Executive Engineer (Electrical) WESCO, Sambalpur v. Maa Tara Rice Industries Pvt. Ltd.
2015-12-01
B.R.SARANGI
body2015
DigiLaw.ai
JUDGMENT : B.R. SARANGI, J. 1. The petitioner, who is the supplier of electricity has filed this application to quash the order dated 05.02.2015 passed by the Grievance Redressal Forum, Burla in GRF Case No. 169/2014 under Annexure-10 on the ground that the same is contrary to the conditions stipulated in the agreement and Orissa Electricity Regulatory Commission Distribution (Condition of Supply) Code-2004 (in short hereinafter referred to as Code-2004) which has been amended by notification dated 18.08.2010 vide Annexure-1. He further seeks for a declaration that the consumer-opposite party is liable to pay the arrears and liability of erstwhile owner/consumer/occupier of the premises which are recoverable from him in view of amended provision of Code-2004. 2. The factual matrix of the case in hand is that initially the power supply was provided to erstwhile consumer M/s. Jagannath Rice Industries which was under the medium category having consumer No. MI/BRL/080. On the basis of the inventory report dated 16.12.1997 provisional assessment was made on 06.10.1998 imposing penalty of Rs.5,05,816/- against the said consumer. Besides the said provisional penal amount, an arrear monthly electricity bill of Rs.3,94,816/- was also pending against the said unit. Challenging the order of provisional assessment dated 06.10.1998, the erstwhile Rice Mill filed a Consumer Dispute Case No. 219 of 1998 before the learned District Consumer Dispute Redressal Forum, Sambalpur who vide order dated 03.05.1999 disposed of the same stating that there was no deficiency of service on the part of the supplier and observed that the consumer will pay the outstanding dues on instalment basis. Against the said order, the consumer preferred appeal before the State Consumer Dispute Redressal Commission, Cuttack in C.D. Appeal No. 402/1999. During pendency of the appeal, the unit was seized under Section 29 of State. Financial Corporations Act, 1951 and the same was put to auction for sale and sale was confirmed against M/s. Maa Tara Rice Industries Pvt. Ltd. the present opposite party herein. Accordingly, the consumer-opposite party took over possession of the unit on 01.12.2000. On the basis of the application submitted by the consumer-opposite party, the Executive Engineer (Electrical) sought for permission from the Superintending Engineer on 04.12.2000 for restoration of power supply and accordingly permission was granted on the very same date for supply of power of 92 KW (MI) with a further request to the opposite party to deposit an amount of Rs.
1.75 lakh towards arrear energy charges and Rs.71,539/- towards fresh security and execute an agreement. It is further intimated to the consumer-opposite party to clear up all the liabilities of the erstwhile consumer. In compliance with the same, opposite party acted upon the communication made in letter No. 7783 (5) dated 04.12.2000 and paid an amount of Rs. 1,75,000/- out of total monthly arrear dues of erstwhile consumer of Rs.3,94,816/- without any objection and the penal bill of Rs.5,05,816/- was left open awaiting the decision of learned State Consumer Disputes Redressal Commission, Cuttack in C.D. Appeal No. 402/1999. The consumer-opposite party also executed the agreement on 05.12.2000. The arrear which was lying outstanding against the previous consumer was indicated in the bill of opposite party. C.D. Appeal No. 402/1999 filed by the erstwhile consumer was heard on 01.12.2011 and the learned State Consumer Disputes Redressal Commission, Cuttack confirmed the order passed by the District Consumer Disputes Redressal Forum, Sambalpur. The consumer-opposite party applied for enhancement of load from 112.16 KVA to 140 KVA and accordingly, permission was accorded to that effect on 26.05.2014, but before execution of agreement for the said enhanced load, since the appeal preferred by the erstwhile consumer was dismissed, a demand cum-disconnection notice was issued on 12.08.2014. Against the said demand, the consumer-opposite party filed a complaint case before the learned Grievance Redressal Forum on 05.09.2014 which was registered as GRF Case No. 169/2014. Learned GRF allowed the claim of the consumer-opposite party stating that the consumer-opposite party is an auction purchaser from Orissa State Financial Corporation prior to amendment of Regn. 13(10)(b) of Code-2004, therefore, he is not liable to clear the arrears incurred by the previous consumer and accordingly, directed to grant enhancement of load which is subject matter of challenge before this Court in the present application. 3. Mr. P.K. Tripathy, learned counsel for the petitioner submits that consumer-opposite party is bound by Clause-9 of the agreement dated 05.12.2000 executed between the parties under Annexure-4. He further submits that against the order of disconnection notice dated 12.08.2014 in Annexure-6 series, the consumer-opposite party filed a complaint case bearing GRF Case No. 169/2014.
