JUDGMENT S. Ravindra Bhat, J.- The petitioner in this case, an industrial user of electricity, questions a supplementary bill for Rs. 8,15,895/- issued by the respondent (hereinafter called BSES) on 27.12.2004. In addition, he has challenged the findings of the assessing officer dated 17.12.2004. 2. The petitioners premises were inspected on 6.10.2002. A copy of the inspection report has been produced in these proceedings. The report recorded that the CT Meter terminal box and other seals were intact. The inspection team endorsed that the plain paper seals with serial numbers were duly signed by the Junior Engineer and found to be pasted on the MS Box. It also recorded that the seals had been removed by them but fresh seals were duly signed. No irregularity was found on that occasion. Another inspection was undertaken at the behest of BSES by M/s. KLG Systel Ltd. on 24.3.2004. This recorded that the meter was running in the right direction; the meter half seals were observed to be unnumbered and the report further stated that the meter was "running fast" by 5.30%. 3. A third impugned inspection was held on 1.12.2004. On this occasion, the inspection team stated that the CT and Meter Box combined seals were found missing and that IR No. 216720 was pasted on the MS Box. This inspection team also recorded as follows: "One number plain paper seal with name "Mr. Parveen Kumar Engr. SIP" found pasted intact on CTMS Box. The coy of the meter accu-check with seal numbers on it, is hereby attached." 4." On that basis of the observations, a show-cause notice was issued on 4.12.1994; the petitioner was alleged to have indulged in Dishonest Abstraction of Electricity (DAE). The notice reads as follows: "Your premises was inspected on 1.12.2004 and your meter/s is/are found to be tampered. Analysis of consumption pattern reveals that the average consumption is low and not in consonance with the assessed/ computed consumption worked out on the basis of DERC norms, constituting suspected Dishonest Abstraction of Energy. You are, hereby, requested to show cause as to why action should not be initiated for Dishonest Abstraction of Energy under Regulation 25 of DERC Regulations. You are given an opportunity for a personal hearing under Regulation 26 of DERC Regulations on 13.12.2004 at 10.30 a.m. at the above mentioned address. You are, hereby, requested to show cause as to why action should not be initiated for Dishonest Abstraction of Energy under Regulation 25 of DERC Regulations. You are given an opportunity for a personal hearing under Regulation 26 of DERC Regulations on 13.12.2004 at 10.30 a.m. at the above mentioned address. You may furnish all necessary documents in support of your case during the personal hearing. In case you/your authorized representative do not reply or appear for personal hearing after receipt of this notice, it shall be assumed that you have nothing to say in the matter ant case shall be proceeded ex-parte." 5. After hearing the petitioner and considering the representations/objections furnished by him, the Assessing Officer of BSES issued the following order on 17.12.2004: "During the inspection conducted by Enforcement Department on 1.12.2004 total connected load of 39.375 KW against the sanctioned load of 35.44 KW, under IX Category, was detected. Both upper and lower CT and meter box combined seal found missing. One number plain paper seal with name Parveen Kumar, Enginner, SIP, found pasted on CT MS box. The average recorded consumption is low. Show-cause notice for suspected dishonest abstraction of energy and request to attend personal hearing on 13.12.2004 was sent vide letter dated 4.12.2004. Shri Davinder Singh Kohli, son of Shri U.S. Kohli attended personal hearing and submitted that connection is being used for job work for repairing of auto parts. Shri Davinder Singh Kohli also submitted copy of record of inspection dated 24.3.2004 by KLG Systel Ltd., which has also been signed by Shri Praveen Yadav, Field Engineer, BSES. This report shows unnumbered meter half seals fixed on meter. Another copy of the inspection report prepared on Proforma No. 4395 dated 6.8.02 also shows meter half seal unnumbered. The case has been examined and study of the consumption pattern for the period 3.10.03 to 29.10.04 shows an average recorded consumption 1119.84 units per month, which has been found 19.95% of the assessed consumption. Meter half seals are important seals in the meter and unnumbered half seals found during inspection dated 24.3.2004 and 6.8.2002 shows tampering of the meter. Consumption is low. DAE is established. After tolerance of 5%, consumer is required to be billed for a connected load of 37.406 KW, under IX category, as per Tariff Schedule, 2004-05 and DERC Regulations." 