Principal, Thangal Kunju Musaliar College of Engineering, Kollam v. Kerala State Electricity Board, represented by the Secretary, Thiruvananthapuram
2013-03-22
C.K.ABDUL REHIM, PIUS C.KURIAKOSE
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DigiLaw.ai
Judgment :- Abdul Rehim, J: 1. Petitioner in the writ petition is the appellant herein and the respondents are the respondents. Three distinct issues were agitated in the writ petition. First issue was regarding correctness of Ext.P13 and P15, demands for payment of arrears of electricity charges, for the period from April, 1990 to June 2004, calculated at Rs.11,48,952/-. The said amount was demanded as a back assessment alleging non-installation of TOD Meter (Two-part Electric Meter). The appellant was an LT consumer with a connected load above 100 KVA, which is coming under the category known as "deemed HT". By virtue of a circular issued by the respondent Board dated 20-11-1989, it was instructed to calculate the demand charges with respect to such consumers at 75% of the connected load, till the two-part meters are installed. Several educational institutions represented before the Board that since all the machineries installed are not used simultaneously and since most of the machineries are idling, maximum demand will be very low and hence the demand charges if taken as 75% of the connected load they will become compelled to make payment of very high amount than what will be due on the basis of actual consumption. The Board in Ext.P1 circular issued instructions to its officials that, as a special case the educational institutions having connected load above 100 KVA and availing supply at LT, shall be billed from 3/89 onwards till the two-part tariff meters are installed and HT agreements are executed, at 50 KVA on a provisional basis, subject to condition of them executing an undertaking to the effect that additional amounts if any based on actual recorded maximum demand and 75% of the contract demand will be paid as and when they install the two-part tariff meters. 2. In the case of the appellant the two-part meter was installed only in 5/2004. Thereafter taking average of the maximum demand for the months of June, July and August 2004 a back assessment was made calculating the difference between the average MD and the 50KVA, for the periods from 4/1990 to 6/2004. The appellant raised contentions that on 11-12-1991 they have purchased a two- part meter as per Ext.P17 and it has got tested by the TMR unit of the Board. But inspite of requests made, the Board has failed to install the Meter and the position continued as such despite reminders.
The appellant raised contentions that on 11-12-1991 they have purchased a two- part meter as per Ext.P17 and it has got tested by the TMR unit of the Board. But inspite of requests made, the Board has failed to install the Meter and the position continued as such despite reminders. A two-part meter was installed by the Board on 02-03-2002. But in May 2003 the Meter was found to be defective. Subsequently the appellant was requested to install a two part Meter through Ext.P7 notice issued on 13-07-2005. The appellant's case is that, once the Board has installed a two-part meter in March, 2002 adoption of the average consumption for the months of June, July and August, 2004 for the purpose of calculating the arrears is erroneous. Against Ext.P13 the appellant submitted objections as per Ext.P14. The Board re-considered the matter and issued Ext.P15 demanding a total sum of Rs.12,82,564/- including Rs.35,750/- towards short assessment of minimum demand for the period from March 1989 to March 1990 and Rs.95,927/- towards 25% of the energy charges levied as penalty for non-installation of TOD meter for the period from May 2004 to November 2004. 3. Challenging Exts.P13 & P15 it is contended that, during the period between 1990 and 2004 there was considerable increase in the consumption due to various expansions and modernisation and therefore average consumption of the months of June, July and August 2004 adopted for the purpose of billing for the periods from 1990 onwards is not real and true. Further it is contended that, since there was failure on the part of the authorities of the Board in not installing the Meter which was purchased as early as in the year 1991, such a back assessment made with inordinate and unreasonable delay cannot be sustained. 4. The above contentions of the appellant were resisted on behalf of respondent Board by denying the allegation that the appellant had acquired a TOD meter as per Ext.P17 invoice and that the same was produced before the Board for testing. It was pointed out that Ext.P17 invoice does not show purchase of the Meter by the appellant, as claimed. According to the respondents, the appellant was enjoying benefit of the provisional bills under Ext.P1 and only in May 2004 a two-part meter was reset at the premises.
