payment for energy supplied. (Para 5 )
8. Does making a supplementary demand for escaped billing constitute a deficiency of service under the Consumer Protection Act?
No, making a supplementary demand for escaped billing is not a deficiency of service. However, negligence or collusion by subordinate staff in failing to record readings or allowing pilferage would constitute a deficiency of service. (Para 5 )
ORDER
The petitioner is canvassing the correctness of the decision of the National Consumers Disputes Redressal Commission, New Delhi, made on August 30, 1996 in Appeal No. 520/95.
2. The admitted position is that the respondent-Electricity Board had issued a supplementary till to the petitioner on February 5, 1993 demanding payment of Rs. 3,17,659/-. The petitioner objected to the bill by his letter dated February 16, 1993. However, when letter was issued for payment of the said amount, the petitioner paid it under protest and filed the complaint before the State Consumers Disputes Redressal Commission. The Commission by order dated May 24, 1995 allowed the complaint and held that the claim was barred by limitation of 3 years. Feeling aggrieved, the Electricity Board filed an appeal. The National Commission relying upon the judgment of a Division Bench of the Bombay High Court in M/s. Bharat Barrel & Drum Manufacturing Co. Pvt. Ltd. v. The Municipal Corporation of Greater Bombay & Anr.1 has held that there is no limitation for making the demand by way of supplementary bill. Section 24 of the Indian Electricity Act, 1910 gives power to the Board to issue such demand and to discontinue the supply to a consumer who neglects to pay the charges. It is contended by the learned counsel for the petitioner that Section 60-A of the Electricity (Supply) Act, 1948 prescribes a limitation of 3 years for the Board to institute any suit, after its constitution, for recovery of the arrears. Thereby the limitation of 3 years is required to be observed. The Board in negation of Section 60A of Supply Act cannot be permitted to exercise the power under Section 24 of the Electricity Act, 1910. We find no force in the contention.
3. Section 60-A of the Electricity (Supply) Act, 1948 envisages the enlargement of the period of limitation in certain circumstances, i.e., intervening period of the constitution of the Board, and the right of the State to recover the amounts due to the State for consumption of electricity delegating the power to the Board. In that
behalf, clauses (i) and (ii) therein operate as under :
"(i) where it has been constituted before the commencement of the Electricity (Supply) Amendment Act, 1966 (3 of 1966) within three years of such commencement; and
(ii) where it has been constituted after such commencement, within three years of its constitution."
4. This is an enabling provision by way of suit. Despite the fact that Section 24 of the Indian Electricity Act clearly empowers the Board to demand and collect any charge from the Consumer and collect the same towards the electricity energy supplied by the Board in the following terms :
"Where any person neglects to pay any charge for energy or any sum, other than a charge for energy, due from him to a licensee in respect of the supply of energy to him, the licensee may, after giving not less than seven clear, days notice in writing to such person and without prejudice to his right to recover such charge or other sum by suit, cut off the supply and for that purpose cut or disconnect any electric supply-line or other works, being the property of the licensee, through which energy may be supplied, and may discontinue the supply until such charge or other sum, together with any expenses incurred by him in cutting off and reconnecting the supply, are paid, but no longer."
5. It would, thus, be clear that the right to recover the charges is one part of it and right to discontinue supply of electrical energy to the consumer who neglects to pay charges is another part of it. The right to file a suit is a matter of option given to the licensee, the Electricity Board. Therefore, the mere fact that there is a right given to the Board to file the suit and the limitation has been prescribed to file the suit, it does not take away the right conferred on the Board under Section 24 to make demand for payment of the charges and on neglecting to pay the same. They have the power
