Back
SUPREME COURT OF INDIA
DIPANKAR DATTA, PANKAJ MITHAL, JJ.
The Madhya Pradesh Madhya Kshetra Vidyut Vitran Company Limited & Ors. – Appellants
Versus
Bapuna Alcobrew Private Limited & Anr. – Respondents
Civil Appeal No.1095 of 2013
Decided On : 04-11-2024
(A) Electricity Act, 2003 – Section 56(2) – Recovery of dues – Limitation period of two (2) years prescribed for recovery of dues under Section 56 of 2003 Act would apply to liabilities arising under 2003 Act, and not prior to enforcement thereof – Division Bench manifestly erred in holding that liability incurred by first respondent prior to enforcement of 2003 Act would still be barred by provisions of Section 56(2) thereof. (Para 13)
(B) Electricity Act, 1910 – Section 24 – Limitation Act, 1963 – Article 15 – Recovery of dues – Limitation – Suit for recovery of price of electrical energy supplied, or sold, by licensee and consumed by consumer would be governed by Article 15 of 1963 Act – Since Section 24 does not prescribe any period of limitation than that prescribed by 1963 Act, as is done by new avatar thereof in 2003 Act, limitation would set in immediately upon consumer’s neglect to pay amount mentioned in bill raised by licensee – Licensee acquires right of action to institute a suit immediately after consumer neglects to pay amount mentioned in bill raised by it – Although Section 24 of 1910 Act prescribes no period of limitation, it does allow licensee to discontinue supply of energy upon a consumer neglecting to pay charges – Whether right of licensee to claim unpaid charges would lapse will have to be decided by court before whom lis is brought upon consideration of defence that is raised and explanation for delay. (Paras 16, 17 and 20)
(C) Limitation Act, 1963 – Section 17 – Civil Procedure Code, 1908 – Order VII Rule 6 – Limitation – Exemption – If a suitor alleges that suit could not be instituted by him within prescribed period of limitation because of some mistake which came to be discovered beyond period prescribed for institution of a suit, it is open to such suitor to claim exemption from limitation in terms of Order VII Rule 6 of Code of Civil Procedure, 1908 and such exemption can be granted in an appropriate case – However, mistake is not a circumstance which can be used as a shield to save negligence in all cases – Absence of due diligence or lack of bona fides would not clothe a suitor to take undue advantage of a beneficent provision like Section 17; it is for relevant court to separate grain from chaff. (Para 19)
(D) Civil Procedure Code, 1908 – Order XXXIX Rule 4 – Interim relief – Once an interim order is passed in a suit or a proceeding, interim relief granted to party seeking interim relief could either be confirmed or vacated at the time of final disposal of suit or proceedings, as the case may be – If disposal is by way of an order of dismissal, interim relief which is granted as an aid of or ancillary to final relief cannot continue beyond termination of such suit or proceedings – However, if in a particular suit or proceeding, interim relief is sought in respect of a development subsequent to institution of suit/proceedings, and challenge to such subsequent development is spurned, party who has approached court cannot be heard to say that effect of spurning of challenge would come to an end with disposal of suit/proceedings – Effect of challenge being spurned would continue till such time it is reversed in appeal or reviewed in a manner known to law – Situation in such a case, adversely affecting party whose challenge has been spurned, cannot be sought to be overcome by contending that suit or proceedings has/have not been dismissed on merits but was/were merely withdrawn. (Paras 30, 31 and 32)
(E) Constitution of India – Article 226 – Writ petition – Maintainability – Point even if wrongly decided binds the party against whom it is decided and same point cannot be urged in a subsequent suit or proceeding at same level – Issue of liability accruing to first respondent for non-payment of minimum guarantee charges had been decided previously and such decision, not being subjected to any appeal, had attained finality in eyes of law estopping first respondent from reagitating the issue – Second writ petition at instance of first respondent was not maintainable and ought not to have been entertained at all. (Para 37)
Facts of the case:
Final judgment and order dated 13th October, 2011 of High Court of Madhya Pradesh, allowing writ appeal presented by first respondent, is under assail in present appeal by special leave.
Task before Court is limited to determining whether Section 56(2) of Electricity Act, 2003 has any application to a demand raised by appellants on first respondent for recovery of sums payable under Electricity Act, 1910.
Findings of Court:
Impugned judgment and order of High Court allowing intra-court appeal being unsustainable in law has to be and is, accordingly, set aside.
Result : Civil Appeal allowed.
JUDGMENT :
DIPANKAR DATTA, J.
