Supreme Court of India
THE EXECUTIVE ENGINEER AND ANR.versusM/S SRI SEETARAM RICE MILL
- Citation
- 2011 INSC 772
- Decided
- 20 October 2011
- Disposal
- Appeal(s) allowed
- Bench
- S H KAPADIA
Holding
Excess consumption beyond the sanctioned load is unauthorised use under Section 126, only final assessments are appealable under Section 127, and the High Court should not have interfered with the provisional assessment but must remand the case to the assessing officer.
Summary
The case concerned a rice mill that consumed electricity beyond its contracted load, leading the Executive Engineer to issue a provisional assessment under Section 126 of the Electricity Act, 2003. The mill challenged the assessment and the accompanying notice of "unauthorised use" before the High Court, arguing lack of jurisdiction and that over‑drawal of load was not covered by Section 126. The Supreme Court held that consumption in excess of the sanctioned load falls within the ambit of "unauthorised use of electricity" and therefore attracts Section 126. It clarified that only a final order of assessment is appealable under Section 127, while a provisional assessment is not. The Court further ruled that the High Court erred by delving into the merits of the assessment and should have remanded the matter to the assessing officer to allow the consumer to file objections, rather than interfering with the provisional order. Consequently, the High Court judgment was set aside and the appeal was allowed, with the matter remitted for a final assessment.
Issues considered
- Whether consumption of electricity in excess of the sanctioned/contracted load constitutes "unauthorised use" attracting Section 126 of the Electricity Act, 2003.
- Whether the High Court was justified in exercising its jurisdiction under Article 226 to interfere with the provisional assessment order despite the existence of a statutory appeal under Section 127.
- Whether the writ petition challenging the provisional assessment was maintainable given the alternative statutory remedy.
Legislation cited
- Constitution of Indias. Article 226
- Delhi Development Act, 1957s. 31A
- Electricity Act, 1910
- Electricity Act, 2003s. 126, s. 127, s. 135
- Electricity Regulatory Commissions Act, 1998
- Electricity (Supply) Act, 1948
- Indian Penal Code, 1860s. 24
Subjects
Electricity Act 2003unauthorised use of electricitySection 126Section 127provisional assessmentfinal assessmentArticle 226purposive interpretationexcess loadstatutory remedywrit jurisdiction
Judgment
[2011] 15 (ADDL.) S.C.R. 211
THE EXECUTIVE ENGINEER AND ANR. A
v.
M/S SRI SEETARAM RICE MILL
(Civil Appeal No. 8859 of 2011)
OCTOBER 20, 2011
B
[S.H. KAPADIA, CJI., K.S. RADHAKRISHNAN AND
SWATANTER KUMAR, JJ.]
Electricity Act, 2003:
c
Salient features of the Act - Discussed.
Legislative history and object of enactment - Discussed.
s. 126 - Applicability of - Held: Consumption of electricity
in excess of sanctioned load would be unauthorized use of D
electricity and would attract applicability of s. 126 of the Act.
s. 126 - Scope of, with reference to construction of the
words 'unauthorized use' and 'means' - Discussed.
s. 126 and s. 135 - Distinction between - Discussed. E
s. 126 - Assessment and computation under - Manner
·of - Discussed.
s. 127 - Appealable order - Held: In view of the language F
of s.127 of the Act, only a final order of assessment passed
uls.126(3) is an order appealable uls.127 and a notice-cum-
provisional assessment made uls.126(2) is not appealable -
Thus, the High Court should normally decline to interfere in
a final order of assessment passed by the assessing officer G
in terms of s. 126(3) of the Act in exercise of its jurisdiction
under Article 226 of the Constitution of India.
s. 127 - Statutory alternative remedy available u/s. 127 of
the Act - Writ petition - Scope of interference with provisional
211 ti
212 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A order of assessment/show cause notice - Held: Keeping in
view the functions and expertise of the specialized body
constituted under the Act including the assessing officer, it
would be proper exercise of jurisdiction, if writ court upon
entertaining and deciding the writ petition on a 1urisdictiona/
B issue, remand the matter to the competent authority for its
adjudication on merits and in accordance with law- If exercise
of jurisdiction by the Tribunal ex facie appears to be an
exercise of jurisdiction in futility then it will be permissible for
the High Court to interfere in exercise of its jurisdiction - In
c ·the instant case, the respondents-consumers were required
to fife objections as contemplated uls. 126 (3) of the Act
against the provisional order of assessment- It was only when
a final order of assessment was passed that the respondents
could prefer a statutory appeal which, admittedly, was not done
0 in the case in hand - High Court did not commit any error of
jurisdiction in entertaining the wn"f petition against the order
raising a jurisdictional challenge to the notice/provisional
assessment order - However, High Court transgressed its
jurisdictional /imitations while travelling into the exclusive
E domain of the Assessing Officer relating to passing of an order
of assessment and determining factual controversy of the
case - Constitution ·of India, 1950 - Article 226.
Constitution of India, 1950:
F Article 226 - Scope of interference with tr1e provisional
order of assessment/show cause notice - Discussed.
Article 226 - Alternative remedy - Maintainability of writ
petition - Discussed.
G Interpretation of statutes:
Purposive interpretation - Held: The statute should be
read as a whole - Its different provisions may have to be
construed together to make consistent construction of the
H whole statute relating to the subject matter - A construction
1
EXECUTIVE ENGINEER AND ANR. v. SRI 213
. SEETARAM RICE MILL
which will improve the workability of the statute, to be more A
effective and purposive, should be preferred to any other
interpretation which may lead to undesirable results.
Expression 'means', 'means and includes' and 'does not
include' - Held: When the Legislature has used a particular
8
expression out of these three, it must be given its plain
meaning while even keeping in mind that the use of other two
expressions has not been favoured by the Legislature.
Fiscal and penal laws - Interpretation of.
c
Object and reason of enactment - Relevancy of.
Discussions of Standing Committee - Relevancy of.
Words and phrases:
D
Word 'dishonest', 'authorisation', 'malpractice' - Meaning
of.
Word 'means' - Meaning of, in· the context of s. 126 of the
Electricity Act, 2003 - Discussed.
