IN THE HIGH COURT OF PATNA, RANCHI BENCH
S. B. SINHA, J.
Castings (India) Ltd - Petitioner.
Versus
Bihar State Electricity Board and others - Respondents.
Civil Writ Jurisdiction Case No. 2315 of 1990 (R)
Decided on : 30.9.1991
ELECTRICITY ACT - SECURITY DEPOSIT - ADDITIONAL SECURITY - DEMAND - TARIFF - INTERPRETATION - CONTRACT DEMAND - FICTIONAL STATE OF AFFAIRS - CONSEQUENCES AND INCIDENTS - LEGAL PRINCIPLE.
Fact of the Case:
The petitioner, a consumer of electrical energy, was directed by the Bihar State Electricity Board (BSEB) to deposit additional security amount of Rs. 2,09,550/-. The petitioner challenged the demand, contending that it was not justified under the Electricity (Supply) Act, 1948 and the Tariff framed thereunder.
Finding of the Court:
The court held that the demand for additional security was justified under clause 16.5 of the Tariff, which provides for a surcharge for exceeding the Contract Demand. The court held that the enhanced contract demand would amount to a fresh agreement for supply of electrical energy, and therefore, the BSEB was entitled to demand additional security deposit.
Issues: 1. Whether the demand for additional security was justified under the Electricity (Supply) Act, 1948 and the Tariff framed thereunder? 2. Whether the enhanced contract demand would amount to a fresh agreement for supply of electrical energy?
Ratio Decidendi: 1. The court interpreted clause 16.5 of the Tariff, which provides for a surcharge for exceeding the Contract Demand. The court held that the enhanced contract demand would amount to a fresh agreement for supply of electrical energy, and therefore, the BSEB was entitled to demand additional security deposit. 2. The court relied on the principle of legal fiction, as stated by Lord Asquith in East End Dwellings Co. Ltd. Vs. Finsbury Borough Council, that if a statute requires a certain state of affairs to be imagined as real, then the consequences and incidents which would inevitably flow from that state of affairs must also be imagined as real.
Final Decision: The court disposed of the petition, but directed the parties to pay and bear their own costs.
S. B. Sinha, J.
This application is directed against the order dated 31.10.1990 issued by respondent no.4 and as contained in Annexure-3 to the writ application whereby and where under the petitioner has been Bihar State Elect. Board directed to deposit additional security amount of Rs. 2,09,550/-.
2. The basic facts of the case are not in dispute.
3. The petitioner is a consumer of electrical energy. It for the purpose of consumption of electrical energy in its factory exccuted an agreement in 1974 for supply of 373.2 KVA. It appears that the petitioner deposited the initial security money amounting to Rs. 28000/-while entering into the aforementioned agreement. Later on, the petitioner applied for reduction of the load, which was agreed upon by the Board and it was reduced to 286 KVA.
4. Admittedly high tension electrical energy is supplied to the petitioner - factory directly from a Transformer. For the purpose of recording the consumption of electrical energy, a meter as well as a Maximum Demand Indicator has been installed in the premises of the petitioner. In the month of November, 1989 the Maximum Demand Indicator had shown the consumption of energy by the petitioner to the extent of 369 KVA. Respondent- Board therefore issued a bill to the petitioner on the basis of 369 KVA as recorded in the Maximum Demand Indicator. The petitioner objected to the correctness of the said reading.
5. It is now accepted in the counter affidavit that the Maximum Demand Indicator was found to he wrong being fast by 9.9%. However, as noticed hereinbefore, the petitioner was served with a bill on the basis of 369 KVA.
6. By a letter dated 30th of March, 1990 as contained in Annexure-2 to the writ application, the petitioner was directed to deposit further security amount of Rs. 70,400/-. The petitioner was also directed to execute a supplementary agreement for the additional load of 83 KVA raising the contract demand from 286 KVA to 369 KVA. By reason of the impugned order dated 31.10.1990, the petitioner was reminded by Bihar State Electricity Board about thcir earlier letters dated 10.2.1990 and 31.3.90 and it was contended that as the actual load was 369 KVA which being more than 10% of the contract demand, the petitioner was again requested to execute a supplementary agreement upon depositing necessary security amount,' details whereof has been given herein which reads as follows :
7. Mr. R. K. Marathia, learned counsel appearing for the petitioner has principally raised two contentions in support of this application.
Learned counsel firstly submitted that the matter relating to the validity of the imposition of additional security is pending consideration before the Supreme Court of India and the order of the Supreme Court of India dated 13th August, 1987 has been annexed to the writ application and marked as Annexure-6.
8. Learned counsel further submitted that additional security could only be demanded in terms of clause 15.3(c) of the Tariff framed by the Board in exercise of its power conferred upon it under section 46 of the Electricity (Supply) Act, 1948. According to the learned counsel, in terms of clause 15 of the aforementioned Tariff, an additional security should be demanded only when one or the other conditions mentioned in clause 15.3(c) of the Tariff is fulfilled.
9. Mr. B.S. Lal learned counsel appearing for the respondent-Board, on the other hand submitted that there is nothing to show as to on what basis the additional security was demanded in the case which is pending before the Supreme Court of India and an interim order has been passed which is contained In Annexure-6 to the writ application.
10. Learned counsel submitted that in this case in view of clause 16.5 of the Tariff, the petitioner is bound to enter il1to a fresh agreement for supply of electrical energy to the extent of 369 KVA and in that view of the matter further security demanded from the petitioner is not by way of additional security, but, in fact, b
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.