It was pointed out that Ext.P17 invoice does not show purchase of the Meter by the appellant, as claimed. According to the respondents, the appellant was enjoying benefit of the provisional bills under Ext.P1 and only in May 2004 a two-part meter was reset at the premises. Therefore calculations made on the basis of the average consumption after reseting the meter, is correct and justified, as provided under Regulation 31 (c) of the Conditions of Supply of Electrical Energy. Regarding contentions with respect to increase in consumption from 1990 to 2004, the Board referred to the appellant's own averments in paragraph 3 of the writ petition, wherein it is admitted that considerable additions were effected by modernising the laboratories and infrastructure. According to respondents the appellant was at an obligation to provide the two-part Meter. But without complying the same they enjoyed benefits of provisional billing throughout the periods. Therefore in the absence of any statutory provision preventing the Board from realising the dues, the demand cannot be questioned on the aspect of delay, is the contention. 5. Learned Single Judge found that, as per Ext.P1 order, 50KVA was adopted for the purpose of billing on a provisional basis, subject to an undertaking on the side of the consumer agreeing to pay the difference, once the two-part Meter is installed. Therefore the appellant had an obligation to provide the two-part meter. It was found that, eventhough Ext.P17 invoice was produced in order to content that a meter was acquired and tested at TMR unit, and the Board had failed to install the same, Ext.P17 and P18 invoices produced do not show that the same relates to purchase of Meter by the appellant. Therefore it was found that there is nothing acceptable on record to show that a two-part Meter was made available by the appellant and that the non-installation was only due to fault of officers of the Board. However, learned Single Judge observed that, it is true that the Board had installed a Meter which is capable of functioning as two-part Meter, on 02-03-2002. But the two-part Metering was introduced in June, 2004. Therefore it was concluded that, adoption of average consumption for the months of June, July and August, 2004 was perfectly valid. Learned Single Judge found that no provisions of law preventing realisation of arrears has been brought to notice.
But the two-part Metering was introduced in June, 2004. Therefore it was concluded that, adoption of average consumption for the months of June, July and August, 2004 was perfectly valid. Learned Single Judge found that no provisions of law preventing realisation of arrears has been brought to notice. It was competent to demand the arrears, especially in view of the fact that the appellant was enjoying benefit of Ext.P1 based on a specific understanding made that they will make payment of the difference. It was also found that the previous liability can only be calculated based on the average consumption after installation of the Meter as provided under Regulation 31 (c) of the Conditions of Supply. Therefore even if there is any substance in the contentions regarding variation in consumption, the Board was fully justified in calculating the average in view of Regulation 31 (c). Therefore the impugned demands under Exts.P13 and P15 were sustained. 6. Second issue considered in the writ petition is regarding the demand made to the tune of Rs.4,49,909.77 towards fine for the alleged delay in installing of the two-part TOD Meter, calculated @ 25% of the energy charges, for the period from January 2004 to November 2004. Contention of the appellant was that no regulation framed by the Board authorises levy of penalty at 25% of the energy charges. Per contra, the Board contended that tariff order of 2002 authorises levy of penalty for delay in installing the two-part Meter, at 25% of the energy charges. Learned Single Judge observed that, it cannot be held that there occurred delay on the part of the Board in installing the two-part Meter since the appellant was not successful in proving that they have discharged their obligation. As already found the two-part metering system was introduced only in May 2004. Therefore going by the tariff order penalty levied for the period from June 2002 to November 2004 is valid. 7. Yet another issue agitated is regarding imposition of fine to the tune of Rs.45,787.50 for the period from July 2004 to November 2004 for the alleged delay in signing the HT agreement. According to the appellant they applied for additional power allocation on 23-04-2004 which was allowed by the Board only through order dated 18-10-2004. The installation works were completed on 21-10-2004 and inspection was conducted on 05-11-2004. Therefore the agreement could be signed only on 24-11-2004.
According to the appellant they applied for additional power allocation on 23-04-2004 which was allowed by the Board only through order dated 18-10-2004. The installation works were completed on 21-10-2004 and inspection was conducted on 05-11-2004. Therefore the agreement could be signed only on 24-11-2004. There is absolutely no delay on the part of the appellant making them liable for any penalty. The Board contended that there was an obligation on the part of the appellant to execute the agreement as early as in April 2004 and fact remains that they have signed the agreement only in November 2004. Therefore levy of 25% of the demand charges is permissible, was the contention. Learned Single Judge found that in view of the dates enumerated with respect to allocation of power, completion of installation and inspection conducted, it is clear that the delay occurred only on account of the delay on the part of the Board in considering the application. Once the allocation was issued there was absolutely no delay on the part of the appellant. Hence penalty imposed to the tune of Rs.45,787.50 was set aside. 8. Heard; Sri. N. Sugathan, learned counsel for the appellant and Sri. C.K. Karunakaran, Standing counsel appearing for the respondents. One of the contentions raised on behalf of the appellant is that, as per Section 5 (2) of the Electricity Act, 2003 the claim is barred by limitation and it cannot be enforced. The contention need to be discarded mainly on the ground that the arrears pertains to a period prior to introduction of Electricity Act, 2003. There was no provisions contained in the statute which remained in force at the relevant time or in any Regulations or Conditions of Supply, preventing or restricting the Board from realising any arrears, on the basis of any limitation. More over, view taken by a learned Judge of this court in W.P (c) No.90/2009 is to the effect that, the word "due" contained in Section 56 (2) can be construed of having the meaning that only upon the issuance of a bill that the amount becomes 'due'. Therefore the bar of limitation will not apply. The judgment in W.P (c) No.90/2009 was confirmed in appeal by a Division Bench, through judgment dated 03-03-2009 in W.A No.476/2009. Under such circumstances the contention based on Section 56 (c) cannot be sustained. 9. Sri.