3. Mr. P.K. Tripathy, learned counsel for the petitioner submits that consumer-opposite party is bound by Clause-9 of the agreement dated 05.12.2000 executed between the parties under Annexure-4. He further submits that against the order of disconnection notice dated 12.08.2014 in Annexure-6 series, the consumer-opposite party filed a complaint case bearing GRF Case No. 169/2014. Before that date there is an amendment to the Orissa Electricity Regulatory Commission Distribution (Condition of Supply) Code, 2004 by virtue of notification dated 18.08.2010 published in the official Gazette dated 12.10.2010 by which Regulation 13(10)(b) has been omitted, as such Regulation in question being a statutory one and amendment is prospective in nature, the consumer-opposite party is guided by the said Clause of the Code-2004. Moreso, as per Clause-9 of the agreement, the opposite party having agreed to pay the arrear outstanding of the previous consumer, the GRF is not justified to hold that the consumer-opposite party is not liable to clear the arrear dues incurred by the previous owner. Therefore, the petitioner seeks for interference of this Court. To substantiate his case, he has relied upon Isha Marbles v. Bihar State Electricity Board and another, 1995 (2) SCC 648 . 4. Per contra, Mr. F.R. Mohapatra, learned counsel for the consumer-opposite party though admits the fact that the consumer is bound by Clause-9 of the agreement dated 05.12.2000 executed between the parties, he submits that the conditions stipulated in the agreement cannot override the statutory provisions, more particularly, the provisions contained in Indian Electricity Act, 2003 read with Code-2004. In exercise of power conferred under Section 181 of the Indian Electricity Act, 2003, the Code-2004 which was published clearly stipulates that an auction purchaser is not liable to pay the arrear dues of the previous consumer as per Regulation 13(10)(b) of the Code-2004. After execution of the agreement between the parties, subsequently Clause-9 of the agreement was incorporated under Annexure-4. Therefore, the consumer-opposite party is not liable to pay the liability of the previous owner and as such incorporation of Clause-9 of the agreement by committing fraud cannot sustain in the eye of law. Accordingly, the opposite party seeks for dismissal of this writ petition. To substantiate his contention, learned counsel for the consumer-opposite party has relied upon Union Territory, Chandigarh Admn.
Accordingly, the opposite party seeks for dismissal of this writ petition. To substantiate his contention, learned counsel for the consumer-opposite party has relied upon Union Territory, Chandigarh Admn. and others v. Managing Society, Goswami, GDSDC, AIR 1996 SC 1759 , Sunil Rajgarhia v. Orissa State Financial Corporation and another, AIR 2003 Orissa 131, Ahmedabad Electricity Co. Ltd v. Gujarat Inn Pvt. Ltd and others, AIR 2004 SC 2171 , Indian Banks' Association, Bombay and others v. M/s. Devkala Consultancy Service and others, AIR 2004 SC 2615 . 5-6. On the basis of the facts pleaded above, it is to be examined as to whether the consumer-opposite party being a subsequent purchaser pursuant to auction conducted by the OSFC is liable to pay the liability of the previous owner or not. The admitted fact is that the consumer-opposite party has purchased the property pursuant to auction sale held by the OSFC when the previous-consumer had some liability towards electricity and the matter was sub-judiced before the State Consumer Disputes Redressal Commission in C.D. Appeal No. 402/1999. By virtue of dismissal of the appeal preferred by the previous consumer, a demand has been made by the petitioner along with disconnection notice to pay the arrear dues in terms of Clause-9 of the agreement dated 05.12.2000 executed by the parties. Clause-9 is quoted below: "This agreement on and from date of operation supersedes the earlier agreement executed between the supplier and the consumer M/s. Jagannath Rice Industries, Sansinagar, P.O.A. Katapali, District-Sambalpur on dated 25.11.1993 for the purpose of power supply to the same premises and for the same purpose. Provided, that all arrears and liabilities under the old and/or superseded Agreement above shall be treated as arrears and liabilities under the present agreement." 7. On perusal of the agreement under Annexure-4, it appears that the consumer has been called upon to execute the agreement for availing of the power supply. The same being a standard form, the petitioner has put his signature to abide by the conditions stipulated therein. But, it reveals that Clause-9 having been typed out separately and incorporated in the agreement itself though in the standard form, Clause-9 deals with stamp duty.
