BIHAR STATE ELECTRICITY BOARD ETC.versusM/S ICEBERG INDUSTRIES LTD. AND OTHERS ETC.

                         [2020] 6 S.C.R. 231                               231


           BIHAR STATE ELECTRICITY BOARD ETC.                              A
                                   v.
     M/S ICEBERG INDUSTRIES LTD. AND OTHERS ETC.
                (Civil Appeal Nos. 7649-7651 of 2019)
                           APRIL 27, 2020                                  B

      [DEEPAK GUPTA AND ANIRUDDHA BOSE, JJ.]
       Electricity Act, 2003– ss.2(15), 42(5) and 56– Agreement for
supply of high-tension electricity connection – Bills raised w.r.t sum
categorised as Annual Minimum Guarantee (AMG) and other                    C
charges – Non-payment/part payment – Supply disconnected on
08.09.2006 – Consumer Grievances Redressal Forum inter alia held
disconnection as legal – Appellant challenged jurisdiction of the
forum – Supply continued to be disconnected occasionally, despite
the order of forum restraining the appellant, and bills kept being
raised – Eventually, Single Judge inter alia held that disconnection       D
without considering the request for instalments was unwarranted
and such default on respondent’s part did not constitute “neglect
to pay” u/s.56 – Affirmed by Division Bench – Held: Term
‘consumer’ is defined in s.2(15) – Respondent fits this description
– No reason to denude it of its locus to approach the forum – Object       E
of use of electricity may be to produce items for sale, but its
consumption by respondent was for their own factory – Further,
there is no dispute on respondent’s obligation to pay AMG charges,
at least so far as first bill is concerned – However, its representation
for instalment was in the nature of a mercy plea – Thus, the finding
of High Court that the consumer did not neglect to pay warranting          F
the disconnection in s.56, not accepted – But, eventually instalment
was granted subsequent to the period of disconnection– Thus, once
respondent’s plea for payment in instalment was accepted and
agreement was entered into for clearing the dues, it demonstrated
its willingness to pay the dues in a manner acceptable to the              G
appellant – High Court rightly found that the act of disconnection
on 08.09.2006 was arbitrary – Judgment of Division Bench
sustained – Consumer Grievance Redressal Forum and Electricity
Ombudsmen Regulation, 2006 – Clause 2(1)(g).

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                                 231
232            SUPREME COURT REPORTS                      [2020] 6 S.C.R.


A           Dismissing the appeals, the Court
            HELD: 1.1 The term ‘consumer’ is defined in Section 2(15)
      of the Electricity Act, 2003. The respondent company fits this
      description. No reason to denude the company of its locus to
      approach the forum. The object of use of electricity may be to
B     produce items for sale, but use or consumption of electricity by
      them was for their own factory. [Paras 10, 11][242-A, C, F]
             1.2 Next comes the question as to whether it was permissible
      on the part of the Board to disconnect the supply of the company
      in spite of the order of stay granted by the Forum. The finding of
C     the Division Bench is accepted on that count. Board could not
      have had ignored the directive of a statutory forum and imported
      their own perception of what was legal to proceed against a
      consumer. [Para 12][242-G]
            1.3 The third point relates to the issue as to whether the
D     company was required to pay AMG charges or not during the
      period their supply stood stalled by disconnection. The Forum
      referred to Circular No. 477 dated 29.10.2002 (General Terms
      and Conditions of Supply) while accepting the consumers stand
      that the Board could not do so. The Redressal Forum in its order
      of 12th February 2008 (in case no. 108/2007) has construed the
E     said Circular partly in favour of the company The statutory Forum
      came to a finding in dealing with certain circular issued by the
      Board. The Court ought not interfere at this stage with such
      finding so far the same related to applicability and interpretation
      of the said circular. [Paras 13, 15 and 16][242-H; 243-A; 244-D;
F     245-F]
            1.4 Under Section 56, disconnection of supply is special
      power given to the supplier in addition to the normal mode of
      recovery by instituting a suit. So far as the subject controversy is
      concerned, there is no dispute on obligation of the respondent
G     company to pay the AMG charges, at least so far as first bill is
      concerned. Its representation for instalment was in the nature of
      a mercy plea. Going by that factor alone, this Court might not
      have had accepted the finding of the High Court that the


