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2022 Supreme(Mad) 606

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
G.R. SWAMINATHAN, J.
S. Venkatraman – Appellant
Versus
The Tamil Nadu Generation & Distribution Corporation Limited, Madurai Electricity Distribution Circle, Represented by its Superintending Engineer, Madurai & Another – Respondents
W.P. (MD) No. 1777 of 2017
Decided on : 07-07-2022

Advocates:
Advocate Appeared:
For the Appellant :T.R. Jeyapalam, Advocate.
For the Respondents: S. Deenadhayalan, Standing Counsel.

A subsequent purchaser cannot be held liable for the arrears incurred by the vendor's vendor's tenant, especially when the liability arose before the relevant Electricity Act came into force.

Headnote:

Liability - Electricity Service Connection - Liability of subsequent purchaser for tenant's arrears

Fact of the Case:

The petitioner, a subsequent purchaser, challenged the inclusion of arrears from the previous tenant in the current electricity consumption bill.

Finding of the Court:

The court held that the subsequent purchaser cannot be burdened with the liability incurred by the vendor's vendor's tenant, especially when the liability arose before the relevant Electricity Act came into force.

Issues: The primary issue was whether the petitioner, as a subsequent purchaser, could be held liable for the arrears of the previous tenant.

Ratio Decidendi: The court relied on the legal principle established in Special Officer Vs. Raghunath Paper Mills Private Limited (2012) 13 SCC 479, which held that a subsequent purchaser cannot be burdened with the liability incurred by the vendor.

Final Decision: The court quashed the impugned demand and allowed the writ petition, stating that the petitioner's remitted amount shall be adjusted against future liability.

JUDGMENT :

(Prayer: Writ petition is filed under Article 226 of the Constitution of India, to issue a Writ of Certiorarified Mandamus, to call for the records relating to the impugned order dated 21.12.2016 in reference number “428/16 passed by the second respondent and quash the same and consequently, forbearing the respondents from demanding the liability of unknown persons Dhanapal and Saravanan in the electricity Service Connection No.GF 716 from the petitioner by including the same in the monthly electricity consumption charges in the electricity service Connection No.036-005-1783 standing in the name of the petitioner.)

1. Heard the learned counsel appearing for the petitioner and the learned standing counsel appearing for the respondents.

2. The writ petitioner purchased the petition mentioned property under two deeds of sale dated 21.01.2008 from one R.K.Muthu @ K.Kalimuthu and Narayanan. The property originally belonged to one Coolu Servai. His tenants Dhanapal and Saravanan allegedly committed energy theft in the year 2001. Since the assessment charges were not paid, the electricity connection that stood in the name of the tenants was disconnected. While so, by the impugned communication dated 21.12.2016, the assessment charges which were levied on the said tenants Dhanapal and Saravanan have been included in the petitioner's current consumption bill. Questioning the same, this writ petition has been filed.

3. The primary contention of the learned counsel appearing for the petitioner is that the petitioner being a subsequent purchaser cannot be burdened with the liability of his vendor's vendor's tenant.

4. Per contra, the learned standing counsel appearing for the respondents relied on Clause 17 (9)(a) of the Tamil Nadu Electricity Supply Code, 2004. He also submitted that the arrears in question constitute statutory dues and they are not merely contractual in nature. He relies on the decision of the Hon'ble Supreme Court rendered in Civil Appeal No.1815 of 2020 (Telangana State Southern Power Distribution Company Limited Vs. M/s.Srigdhaa Beverages) for the proposition that liability to clear the electricity dues runs with the land owner. He pointed out that this decision has been followed by this Court in W.P.No.13672 of 2020 dated 29.06.2021 (M/s.Virgin Manufacturing Industries Private Limited Vs. The Chairman and Managing Director, Tamil Nadu Generation and Distribution Corporation Limited (TANGEDCO)). He called upon this Court to dismiss this writ petition.

5. I carefully considered the rival contentions and went through the materials on record. Clause 17(9)(a) of the Tamil Nadu Electricity Supply Code, 2004 reads as under:-

    “17. Agreement with respect to supply: Issues on recovery of charges:

(9)(a). In case of service connections in a premises, which have been disconnected / dismantled for defaults in payment of dues whatsoever and if such service connection are to be connected or new service connections are to be obtained by other persons in such premises either by purchase or transfer or lease basis, the Distribution Licensee shall reconnect such service connections or effect new service connections, as the case may be, in such premises only after payment of dues attributed to such premises by the applicant.”

6. The expression 'premises' occurring in the aforesaid regulation was construed by a learned Judge of this Court in the decision reported in 2016-1-L.W.114 (Kadhariya Oriental Nursery and Primary School Vs. The Tamil Nadu Generation and Distribution Corporation Limited, Madurai Electricity Distribution Circle). It was held therein that the expression 'premises' means area where electricity service connection is provided to a consumer and not the whole area.

7. Prima facie, the decision of the Hon'ble Supreme Court in Telangana State Southern Power Distribution Company Limited Vs. M/s.Srigdhaa Beverages (Civil Appeal No.1815 of 2020) and the decision reported in 2016-1-L.W.114 (Kadhariya Oriental Nursery and Pri

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