E
Expression 'unauthorised use of electricity' - Meaning of,
in the context of s.126 of the Electricity Act, 2003 -
Discussed.
An agreement was entered into between appellant F
no.1 and the respondent for supply of power to the
respondent. The respondent was categorized as medium
industry category and accordingly accorded the
contracted load. This category dealt with the contract
demand of 99 KVA and above but below 110 KVA. On G
10th June, 2009, the Executive Engineer inspected the
business premises of the respondent's unit and issued
a dump report. In the dump report, it was stated that there
was unauthorized use of electricity and Maximum
Demand (MD) had been consumed up to 142 KVA. On H
214 SUPREME COURT REPORTS (2011] 15 (ADDL) S.C.R.
A 25th July, 2009, provisional assessment order was issued
by the appellants to the respondent by taking the
contracted demand as that applicable to large industry
and the respondent was required to file objections, if any,
and to also pay the amount. On the same day, intimation
B was also issued to the respondent that there was
unauthorized use of electricity falling squarely within the
ambit of provisions of Section 126 of the Electricity Act,
2003. The demand was raised assessing the consumer
for the period from June 2008 to August 2009 for a sum
C of Rs.7,77,300/·. This was computed for 15 months at the
rate of Rs.200 per KVA (i.e., tariff for large industry)
multiplied by two times, aggregating to the claimed
amount The respondent did not file its objections/reply
but challenged the said provisional assessment order
and the intimation of unauthorized use before the High
0
Court by filing writ petition on the grounds of lack of
authority and jurisdiction on the part of the Executive
Engineer. Ii was also contended that no inspection was
conducted in the business premises till date of dump, i.e.,
10th June, 2009 when alleged unauthorized use of
E electricity was found. The respondent also challenged
the maintainability and sustainability of the order of
provisional assessment in calculating the dump charges
for a period of 15 months from June 2008 to August 2009
on the basis of dump charges relating to large industry
F while the respondent was classified as medium scale
industry.
The High Court held that the words 'unauthorized use
of electricity' and 'means' as provided in Explanation to
G Section 126 of the 2003 Act were exhaustive; overdrawal
of MD would not fall under the scope of 'unauthorized
use of electricity' as defined under the 2003 Act, and the
appellants had no jurisdiction to issue the intimation and
pass the assessment order in terms of Section 126 of the
H 2003 Act.
EXECUTIVE ENGINEER AND ANR. v. SRI 215
SEETARAM RICE MILL
In the instant appeal, the questions which arose for A
consideration were: (1) wherever the consumer
consumes electricity in excess of the maximum of the
contracted load, would the provisions of Section 126 of
the 2003 Act be attracted on its true scope and
interpretation; (2) whether the High Court, in the facts and B
circumstances of the case, was justified in interfering with
the provisional order of assessment/show cause notice
in exercise of its jurisdiction under Article 226 of the
Constitution of India; and (3) was the writ petition before
the High Court under A~icle 226 of the Constitution of c
India not maintainable because of a statutory alternative
remedy being available under Section 127 of the 2003
Act.
Allowing the appeal, the Court
D
HELD: 1. To address the issues like deterioration in
performance of the Boards and the difficulties in
achieving efficient discharge of functions, a better,
professional and regulatory regime was introduced
under the Electricity Bill, 2001, with the policy of E
encouraging private sector participation in generation,
transmission and distribution of electricity and with the
objective of distancing regulatory responsibilities from
the Government by transferring the same to the
Regulatory Commissions. The need for harmonizing and F
rationalizing the provisions of the earlier statutes was met
by creating a new, self-contained and comprehensive
legislation. Another object was to bring unity in
legislation and eliminate the need for the respective State
Governments to pass any reform Act of their own. This G
Bill had progressive features and strived to strike the right
balance between the economic profitability and public
purpose given the current realities of the power sector
in India. This Bill was put to great discussion and then
emerged the Electricity Act, 2003 ( 'the 2003 Act'). The
H
216 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A 2003 Act had notably provided for private sector
participation, private transmission licences for rural and
remote areas, stand alone systems for generation and
distribution, the constitution of an Appellate Tribunal,
more regulatory powers for the State Electricity
B Regulation Commission and provisions relating to theft
of electricity. The additional provisions were introduced
in the 2003 Act in relation to misuse of power and
punishment of malpractices such as over-consumption
of sanctioned electric load which are not covered by the
c provisions relating to theft; all .of which had significant
bearing upon the revenue focus intended by the
Legislature. This is the legislative history and objects and
reasons for enacting the 2003 Act. To ensure better
regulatory, supervisory and revenue recovery system, as
expressed in the objects and reasons of the 2003 Act,
0
there was definite concerted effort in preventing
unauthorized use of electricity on the one hand and theft
of electricity on the other. The present case falls in the
former. [Paras 2, 3] [238-F-H; 239-A·FJ
E 2. Question (1)
2.1.1 It is clear from the object of enactment of
Electricity Act, 2003 that 'revenue focus' was one of the
principal consideratle~s that weighed with the
F Legislature while enacting this law. The regulatory regime
under the 2003 Act empowers the Commission to frame
the tariff, which shall be the very basis for raising a
demand upon a consumer, depending upon the category
to which such consumer belongs and the purpose for
G which the power is sanctioned to such consumer. The
contention on behalf of the respondent cannot be
accepted that the provisions of Section 126 of the 2003
Act have to be given a strict and textual construction to
the extent that they have to be read exhaustively in
absolute terms. This is a legislation which establishes a
H
EXECUTIVE ENGINEER AND ANR. v. SRI 217
SEETARAM RICE MILL
regulatory regime for the generation and distribution of A
power, as well as deals with serious fiscal repercussions
of this entire regime. The two maxims which should be
applied for interpretation of such statutes are ex
visceribus actus (construction of the act as a whole) and
ut res magis valeat quam pereat (it is better to validate a B
thing than to invalidate it). It is a settled cannon of
interpretative jurisprudence that the statute should be
read as a whole. In other words, its different provisions
may have to be construed together to make consistent
construction of the whole statute relating to the subject c
matter. A construction which will improve the workability
of the statute, to be more effective and purposive, should
be preferred to any other interpretation which may lead
to undesirable results. [Para 10] [244-G-H; 245-A-E]
2.1.2. It is true that fiscal and penal laws are normally D
construed strictly but this rule is not free of exceptions.