H
    BIHAR STATE ELECTRICITY BOARD v. M/S ICEBERG                         233
            INDUSTRIES LTD. AND OTHERS

consumer did not neglect to pay so as to warrant the disconnection       A
provision contained in Section 56 of the Act. But in respect of
respondent company, eventually instalment was granted
subsequent to the period of disconnection. Once that plea for
instalment payment was accepted and agreement was entered
into for clearing the dues, it demonstrated willingness to pay on
                                                                         B
the part of the company of the dues in a manner acceptable to the
appellant Board. Such plea of the company was accepted after
keeping the matter pending for a long time. In such
circumstances, the High Court was right in giving its finding that
the act of disconnection on 8th September 2006 was arbitrary.
The judgment of the Division Bench of the Patna High Court is            C
sustained. [Paras 19-21][247-C, G-H; 248-A-C]
      Corporation of the City of Nagpur v. Nagpur Electric
      Light and Power Company Limited AIR 1958 Bom. 498;
      Amalgamated Commercial Traders v. A.C.K.
      Krishnaswami 1995(XXV) CC 454; Laxmikant                           D
      Revchand Bhojwani and another v. Pratapsing
      Mohansingh Pardeshi (1995) 6 SCC 576 –
      referred to.
                       Case Law Reference
(1995) 6 SCC 576                referred to             Para 19          E

      CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 7649-
7651 of 2019.
      From the final Order dated 07.02.2013 of the High Court of
Judicature at Patna in Letters Patent Appeal Nos. 521 of 2011, 1490 of   F
2010 and 1491 of 2010.
      Navin Prakash, Abhishek Vikas, Advs. for the Appellant.
       Nikhil Nayyar, Sr. Adv., Susmit Pushkar, Anchit Oswal,
Ms. S. Nausad, Ms. Bhawna Mishra, Abhinav Mukerji, Ms. Pratishtha
Vij, Bihu Sharma, Samarth Khanna, E. C. Vidya Sagar, Manish Kumar,       G
Srikaanth S., Advs. for the Respondents.




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234             SUPREME COURT REPORTS                           [2020] 6 S.C.R.


A           The Judgment of the Court was delivered by
            ANIRUDDHA BOSE, J.
              These appeals are directed against a judgment of a Division Bench
      of the Patna High Court affirming in substance the decision of the learned
      Single Judge in disposing of three writ petitions in disputes arising out of
B
      obligation of the first respondent to pay certain sum categorised as Annual
      Minimum Guarantee (AMG) and certain other charges to the Bihar State
      Electricity Board. The appellant was the Board. The complaint of the
      first respondent, Iceberg Industries Ltd. (the company) over disconnection
      of their supply which they argued to be illegal was sustained by the
C     Single Judge and it was also held by the First Court that the said company
      was not liable to pay AMG and certain other charges as per Board’s
      computation. The judgment of the Division Bench was delivered on 7th
      February 2013. The company had entered into an agreement for supply
      of electricity with the appellant Board for contract demand of 1,000
      KVA on 16th April 2004. This was for supply of high-tension electricity
D
      connection for setting up of a brewery. Supply to the company was
      energised on 06.05.2005. The dispute involved in the three writ petitions
      giving rise to these appeals originated from a bill for Rs. 27,11,814/-
      dated 17th April 2006. This was raised by the appellant towards AMG
      and was payable by 06.05.2006. The company did not make payment
E     thereof within the prescribed date. Three disconnection notices, dated
      15th May, and 26th May and 29th June 2006 on account of default in
      payment of AMG as also energy charges were issued by the Board.
      The company on 29th July 2006 made a representation for liquidating
      their dues on account of AMG in ten monthly instalments citing certain
      business related difficulties. Part payment of the dues to the extent of
F
      Rs. 14,71,952/- was made. Next disconnection notice under Section 56
      of the Electricity Act, 2003 (the Act) was sent to the company dated
      23rd August 2006 for a sum of Rs. 33,38,572/- for non-payment of AMG
      as also on account of Delayed Payment Surcharge (DPS). Another bill
      was raised on 1st September 2006, the due date for which was 20th
G     September 2006. The bill amount was Rs. 37,00,923/- and the bill heads
      were AMG, DPS as also energy charges. Supply to the company,
      however, was disconnected on 6th September 2006. There is some doubt
      as to whether such disconnection took place on 6th September or 8th
      September, but this variation is of little significance so far these appeals
      are concerned.
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    BIHAR STATE ELECTRICITY BOARD v. M/S ICEBERG                            235
  INDUSTRIES LTD. AND OTHERS [ANIRUDDHA BOSE, J.]

