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1989 Supreme(Kar) 411
Karnataka High Court
Judges : K.A.Swami
BANHATTI CO-OPERATIVE SPINNING MILL LTD. - Appellant
Versus
KARNATAKA ELECTRICITY BOARD - Respondent
W. P. 2568 Of 1989
Decided On : 11/30/1989
The main legal point established in the judgment is the applicability of the Limitation Act, 1963 to the demand made by the Karnataka Electricity Board and the validity of the demand for electrical energy charges.
Headnote:
Limitation Act - Demand for Electrical Energy Charges - Section 60a of the Electricity (Supply) Act, 1948 - Applicability of Limitation Act, 1963 - Validity of Demand - Current Transformer Ratio (CTR) - Validity of Bill - Instalment Payment
Fact of the Case:
The petitioner, a Co-operative Society, sought to quash a bill issued by the Karnataka Electricity Board (KEB) and requested a Writ in the nature of Mandamus to prevent the recovery of a demanded amount. The petitioner contended that the provisions of the Limitation Act, 1963 were applicable to the demand made by the KEB under the bill. The KEB argued that the demand was valid and based on the correct CTR. The court considered the CTR issue and the validity of the demand.
Finding of the Court:
The court found that the demand made under the bill was valid to the extent of Rs. 90,85,857-88. It permitted the petitioner to pay this amount in monthly instalments of Rs. 3 lakhs along with the current bill, with one default clause. If the petitioner defaulted in payment, the KEB could proceed to recover the entire balance of the amount in accordance with the law.
Issues: The issues included the applicability of the Limitation Act, 1963 to the demand made by the KEB, the validity of the demand, and the correct CTR for the energy supplied to the petitioner.
Ratio Decidendi: The court held that the provisions of the Limitation Act were not applicable for making a demand and recovering the amount due representing charges of energy supplied and consumed by a consumer otherwise than by way of a suit. It also determined that the demand made under the bill was valid to the extent of Rs. 90,85,857-88 and permitted the petitioner to pay this amount in monthly instalments of Rs. 3 lakhs along with the current bill, with one default clause.
Final Decision: The Writ Petition was disposed of with the finding that the amount payable by the petitioner under the bill was Rs. 90,85,857-88 and not Rs. 1,02,646-40. The petitioner was permitted to pay the amount in monthly instalments of Rs. 3 lakhs along with the current bill until the amount was satisfied, with one default clause. If the petitioner defaulted in payment, the KEB could proceed to recover the entire balance of the amount in accordance with the law.
( 1 ) IN this petition under Article 226 of the Constitution, the petitioner has sought for quashing the Bill dated 21-1-1989 bearing No. BNHT 2 issued by the second respondent produced as annexure-J. It has also sought for issue of a Writ in the nature of Mandamus directing the respondents not to recover the amount of Rs. 91,02,646-40p. from the petitioner as demanded under the aforesaid Bill Annexure-J.
( 2 ) THE petitioner is a Co-operative Society registered under the Karnataka Co-operative Societies act, 1959. It is a Co-operative Spinning Mill situated at Banahatti, Jamkhandi Taluk, Bijapur district.
( 3 ) HAVING regard to the contentions urged on both sides, the following points arise for consideration:
(i) Whether the provisions of the Limitation Act, 1963 are applicable to the demand made by the k. E. B. under the Bill dated 21-1-1989 produced as Annexure-J? (ii) If the provisions of the Limitation Act, 1963 are applicable, whether Article 14 or Article 15 of the Limitation Act is applicable to the demand in question? (iii) Whether the demand is valid in law? POINT NOS. (i) and (ii)
( 4 ) THE contention of the petitioner is that the provisions of the Limitation Act are applicable because the electrical energy falls within the definition of 'goods' and therefore, no sooner the energy is consumed, the charges for the same become payable. The Limitation prescribes periods of limitation for filing suits, appeals and applications before Court and not for taking action by the Authority such as Karnataka Electricity Board (for short 'keb'), through its own machinery and not with the aid of the Court for recovering the amount due to it otherwise than by a suit filed in a Court. In other words, the Limitation Act primarily applies to suits instituted, appeals preferred and applications made before a Court of Law. If suits, appeals and applications are instituted, preferred and made, before a Court of Law after the period prescribed, they are liable to be dismissed although limitation has not been set up as a defence. Section 60a of the electricity (Supply) Act, 1948 (hereinafter referred to as the 'act') also has no application to the present case because that Section deals with the case where the right to recover any amount due to the State Government for or in connection with the consumption of electricity is vested in the board. The amount due from the petitioner which is sought to be recovered by the Board is not the amount due to the State Government. Hence Section 60a of the Act is not applicable to the case on hand.
( 5 ) IN addition to this, It is stated that the Karnataka Electricity Board was constituted in the year 1957 before the coming into force of the Electricity (Supply) (Amendment) Act, 1966. But the bill that is issued does not relate to the period prior to 1966. It also does not represent the amount due to State Government. Therefore, even on this ground Section 60a of the Act has no application to the case on hand. No provision in the Limitation Act 1963 is brought to my notice by the learned Counsel for the petitioner which could be made applicable to the demand made by the K. E. B. under Annexure-J, otherwise than by institution of a suit in a Civil Court.
( 6 ) HOWEVER, the learned Counsel for the petitioner has placed reliance on the decisions of the high Courts of Allahabad, Madras and Rajasthan. In NAINI TAL HOTEL CO. LTD. v. MUNICIPAL BOARD, NAINI TAL, AIR 1946 Allahabad 502, the case arose out of a regular suit filed by the Board for recovery of the amount. It was held that:
"in the case of electric energy, the consumer is liable to pay according to the consumption shown by the meter and it is for the supplier to make demands accordingly. He cannot be allowed to plead his own mistake or negligence in not making demands within the ordinary period of limitation. . . . . The word 'goods' is not defined in the Limitation Act,, but according to the definition in the Indian Sale of Goo