In given situations, this Court may, even in relation to
penal statutes, decide that any narrow and pedantic,
literal and lexical construction may not be given effect to,
as the law would have to be interpreted having regard to E
the subject matter of the offence and the object that the
law seeks to achieve. The provisions of Section 126, read
with Section 127 of the 2003 Act, in fact, becomes a code
in itself. Right from the initiation of the proceedings by
conducting an inspection, to the right to file an appeal F
before the appellate authority, all matters are squarely
covered under these provisions. It specifically provides
the method of computation of the amount that a
consumer would be liable to pay for excessive
consumption of the electricity and for the manner of G
conducting assessment proceedings. In other words,
Section 126 of the 2003 Act has a purpose to achieve, i.e.,
to put an implied restriction on such unauthorized
consumptic>n of electricity. The provisions of the 2003
Act, applicable regulations and the Agreement executed H
218 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A between the parties at the time of sanction of the load
prohibit consumption of electricity in excess of maximum
sanctioned/ installed load. In the event of default, it also
provides for the consequences that a consumer is likely
to face. It embodies complete process for assessment,
B determination and passing of a demand order. This
defined legislative purpose cannot be permitted to be
frustrated by interpreting a provision in a manner not
intended in law. This Court would have to apply the
principle of purposive interpretation in preference to
c textual interpretation of the provisions of Section 126 of
the 2003 Acl This Court would prefer to adopt purposive
interpretation so as to ensure attainment of the object and
purpose of the 2003 Act, particularly, of the provisions of
Section 126 in question. [Para 11] [245-F-H; 246-A-E]
D Bairam Kumawat v. Union of India & Ors. (2003) 7 SCC
628; Superintendent and Remembrancer of Legal Affairs to
Government of West Bengal v. Abani Maity (1979) 4 SCC 85:
1979 (3) SCR 472 - relied on.
E 2.1.3. The relevancy of objects and reasons for
enacting an Act is a relevant consideration for the court
while applying various principles of interpretation of
statutes. Normally, the court would not go behind these
objects and reasons of the Act. The discussion of a
F Standing Committee to a Bill may not be a very
appropriate precept for tracing the legislative intent but
in .given circumstances, it may be of some use to notice
some discussion on the legislative intent that is reflected
in the substantive provisions of the Act itself. The
G Standing Committee on Energy, 2001, in its discussion
said, 'the Committee feel that there is a 11eed to provide
safeguards to check the misuse of these powers by
unscrupulous elements'. The provisions of Section 126
of the 2003 Act are self-explanatory, they are intended to
covtir situations other than the situations specifically
H
EXECUTIVE ENGINEER AND ANR. v. SRI 219
SEETARAM RICE MILL
covered under Section 135 of the 2003 Act. This would A
further be a reason for this Court to adopt an
interpretation which would help in attaining the legislative
intent. Therefore, the provisions of Section 126 of the
2003 Act should be read with other provisions, the
regulations in force and they should be so interpreted as B
to achieve the aim of workability of the enactment as a
whole while giving it a purposive interpretation in
preference to textual interpretation. [Paras 13-14] [250-A-
E]
2.2. Distinction between Sections 126 and 135 of the C
2003 Act.
2.2.1. Upon their plain reading, the mark differences
in the contents of Sections 126 and 135 of the 2003 Act
are obvious. They are distinct and different provisions D
which operate in different fields and have no common
premise in law. Sections 126 and 127 of the 2003 Act read
together constitute a complete code in themselves
covering all relevant considerations for passing of an
order of assessment in cases which do not fall under E
Section 135 of the 2003 Act. Section 135 of the 2003 Act
falls under Part XIV relating to 'offences and penalties'
and title of the Section is 'theft of electricity'. The Section
opens with the words 'whoever, dishonestly' does any
or all of the acts specified under clauses (a) to (e) of Sub- F
section (1) of Section 135 of the 2003 Act so as to abstract
or consume or use electricity shall be punishable for
imprisonment for a term which may extend to three years
or with fine or with both. Besides imposition of
punishment as specified under these provisions or the G
proviso thereto, Sub-section (1A) of Section 135 of the
2003 Act provides that without prejudice to the provisions
of the 2003 Act, the licensee or supplier, as the case may
be, through officer of rank authorized in this behalf by the
appropriate commission, may immediately disconnect the H
220 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R.