      2. The factual background of the three petitions would appear         A
from the recordal made in the following passages of the judgment under
appeal:
      “Subsequently a fresh bill was raised on 1.9.2006 which included
      arrears of AMG and DPS under the bill dated 17.4.2006 also for
      a total of Rs.37,00,923/- along with current charges. The due date    B
      for payment was 20.9.2006. The Board disconnected supply on
      6.9.2006 pursuant to the notice for disconnection dated 23.8.2006.
      The Board thereafter acted on the representation dated 26.8.2006
      and granted facility of instalments. An agreement was signed
      between the parties on 11.4.2007 for payment of AMG and DPS
      in instalments. The connection was restored 7 months later on         C
      16.4.2007. It is not in dispute that payments under the bill dated
      17.4.2006 has then been made as agreed.
      A fresh bill was thereafter raised by the Board on 4.5.2007 for
      Rs.70,23,149/- as the minimum guarantee charge/base charge for
      the disconnected period of 1.11.2006 to 30.4.2007, along with AMG     D
      charge for the financial year 2006-07 (which also included charges
      for the disconnected periods of August, September, October 2006)
      of Rs.18,02,582/-. The total bills thus raised was for
      Rs.88,389,528/-. A fresh disconnection notice for non-payment of
      the same was issued on 22.5.2007. The industry moved the Forum        E
      under the Act. By order dated 12.2.2008 the Forum held the
      industry liable to pay minimum charges up to November 2006.
      The minimum charges from December 2006 to April 2007 were
      held to be bad. The Industry, to the extent it was aggrieved by the
      order, questioned it in CWJC 4637 of 2008. The latter part of the
      order was not challenged by the Board.                                F

      On 19.3.2008, a fresh disconnection notice was served for non-
      payment of Rs.1.33 Crores inclusive of AMG and DPS for the
      period December 2006 to April 2007 disallowed by the Forum.
      The Board also refused to accept current consumption charges.
      Based on a demand contrary to the order of the Forum, the Board       G
      disconnected electric supply for the second time on 2.4.2008.
      After it had disobeyed the order dated 12.2.2008 of the Forum
      CWJC 7314 of 2008 was filed by the Board on 5.5.2008
      questioning the same. The writ petition did not disclose that the
      Board had already disobeyed the order and disconnected supply         H
236            SUPREME COURT REPORTS                            [2020] 6 S.C.R.


A           without raising fresh revised bills. No prayer for interim stay of
            the order of the Forum was made in the Writ Petition.
            Pursuant to an interim deposit of 35 Lacs directed on 15.5.2008 in
            CWJC 4637 of 2008, electric supply was restored on 24.5.2008.
            A fresh bill was again raised on 22.5.2009 for Rs.1.47 Crores
B           along with notice for disconnection. It included AMG and DPS
            for the period disallowed by the Forum. It also included AMG and
            DPS charges for the subsequent disconnection from 2.4.2008 to
            23.5.08. The industry challenged the same again before the Forum.
            The demand was stayed by the Forum on 12.6.2009. Without
            challenging the order of the Forum, the Board in complete disregard
C           refused to accept even current payments, showed arrears of
            Rs.1.82 crores and disconnected supply of the Industry again on
            7.8.2009. CWJC 9742 of 2009 was preferred against the same
            by the Industry. Rs.80 Lacs was deposited pursuant to the order
            of the Court, and electric supply was restored on 1.12.2009. The
D           industry therefore also questioned AMG and DPS charge for the
            disconnection period from 7.8.2009 to 30.11.2009. Further payment
            of Rs.40 Lacs has been made pursuant to interim directions in the
            present Appeals.”
             3. The Single Judge found the act of disconnection without
E     considering the request for instalments was unwarranted. It was held
      that such default on the part of the company did not constitute “neglect
      to pay” as contemplated in Section 56 of the 2003 Act. The fresh bill,
      which was raised on 1st September 2006 showed the due date of payment
      to be 20th September 2006. Disconnection was however made on 6th
      September 2006 on the basis of earlier notice of 23rd August 2006. This
F     was held to be unjustified. The demands raised thereafter contrary to
      the order of the Forum constituted under Section 42(5) of the Act was
      also held to be illegal by the Single Judge.
            4. The Appeal Bench, inter, alia, found:-

G           “The bill dated 19.3.2008 which included the AMG and DPS for
            the period 1.11.2006 to 3.4.2007 contrary to the order of the Forum
            being illegal, the Industry was under no obligation to pay the same.
            The subsequent disconnection on 2.4.2008 automatically becomes
            illegal. Surprisingly, the officials of the Board persisted in defying
            the order of the Forum in the bill dated 22.5 2009 by again including
H
  BIHAR STATE ELECTRICITY BOARD v. M/S ICEBERG                               237
INDUSTRIES LTD. AND OTHERS [ANIRUDDHA BOSE, J.]