6. Meter half seals are important seals in the meter and unnumbered half seals found during inspection dated 24.3.2004 and 6.8.2002 shows tampering of the meter. Consumption is low. DAE is established. After tolerance of 5%, consumer is required to be billed for a connected load of 37.406 KW, under IX category, as per Tariff Schedule, 2004-05 and DERC Regulations." 6. The petitioner alleges that the finding of DAE are wrong and unwarranted. Reliance is placed upon the previous reports of 6.8.2002 and 24.3.2004 to say that both those reports were completely ignored. The first report of 2002 had found no irregularity in the meter seals. Likewise the second report also recorded that at that time of observation in March 2004, there was no tampering of any seal. It is stated that the paper seal was affixed on 24.3.2004 and duly signed by the Field Engineer of BSES, which is evident from the record of inspection. This seal was found on the third inspection and declared to be unnumbered/tampered seal. It is claimed that the findings of DAE are based purely on the so-cal1ed consumption pattern. The petitioner has pleaded the consumption pattern for the period of February 2004 to November 2004 and contended that there was no consistent pattern because of the nature of industrial activity namely job work received from time-to-time; as and when there are work orders, the consumption increases and whenever there is a periodic lul1 or slackness in industrial activity, the consumption becomes lower. The findings of arbitrariness and the bill for DAE have, therefore, been impugned as illegal and arbitrary. 7. The BSES in its counter affidavit al1eges as the premises were inspected by its enforcement team on 1.12.2004 when Meter No. DVB/2002/CT/011927 was found instal1ed against K. No. 2610H0030202 (IX), a load of 39.375 KW (IX) was found connected against sanctioned load 35.44 KW (IX); supply was found being used by the petitioner for job work repairing of Auto Parts. A load report in the form of Assessment of connected load and meter report in the form of Inspection Report (Meter Detail) were prepared at site. A representative of the petitioners was present during the inspection but he refused to sign and receive copy of inspection report. It is al1eged that as per meter report following irregularities were found in the metering equipment. "* CT and meter box combined seals found missing. A representative of the petitioners was present during the inspection but he refused to sign and receive copy of inspection report. It is al1eged that as per meter report following irregularities were found in the metering equipment. "* CT and meter box combined seals found missing. * Plane paper seal was not authenticated. On the basis of inspection dated 1.12.2004, show-cause notice dated 4.12.2004, regarding Suspected Dishonest Abstraction of Energy was served to the petitioner to attend the Personal Hearing on 13.12.2004 as per Tariff provision and DERC Regulations." 8. It is alleged that in response of the show-cause notice, the petitioner was represented in the personal hearing on 13.12.2004 before Assessing Officer; he submitted detailed representation and pleaded his case. It is claimed that keeping in view all facts of the case, circumstances, giving due consideration outcome to personal hearing and after thorough analysis of the consumption pattern for the period 3.10.2003 to 29.10.2004, (which shows that the average recorded consumption is 19.95% of computed consumption) the Assessing Officer concluded that the petitioner had indulged in DAE. The meter half seals which are important seals in the meter and unnumbered half seals found during inspection dated 24.3.2004, 6.8.2004, and plain paper seal which have no authenticity, which show tampering in the meter. The Assessing Officer on basis of the same reached the conclusion that it is a clear case of Dishonest Abstraction of Electricity (hereinafter referred to as DAE). After that he issued a speaking order as per requirement of law, on 17.12.2004. The speaking order passed by Assessing Officer accords to DERC Regulation. 9. It is alleged that on the basis of above speaking order dated 17.12.2004, and as per provision of tariff order and DERC Regulations, AFO (En f.) raised DAE bill of amount of Rs. 8,15,895/-. 