A supply of electricity and even take other measures
enumerated under Sub-sections (2) to (4) of the said
Section. The fine which may be imposed under Section
135 of the 2003 Act is directly proportional to the number
of convictions and is also dependent on the extent of load
B abstracted. In contradistinction to these provisions,
Section 126 of the 2003 Act would be applicable to the
cases where there is no theft of electricity but the
electricity is being consumed in violation of the terms and
conditions of supply leading to malpractices which may
c squarely fall within the expression 'unauthorized use of
electricity'. [Para 15] [250-G-H; 251-A-E]
2.2.2. Section 135 of the 2003 Act deals with an
offence of theft of electricity and the penalty that can be
imposed for such theft. This squarely falls within the
D dimensions of Criminal Jurisprudence and mens rea is
one of the relevant factors for finding a case of theft. On
the contrary, Section 126 of the 2003 Act does not speak
of any criminal intendment and is primarily an action and
remedy available under the civil law. It does not have
E features or elements which are traceable to the criminal
concept of mens rea. Thus, the expression 'unauthorized
use of electricity' under Section 126 of the 2003 Act deals
with cases of unauthorized use, even in absence of
intention. These cases would certainly be different from
F cases where there is dishonest abstraction of electricity
by any of the methods enlisted under Section 135 of the
2003 Act. A clear example would be, where a consumer
has used excessive load as against the installed load
simpliciter and there is violation of the terms and
G conditions of supply, then, the case would fall under
Section 126 of the 2003 Act. On the other hand, where a
consumer, by any of the means and methods as specified
under Sections 135(a) to 135(e) of the 2003 Act, has
abstracted energy with dishonest intention and without
H authorization, like providing for a direct connection
EXECUTIVE ENGINEER AND ANR. v. SRI 221
SEETARAM RICE MILL
bypassing the installed meter, the case would fall under A
Section 135 of the Act. Therefore, there is a clear
distinction between the cases that would fall under
Section 126 of the 2003 Act on the one hand and Section
135 of the 2003 Act on the other. There is no commonality
between them in law. They operate in different and B
distinct fields. The assessing officer has been vested with
the powers to pass provisional and final order of
assessment in cases of unauthorized use of electricity
and cases of consumption of electricity beyond
contracted load will squarely fall under such power. The c
legislative intention is to cover the cases of malpractices
and unauthorized use of electricity and then theft which
is governed by the provisions of Section 135 of the 2003
Act. [Paras 16-17) [252-D-H; 253-A-C]
2.2.3. Section 135 of the 2003 Act significantly uses D
the words 'whoever, dishonestly' does any of the listed
actions so as to abstract or consume electricity would be
punished in accordance with the provisions of the 20(}3
Act. 'Dishonesty' is a state of mind which has to be
shown to exist before a person can be punished under · E
the provisions of that Section. The word 'dishonest' in
normal parlance means 'wanting in honesty'. A person
can be said to have 'dishonest intention' if in taking the
property it is his intention to cause gain, by unlawful
means, of the property to which the person so gaining F
is not legally entitled or to cause loss, by wrongful means,
of property to which the person so losing is legally
entitled. 'Dishonestly' is an expression which has been
explained by the Courts in terms of Section 24 of the
Indian Penal Code, 1860 as 'whoever does anything with G
the intention of causing wrongful gain to one person or
wrongful loss to another person is said to do that thing
dishonestly'. All these explanations clearly show that
dishonesty is a state of mind where a person does an act
with an intent to deceive the other, acts fraudulently and H
222 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A with. a deceptive mind, to cause wrongful loss to the
other. The act has to be of the type stated under Sub-
sections (1)(a) to (1)(e) of Section 135 of the 2003 Act. If
these acts are committed and that state of mind, mens rea,
exists, the person shall be liable to punishment and
B payment of penalty as contemplated under the provisions
of the 2003 Act. In contradistinction to this, the intention
is not the foundation for invoking powers of the
competent authority and passing of an order of
assessment under Section 126 of the 2003 Act. [Paras18-
C 19, 22] [253-D-G; 254-C-D]
Dr. S. Dutt v. State of U.P. AIR 1966 SC 523: 1966 SCR
493 - relied on.
The Law Lexicon (2nd Edn. 1997) by P. Ramanatha
D Aiyar; Collins English Dictionary; Black's Law Dictionary
(Eighth Edition) - referred to.
2.3. The ambit and scope of Section 126 with
reference to the construction of the words 'unauthorised
use' and 'means'
E
2.3.1. The provisions of Section 126 contemplate the
following steps to be taken: (i) An assessing officer is to
conduct inspection of a place or premises and the
equipments, gadgets, machines, devices found
F connected or used in such place. (ii) The formation of a
conclusion that such person has indulged in
unauthorized use of electricity. (iii) The assessing. officer
to provisionally assess, to the best of his judgment, the
electricity charges payable by such person. (iv) The order
G of provisional assessment to be served upon the person
concerned in the manner prescribed, giving him an
opportunity to file objections, if any, against the
provisional assessment. (v)The assessing officer has to
afford a reasonable opportunity of being heard to such
H person and pass a final order of assessment within 30
EXECUTIVE ENGINEER AND ANR. v. SRI 223
SEETARAM RICE MILL
days from the date of service of such order of provisional A
assessment. (vi)The person, upon whom the provisional
order of assessment is served, is at liberty to pay the said
amount within seven days of the receipt of such order
and where he files such objections, final order of
assessment shall be passed, against which such person B
has a right of appeal under Section 127 of the 2003 Act
within the prescribed period of limitation. [Para 23) [254-
!=-H; 255-A-E]
2.4. Assessment and Computation
c
2.4.1. Wherever the assessing officer arrives at the
conclusion that unauthorized use of electricity has taken
place, the assessment shall be made for the entire period
during which such unauthorized use of electricity has
taken place and if such period cannot be ascertained, it D
shall be limited to a period of 12 months immediately
preceding the date of inspection and the assessment
shall be made at the rate equal to twice the tariff
applicable for the relevant category of service specified
under these provisions. This computation has to be taken E
in terms of Sections 126(5), 126(6) and 127 of the 2003 Act.
[Para 24) (255-F-G]
2.4.2. The expression 'unauthorized use of electricity'
on its plain reading means use of electricity in a manner F
not authorized by the licensee of the Board.
'Authorization' refers to the permission of the licensee to
use of electricity', subject to the terms and conditions for
such use and the law governing the subject. The supply
of electricity to a consumer is always subject to the
provisions of the 2003 Act, State Acts, Regulations G
framed thereunder and the terms and conditions of
supply in the form of a contract or otherwise. Generally,
when electricity is consumed in violation of any or all of
these, it would be understood as 'unauthorized use of
electricity'. But this general view will have to be examined H
224 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R.
A in the light of the fact that the legislature has opted to
explain this term for the purposes of Section 126 of the
2003 Act. The 'unauthorized use of electricity' means the
usage of electricity by the means and for the reasons
stated in sub-clauses (i) to (v) of clause (b) of Explanation
e to Section 126 of the 2003 Act. Some of the illustratively
stated circumstances of 'unauthorised use' in the section
cannot be construed as exhaustive. The 'unauthorized
use of electricity' would mean what is stated under that
Explanation, as well as such other unauthorized user,
c which is squarely in violation of the statutory or
contractual provisions. [Paras 27-28] [256-E-G; 256-F-G]
2.4.3. 'Unauthorized' is a concept well-recognized
under different statutes, for example, under Section 31A
of the Delhi Development Act, 1957 (the 'DOA Act') the
D authority has the power to seal the 'unauthorized'
development, if the misuser of the premises would come
within the ambit of unauthorized development. But if
such misuse does not come within the ambit of
'unauthorized development', such power is not available
E to the authority. Simplicitor misuse, therefore, may not fall
within the ambit of unauthorized development under the
provisions of the ODA Act. The unautho~ized use of
electricity in the manner as is undisputed on record
clearly brought the respondent 'under liability and in
F blame' within the ambit and scope of Section 126 of the
2003 Act. [paras 29, 31] [258-H; 259-A-B; 259-F]
M. C. Mehta v. Union of India (2006) 3 SCC 391 - relied
on.
