IMPORTANT POINT
After accepting the postal articles for delivery sender cannot be made liable for deficit of stamp.

JUDGMENT

Sudhansu Jyoti Mukhopadhaya, J.-These appeals have been preferred by the appellant- CESC Limited (hereinafter referred to as the “Company”) against the common order and judgment dated 20.1.2004 whereby the Division Bench of the Calcutta High Court allowed the appeal preferred by the first respondent- the Chief Post Master General, West Bengal Circle and others (hereinafter referred to as the “Postal Authority”) and dismissed the appeal preferred by the Company.

2. The order impugned before the Division Bench was passed in the Writ Petition No. 2282 of 1999 preferred by the Company against a demand notice dated 10.9.1999 issued by Postal Authority asking the Company to deposit a sum of Rs.1,83,89,410/-. The learned Single Judge by order dated 7.11.2000 had allowed the writ petition and held that the demand notice dated 10.9.1999 is contrary to Section 11(2) of the Indian Post Office Act, 1898 (hereinafter referred to as “the Act”) and remitted the matter with a direction to the Postal Authority to consider the representation of the Company after giving it a hearing and with a further direction that, till the matter is decided, the entire deposit of Rs.50 lacs as was made by the Company in terms of the interim direction be kept with the Postal Authority. In case, it was decided that the amount was not payable by the Company, the Postal Authority would refund the same, but in the event it is found that the amount was due and payable by the Company, the Postal Authority shall adjust the same against the dues.

3. Against the said order, an appeal was preferred by the Company as the learned Single Judge allowed the Postal Authority to retain the amount of Rs. 50 lakhs deposited by the Company in terms of the interim order while another was preferred by the Postal Authority against the said order of the learned Single Judge since the notice of demand was quashed and the learned Single Judge held that the Postal Authority had no power to demand such amount.

4. The case of the appellant is that it is a ‘company’ incorporated under the provisions of the Companies Act and is conducting the business of supplying electricity. The Company has about 26 lakh of registered consumers which is increasing continuously. The consumption bills are sent by the Company to its consumers, every month through the Post Office. For the purpose of sending monthly consumption bills by post, a specific area has been allotted to the Post Office in the South-west Regional Office of the Company at Taratola for carrying out the necessary operations, commonly known as the “Taratola Sorting Office” of the Postal Department. This practice is being followed by the company for a considerable period of time. The Officials of the Postal Department are posted at the said Taratola Sorting Office and a sub-office has been set up in a space provided by the appellant company exclusively for the purpose of receiving ‘franked’ monthly electricity consumption bills as is made by the officials posted there. The appellant company had installed the requisite ‘franking machines’ for this purpose which are operated by the appellant company’s staff.

5. The dispute relates to the period between 1.6.1997 to 29.10.1998, during which, the monthly consumption bills, upon being folded, were marked with the requisite postal stamp of Rs.1/- per bill using franking machines. The monthly consumption bills thus franked, were made over to the counter of the Postal Department located in the said premises. Upon being satisfied with the franking marks and the value thereof, the Postal Officials accepted and took the postal articles, namely, the monthly consumption bills for being dispatched to the addressee consumers. Till then there were no disputes that the appellant had ever breached the franking conditions as enshrined under the license. The monthly consumption bills are printed on a sheet of paper which are then merely folded for convenience. The consumption bills are not sealed