2017 Supreme(All) 325
ALLAHABAD HIGH COURT
BEFORE : DILIP B. BHOSALE, C.J. AND YASHWANT VARMA, J.
M/s. DEV PRAYAG PAPER MILL (PVT.) ....Petitioner
Versus
STATE OF U.P. AND OTHERS ....Respondents
(Civil Misc. Writ Petition Nos. 30898, 28797, 1281, 2271, 31371 of 2016, 56475, 63623 of 2014, 28780 of 2016, 58725, 58043, 55427, 56478, 55362 of 2014, 35908, 26316 of 2016, 1667, 1669 of 2015, 34862 of 2009, 22286 of 2016, 52886, 42752 of 2004, 1541 of 2006, 31394 of 2009, 2432, 27736 of 2006, 53044 of 2004, 29673 of 2007, 34247 of 2006, 61389, 61387, 61781 of 2010, 30484, 30457, 30754, 30753, 30751 of 2009, 52897 of 2004, 39838, 28491, 28492, 51511 of 2007, 619, 24221, 24225, 24228 of 2005, 31769 of 2007, 58426, 59027 of 2005, 61779 of 2010, 37613, 30584, 30580, 30458, 37663, 31361, 26524 of 2009, 57682, 57714, 58425, 58337, 44352, 56776, 55276, 61972, 62047, 65885, 67140, 67141, 67281, 67341 of 2005, 30132, 49797, 49799, 49791, 49792, 49795, 49788 of 2007, 62228, 52596, 62234 of 2008, 10753 of 2010, 26920 of 2009, 52911, 51608, 19564, 19566 of 2010, 30755, 32366, 38965 of 2009, 48280, 48543, 48569, 52000 of 2006, 61782 of 2008, 58456, 53238 of 2006, 53046 of 2004, 61770, 66722 of 2005, 43757 of 2014, 43770, 45438, 44732 of 2015, 34994, 35004, 35159, 35305, 35396, 35397, 35399, 34868, 34862, 46751, 46848, 46849 of 2013, 32006 of 2016, 67682, 63326 of 2015, 33733, 33464, 30363, 33736, 33734, 30987, 29564, 29265, 28910 of 2014, 26315 of 2008, 25088 of 2014, 67346 of 2005, 43171 of 2008, 69598 of 2013, 44757 of 2008, 25604 of 2007, 32059 of 2014, 44549, 55137 of 2016, 2275 and 3472 of 2017, decided on 21st March, 2017)
Counsel :
Bidhan Chandra Rai, Satyam Narayan, Anshul Kumar Singhal, Vinod Kumar Agarwal, Kshitij Shailendra, Gopal Krushna, Dinesh Kumar Chadha, Mayank Agrawal, Seema Agrawal, Aishwarya Pratap Singh, Anubhav Trivedi, S.K. Pandey, R.K. Pandey, Hare Krishna Mishra, Vishal Dixit, Pramod Kumar Jain for the Petitioner; C.S.C., Amrendra Nath Singh, Mahboob Ahmad, S.S.A. Kazmi, Vinay Kumar Singh, Nripendra Mishra, Baleshwar Chaturvedi, S.C., A.K. Saxena, Chandan Agarwal, H.P. Dube, Shivam Yadav, Pankaj Kumar Shukla, Pranjal Mehrotra, W.H. Khan, A.S.G.I. 2006/66, Mridul Tripathi, Dr. A.K. Nigam, J.P. Singh, A.K. Mehrotra for the Respondents.
