An auction-purchaser cannot be held liable for the arrear dues of the previous owner in the context of electricity supply, as established in the case of M/s. Isha Marbles v. Bihar State Electricity Board.

A. K. PATNAIK, P. K. MISRA, JJ.

( 1 ) M/s. Shrivally Synthetics Pvt. Ltd. owned an industry in D-2/11, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar. The said industry was financed by the Orissa State Financial Corporation, (in short, 'osfc' ). The aforesaid industry of M/s. Shrivally Synthetics Pvt. Ltd. was taken over by the OSFC under S. 29 of the State Financial Corporation Act, 1951 and sold to the petitioner at a price of Rs. 18 lakhs. The sale agreement was executed between the OSFC and the petitioner on 21-1-2002. The assets of the aforesaid industry comprising of land and building were given in possession of the petitioner on 25-1-2002. On 5-2-2002, the Branch Manager, OSFC, Bhubaneswar Branch informed the Chief General Manager, IDCO that the aforesaid industrial land and building of M/s. Shrivally Synthetics Pvt. Ltd. have been sold to the petitioner, the proprietor of M/s. Auro Agencies, located at Puspa Market, Room No. 1, Cuttack Road, Bhubaneswar-6 and the petitioner has taken over physical possession of the assets on 25-1-2002. By the said letter dated 5-2-2002, the Branch Manager of OSFC, Bhubaneswar Branch also requested the Chief General Manager, IDCO to transfer the land and building in favour of the petitioner. A copy of the said letter dated 5-2-2002 was also marked to the Executive Engineer, City Distribution Division, Unit-8, Bhubaneswar with a request to restore power connection to the petitioner without insisting on payment of arrear dues as per the provisions of the I. P. R. The petitioner thereafter applied for supply of electricity in the form for requisition for supply of electrical energy for domestic and commercial purposes to the Junior Engineer, City Distribution Division of CESCO, Bhubaneswar. But the petitioner was not supplied power. Aggrieved, the petitioner has filed this writ petition under Articles 226 and 227 of the Constitution of India for a direction to CESCO, opposite party No. 2 to restore power supply to the unit of the petitioner.

( 2 ) MR. B. S. Mishra, learned counsel for the petitioner submitted that the counter affidavit filed on behalf of opposite party No. 2 would show that opposite party No. 2 has refused to supply electricity to the petitioner on the ground that a sum of Rs. 1,23,541/- is due and payable for supply of electricity by CESCO from the previous owner of the industrial unit, namely, M/s. Shrivally Synthetics Pvt. Ltd. He submitted that the aforesaid liability of M/s. Shrivally Synthetics Pvt. Ltd. cannot be thrust on the petitioner, who has purchased the industry from the OSFC pursuant to take over of the industry by the OSFC under S. 29 of the State Financial Corporations Act, 1951. In support of his aforesaid contention, Mr. Mishra relied on the decision of the Supreme Court in M/s. Isha Marbles v. Bihar State Electricity Board and another : 1995 (2) JT SC 626 : 1995 (1) Scale 721 : 1995 (2) SCC 648, in which the Supreme Court held that the liability of the previous contracting party cannot be enforced against the auction purchaser, who is a third party and is in no way connected with the previous owner/occupier of the industrial premises. In the said decision, Mr. Mishra pointed out that the Bihar State Electricity Board was trying to recover the dues towards electricity charges of the previous contracting party with the aforesaid Board from the auction purchaser, but the Supreme Court held that this cannot be done. According to Mr. Mishra, therefore, CESCO cannot enforce the liability of the previous consumer M/s. Shrivally Synthetics Pvt. Ltd. from the petitioner, who has purchased the industrial assets of M/s. Shrivally Synthetics Pvt. Ltd. in auction purchase from OSFC.

( 3 ) MR. B. K. Nayak, learned counsel appearing for CESCO, on the other hand, submitted that the counter affidavit of CESCO is as well as the annexure enclosed thereto, would show that the Executive Engineer, Commercial, CESCO, has informed the Branch Manager of OSFC, Bhu