G 2.4.4. The expression 'means' used in the definition
clause of Section 126 of the 2003 Act can have different
connotations depending on the context in which such
expression is used. The word ordinarily includes a
mistaken but reasonable understanding of a
H communication. 'Means' by itself is a restrictive term and
EXECUTIVE ENGINEER AND ANR. v. SRI 225
SEETARAM RICE MILL
when used with the word 'includes', it is construed as A
exhaustive. In those circumstances, a definition using the
term 'means' is a statement of literal connotation of a term
and the courts have interpreted 'means and includes' as
an expression defining the section exhaustively. While
determining whether a provision is exhaustive or merely B
illustrative, this will have to depend upon the language
of the Section, scheme of the Act, the object of the
Legislature and its intent. [Para 32] [259-G; 260-A-C]
Black's Law Dictionary (Eighth Edition) page 1001 -
referred to. C
2.4.5: 'Purposive construction' is certainly a cardinal
principle of interpretation. Equally true is that no rule of
interpretation should either be over-stated or over-
extended. This rule of interpretation can be applied to the D
instant case. It points to the conclusion that an
interpretation which would attain the object and purpose
of the Act has to be given precedence over any other
interpretation which may not further the cause of the
statute. The development of law is particularly liberated E
' both from literal and blinkered interpretation, though to
a limited extent. The precepts of interpretation of
contractual documents have also undergone a wide
ranged variation in the recent times. The result has been
subject to one important exception to assimilate the way F
in which such documents are interpreted by judges on
the common sense principle by which any serious
utterance would be interpreted by ordinary life. In other
words, the common sense view relating to the implication
and impact of provisions is the relevant consideration for G
interpreting a term of document so as to achieve
temporal proximity of the end result. Another similar rule
is the rule of practical interpretation. This test can be
effectuatedly applied to the provisions of a statute of the
present kind. It must be understood that an interpretation
H
226 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A which upon application of the provisions at the ground
reality, would frustrate the very law should not be
accepted against the common sense view which will
further such application. [paras 33-35) [260-D-H; 261-A-
B]
B
2.4.6. Once the court decides that it has to take a
purposive construction as opposed to textual
construction, then the legislative purpose sought to be
achieved by such an interpretation has to be kept in mind.
Keeping in view the legislative scheme and the
C provisions of the 2003 Act, it will be appropriate to adopt
the approach of purposive construction on the facts of
this case. The provisions of Section 126 of the 2003 Act
are intended to cover the cases over and above the cases
which would be specifically covered under the
D provisions of Section 135 of the 2003 Act. In other words,
the purpose sought to be achieved is to ensure stoppage
of misuse/unauthorized use of the electricity as well as
to ensure prevention of revenue loss. It is in this
background that the scope of the expression 'means' has
E to be construed. If it is held· that the expression 'means'
is exhaustive and cases of unauthorized use of electricity
are restricted to the ones stated under Explanation (b) of
Section 126 alone, then it shall defeat the very purpose
of the 2003 Act, inasmuch as the different cases of breach
F of the terms and conditions of the contract of supply,
regulations and the provisions of the 2003 Act would
escape the liability sought to be imposed upon them by
the Legislature under the provisions of Section 126 of the
2003 Act. Thus, it will not be appropriate for the courts
G to adopt such an approach. The Legislature has
intentionally omitted to use the word 'includes' and has
only used the word 'means' with an intention to explain
inter alia what an unauthorized use of electricity would
be. It must be noticed that clause (iv) of Explanation (b)
H and sub-Section (5) of Section 126 of the 2003 Act were
EXECUTIVE ENGINEER AND ANR. v. SRI 227
SEETARAM RICE MILL
both amended/substituted by the same amending Act 26 Ai
of 2007, with a purpose and object of preventing
unauthorised use of electricity not amounting to theft of
electricity within the meaning of Section 135 of the 2003
Act. This amendment, therefore, has to be given its due
meaning which will fit into the scheme of the 2003 Act and B
would achieve its object and purpose. The expression
'means' would not always be open to such a strict
construction that the terms mentioned in a definition
clause under such expression would have to be
inevitably treated as being exha.ustive. There can be a c
large number of cases and examples where even the
expression 'means' can be construed liberally and
treated to be inclusive but not completely exhaustive of
the scope of the definition, of course, depending upon
the facts of a given case and the provisions governing
0
that law. [Paras 36-38] (261-B-G; 262-A-E]
K. V. Muthu v. Angamuthu Ammal (1997) 2 SCC 53:
1996 (10) Suppl. SCR 188; Union of India v. Prabhakaran
Vijaya Kumar & Ors. (2008) 9 SCC 527: 2008 (7) SCR 673
- relied on. E
2.4.7. It cannot be stated as an absolute proposition
·of law that the expression 'means' wherever occurring in
a provision would inevitably render that provision
exhaustive and limited. This rule of interpretation is not F
without exceptions as there could be statutory provisions
whose interpretation demands somewhat liberal
construction and require inclusive construction. An
approach or an interpretation which will destroy the very
purpose and object of the enacted law has to be avoided. G
The other expressions used by the Legislature in various
sub-clauses of Explanation (b) of Section 126 of the 2003
Act are also indicative of its intent to make this provision
wider and of greater application. Expressions like 'any
artificial means', 'by a mearis not authorised by the H
228 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A licensee' etc. are terms which cannot be exhaustive even
linguistically and are likely to take within their ambit what
is not specifically stated. For example, 'any artificial
means' is a generic term and so the expression 'means'
would have to be construed generally. The expressions
B 'means', 'means and includes' and 'does not include' are
expressions of different connotation and significance.
When the Legislature has used a particular expression
out of these three, it must be given its plain meaning
while even keeping in mind that the use of other two
c expressions has not been favoured by the Legislature.
