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2003 Supreme(Cal) 10
High Court Of Calcutta
KALYAN JYOTI SENGUPTA
LOHIA MANDILIA - Appellant
Versus
C.E.S.C.LTD. - Respondent
W. P. 2926 Of 2000
Decided On : 01/14/2003
The appointment of CESC's own officials as adjudicators to assess the value of the electrical energy pilfered at penal rate and the quantity of electricity contained therein is unconstitutional and violative of Article 14 of the Constitution.
Headnote:
ELECTRICITY ACT - CONDITIONS OF SUPPLY - VALIDITY - CESC's conditions of supply relating to disconnection of supply without notice in case of pilferage of electricity, assessment of unmetered consumption and payment of additional security deposit, and appointment of CESC's own officials as adjudicators - Held: (i) Conditions empowering CESC to disconnect supply without notice and to realize 50% of provisionally assessed unmetered consumption and connection/reconnection charges as a condition precedent for restoration of supply are valid. (ii) Condition for realization of additional security deposit is ultra vires the Act and the terms of grant of license. (iii) Appointment of CESC's own officials as adjudicators is unconstitutional and violative of Article 14 of the Constitution.
Fact of the Case:
Petitioners, consumers of M/s. CESC Ltd., challenged the amended conditions of supply, namely Clauses 28, 29, 30, sanctioned by the Government on 15/05/2000. These conditions empowered CESC to disconnect supply line without notice in suspected cases of pilferage, and to realize un-metered consumption of electric energy by pilferage and other charges.
Finding of the Court:
The Court held that: (i) The conditions empowering CESC to disconnect supply without notice and to realize 50% of provisionally assessed unmetered consumption and connection/reconnection charges as a condition precedent for restoration of supply are valid. (ii) Condition for realization of additional security deposit is ultra vires the Act and the terms of grant of license. (iii) Appointment of CESC's own officials as adjudicators is unconstitutional and violative of Article 14 of the Constitution.
Issues: 1. Whether the conditions of supply published by CESC on 15/05/2000 are ultra vires the Indian Electricity Act, 1910 and also ultra vires Constitution of India and null and void and liable to be struck down? 2. Whether CESC officials can be appointed as adjudicators to assess the value of the electrical energy pilfered at penal rate and the quantity of electricity contained therein?
Ratio Decidendi: 1. The conditions empowering CESC to disconnect supply without notice and to realize 50% of provisionally assessed unmetered consumption and connection/reconnection charges as a condition precedent for restoration of supply are valid because: (a) Section 24 of the Electricity Act, 1910, which deals with disconnection of supply, does not apply to a case of detection of pilferage. (b) The Supreme Court in Hyderabad Vanaspati Ltd. v. Andhra Pradesh State Electricity Board held that the validity of similar conditions of supply of electricity and held on prima facie conclusion of power theft reached by the authority, it was not necessary to give further hearing to the consumer and action taken by the board disconnecting the supply was not violative of Articles 20(1) and 14 of the Constitution and the principle of natural justice. 2. The condition for realization of additional security deposit is ultra vires the Act and the terms of grant of license because: (a) The Act, Rules, and Clauses V and VI Schedule of the Act do not permit the licensee to realize additional security on any account. (b) Realization and payment of security deposit necessarily has a link with a lawful contract of supply, not as a penal measure. 3. The appointment of CESC's own officials as adjudicators is unconstitutional and violative of Article 14 of the Constitution because: (a) The officials of CESC are not expected to act as arbiters fairly and independently and in all possibility they will not be able to do so, even if they intend to do so, as CESC is a party to the dispute. (b) The CESC limited being a licensee cannot be placed at par with the Electricity Board, which is a statutory authority, regulated and controlled by the law not by the decisions of the Board of Directors or a group of individuals.
Final Decision: The writ petition was disposed of without passing any order. The Court directed CESC to appoint an independent person or persons as adjudicators within eight weeks from the date of communication of the order. If this was not done, the petitioners were at liberty to apply to the Chief Electrical Inspector who would either adjudicate the dispute himself or get it done by any other electrical inspector of his choice.
( 1 ) BY this single judgment the aforesaid two matters can be disposed of, as the facts and law involved therein are identically same. Shorn of details of the fact made out in both the writ petitions it would be suffice to narrate the short fact. In both the cases the petitioners, are consumers of M/s. CESC Ltd. , being the respondent No. 1. On 4/09/2000 one of the three phases of electric connection of the premises of the petitioners was gutted in fire, as a result whereof, the same was destroyed. On information the CESC officials came to restore the supply line after removing defect occurred due to fire. However, the line was not restored, despite repeated request and representations. On the contrary CESC authorities took a false plea of pilferage of electric energy, by means of tampering of seals of the meters. So, CESC sent a bill of huge amount for payment as condition precedent for restoration of supply line. The petitioners approached concerned Redressal Forum, under Consumer Protection Act, 1986 without any favourable result, ultimately these writ petitions were filed and pursuant to the interim order the line has been restored. In both the writ petitions the vires of amended conditions of supply, namely Clauses 28, 29, 30 as sanctioned by the Government dated 15/05/2000 are challenged. By the aforesaid conditions of supply CESC has been empowered amongst others to disconnect supply line without any notice in suspected cases of pilferage, and realize un-metered consumption of electric energy by pilferage and other charges. Upon proper examination of the body of the petitions I find there is no specific ground in the petition filed in Original Side writ to challenge the vires of the aforesaid conditions of supply, however, in the petition of the Appellate Side the grounds are there. As both the matters are being heard in consolidated manner, I have no option but to decide all the questions raised in both the petitions. The affidavit-in-opposition reveals fact somewhat differently, as it is stated that the petitioners had resorted to the clandestine act of pilferage of electric energy thereby, the petitioners have allowed electric energy to be consumed without any registration in the meter. Incident of breaking out of the fire in one of the phases was mere an isolated incident, but this incident was really an eye-opener to the CESC officials for detection of this pilferage of electric energy.
( 2 ) MR. Pradip Kumar Ghosh, learned Senior Advocate appearing in support of the petition has argued the case on the question of vires. So, I cannot help to consider his submission, which is summarized as hereunder :he submits that the aforesaid clauses 28, 29, 30 have overridden the expressed provision of the statute under which conditions of supply have been framed and the same cannot be allowed to be done under the law as such they are bad in law. He submits that the aforesaid conditions of supply are not at all necessary even if it is assumed the same are valid, inasmuch as the existing provisions in the Act and Rules are quite adequate to meet any eventuality or situation even in case of theft of electric energy or for that matter in case of disconnection of supply line where the consumer commits default or commits breach of the terms and conditions of the supply. He has drawn my attention to Section 20 of the Indian Electricity Act, 1910, which authorize the licensee to inspect, test, repair meter or meter fittings and for this purpose the licensee can have access upon prior intimation to the occupier to inspect the electrical installation and metering system. For this, if necessary, the licensee can procure the order of Magistrate for entering the premises after giving not less than 24 hours' notice and even the line can be cut off if the entry or access is refused by the consumer. He contends that under provision of clauses 28, 29 service of prior notice has been done away with. So, according to