   AMG and DPS for the period of disconnection disallowed by the             A
   Forum and reiterating the subsequent illegal bill also for the period
   of illegal disconnection from 2.4.2008 to 23.5.2008. The petitioner
   challenged this bill before the Forum again which stayed
   disconnection on 12.6.2009. The authoritarianism of the Board
   persisted in flagrant disobedience and supply again disconnected
                                                                             B
   on 7.8.2009 leading to institution of CWJC 9742 of 2009. The
   supply was restored on 1.12.2009 upon payment of Rs.80 Lacs
   under orders of the Court. The disconnection from 7.8.2009 to
   30.11.2009, needs no further discussion to be held illegal. We are
   constrained to observe that this second occasion when the officials
   of the Board acted in gross defiance of the orders of the statutory       C
   authority is indicated of dangerous executive thinking. We expect
   the officials of the Board to understand their folly and act prudently,
   take action against the officers concerned so that in future such
   administrative adventurism is not attempted.
   In fairness to the Board, we must deal with CWJC 7314 of 2008             D
   filed by it against the order of the Forum. It does not appear from
   the impugned Judgement that any substantive challenge was laid
   out to it except that the Board did not agree with the same. Even
   before us no substantive challenge has been laid out why the order
   of the Forum was wrong. The only ground urged before us was
   that the order of the Forum was contrary to the agreement signed          E
   between the parties for an H.T. connection. It was the foremost
   duty of the Board to either comply the order of the Forum and
   then challenge it or alternately challenge the order immediately
   and seek stay of the order. Its conduct has been found grossly
   wanting on both aspects. An evasive and purposefully vague                F
   statement was made in paragraph 9 of disconnection. No details
   of the date was stated or that it had already disobeyed the order
   before filing the Writ petition. If the Board was seeking the
   protection of the law against the statutory quasi-judicial order, it
   had to first respect the law. A person falling foul of the law cannot
   seek the shelter of the law to perpetuate disobedience. The writ          G
   petition filed by the Board was therefore fit to be dismissed on
   this ground also.
   The case of (Southco) (supra) relied upon by the Board has no
   application to the present case. The words “revenue focus” was
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238            SUPREME COURT REPORTS                            [2020] 6 S.C.R.


A           used in context of unauthorised use of electricity. Similarly Kesoram
            Industries (supra) related to construction of a taxing statute.
            Likewise Raymond (supra) and Green Industries (supra) did not
            relate to the obligation for payment of Minimum Guarantee
            Charges for the period of illegal disconnection by the Board.
B           Affirming the reasoning and findings of the Writ Court, we hold
            that the initial disconnection itself being illegal, the Board does not
            have the authority to charge any AMG and DPS not only for that
            period but also for each and every subsequent period of illegal
            disconnection also, because it failed to revise the bills. The
            directions given by the Writ Court in the penultimate paragraph of
C           the judgment calls for no interference.”
             5. Before us three issues emerge, which we need to address. The
      first one is whether the company could have invoked the Redressal
      Forum’s jurisdiction over the dispute pertaining to AMG and DPS including
      the question of disconnection in terms of Section 56 of the Act. The
D     second issue is as to whether, after receiving a representation seeking
      instalment payment, supply to consumer could be disconnected without
      dealing with such representation. The third issue is as to whether AMG
      was payable by the company for the entire period during which supply
      to the consumer remain disconnected.
E            6. The company’s request for grant of instalments to liquidate
      their dues was ultimately accepted by the Board and to that effect an
      agreement was executed between Company and the Board for liquidation
      of the outstanding dues of Rs. 37,09,027/- in ten instalments. This
      agreement is dated 11th April 2007. A copy of this agreement has been
F     made Annexure R11 to the counter-affidavit of the Company. On payment
      of the first instalment, supply line of the company was energised on 16th
      April, 2007. Another bill dated 04.05.2007 was sent to the company for
      Minimum Monthly Base charges for the period between 1st December
      2006 and 30th April 2007, AMG charges for the year 2006-2007 and
      total amount demanded under this bill was for Rs. 88,389,528/-. The
G     next notice under Section 56 of the Act was issued on 22.05.2007 as the
      company did not make payment of the bill dated 4th May, 2007. The
      Company thereafter approached the Consumer Grievances Redressal
      Forum questioning legality of the notice dated 4th May 2007. Their
      application was registered as Case no. 108 of 2007 and initially the demand
H     was stayed by the Forum. In the final order dated 12th February 2008,
      the Forum gave its finding in the following terms:-
    BIHAR STATE ELECTRICITY BOARD v. M/S ICEBERG                             239
  INDUSTRIES LTD. AND OTHERS [ANIRUDDHA BOSE, J.]