10. Mr. Mukul Dhawan, learned Counsel submits that the findings of DAE were completely unfounded. He has placed reliance on all the three reports and submitted that on each occasion, separate/fresh seals were affixed. Thus, when the agency along with Field Officer of BSES visited the site and inspected the premises on 24.3.2004 after opening CT Box when the accuracy of the meter was seen leading to the conclusion that the meter was running fast, the Box was resealed, with a blank paper seal. Thus, when the agency along with Field Officer of BSES visited the site and inspected the premises on 24.3.2004 after opening CT Box when the accuracy of the meter was seen leading to the conclusion that the meter was running fast, the Box was resealed, with a blank paper seal. The authenticity of this seal, although unnumbered, was emphasized and the Counsel relied upon signatures of Shri Parveen Kumar, which were affixed on that blank paper seal on 24.3.2004. He also pointed out that the same Mr. Parveen Kumar had signed the inspection report, which has not been denied by the BSES. 11. Learned Counsel urged that the higher load or the paper seal by itself, could not have justified a finding of a DAE. The Counsel submitted that the bill and the speaking order were not only unjustified, but an abuse of power. It was contended that reference to consumption pattern, which had to be independently seen as per the Regulation 26(ii) of the DERC (Standards of Metering and Billing) Regulations, 2002 (hereinafter called the Regulations) did not, mean that even an assumed irregularity in the meter seals, and artificial determination consumption pattern justified such findings. The Counsel claimed that in this case, there was no irregularity or tampering of the seal. The signatures on the inspection report and on the paper seal deemed to be tampered seal were by the same official. In these circumstances without any other material, BSES could not have concluded DAE. The reference to lower consumption pattern was misleading, since the petitioners work was sporadic and defended on work/job orders, that were not continuous. The Counsel also relied upon the definition of DAE in Regulation 2(m) as well as Regulation 25(iv) and submitted that there had to be some other material to "conclusively establish" DAE. 12. Learned Counsel for the respondent urged that the analysis of consumption pattern in this case revealed that as against the total connected load, on an application of the relevant load factor, on assumption that the unit was functioning on 60% capacity i.e. 10 hours daily for 25 days a month the average consumption would have been at least about 5 times more. The average recorded consumption was 1119.84 units per month whereas it ought to have been at least 5200 units per month on the basis of the observed connected load. 13. The average recorded consumption was 1119.84 units per month whereas it ought to have been at least 5200 units per month on the basis of the observed connected load. 13. Learned Counsel urged that the seals found upon the inspection on 1.12.2004 were irregular, plain paper seals which were, no doubt, signed. Yet BSES was justified in its conclusion that such a paper seal was tampered and could have led to access to the meter and enabled, the consumer to manipulate recordings by the meter. It was contended that a combination of the irregularity in the meter seals observed and the low consumption pattern analysed sustained the conclusion of DAE. Therefore, findings of the Assessing Officer and the impugned supplementary bill were neither illegal nor arbitrary. 14. The above narrative shows that the petitioners premises were inspected on three occasions. There is no controversy as to the nature of the meter or the seals on the first occasion, in 2002. The second inspection report too has not been denied; that report states that the meter was 5.30% fast; the seals existing then were observed as intact. The inspection report was signed by the Field Engineer, Parveen Kumar. There is no dispute about the authenticity of this document. The third inspection noted that the plain paper seals on the CT Meter Box was missing, and that the conclusion of "tampered" meter was arrived at, on the basis of the unauthenticated plain paper seals. 15. Section 126 of the Electricity Act, 2003 is reproduced as under: "126. Assessment-(1) If on an inspection of any place or premises or after inspection of the equipments, gadgets, machines, devices found connected or used, or after inspection of records maintained by any person, the assessing officer comes to the conclusion that such person is indulging in unauthorized use of electricity, he shall provisionally assess to the best of his judgment the electricity charges payable by such person or by any other person benefited by such use. (2)The order of provisional assessment shall be served upon the person in occupation or possession or in charge of the place or premises in such manner as may be prescribed. (2)The order of provisional assessment shall be served upon the person in occupation or possession or in charge of the place or premises in such manner as may be prescribed. (3)The person, on whose a notice has been served under Sub-section (2), shall be entitled to file objections, if any, against the provisional assessment before the assessing officer, who may, after affording a reasonable