THE CHALLENGE
1. The final judgment and order dated 13th October, 20111[impugned judgment, hereafter] of the High Court of Madhya Pradesh2[High Court, hereafter], allowing the writ appeal3[Writ Appeal No. 550/2009] presented by the first respondent, is under assail in the present appeal by special leave.
BRIEF RESUME OF FACTS
2. The factual matrix of the case, insofar as is relevant for the purpose of deciding the present appeal, is noted hereinbelow:
I. The first appellant is the state electricity distribution utility for the State of Madhya Pradesh, while the second and the third appellants are its officers. The first respondent is a company registered under the Companies Act, 1956. It is engaged in the business of manufacturing rectified spirit, extra neutral alcohol and bottling of Indian made foreign liquor. The second respondent is the Madhya Pradesh Pollution Control Board, which had asked the first respondent to submit a proposal with respect to its plans for a bio- gas electricity generation unit. The first respondent did not pursue any communication with the second respondent thereafter and, thus, no relief has been sought in this appeal against the latter.
II. The appellants and the first respondent entered into an agreement dated 18th November, 1991, for supply of electrical energy to the first respondent’s unit at Gwalior, with the first respondent guaranteeing a minimum consumption that would yield an annual revenue of Rs. 34,747/- (Rupees thirty four thousand seven hundred and forty seven rupees only).
III. Thereafter, supplementary agreements were executed between the appellants and the first respondent, increasing the consumption of electrical energy. Vide agreement dated 17th November, 1992, the quantum was initially increased from 136 kVA to 169 kVA and vide agreement dated 30th March, 1995, there was a further increase to 305 kVA.
IV. The first respondent sought permission from the appellants to install and run an 807 kVA biogas turbo generating set4[TG set, hereafter] for captive use. On 30th May, 1996, the second appellant granted permission to the first respondent on the condition that the TG set does not run parallel with the appellants’ supply system, and that the TG set would be used only as a stand-by measure upon the failure of the appellants to supply power. Most importantly, in what would give birth to the dispute, the first respondent was bound to a monthly minimum consumption of units, with 35% load factor in case of no power cut, and 39% load factor in cases of power cut.
V. A third supplementary agreement was executed by and between the appellants and the first respondent on 01st June, 1996, which provided for supply of an additional 560 kVA to the first respondent thereby increasing the total contract demand to 1170 kVA. VI. Alleging that the first respondent was running the TG set as a parallel source of power notwithstanding the supply of power provided by the first appellant, a notice dated 28th March, 20005[cancellation notice, hereafter] was served by the appellants upon the first respondent cancelling the permission accorded to the first respondent to run the TG set.
VII. Challenging the cancellation notice, the first respondent knocked the doors of the High Court by invoking its writ jurisdiction. On the writ petition6[W.P. No. 677/2000; first writ petition, hereafter], the High Court passed an interim order dated 04th May, 2000 staying operation of the cancellation notice, subject to the condition, inter alia, that the first respondent would deposit the ‘minimum guarantee charges’ payable as against the load of 807 kVA to be assessed by the appellants.
VIII. Consequently, the appellants issued a show cause notice7[first show cause notice, hereafter] dated 14th July, 2000 to the first respondent quantifying its liability in a sum of Rs 70,50,000/- (Rupees seventy lakh fifty thousand only). The first show cause notice provided a time of fifteen (15) days to the first r
(1) Recovery of dues – Limitation period of two (2) years prescribed for recovery of dues under Section 56 of Electricity Act, 2003 would apply to liabilities arising under 2003 Act, and not prior to....
Supplementary bills can be raised for mistakes, but disconnection for non-payment after two years is prohibited under Section 56(2) of the Electricity Act, 2003.
A licensee cannot exercise the power of electricity disconnection for the recovery of arrears that are more than two years old, unless such sums were continuously shown as recoverable in previous bil....
The Electricity Board must adhere to statutory notice requirements before disconnection and cannot recover charges post-disconnection without such compliance.
The court reaffirmed that under Section 56(2) of the Electricity Act, charges for electricity consumed can only be recovered for a period not exceeding two years preceding the first demand bill.
The limitation period for recovering electricity dues under Section 56(2) of the Electricity Act, 2003 is two years; claims beyond this period cannot be enforced.
(1) Duty to supply electricity under Section 43 of 2003 Act is not absolute and is subject to such charges and compliances stipulated by Electric Utilities as part of application for supply of electr....
The right to recover electricity dues through civil suits is not barred by the two-year limitation for disconnection proceedings under Section 56(2) of the Electricity Act.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