The same being a standard form, the petitioner has put his signature to abide by the conditions stipulated therein. But, it reveals that Clause-9 having been typed out separately and incorporated in the agreement itself though in the standard form, Clause-9 deals with stamp duty. Therefore, incorporation of Clause-9 in the agreement directing that the opposite party has to bear the liability of the previous consumer creates doubt "with regard to the conduct of the petitioner who might have done so by using external pressure. In any case, the incorporation of Clause-9 which has been typed out and inserted into the standard form to which both the parties are the signatories of the same whether the same has been done by using external pressure or coercion, this Court expresses no opinion at this point of time as the same has not been challenged at any point of time. This question can only be considered by an appropriate forum, if the consumer so likes. 8. By the time the petitioner executed the agreement on 05.12.2000 in exercise of power conferred by sub-section (2) of Section 9 and Section 54 of the Orissa Electricity Reforms Act, 1995 and all other powers enabling it on that behalf, the Orissa Electricity Regulatory Commission framed regulations to govern distribution and supply of electricity and procedures thereof such as the system of billing, modality of payment of bills, powers, functions and obligations of the suppliers and the rights and obligations of consumers and matters connected therewith and incidental thereto. Regulations-10 and 14 of Orissa Electricity Regulatory Commission Distribution (Conditions of Supply) Code, 1998 (in short hereinafter referred to as "Code-1998") are quoted below. 10. If the applicant in respect of an earlier agreement executed in his name or in the name of his spouse or in the name of a firm or company with which he was associated either as a partner, director or managing director, is in arrears of electricity dues or other dues for the same premises payable to the licensee, the application for supply shall not be allowed by the engineer until the arrears are paid in full. 14.
14. Licensee's Obligation to Supply - (1) The supply of power shall be made, if it is available in the system, technically feasible and remunerative as per the norms fixed by the licensee with the approval of the Commission and the applicant enters into an agreement in the Standard Agreement Form (Form No. 1) or Form of Requisition (Form No. 2) under Regulation 15 accepting the terms relating to tariff and other conditions of supply of the licensee. (2) In case the scheme of supply is not remunerative as above, the applicant shall be required to bear the portion of charges to make the scheme remunerative. (3) No additional power shall be supplied by licensee unless all arrear charges for the existing power supply have either been paid in full or paid in accordance with an instalment facility granted by the licensee for unconditionally paying the arrears within the stipulated time. 9. In view of the dismissal of the appeal preferred by the previous consumer, the same is binding on the present consumer-opposite party in terms of the Regulation-10 read with Regulation 14(3) of the Code-1998. As such in compliance with the conditions of the Clause-9 of the agreement, the petitioner has paid the 50% of the demand of Rs. 1,75,000/- for getting power supply to the premises subject to pending adjudication of the denial by the C.D. Appeal No. 402/2000 by the State Consumer Disputes Redressal Commission. The said appeal was dismissed by the State Consumer Disputes Redressal Commission. The liability of the previous owner has to be borne out by the present consumer-opposite party, the subsequent purchaser of the premises in question in terms of Regulation-11 read with 14(3) of the Code-1998. Subsequently, the Code-1998 has been replaced by OERC Supply Code, 2004. Clause 13(10)(b) states as follows: "Provided that this shall not be applicable B when the ownership of the premises is transferred under the provisions of the State Financial Corporations Act." 10. The provisions contained in Regulation 13(10)(b) of the Code-2004 reads as follows: "The service connection from the name of a person to the name of another consumer shall not be transferred unless the arrear charges pending against the previous occupier are cleared.