opportunity of hearing to such person, pass a final order of assessment of the electricity charges payable by such person. (4) Any person served with the order of provisional assessment may, accept such assessment and deposit the assessed amount with the licensee within seven days of service of such provisional assessment order upon him: Provided that in case the person deposits the assessed amount, he shall not be subjected to any further liability or any action by any authority whatsoever. (5) If the assessing officer reaches to the conclusion that unauthorised use of electricity has taken place, it shall be presumed that such unauthorised use of electricity was continuing for a period of three months immediately preceding the date of inspection in case of domestic and agricultural services and for a period of six months immediately preceding the date of inspection for all other categories of services, unless the onus is rebutted by the person, occupier or possessor of such premises or place. (6) The assessment under this Section shall be made at a rate equal to one and half times the tariff applicable for the relevant category of services specified in Sub-section (5). Explanation.-For the purposes of this section- (a) assessing officer means an officer of a State Government or Board or licensee, as the case may be, designated as such by the State Government; (b) unauthorised use of electricity means the usage of electricity- (i) by any artificial means; or (ii) by a means not authorised by the concerned person or authority or licensee; or (iii) through a tampered meter; or (iv) for the purpose other than for which the usage of electricity was authorised." 16. The relevant provisions of the Delhi Electricity Reforms Commission (Performance and Standards of Meter) Regulations, 2002 (hereafter "Regulations"), frame under the Delhi Electricity Reforms Act, 2000, read as follows: “2..(m) Dishonest Abstraction of Energy (DAE)" shall mean abstraction of electrical energy where accessibility to the internal mechanism of the metering equipment and some collateral evidence is found to support the conclusion that the meter has been caused to record less energy than actually passing through it. It shall also include any other means adopted by consumer to cause the meter to stop or run slow (such as reversing the polarity of one phase of poly phase meters, changes in CT or PT, etc.). xxx xxx xxx "25. Procedure for booking a case for pilferage of energy- (i) The licensee, suo motu or on receipt of reliable information regarding commitment of any offence of theft/tampering/dishonest abstraction of energy (DA E), shall promptly conduct inspection of consumers premises. The inspection team •shall carry a written authority signed by designated officer of the licensee. (ii) The inspecting team shall prepare a report giving details such as connected load, condition of seals, working of meter and mention any irregularity noticed (such as, artificial means adopted for dishonest abstraction of energy) as per format prescribed by the licensee. (iii) The report shall clearly indicate whether conclusive evidence substantiating the fact that energy was being dishonestly abstracted was found or not. The details of such evidence should be recorded in the report and it should be clearly brought out whether the case is being booked for direct theft or DAE. (iv) No case for DAE shall be booked only on account of one seal on the meter missing or tampered or breakage of glass window, etc. unless corroborated by consumption pattern of consumer as per Regulation 26(ii) given below and such other evidence as may be available. (v) In case sufficient evidence is found to establish direct theft of energy, the licensee may lodge a report with the local police along with the material evidence including wires/cables, meter, service line, etc. seized from the site, which shall be handed over to police. The licensee shall also assess the energy consumption for past six months as per the Tariff Order and prepare final assessment bill on 5 times the rates as per applicable tariff. seized from the site, which shall be handed over to police. The licensee shall also assess the energy consumption for past six months as per the Tariff Order and prepare final assessment bill on 5 times the rates as per applicable tariff. The consumer shall be required to make the payment within 2 working days of its proper receipt. (vi) In case of suspected DAE, the inspection team shall not remove the tampered meter but shall disconnect it from the supply and shall restore the supply through a new meter of appropriate rating. In such cases, the licensee shall check the connected load and consumers installation, affix a numbered Johnsons paper seal on the tampered meter and shall also record the particulars of the same in