Therefore the bar of limitation will not apply. The judgment in W.P (c) No.90/2009 was confirmed in appeal by a Division Bench, through judgment dated 03-03-2009 in W.A No.476/2009. Under such circumstances the contention based on Section 56 (c) cannot be sustained. 9. Sri. N. Sugathan contended that, even assuming (without admitting) that there is no specific provisions prescribing limitation for realising any amount due, the Board cannot permitted to act in a totally unreasonable and arbitrary manner in making the demand after a long lapse of time. The undue and unreasonable delay caused in raising such a demand will preclude the Board from recovering any such amount, is the contention. He placed reliance on a decision of the honourable Supreme Court in Punjab State Electricity Board Ltd. V. Zora Singh and others ( 2005 (6) SCC 776 ). It is held therein that the Board being a statutory authority is 'State' within the meaning of Article 12 of the Constitution and it is expected to discharge its statutory functions within a reasonable time have regard to the fact that it undertakes an important public utility service. Functions of the Board besides being governed by statutes, must also fulfil the test of reasonableness as enshrined under Article 14 of the Constitution of India. Learned counsel had also relied on the decision of the apex court in Santhoshkumar Shivgonda Patil and others V. Balasaheb Tukaram Shevale and others ( 2009 (9) SCC 352 ). Referring to various decisions of the honourable Supreme Court itself, it is observed that, it remains fairly settled that if a statute does not prescribe any time-limit for exercise of revisional power, it does not mean that such power can be exercised at any time; rather it should be exercised within a reasonable time. It is so because the law does not expect a settled thing to be unsettled after a long lapse of time. Where the legislature does not provide for any length of time within which the power of revision is to be exercised by the authority, suo motu or otherwise, it is plain that the exercise of such power within reasonable time is inherent therein. 10. Reference was also placed to a Full Bench decision of this court in E.S.I. Corporation V. Excel Glasses Ltd. (2003 (3) KLT 42 (F.B).
10. Reference was also placed to a Full Bench decision of this court in E.S.I. Corporation V. Excel Glasses Ltd. (2003 (3) KLT 42 (F.B). While interpreting Section 77 (1A)(b) of the Employees' State Insurance Act, this court held that the Law of Limitation has got logic. It fixes the life span of the remedy. Its purpose is to check judicial and even quasi-judicial lawlessness. It is founded on public policy. Its purpose is to stall the stale claims. The sword must not hang on the head of a person for ever. The suspense must not be allowed to last beyond the specific period. On the basis of the above cited decisions and other settled judicial precedents, it is contended that impugned arrears demanded for a period from the year 1989 onwards cannot be sustained and recovered. 11. The above contentions were resisted by Sri. C.K. Karunakaran, learned standing counsel, drawing attention to the terms of circular issued by the Board on 20.11.1989. With respect to the billing of L.T. Consumers having connected load above 100 KVA, it is categorically stated that, till two part tariff meters are installed the demand charges shall be arrived at by taking the Billing Demand as 75% of the total connected load in KVA. The consumers were given option to choose their contract demand when they install the two part meters. It is specifically mentioned that, three months after installation of the two part meters, the Billing Demand will be re-assessed comparing the average of maximum demand as per rules in force and that the bills already raised from 3/89 will be revised, if found necessary. According to the standing counsel, Exhibit P1 circular is a further modification wherein educational institutions alone were given a further option to make payment of the Billing Demand at 50 KVA, purely on a provisional basis, subject to undertaking made to the effect that additional amounts if any found due based on actual recorded maximum demand and 75% of the contract demand, shall be paid when the consumer install the two-part Meter and executes the agreement. Under such circumstances, having availed of the option and concession based on specific undertaking, the appellant cannot now turn around and content that the arrears has become time barred. Learned standing counsel placed reliance on a decision of this court in Southern India Marine Products Co.