Headnote:(A) Electricity Act, 2013—Section 47(5)—Additional security deposit—Demand of—Validity—In post consumption payment system licencee run risk of recovery of dues as there are innumerable defaulters—Delay in payment likely to choke licensee and paralyze electricity distribution system—To safe guard his interest and interest of public at large, there is no illegality in demanding deposit by licensee. [Paras 14 and 15]
(B) Electricity Act, 2013—Section 55—Prepaid meters—Demand for additional security deposit—Petitioner sought dispensing with security deposit until pre-paid meters provided—Mandate on licensee to supply electricity through installation of correct meters so as to ensure proper accounting—However pre-paid meters for HT consumers not available—On fact that if licensee restrained from demanding security deposit same will result in licensee purchasing power from generators at his own cost and collect charges from consumer only after block period—Resulting in choke of licensee and paralysing supply of electricity—Hence demanding security deposit is not illegal. [Paras 14, 15 and 20]
(C) Electricity Act, 2013—Section 55—Prepaid meters—Obligation on licensee to supply—Unless prepaid meters with proven technology available to supply electricity to H.T. Consumers—There is no obligation on licensee to supply those meters. [Para 20]
(D) Electricity Act, 2013—Sections 47(2), 55—Prepaid meters—Demand for additional security deposit—As long as pre-paid meters not installed, it is mandatory upon HT consumers to pay security as demanded by licensee—Plea of waving of security deposit merely because request for pre-paid meters made when no such meters available contrary to statutory scheme, rejected. [Para 24]
(E) Constitution of India, 1950—Article 226—Electricity Act, 2013—Sections 47(2), 55—Demand for additional security—Power of Court to order dispense with payment—Statute vest power in licensee to demand security deposit—No provision in statute provided for waiver—Held Court in exercise of jurisdiction under Article 226 of Constitution cannot direct licensee to dispense with payment. [Para 24]
Result; Petitions Dimissed.
Hon'ble Dilip B. Bhosale, C.J.—This bunch of writ petitions, under Article 226 of the Constitution of India, challenge demand notices issued by Distribution Companies, through its Executive Engineers, whereby the petitioners are directed to/required to deposit additional security for supply of electricity, with the warning that if the payment of security is not made within the stipulated time, appropriate action would be taken in accordance with law. The petitions also challenge the provisions contained in clause (l) of Para 4.20 of the Electricity Supply Code, 2005 (for short, ‘Supply Code, 2005’) insofar as it provides ‘as and when a distribution licensee provides a choice to consumer to opt’ being ultra vires the provisions of sub-section (5) of Section 47 of the Electricity Act, 2003 (for short, ‘Act, 2003’). It appears that in most of the writ petitions, this Court has granted interim orders in favour of the petitioners. Since the questions raised in the writ petitions are similar, the entire bunch of petitions is being disposed of by this common judgment.
2. In order to understand, appreciate and consider the controversy, it would be appropriate to state the facts in Writ Petition No. 30898 of 2016, to the extent they are necessary for our purpose. The petitioner - company, registered under the Companies Act, 1956, is an industrial unit, engaged in the manufacture of craft paper, mill-board, grey board, duplex board, copying and packaging paper. It is a consumer within the meaning of clause (15) of Section 2 of the Act, 2003, which draws electricity from respondent No. 3 - Purvanchal Vidyut Vitran Nigam Limited, a State Power Distribution Company. The petitioners in all writ petitions consume high volume of electricity and are classified as High Tension (for short, ‘HT’) consumers. The petitioner - company got an electricity connection for which they had deposited a sum of Rs. 53,28,300/- towards security. According to petitioner, respondent No. 4 - Executive Engineer, Electricity Urban Distribution Division, of respondent No. 3 - State Power Distribution Company, in purported exercise of the powers under circular dated 7.3.1994 and the Supply Code, 2005, issued a demand notice dated 9.6.2016, for the financial year 2015-16, to pay a total security amount of Rs. 87,40,891. After adjusting the amount that was already paid, the petitioner was directed to pay the difference of the amount, i.e. Rs. 34,12,597/-. Such demand notices forced all the petitioners-HT consumers, to file writ petitions not only challenging the demand notices but also the provisions of clause (l) of Para 4.20 of the Supply Code, 2005 being ultra vires the provisions of sub-section (5) of Section 47 of the Act, 2003.
3. The petitioner claims, as provided for under Section 47(5) of Act, 2003, that it has already informed the respondent No. 4 - Executive Engineer to install prepaid meters vide letter dated 21.4.2016 and in view thereof, no security, as contemplated by sub-section (1) of Section 47, is liable to be paid. On this ground alone, the impugned demand according to the petitioner is illegal. The petitioners have not challenged their liability to deposit security as such and what they have challenged is the impugned demand for additional security for supply of electricity. Similar are the facts and circumstances against which the petitioners in all other writ petitions have approached this Court, raising similar challenge after having received demand notices issued by the respective State Power Distribution Companies, and for uninterrupted electrical energy being supplied to them without providing prepaid meters under Section 47 (5) of the Act, 2003.
4. The provisions of clause (l) of Para 4.20 of the Supply Code, 2005, which is under challenge, provides that a distribution licensee shall not be entitled to require security in pursuance of sub-section (1) of Section 47 of the Act, 2003, if the person requiring the supply is prepared to ta