the report. (vii) While the report must be signed by each member of the joint team and the notice, if any, must be signed by an authorized signatory of the licensee and all these must be handed over to the consumer or his/her representative at site immediately under proper receipt. In case of refusal by the consumer or his/her representative to either accept or give a receipt, a copy of each must be pasted at a conspicuous place in/outside the premises. Simultaneously, the joint report, the assessment bill and the notice shall be sent to the consumer under Registered Post. (viii) The consumer shall be served a 3 days show-cause notice at the site as to why the case of DAE should not be booked against him/her. The notice should clearly state the time, date and place at which the reply has to be submitted and the designation of the person to whom it should be addressed. 26. Personal hearing- (i) Within 4 working days from the date of submission of consumers reply, if made within prescribed period, the licensee shall arrange a personal hearing with the consumer. (ii) Before the personal hearing, the officer of the licensee, before whom personal hearing has to be given, shall analyse the case after carefully considering all the documents, submissions by the consumer, facts on record and the consumption pattern, wherever available. The licensee shall also assess the energy consumption for past six months as per the Tariff Order. (ii) Before the personal hearing, the officer of the licensee, before whom personal hearing has to be given, shall analyse the case after carefully considering all the documents, submissions by the consumer, facts on record and the consumption pattern, wherever available. The licensee shall also assess the energy consumption for past six months as per the Tariff Order. In case of suspected DAE, if consumption pattern for last one year is reasonably uniform and is not less than 75% of the assessed consumption where meter is less than 10 years old and not less than 65% of the assessed consumption where meter is more than 10 years old, no further proceedings shall be taken and the decision shall be communicated to the consumer under proper receipt within 3 working days and connection shall be restored through original meter. (iii) During the personal hearing the licensee shall give due consideration to the facts submitted by the consumer and pass, within 15 days, a speaking order as to whether the case of suspected theft DAE is established or not. In case of the decision that the case of suspected theft/DAE is not established, no further proceedings shall be taken and connection shall be restored through original meter. (iv) Where it is established that there is a case of DAE, the licensee may lodge a report with the local police along with the material evidence including wires/cables, meter, service line, etc. seized from the site, which shall be handed over to police. The licensee shall also assess the energy consumption for past six months as per the Tariff Order and prepare final assessment bill on 5 times the rates as per applicable tariff. The consumer shall be required to make the payment within 2 working days of its proper receipt. The licensee may, taking into consideration the financial position and other conditions of the consumer, extend the last date of payment or approve the payment to be made in installments. The amount, the extended last date and/or time schedule of payment/installments should be clearly stated in the speaking order. A copy of the speaking order shall be handed over to the consumer under proper receipt on the same day." 17. The regulations were framed before the advent of the Electricity Act, 2003. The amount, the extended last date and/or time schedule of payment/installments should be clearly stated in the speaking order. A copy of the speaking order shall be handed over to the consumer under proper receipt on the same day." 17. The regulations were framed before the advent of the Electricity Act, 2003. The legal regime which existed at that time, outlawed electricity theft, in terms of Sections 39 and 44 of the Electricity Act. The concept of "fraudulent abstraction of electricity" however had been evolved in tariff orders, and on allegations of such behaviour, the consumer could be saddled with higher liabilities. The regulations were framed in terms of the 2000 Act, which was primarily aimed at creation of a regulatory mechanism for electricity generation, transmission and distribution. 