Under such circumstances, having availed of the option and concession based on specific undertaking, the appellant cannot now turn around and content that the arrears has become time barred. Learned standing counsel placed reliance on a decision of this court in Southern India Marine Products Co. V. K.S.E.B. ( 1995 (2) KLT 167 ) to contend that demand for arrears of electricity charges by K.S.E.B. will not attract provisions of the Limitation Act, 1963. It is held by this court that the relationship between the petitioner and the Board is governed by terms and conditions of the supply and therefore there is no question of limitation with reference to the arrears due. In the decision in Abdul Nazer V. K.S.E.B. (2006 (1) KLT 811), while interpreting Section 56(2) of the Electricity Act, 2003 this court found that the said provision will operate only prospectively and arrears due prior to coming into force of the said Act can be recovered since no time limit has been prescribed. The above view has been reiterated by the honourable Supreme Court in the decision in Kusumam Hotels (P) Ltd. V. Kerala State Electricity Board (2008 (3) KLT 276 (SC). Learned standing counsel also pointed out that the decision of this court in WP(C) No. 90/2009 which is confirmed in W.A. No. 476/2009 wherein Section 56(2) of Electricity Act, 2003 has been interpreted, is also followed by the Bombay High Court in a decision reported in 2007 (3) KLT SN 9 (C.No.11) Bom. 12. While evaluating the rival contentions, we take note of the fact that, position regarding inclusion of the appellant under the 'deemed H.T.' category is not disputed. It is also not in dispute that the provisional billing was made subject to specific undertaking to pay the difference if any found after installation of the two-part meter, which is an obligation on the part of the consumer. By virtue of circular dated 20.11.1989 and by virtue of Exhibit P1 issued by the 1st respondent Board, the appellant cannot dispute that they were continuing under a provisional billing system subject to an undertaking that the difference will be paid subsequently. Therefore the liability arises out of a mutual agreement from which the appellant cannot wriggle out.
By virtue of circular dated 20.11.1989 and by virtue of Exhibit P1 issued by the 1st respondent Board, the appellant cannot dispute that they were continuing under a provisional billing system subject to an undertaking that the difference will be paid subsequently. Therefore the liability arises out of a mutual agreement from which the appellant cannot wriggle out. As found by the learned single Judge, the appellant was not at all successful in proving that they have acquired a two-part meter and the delay in installation was caused only due to failure on the part of the officials of the Board. Hence all the contentions raised against the demand in question, including the ground of limitation as well as the unreasonable delay, raised by the appellant cannot be countenanced. Hence the appeal cannot be entertained on those grounds. 13. However, learned counsel for the appellant pointed out that the respondent Board has failed in introducing the two-part metering system till May 2004, despite the fact that they have already installed Electric Meter in the premises, having facility for two-part metering, as early as on 02.03.2002. Contention of the appellant is that, after installing the two-part meter on 02.03.2002, the consumption was recorded under such system. But the demand for arrears is made on the basis that the Meter was reset and the two-part metering system was introduced only in May, 2004. Such a stand adopted, according to the appellant, is highly unreasonable and arbitrary. Hence at any rate the arrears cannot be demanded after 02.03.2002, is the contention. 14. Going by the pleadings, there is no proper explanation forthcoming from the side of the respondents as to why inspite of installation of a two-part Meter on 02.03.2002, the metering was not set for recording consumption on two-part basis and as to why such system was not introduced. We are of the considered opinion that the delay in discharging the obligation on the part of the appellant can be presumed only till 02.03.2002, the date on which the two-part meter was installed by the Board. The delay if any caused in resetting the Meter or in introducing the two-part metering system cannot be attributed against the appellant. Hence we are inclined to hold that the demand for the entire period cannot be sustained. Hence the calculation with respect to the arrears is to be reworked.
The delay if any caused in resetting the Meter or in introducing the two-part metering system cannot be attributed against the appellant. Hence we are inclined to hold that the demand for the entire period cannot be sustained. Hence the calculation with respect to the arrears is to be reworked. We are also of the considered opinion that, if from the records available with the Board it is evident that the consumption was recorded under the two-part system from 02.03.2002 onwards, then the average of the Maximum Demand of 3 months immediately preceding installation of the said meter on 02.03.2002, shall be adopted. Otherwise, the calculation of average already adopted in Exhibits P13 & P15 shall be followed, limiting the period of arrears upto 2/2002. 15. Under the above mentioned circumstances, while repelling the main contentions on merits, we allow the appeal in part to the extent of limiting calculation of the period for realising the arrears upto 02/2002. Exhibits P13 & P15 are hereby set aside. The respondent concerned shall issue a revised demands with respect to difference in the demand charges between 50 KVA and the average maximum demand calculated on the basis of directions contained herein above, limiting the period of arrears from 4/1990 to 2/2002. So also the fine imposed at 25% of the energy charges alleging delay in installation of the two-part meter shall also be revised limiting the period till 2/2002. 16. Revised demand on the basis of the above directions shall be issued at the earliest, at any rate within a period of six weeks from the date of receipt of a copy of this judgment. Needless to observe that payments already made if any, shall be appropriated and adjusted in accordance with the fresh demand to be finalised.