To put it simply, the Legislature has favoured non-use of
such expression as opposed to other specific
expression. In the instant case, the Explanation to
Section 126 has used the word 'means' in
contradistinction to 'does not include' and/or 'means and
0
includes'. This would lead to one obvious result that even
the Legislature did not intend to completely restrict or limit
the scope of this provision. [Paras 41-42] (265-B-E; 267-
A-C]
E Eureka Forbes Ltd. v. Allahabad Bank (2010) 6 SCC
193: 2010 (5) SCR 990 - relied on.
2.4.8. Unauthorised use of electricity cannot be
restricted to the stated clauses under the explanation but
F has to be given a wider meaning so as to cover cases of
violation of terms and conditions of supply and the
regulations and provisions of the 2003 Act governing
such supply. 'Unauthorised use of electricity' itself is an
expression which would, on its plain reading, take within
G its scope all the misuse of the electricity or even
malpractices adopted while using electricity. It is difficult
to restrict this expression and limit its application by the
categories stated in the explanation. It is indisputable %~t
the electricity supply to a consumer is restricted nd
H controlled by the terms and conditions of supP,ly, he
EXECUTIVE ENGINEER AND ANR. v. SRI 229
SEETARAM RICE MILL
regulations framed and the provisions of the 2003 Act. A
The requirement of grant of licence itself suggests that
electricity is a controlled commodity and is to be
regulated by the regulatory authorities. If a person
unauthorisedly consumes electricity, then he can
certainly be dealt with in accordance with law and B
penalties. may be imposed upon him as contemplated
under the contractual, regulatory and statutory regime.
The Orissa Electricity Regulatory Commission, in exercise
of its powers under Section 181 (2)(t), (v), (w) and (x) read
with Part VI of the 2003 Act, Orissa Electricity Reforms c
Act, 1995 and all other powers enabling it in that behalf,
made the regulations to govern distribution and supply
of electricity and procedure thereof such as system of
billing, modality of payment, the powers, functions and
applications of the distribution licensees form for supply
0
and/or suppliers and the rights and obligations of the
consumers. These were called 'Orissa Electricity
Regulatory Commission Distribution (Conditions of
Supply) Code, 2004 ('Conditions of Supply) vide
notification dated 21st May, 2004. This Agreement was E
undisputedly executed between the parties. Clause (2) of
the Agreement deals with Conditions of Supply. It stated
that consumer had obtained and perused a copy of the
Grid Corporation of Orissa Ltd. (General Conditions of
.Supply) Regulations, 1995, understood its content and
undertook to observe and abide by all the terms and F
conditions stipulated therein to the extent they are
applicable to him. The respondent was a consumer under
the 'medium industry category'. [Para 43] [267-D-H; 268-
A-D]
G
2.4.9. Minimum energy charges are to be levied with
reference to 'contract demand' at the rate prescribed
under the terms and conditions. These clauses of the
Agreement clearly showed that the charges for
consumption of electricity are direct!Y.,relatable to the H
230 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A sanctioned/connected load and also the load consumed
at a given point of time if it is in excess of the sanctioned/
connected load. The respondent could consume
electricity up to 110 KVA but if the connected load
exceeded that higher limit, the category of the respondent
B itself could stand changed from 'medium industry' to
'large industry' which will be governed by a higher tariff.
Chapter VII of the Conditions of Supply classified the
consumers into various categories and heads. The
electricity could be provided for a domestic, LT Industrial,
C LT/HT Industrial, Large Industry, Heavy Industries and
Power Intensive Industries, etc. In terms of Regulation 80,
the industry would fall under LT/HT category, if it relates
to supply for industrial production with a contract
demand of 22 KVA and above but below 110 KVA.
However, it will become a 'large industry' under
D Regulation 80(10) if it relates to supply of power to an
industry with a contract demand of 110 KVA and above
but below 25,000 KVA. Once the category stands
changed because of excessive consumption of
electricity, the tariff and other conditions would stand
E automatically changed. The licensee has a right to
reclassify the consumer under Regulation 82 if it is found
that a consumer has been classified in a particular
category erroneously or the purpose of supply as
mentioned in the agreement has chang id or the
F consumption of power has exceeded the limit of that
category etc. The Conditions of Supply even places a
specific prohibition on consumption of excessive
electricity by a consumer. The cumulative reading of the
terms and conditiops of supply, the contract executed
G between the parties and the provisions of the 2003 Act
showed that consumption of electricity in excess of the
sanctioned/ connected load shall be an 'unauthorised
use' of electricity in terms of Section 126 of the 2003 Act.
This is for the reason that overdrawal of electricity
H amounts to breach of the terms and conditions of the
EXECUTIVE ENGINEER AND ANR v. SRI 231
SEETARAM RICE MILL
contract and the statutory conditions, besides such A
overdrawal being prejudicial to the public at large, as it
is likely to throw out of gear the entire supply system,
undermining its efficiency, efficacy and even increasing
voltage flur.tuations. In somewhat similar circumstances,
where the consumer had been found to be drawing B
electricity in excess of contracted load and the general
conditions of supply of electricity energy by the Board
and clause 31(f) of the same empowered the Board to
disconnect supply and even levy higher charges as per
the tariff applicable, this Court held that such higher tariff c
charges could be recovered. [Paras 44-46] [268-F-H; 269-
A-D, F-H; 270-A-C]
Bhilai Rerollers & Ors. v. M.P. Electricity Board & Ors.
(2003) 7 SCC 185: 2003 (2) Suppl. SCR 787; Orissa State
Electricity Board & Anr. v. IP/ Steel Ltd. & Ors. (1995) 4 SCC D
328 - relied on.
2.4.10. Certain malpractices adopted by the
consumer for consuming electricity in excess of the
contracted load could squarely fall within the ambit and E
scope of Section 126 of the 2003 Act as it is intended to
provide safeguards against pilferage of energy and
malpractices by the consumer. The Regulations framed
in exercise of power of subordinate legislation or terms
and conditions imposed in furtherance of statutory F
provisions have been held to be valid and enforceable.
They do not offend the provisions of the 2003 Act. In fact,
the power to impose penal charges or disconnect
electricity has been held not violative even of Article 14
of the Constitution of India. The expression 'malpractices' G
does not find mention in the provisions under the 2003
Act but is a term coined by judicial pronouncements.