18. I would not dwell at length upon the differences which were introduced by Section 126, which in many respects, is significant from the provisions of Regulations 25 and 26. The latter enumerate a common procedure to deal with dishonest abstraction of electricity, ("DAE") and theft; the relevant load factors too are common. However, the Central Act creates separate mechanisms for "unauthorized use of electricity" - which conceptually, and definitionally overlaps with "dishonest abstraction of electricity" - and theft. For the latter, a separate• mechanism has been enacted in the form of an independent adjudicating body, i.e. the Special Court. The Court has to try the case, and in the event of finding of guilt, can also determine civil liability. 19. A harmonious reading of all the provisions indicates that an inspection should precede assessment that the consumer has indulged in DAE. The licensee is obliged to follow principles of natural justice, and grant reasonable hearing [Section 126(3) and Regulation 25(viii)]. Mere irregularity in meter seals, or breakage of glass, etc. do not authorize the licensee to issue show-cause notice; the assessing officer has to observe the consumption pattern, before the personal hearing is granted to the consumer [Regulation 25(iv) read with Regulation 26(ii)]. Mere irregularity in meter seals, or breakage of glass, etc. do not authorize the licensee to issue show-cause notice; the assessing officer has to observe the consumption pattern, before the personal hearing is granted to the consumer [Regulation 25(iv) read with Regulation 26(ii)]. The definition also envisons some collateral evidence of such objectionable behaviour; it enacts that DAE means- "....abstraction of electrical energy where accessibility to the internal mechanism of the metering equipment and some collateral evidence is found to support the conclusion that the meter has been caused to record less energy than actually passing through it." (Emphasis supplied) The necessity of recording existence of such materials (collateral evidence) is reinforced by Regulation 25(iii) which obliges the inspecting team to record if "conclusive evidence" substantiating the fact that energy was being dishonestly abstracted was found or not. 20. In this case, there is no denial about the genuineness of the signatures of Shri Praveen Kumar, on the second inspection report; the same official of the BSES signed the paper seals allegedly not "authenticated" when the third inspection took place. There is no other material, save this observation, and lack of seals on the CT Meter Box. The previous, second inspection and report not being in dispute, the mere circumstance that the CT Box meter was missing itself could not, in my considered opinion have lead to a conclusive proof of tampering or DAE. In the absence of any other collateral evidence, the only basis for the reasoned order of the assessing officer, is the consumption pattern. Here, the petitioners consistent stand is that he is engaged in job work of auto parts repairs, and the consumption pattern cannot be considered consistent, as in other activities, as much depends upon the work orders received. The consumption pattern in this case was observed on application of a formula, of the observed load, multiplied by a certain number of hours, a certain number of days, in a month, on the basis of a percentage of consumption. The consumption pattern, being derivative in this case, and not on the basis of the actual consumption, by use of scientific principles or better tools, more accurately deducing the actual consumption of electricity (rather than the consumption factor by mathematical calculation, at best an imperfect too!) led to inference that the meter was slow. The consumption pattern, being derivative in this case, and not on the basis of the actual consumption, by use of scientific principles or better tools, more accurately deducing the actual consumption of electricity (rather than the consumption factor by mathematical calculation, at best an imperfect too!) led to inference that the meter was slow. The meter was not checked for accuracy, or defects; nor were any materials disclosed to that effect. The findings of DAE were entirely premised upon the "observed" consumption pattern, on application of the formula indicated in the tariff. 21. I am of the opinion that in the absence of any collateral materials, or conclusive proof, about DAE, the mere existence of an irregular seal could not have justified such findings. The inference led to "study" of the consumption pattern, which was application of a calculation formula, and its comparison with the billing resorted to. The facts of this case did not disclose any evidence in support of the conclusion reached by the assessing officer. 22. For the foregoing reasons, the writ petition is entitled to succeed. The impugned bill, and speaking order are hereby quashed. The sum of Rs. one lakh deposited pursuant to interim order of the Court shall be refunded by the respondent to the petitioner within six weeks. The writ petition is allowed in the above terms. Writ Petition allowed.