      1. The disconnection of the electric line of the Petitioner on         A
         08.09.2006 is being held “legal”
      2. The date of disconnection of “08.09.2006” has been found as
         notice for determination of the agreement.
      3. The Petitioner/consumer is liable for payment of Energy Bill
         of AMG Charge for September’ 2006 & October’ 2006 and               B
         monthly Minimum Base Charge of November’ 2006 i.e. for
         three months from the month of disconnection of the line.
      4. As per Board’s Notification no-477 dated 29.10.2002 and letter
         No. 793 dated 22.10.2013-both issued in the signature of
         Secretary, Bihar State Electricity Board, Patna; the                C
         reconnection done on 16.04.2007 by accepting of amount of
         1st instalment with disconnection & Reconnection Charge has
         been decided as clear violation of the Board’s directives, as
         the electric line of the Petitioner remained disconnected from
         08.09.2006 to 15.04.2007 i.e. more than six months period.          D
      5. Any request made by the Petitioner for availing/providing
         electric power should have been treated, as the case of New
         Applicant and reconnection done is found as improper.
      6. The charging of Monthly Minimum Base charge from
         December’ 2006 to March’2007 is decided as illegal and liable       E
         for withdrawal, as the connection was given in the Month of
         April’ 2007.
      7. If the Petitioner is found fit to avail the benefit of exemption,
         necessary suitable and appropriate action may be taken to
         allow the benefit of exemption from payment of Monthly              F
         Minimum Base Charge as per Industrial Policy Resolution’
         2006.
       7. Supply to the Company was disconnected again on 2nd April
2008. Both the appellant and the respondent company had assailed the
order of the forum invoking the Constitutional Writ jurisdiction of the      G
Patna High Court. The company’s writ petition, registered as CWJC
4637 of 2008 challenged that part of the order in which disconnection of
electricity on 8th September 2006 was held to be legal. The Board’s writ
petition was registered as CWJC 7314 of 2018. In this writ petition, the
Board questioned the jurisdiction of the Redressal Forum to adjudicate
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240            SUPREME COURT REPORTS                            [2020] 6 S.C.R.


A     the dispute on the ground that the company was not using the electricity
      for their own use. They also wanted invalidation of the Forum’s order by
      which the energy bill dated 4th May 2007 was quashed.
             In the first writ petition filed by the company (CWJC 4637 of
      2008), by an interim order, the High Court had directed deposit of sum of
B     Rs.35 lacs for the purpose of reenergising supply and this amount, we
      are apprised, was deposited by them. The supply line was also restored
      on 24.5.2008. But between 2nd April 2008 and 24th May 2008, the
      company’s electricity stood disconnected. Thereafter, demands were
      made on different dates under several heads including arrears, DPS and
      a fresh notice of disconnection under Section 56 of the 2003 Act was
C     issued on 22nd May 2009. The company again approached the Forum
      against a bill dated 5th June 2009 for a sum of Rs.1,63,15,452/-. The
      Forum had stayed the demand and passed an order restraining the Board
      from disconnecting supply of the respondent no.1. But on 7th August,
      2009, again supply to the company was disconnected, which prompted
D     filing of the third writ petition by the company, which was registered as
      CWJC 9742 of 2009. An interim order was issued in that writ petition
      requiring them to deposit a sum of Rs.40 lacs within a week after which
      the power supply was to be restored to be followed by further deposit of
      a sum of Rs.40 lacs by 6th November 2009. This interim order was
      passed on 15th October 2009. The said sum was deposited and supply
E     was restored. Ultimately, the learned Single Judge disposed of all the
      three writ petitions by a common judgment and order passed on 29.4.2010
      with the following directions and observations: -
            “(1) The Board would have to delete from the demands being
            made as against the petitioner amounts in relation to the period of
F           disconnections, because, as shown above, each disconnection was
            illegal, wrongful and the petitioner cannot be made to pay for the
            period of such wrongful disconnections.
            (2) The bills and the liability of the petitioner would have to be re-
            caste from the very initial period, deleting charges aforesaid, giving
G           due credit to payment made in between & then final amount has
            to be worked out.
            (3) The final amount being worked out for which the period of
            one month is granted to the Board, the Board would serve the bill
            giving the full details in respect thereof, deleting the charges as
H           indicated above.
    BIHAR STATE ELECTRICITY BOARD v. M/S ICEBERG                             241
  INDUSTRIES LTD. AND OTHERS [ANIRUDDHA BOSE, J.]

      (4) As this Court has found that the amounts as claimed were           A
      incorrectly claimed, then the bills being revised would not contain
      delayed payment charges for balance due in view of Division
      Bench judgment of this Court in the case of M/s Gaya Roller
      Flour Mills Private Ltd. Vs. Bihar State Electricity Board since
      reported in 1995(2) PLJR 715.
                                                                             B
      (5) Petitioner by one of the interlocutory applications has prayed
      that he is entitled to exemption under the Industrial Policy 2006 of
      the Government. That dispute is pending before the Industries
      Development Commissioner. The petitioner would have liberty to
      pursue the matter before that authority.”
                                                                             C
       8. We shall first address the question as to whether the Forum
under Section 42(5) of the 2003 Act had the jurisdiction to entertain and
determine the company’s application. We must point out here that before
the Appeal Bench the counsel for the Board had acknowledged Forum’s
jurisdiction to adjudicate the dispute raised before it. This appears from
the recordal of submission of the counsel for the Board before the Appeal    D
Bench as it appears in the judgment under appeal:-
      “…….Before us, Counsel for the Board fairly acknowledged that
      the Forum had jurisdiction to adjudicate the dispute……”
       9. But even if we proceed on the basis that concession on law         E
made before a judicial forum against whose decision we are hearing
these appeals would not bind a party to such concession, we do not find
anything in law which barred the Redressal Forum from adjudicating the
dispute. Section 42(5) of the 2003 Act lays down:
      “42. Duties of distribution licensees and open access.- (1)            F
      xxx xxx
      (2) xxx    xxx     xxx
      (3) xxx    xxx     xxx
      (4) xxx    xxx     xxx
                                                                             G
      (5) Every distribution licensee shall, within six months from the
      appointed date or date of grant of licence, whichever is earlier,
      establish a forum for redressal of grievances of the consumers in
      accordance with the guidelines as may be specified by the State
      Commission.”
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242             SUPREME COURT REPORTS                           [2020] 6 S.C.R.