Thus, the expression 'malpractices' has to be construed
in its proper perspective and normally may not amount
to theft of electricity as contemplated under Section 135 H
232 SUPREME COURT REPORTS (2011) 15 (ADDL.) S.C.R.
A of the 2003 Act. Such acts/malpractices would fall within
the mischief of unauthorized use of electricity as
stipulated under Section 126 of the 2003 Act. [Para 48]
[270-G-H; 271-A-C]
B Hyderabad Vanaspathi Us. v. A.P. State Electricity Board
& Anr. (1998) 4 SCC 471 - relied on.
2.4.11. There is another angle from which the instant
case can be examined and obviously without prejudice
to the other contentions raised. It is a case where, upon
c inspection, the officers of the appellant found that
respondent was consuming 142 KVA of electricity which
was in excess of the sanctioned load. To the inspection
report, the respondent had not filed any objection before
the competent authority as contemplated under Section
0 126(3) and had approached the High Court. Limited for
the purposes of these proceedings, excess consumption
is not re~lly in dispute. The contentions raised by the
respondent were to challenge the very jurisdiction of the
concerned authorities. Consumption in excess of
E sanctioned load is violative of the terms and conditions
of the agreement as well as of the statutory benefits.
Under Explanation (b)(iv), 'unauthorised use of electricity'
means if the electricity was used for a purpose other than
for which the usage of electricity was authorised.
F Explanation (b)(iv), thus, would also cover the cases
where electricity is being consumed in excess of
sanctioned load, particularly when it amounts to change
of category and tariff. As is clear from the agreement
deed, the electric connection was given to the
respondent on a contractual stipulation that he would
G consume the electricity in excess of 22 KVA but not more
than 110 KVA. The use of the negative language in the
condition itself declares the intent of the partt.as that there
was an implied prohibition in consuming electricity in
excess of the maximum load as it would per se be also
H prejudiced. Not only this, the language of Regulations 82
EXECUTIVE ENGINEER AND ANR. v. SRI 233
SEETARAM RICE MILL
and 106 also prescribe that the consumer is not expected A
to make use of power in excess of approved contract
demand otherwise it would be change of user falling.
within the ambit of 'unauthorised use of electricity'. Again,
there is no occasion for this Court to give a restricted
meaning to the language of Explanation (b)(iv) of Section B
126. The contention that only the actual change in
purpose of use of electricity and not change of category
that would attract the provisions of Section 126 of the
2003 Act is again without any substance. The cases of
excess load of consumption would be squarely covered c
under Explanation (b)(iv) of Section 126 of the 2003 Act.
Once this factor is established, then the assessing officer
has to pass the final order of assessment in terms of
Sections 126(3) to 126(6) of the 2003 Act. [Paras 49-50)
[271-E-H; 272-A-E; 273-H; 274-A]
D
Association of Industrial Electricity Users v. State of A.P.
& Ors. (2002) 3 SCC 711: 2002 (2) SCR 273; Punjab State
Electricity Board v. Vishwa Caliber Builders Private Ltd.
(2010) 4 sec 539 - relied on.
E
Question No.2 and 3
3.1. It is a settled canon of law that the High Court
would not normally interfere in exercise of its jurisdiction
under Article 226 of the Constitution of India where
statutory alternative remedy is available. It is equally F
settled that this canon of law is not free of exceptions.
The courts, including this Court, have taken the view that
the statutory remedy, if provided under a specific law,
would impliedly oust the jurisdiction of the Civil Courts.
The High Court in exercise of its extraordinary jurisdiction G
under Article 226 of the Constitution of India can entertain
writ or appropriate proceedings despite availability of an
alternative remedy. This jurisdiction, the High Court
would exercise with some circumspection in exceptional
cases, particularly, where the cases involve a pure H
234 SUPREME COURT REPORTS [2011] 15 (ADDL) S.C.R.
A question of law or vires of an Act are challenged. [para
5~] [275-D-F]
3.2. It is somewhat difficult to state with absolute
clarity any principle governing such exercise of
jurisdiction. It always will depend upon the facts of a given
8 case. Interest of administration of justice shall be better
subserved if the cases of the present kind are heard by
the courts only where it involves primary questions of
jurisdiction or the matters which goes to the very root of
jurisdiction and where the authorities have acted beyond
C the provisions of the Act. However, it should only be for
the specialized Tribunal or the appellate authorities to
examine the merits of assessment or even factual matrix
of the case. The High Court should not decline to
exercise its jurisdiction merely for the reason that there
D is a statutory alternative remedy available even when the
case falls in the above-stated class of cases. It is a settled
principle that the Courts/Tribunal will not exercise
jurisdiction in futility. The law will not itself attempt to do
an act which would be vain, lex nil frustra facit, nor to
E enforce one which would be frivolous-lex neminem
cogit ad vana seu inutili~the law will not force any one
to do a thing vain and fruitless. In other words, if exercise
of jurisdiction by the Tribunal ex facie appears to be an
exercise of jurisdiction in futility for any of the stated
F reasons, then it will be permissible for the High Court to
interfere in exercise of its jurisdiction. Applying these
principles to the facts of the present case, it is obvious
that no statutory appeal lay against a provisional order
of assessment and the respondents herein were required
G to file objections as contemplated under Section 126 (3)
of the 2003 Act. It was only when a final order of
assessment was passed that the respondents could
prefer a statutory appeal which admittedly was not done
in the case in hand. [paras 54, 56] [276-B-F; 279-8-C]
H Whirlpool Corporation v. Registrar of Trade Marks,
EXECUTIVE ENGINEER AND ANR. v. SRI 235
SEETARAM RICE MILL
Mumbai (1998) 8 SCC 1: 1998 (2) Suppl. SCR 359; Union A
of India v. State of Haryana (2000) 10 SCC 482 - relied on.
