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High Court Of Rajasthan
Judgename : Navin Chandra Sharma
Newar Marble Industries Pvt.Ltd - Appellant
Versus
Rajasthan State Electricity Board - Respondent
Civil Writ Petition No. 3148 of 1991
Decided On : 01/06/1992
ELECTRICITY - THEFT OF ENERGY - COMPOUNDING OF OFFENCE - ILLEGALITY - PUBLIC POLICY - CONTRACT ACT, SECTION 23 - INDIAN ELECTRICITY ACT, 1910, SECTION 39 - GENERAL CONDITIONS OF SUPPLY AND SCALE OF MISCELLANEOUS CHARGES RELATING TO THE SUPPLY OF ELECTRICITY (1964) BY THE RSEB, CONDITION 29(C)(II) - CODE OF CRIMINAL PROCEDURE, 1973, SECTION 320(9).
Fact of the Case:
The petitioner, a private limited company, was a consumer of HT electricity supply from the respondent Rajasthan State Electricity Board (RSEB). The petitioner was accused of theft of energy by the RSEB officials during a routine inspection. The petitioner agreed to compound the offence for a sum of Rs. 4,50,000/- and paid Rs. 1 lac as the first instalment. The petitioner filed a writ petition challenging the legality of the compounding agreement and seeking a refund of the amount deposited.
Finding of the Court:
The court held that the compounding agreement was illegal and void under Section 23 of the Contract Act as it was opposed to public policy. The court observed that the offence of theft of energy under Section 39 of the Indian Electricity Act, 1910 was not a compoundable offence and that the consideration or object of the compounding agreement was abstention by the RSEB from criminally prosecuting the petitioner-Company from offence under Section 39 of the Act and that the RSEB has converted the crime into a source of profit or benefit to itself. The court further held that the petitioner was not entitled to claim a refund of the part of consideration money that was paid by him with full knowledge of the illegality of the contract.
Issues: 1. Whether the compounding agreement between the petitioner and the RSEB was legal and valid? 2. Whether the petitioner was entitled to a refund of the amount deposited by him?
Ratio Decidendi: 1. The court held that the compounding agreement was illegal and void under Section 23 of the Contract Act as it was opposed to public policy. The court observed that the offence of theft of energy under Section 39 of the Indian Electricity Act, 1910 was not a compoundable offence and that the consideration or object of the compounding agreement was abstention by the RSEB from criminally prosecuting the petitioner-Company from offence under Section 39 of the Act and that the RSEB has converted the crime into a source of profit or benefit to itself. 2. The court held that the petitioner was not entitled to claim a refund of the part of consideration money that was paid by him with full knowledge of the illegality of the contract.
Final Decision: The writ petition was partly allowed. The compounding of the offence under Section 39 of the Indian Electricity Act, 1910 made by relevant parts of Annexures 1, 2 and 4 by the parties was declared to be unlawful and void under Section 23 of the Contract Act and the respondents were restrained from realising any further amount from the petitioner-Company on the basis of the compounding agreement arrived at between the parties as per the relevant parts of Annexures 1, 2 and 4.
Navin Chandra Sharma, J.-Newar Marble Industries Pvt. Ltd., a private limited Company, incorporated under the provisions of the Companies Act, 1956 and having its registered office at E-27, Ambaji Industrial Area, Post Office Abu Road (District Sirohi), is carrying on business of manufacturing miror-polished marble tiles since the year 1988. It is a Consumer of HT electricity supply from the supplier Rajasthan State Electricity Board (for short, “the Board”) since 14th April, 1989 under a sanctioned contract demand of 300 KVA with a sanctioned connected load of 537.5 BEP. The petitioner company provided “Consumer’s sub-station or an enclosed Switch Station” for HT Consumers for the purpose of housing the Board’s Terminal High Tension Switch gear and equipment which included the metering facilities, apparatus and measuring devices as required by the Board.
2. In this lengthy writ petition running in 51 pages, prays that--
(a) Report dated 15-2-91 (Annexure-I), order of the Chairman of the Board dated 21-2-91 (Annexure-4), meter test record dated 23-2-91 (Annexure- 12) and an unaverred and unproduced Annexure-13 be declared void and unenforceable against the petitioner-Company and the demand of Rs. 4,50,000/- under order dated 15-2-9 1 be quashed;
(b) TheBoard may be restrained from disconnecting any power supply to the petitioner-Company on account of non-payment of the instalments in pursuance of the order of the Chairman of the Board dated 21-2-91 (Annexure- 4); and
(c) the Board be directed to refund a sum of Rs. 1.60 lacs to the petitioner-Company with interest at 18% per annum from the date of payment till realization.
3. What after all these three documents Annexures-1, 4 and 12 are? The Executive Engineer (MT) RSEB, Jodhpur, the Executive Engineer (0 & M) RSEB, Sirohi, the Asstt. Engineer (ST), Sirohi and the Asstt. Engineer (0 & M), Abu Road made a joint routine checking of JDC HT 115 at the industry precincts of the petitioner-Company on 15th February, 1991 and made a joint report Annexure-I. It was inter-alia reported in the joint inspection report that- During inspection following act of theft was noticed: “the sealing wire of meter pannel is found rejointed i.e.,
tampering of sealing system where Trivector meter No. 8850/8/80 IMP Make meter sealing wire having sealed by lead seal No. P. 4683. The above facts indicates that you are guilty of theft. The amount of compensation payable by consumer to the Board under the relevant provision of General Conditions of Supply has been provisionally assessed at Rs. 8,93,520/-. Consumer has agreed for compounding his theft case. Compounding amount Rs. 300 x 1500 = Rs. 4,50,000/-(four lakhs fifty thousands only). Meter room is sealed by seal No. C 11489 punched by plies No. 308 of x En (MT), Jodhpur.
4. Annexure 4 is an application made by the Director of the petitioner-Company to the Chairman of the Board stating that “during the checking of meters by RSEB officers on dated 15-02-9 1, we have been agreed for compounding as per their report (copy enclosed) amounting to Rs. 4,50 lacs. Presently we are unable to deposit the full amount. Therefore we request your goodself to grant us twenty instalments for depositing the above amount. Moreover we may please be allowed for re-connection of power after depositing the first instalment. We shall also be paying the monthly energy charges along with the instalment.” Upon this application is the order dated 21-2-91 passed by the Chairman of the Board addressed to the AEN to the effect that “The party has been allowed to deposit Rs. 1 lakh (one lakh) in five days. Remaining amount may be recovered in monthly instalments of Rs. 3 0,000/-(Thirty thousands).
5. Annexure 12 is the meter test record card issued on 23-2-91 showing percentage of true revolutions errors in KWh revolution, KV Arh revolution and KVAh revolution and percentage of error of demand with KVAh.
6. According to the petitioner-Company, authorised officers of the Boa
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