A           10. The term ‘consumer’ has been defined in Section 2(15) of the
      2003 Act in the following terms:-
            “2(15) “consumer” means any person who is supplied with
            electricity for his own use by a licensee or the Government or by
            any other person engaged in the business of supplying electricity
B           to the public under this Act or any other law for the time being in
            force and includes any person whose premises are for the time
            being connected for the purpose of receiving electricity with the
            works of a licensee, the Government or such other person, as the
            case may be;”
C            11. The respondent company fits this description. A case was
      sought to be made out that since the company was a high-tension
      commercial consumer, they could not apply to the Forum. On this count,
      definition of consumer as specified in clause 2 (1) (g) of the Consumer
      Grievance Redressal Forum and Electricity Ombudsmen Regulation, 2006
      was sought to be relied upon. This clause specifies:-
D
            2 (1) (g):- ‘Consumer’ means any person who is supplied with
            electricity for his own use by a licensee and includes any person
            whose premises are connected for the purpose of receiving
            electricity with the works of a licensee or a person whose electricity
            supply is disconnected by a licensee or the person who has applied
E           for connection for receiving electricity from a licensee, as the
            case may be.
             But we do not find any reason to denude the company of its locus
      to approach the forum. The object of use of electricity may be to produce
      items for sale, but use or consumption of electricity by them was for
F     their own factory.
             12. Next comes the question as to whether it was permissible on
      the part of the Board to disconnect the supply of the company in spite of
      the order of stay granted by the Forum. We have reproduced the passage
      from the judgment of the Division Bench dealing with that aspect of the
G     controversy. We accept the finding of the Division Bench on that count.
      Board could not have had ignored the directive of a statutory forum and
      imported their own perception of what was legal to proceed against a
      consumer.
            13. The third point urged before us relates to the issue as to whether
H     the company was required to pay AMG charges or not during the period
    BIHAR STATE ELECTRICITY BOARD v. M/S ICEBERG                              243
  INDUSTRIES LTD. AND OTHERS [ANIRUDDHA BOSE, J.]

their supply stood stalled by disconnection. The Forum referred to Circular   A
No. 477 dated 29.10.2002 (General Terms and Conditions of Supply)
while accepting the consumers stand that the Board could not do so. In
the order of the Forum dated 12th February 2008 paragraphs 6(B) and
6(B)(iii) of that circular have been quoted as:
      “If the line of a consumer is disconnected for default in payment       B
      of dues of the Board and the same remains disconnected for a
      period of 3 months, the date of disconnection of line shall be deemed
      to be the date of notice for termination of agreement and the
      agreement shall be deemed to have ceased and determined after
      a period of three months, calculated from the month of
      disconnection. The Consumer shall be liable to pay minimum              C
      energy/charge/demand charges; as per tariff provisions for this
      period of 3 months.”
      “If, after termination of agreement, the consumer comes forward
      with a request to provides to his premises, he will be treated as a
      new applicant, but he shall clear all dues against the erstwhile        D
      connections.”
        14. The AMG charges quantified in the bills raised subsequent to
the one dated 17th April 2006 did not take into account the period during
which supply to the consumer had remained disconnected. On behalf of
the Board, on the other hand reliance was placed on clauses 9(a) and          E
(b) of the Supply Agreement dated 16th April 2004 to contend that the
circular No. 477 could not have had been made applicable within the
first three years from the date of commencement of the supply of energy.
These two clauses read:-
      “9(a) The consumer shall not be at liberty to determine this            F
      agreement before the expiration of three years from the date of
      commencement of the supply of energy. The consumer may
      determine this agreement with effect from any date after the said
      period on giving to be Board not less than twelve calendar months’
      previous notice in writing in that behalf and upon the expiration of    G
      the period of such notice this agreement shall cease and determine
      without prejudice to any right which may then have accrued to
      the Board hereunder provided always that the consumer may at
      any time with the previous consent of the Board transfer and
      assign this agreement to any other person and upon subscription
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244            SUPREME COURT REPORTS                          [2020] 6 S.C.R.