The provisions contained in Regulation 13(10)(b) of the Code-2004 reads as follows: "The service connection from the name of a person to the name of another consumer shall not be transferred unless the arrear charges pending against the previous occupier are cleared. Provided that this shall not be applicable when the ownership of the premises is transferred under the provisions of the State financial Corporations Act." The proviso to Regulation 13(10)(b) has been omitted pursuant to notification dated 18.08.2010 which has been published in official Gazette on 12.10.2010. 11. Admittedly the consumer-opposite party has purchased the property pursuant to auction sale held by the Orissa State Financial Corporation under the provisions of State Financial Act, 1951. 12. By virtue of amendment made to Code-2004, proviso to Regulation 13(10)(b) has been omitted by virtue of notification issued under Annexure-1 which has got prospective application. It appears that the consumer-opposite party has purchased the property in question and took over the possession on 01.12.2000. Where the premises come to be owned or occupied by the auction purchaser and such purchaser seeks supply of electric energy, he cannot be called upon to clear the past arrears as a condition precedent to supply. There is no charge over the property. What matters is the contract entered into by the erstwhile consumer with the supplier. Therefore, the supplier cannot seek the enforcement of contractual liability against the third party. Consequentially the supplier cannot make the auction purchaser liable. It is true that it was the same premises to which reconnection is to be given. Otherwise, with the change of every ownership new connections have to be issued does not appear to be the correct line of approach as such a situation is brought about by the inaction of the supplier in not recovering the arrears as and when they fall due or not providing itself by adequate deposits. In the present case what the Corporation sought to recover under Section 29 of the State Financial Corporations Act were the loans advanced by enforcement of a mortgage. Such sale cannot affect the right of the supplier to recover its dues. The failure of the supplier to recover the dues as and when such dues arose, is a point to be put against it. 13. Electricity is public property. Law, in its majesty, benignly protects public property and behoves everyone to respect public property.
Such sale cannot affect the right of the supplier to recover its dues. The failure of the supplier to recover the dues as and when such dues arose, is a point to be put against it. 13. Electricity is public property. Law, in its majesty, benignly protects public property and behoves everyone to respect public property. Hence, the courts must be zealous in this regard. But, the law, as it stands, is inadequate to enforce the liability of the previous contracting party against the auction-purchaser who is a third party and is in no way connected with the previous owner/occupier. Section 24 of the Indian Electricity Act, 1910 relieves licensee/supplier of its obligation is under Section 22 to supply energy if the consumer has not paid to it the charges for electricity supplied or where the consumer neglects to pay the same. Section 24 will come into play when the consumer neglects to pay any charge due to a licensee or the consumer neglects to pay sums other than a charge for energy due from him to the licensee. Section 24 of the Indian Electricity Act, 1910 is not the only remedy available for recovery, but the general remedy to file a suit is always available to the supplier for recovery of the said amount. In any case, the Apex Court in Isha Marbles (supra) has laid down a broader principle stating that an auction purchaser cannot be made to pay the liability of the previous contracting party for supply of the electricity when the premises come to be owned or occupied by the auction purchaser and such purchaser seeks supply of electric energy, he cannot be called upon to clear the past arrears as a condition precedent to supply. 14. The Apex Court in Ahmedabad Electricity Co. Ltd. ( AIR 2004 SC 2171 ) (supra) and this Court in Sunil Rajgarhia ( AIR 2003 Ori 131 ) (supra) have also taken similar view. Therefore, when a procedure is envisaged under the Act and Code for recovery of the amount from the previous consumer, this cannot be enforced against the 3rd party for recovery of the dues of previous consumer from the subsequent consumer like that of the opposite party who has purchased the property in an auction purchase under Section 29 of OSFC Act. 15.
15. The Apex Court in Indian Bank' Associations ( AIR 2004 SC 2615 ) (supra) has categorically held that while purporting to exercise their jurisdiction under a statute they were required to act in terms thereof and not in derogation thereto. 16. In view of the aforesaid facts and circumstances and law discussed above, this Court is of the considered view that the Grievance Redressal Forum has not committed any illegality or irregularities in holding that the consumer-opposite party who is the auction purchaser from State Financial Corporation is not liable to clear the arrears of the previous consumer. Accordingly, the writ petition filed by the supplier merits no consideration and the same is dismissed. No order to cost. Petition dismissed.