A           of such transfer, this agreement shall be binding on the transferee
            and Board and taken effect in all respects as if the transferee had
            originally been a party hereto in place of the consumer who shall
            henceforth be discharged from all liabilities under or in respect
            thereof.
B           (b) In case the consumer’s supply is disconnected by the Board
                in exercise of its powers under this agreement and/or law and
                the consumer does not apply for reconnection in accordance
                with law within the reminder period of the compulsorily availing
                of supply as stated above or the period of notice whichever
                be longer, he will be deemed to have given a notice on the
C               date of the disconnection in terms of aforesaid clause 9(a) for
                the determination of the agreement and on expiration of the
                abovesaid reminder period of compulsorily availing of supply
                or the period of notice whichever is longer, this agreement
                shall cease and determine in the same way as above.”
D           15. The Redressal Forum in its order of 12th February 2008 (in
      case no. 108/2007) has construed the said Circular partly in favour of
      the company in the following manner:-
            “Thus, it is very clear that after three months of the month of
            disconnection, i.e. after termination of the agreement, the consumer
E           requested to the concerned authorities of the Board to allow him
            20 equal instalments of the AMG bill for 2005-2006 and monthly
            energy bill for August 2006, but the concerned authorities of the
            Board has executed the agreement of instalments with
            disconnection & reconnection on 11.04.2007 in violation of this
F           important Circular of the Board and the line was reconnected on
            16.04.2007 after acceptance of payment of Rs.9,27,257.00 (1st
            instalment) and disconnection & Reconnection charge of
            Rs.2,000=00 vide money receipt no – 444920 & 444921
            respectively of dated 12.04.2007; whereas the petitioner/consumer
            would have been treated as new applicant.
G
            This letter of ESE/Patna further states that on reconnection, the
            consumer were served the regular energy bill and the AMG bill
            during the period of this connection i.e. from 11/2006 to 4/2007
            worth Rs.70,23,149.00.

H
    BIHAR STATE ELECTRICITY BOARD v. M/S ICEBERG                             245
  INDUSTRIES LTD. AND OTHERS [ANIRUDDHA BOSE, J.]

      The Forum finds that, during the issue of energy bill for the month    A
      of 4/2007, the bill issuing authority i.e. ESE (Consumer &
      Revenues)/Patna Electrical Circle has issued MMC bill including
      the period of 01.11.2006 to 30.04.2007 – for six months for
      Rs.70,36,946=00 by mentioning the rebate Amount of Rs.13797=00,
      if paid before 16.05.2007.
                                                                             B
      On examination of the copy of his issued energy bill, the Forum
      finds; that this energy bill-mentioned as bill for the month of 4/
      2007 – is wrongly prepared and levied as after termination of
      agreement, as per Circular of Board the consumer/petitioner is
      only liable for payment of AMG/MMC charge for three months
      from the months of disconnection i.e. AMG charge for the month         C
      of Sept’ 2006 and Oct.2006 and Monthly Minimum Base Charge
      for the month of November 2006 only, hence charging/levying of
      Monthly Minimum Base charge for the period December 2006 to
      March 2007 is wholly illegal and incorrect.
      The Forum also detects that Electricity Duty of 6% of                  D
      Rs.3,47,684=00 on the total amount of Monthly Minimum base
      charge of Rs.57,94,740=00 have been wrongly levied, where as
      the Electricity Duty @ 6% is to be chargeable only on the energy
      charge of the units as recorded and calculated as per reading
      shown in the installed Meter.                                          E
      Even though the amount of DC&RC Charge for Rs.2000=00 has
      already been deposited by the consumer on 12.04.2007, this amount
      of Rs.2000=00 is again shown as charged in the instant bill for the
      month of 4/2007, issued on 04.05.2007, with due date of the date
      16.06.2007, which makes this bill as incorrect.”                       F
       16. We thus find that the statutory Forum has come to a finding in
dealing with certain circular issued by the Board. We do not think we
ought to interfere at this stage with such finding so far the same related
to applicability and interpretation of the said circular.
       17. As regards the provisions of clauses 9 (a) and (b) of the         G
agreement, the first provision curb the right of a consumer to determine
the agreement unless certain conditions are fulfilled. The circular relied
upon by the Forum however has wider application and its applicability
has not been disputed by the Board. Contention of the Board is that the
Forum did not adhere to clause 6 (B) (i) of the circular, which according
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246             SUPREME COURT REPORTS                           [2020] 6 S.C.R.


A     to the Board, constituted partial modification of general terms and
      conditions of supply. We do not accept this argument, particularly in the
      factual perspective of these appeals. The Board had agreed to instalments
      for clearing the dues and restored the supply. On that basis, an independent
      arrangement came into existence vis-a-vis the company’s terms of supply
      in the given case.
B
            18. The only point which now remains to be dealt with is as to
      whether the representation of the company after issue of notice of
      disconnection could absolve them from rigours of Section 56 of the 2003
      Act which relates to disconnection of supply, on the ground that such
      representation demonstrated there was no negligence on the part of the
C     consumer to pay any charge of electricity. Section 56 of the Act provides:-
            “56 Disconnection of supply in default of payment- (1) Where
            any person neglects to pay any charge for electricity or any sum
            other than a charge for electricity due from him to a licensee or
            the generating company in respect of supply, transmission or
D           distribution or wheeling of electricity to him, the licensee or the
            generating company may, after giving not less than fifteen clear
            days’ notice in writing, to such person and without prejudice to his
            rights to recover such charge or other sum by suit, cut off the
            supply of electricity and for that purpose cut or disconnect any
E           electric supply line or other works being the property of such
            licensee or the generating company through which electricity may
            have been supplied, transmitted, distributed or wheeled and may
            discontinue the supply until such charge or other sum, together
            with any expenses incurred by him in cutting off and reconnecting
            the supply, are paid, but no longer:
F
            Provided that the supply of electricity shall not be cut off if such
            person deposits, under protest,-
                (a) an amount equal to the sum claimed from him, or
                (b) the electricity charges due from him for each month
G               calculated on the basis of average charge for electricity paid
                by him during the preceding six months,
                whichever is less, pending disposal of any dispute between
                him and the licensee.

H
    BIHAR STATE ELECTRICITY BOARD v. M/S ICEBERG                                247
  INDUSTRIES LTD. AND OTHERS [ANIRUDDHA BOSE, J.]

          (2) Notwithstanding anything contained in any other law for           A
          the time being in force, no sum due from any consumer, under
          this section shall be recoverable after the period of two years
          from the date when such sum became first due unless such
          sum has been shown continuously as recoverable as arrear of
          charges for electricity supplied and the licensee shall not cut
                                                                                B
          off the supply of the electricity.”
        19. Under the aforesaid provision, disconnection of supply is special
power given to the supplier in addition to the normal mode of recovery
by instituting a suit. Both the Single Judge and the Appellate Bench of
the High Court have held that the respondent company did not neglect to
pay their dues, for which reason the supplier could have effected the           C
harsher mode by disconnection supply. The Single Judge referred to two
authorities, Corporation of the City of Nagpur Vs. Nagpur Electric
Light and Power Company Limited – (AIR 1958 Bom. 498) and
Amalgamated Commercial Traders Vs. A.C.K. Krishnaswami –
(1995)(XXV) CC 454 in which it has been held that in the event there is         D
bona fide dispute between the parties on the quantum of dues, non-
payment of such sum would not amount to negligence to pay. The first
authority relates to Section 24(1) of the Indian Electricity Act, 1910 having
provision similar to that of Section 56 of the 2003 Act. The second case
related to initiation of winding-up proceeding under the Companies Act,
1956. The other authority referred to was the case of Laxmikant                 E
Revchand Bhojwani and another Vs. Pratapsing Mohansingh
Pardeshi – (1995) 6 SCC 576. In this case, one of the issues involved
was default in payment of dues on account of rent, for which eviction
could be asked for. The court found that the rent in that case was sought
to be paid through money order within the specified period. It was held         F
that it was not a case default to pay simpliciter and hence the rigours of
the default provision leading to eviction under the applicable rent law
stood diluted.
       20. So far as the subject controversy is concerned, there is no
dispute on obligation of the respondent company to pay the AMG charges,         G
at least so far as first bill is concerned. Its representation for instalment
was in the nature of a mercy plea. Going by that factor alone, we might
not have had accepted the finding of the High Court that the consumer
did not neglect to pay so as to warrant the disconnection provision
contained in Section 56 of the Act. But in respect of respondent company,
                                                                                H
248             SUPREME COURT REPORTS                           [2020] 6 S.C.R.


A     eventually instalment was granted subsequent to the period of
      disconnection. Once that plea for instalment payment was accepted and
      agreement was entered into for clearing the dues, it demonstrated
      willingness to pay on the part of the company of the dues in a manner
      acceptable to the appellant Board. Such plea of the company was
      accepted after keeping the matter pending for a long time. In such
B
      circumstances, in our opinion the High Court was right in giving its finding
      that the act of disconnection on 8th September 2006 was arbitrary.
      Because of these reasons we do not want to disturb the finding of the
      Courts below.
             21. The appeals filed by the Board are accordingly dismissed.
C     The judgment of the Division Bench of the Patna High Court is sustained.
      All connected applications stand disposed of. There shall be no order as
      to costs.


D     Divya Pandey                                                Appeals dismissed.




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