3.3. In the instant case, the High Court did not fall in
error of jurisdiction in entertaining the writ petition but
certainly failed to finally exercise the jurisdiction within B
the prescribed limitations of law for exercise of such
jurisdiction. Keeping in view the functions and expertise
of the specialized body constituted under the Act
including the assessing officer, it would have been
proper exercise of jurisdiction, if the High Court, upon C
entertaining and deciding the writ petition on a
jurisdictional issue, would have remanded the matter to
the competent authority for its adjudication on merits and
in accordance with law. In the facts of the instant case,
the High Court should have answered the question of law
relating to lack of jurisdiction and exercise of jurisdiction D
in futility without travelling into and determining the
validity of the demand which squarely fell within the
tfomain of the specialized authority. The High Court
should have remanded the case to the assessing officer
with a direction to the respondent to file its objections E
including non-applicability of" the tariff before the
assessing authority and for determination in accordance
with law. [Para 57] [279-D-G]
Conclusions: F
1. Wherever the consumer commits the breach of the
terms of the Agreement, Regulations and the
provisions of the Act by consuming electricity in
excess of the sanctioned and connected load, such
consumer would be 'in blame and under liability' G
within the ambit and scope of Section 126 of the 2003
Act.
2. The expression 'unauthorized use of electricity
means' as appearing in Section 126 of the 2003 Act H
236 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A is an expression of wider connotation and has to be
construed purposively in contrast to contextual
interpretation while keeping in mind the object and
purpose of the Act. The cases of excess load
consumption than the connected load inter a/ia
B would fall under Explanation (b)(iv) to Section 126 of
the 2003 Act, besides it being in violation of
Regulations 82 and 106 of the Regulations and terms
of the Agreement.
3. In view of the language of Section 127 of the 2003
c Act, only a final order of assessment passed under
Section 126(3) is an order appealable under Section
127 and a notice-cum-provisional assessment made
under Section 126(2) is not appealable. Thus, the
High Court should normally decline to interfere in a
D final order of assessment passed by the assessing
officer in terms of Section 126(3) of the 2003 Act in
exercise of its jurisdiction under Article 226 of the
Constitution of India.
E 4. The High Court did not commit any error of
jurisdiction in entertaining the writ petition against
the order raising a jurisdictional challenge to the
notice/provisional assessment order dated 25th July,
2009. However, the High Court transgressed its
F jurisdictional limitations while travelling into the
exclusive domain of the Assessing Officer relating to
passing of an order of assessment and determining
factual controversy of the case.
· 5. The High Court having dealt with the jurisdictional
G issue, the appropriate course of action would have
been to remand the matter to the Assessing Authority
by directing the consumer to file his objections, if
any, as contemplated under Section 126(3) and
require the Authority to pass a final order of
H assessment as contemplated under Section 126(5) of
EXECUTIVE ENGINEER AND ANR. v. SRI 237
SEETARAM RICE MILL
the 2003 Act in accordance with law. [Para 58] [279- A
H; 280-A-H; 281-A-C]
4. The judgment of the High Court is set aside and
the matter is remanded to the Assessing Officer to pass
a final order of assessment expeditiously, after providing B
opportunity to the respondent herein to file objections, if
any, to the provisional assessment order, as
contemplated under Section 126(3) of the 2003 Act. [para
59] [281-D]
Case Law Reference: c
1979 (3) SCR 472 relied on Para 12
1966 SCR 493 relied on Para 20
(2006) 3 sec 391 relied on Para 29 D
1996 (10) Suppl. SCR 188 relied on Para 38
2008 (7) SCR 673 relied on Para 39
2010 (5) SCR 990 referred to Para 41
E
2003 (2) Suppl. SCR 787 referred to Para 47
(1995) 4 sec 328 referred to Para 47
(1998) 4 sec 471 referred to Para 48
2002 (2) SCR 273 referred to Para 49 F
(201 O) 4 sec 539 referred to Para 49
1998 (2) Suppl. SCR 359 referred to Para 54
(2000) 1o sec 482 referred to Para 55 G
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
8859 of 2011.
From the Judgment & Order dated 25.10.2010 of the High
Court of Orissa at Cuttack in WP No. 12175 of 2009. H
238 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A Suresh Chandra Tripathy for the Appellants.
Huzefa Ahmadi, Farrukh Rasheed, M. Paikray, V.N.
Raghupathy for the Respondent.
The Judgment of the Court was delivered by
B
SWATANTER KUMAR, J. 1. Leave granted.
2. Over a period of time, it was felt that the performance
of the State Electricity Boards had deteriorated on account of
C various factors. Amongst others, the inability on the part of the
State Electricity Boards to take decisions on tariffs in a
professional and independent manner was one of the main
drawbacks in their functioning. Cross-subsidies had reached
unsustainable levels. To address this issue and to provide for
distancing of governments from determination of tariffs, the
D Electricity Regulatory Commissions Act, 1998 (hereinafter, 'the
1998 Act') was enacted in addition to the existing statutes like
Indian Electricity Act, 1910 (hereinafter, 'the 1910 Act') and the
Electricity (Supply) Act, 1948 (hereinafter, 'the 1948 Act'). For
a considerable time, these three legislations remained in force,
E governing the electricity supply industry in India. The Boards
created by the 1948 Act and the bodies created under the 1998
Act, as well as the State Governments, were provided distinct
roles under these statutes. There was still overlapping of duties
and some uncertainty with regard to exercise of power under
F these Acts. To address the issues like deterioration in
performance of the Boards and the difficulties in achieving
efficient discharge of functions, a better, professional and
regulatory regime was introduced under the Electricity Bill,
2001, with the policy of encouraging private sector participation
G in generation, transmission and distribution of electricity and
with the objective of distancing regulatory responsibilities from
the Government by transferring the same to the Regulatory
Commissions. The need for harmonizing and rationalizing the
provisions of the earlier statutes was met by creating a new,
EXECUTIVE ENGINEER AND ANR. v. SRI 239
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
self-contained and comprehensive legislation. Another object A
was to bring unity in legislation and eliminate the need for the
respective State Governments to pass any reform Act of their
own. This Bill had progressive features and strived to strike the
right balance between the economic profitability and public
purpose given the current realities of the power sector in India. B
This Bill was put to great discussion and then emerged the
Electricity Act, 2003 (for short, 'the 2003 Act'). The 2003 Act
had notably provided for private sector participation, private
transmission licences for rural and remote areas, stand alone
systems for generation and distribution, the constitution of an c
Appellate Tribunal, more regulatory powers for the State
Electricity Regulation Commission and provisions relating to
theft of electricity. The additional provisions were introduced in
the 2003 Act in relation to misuse of power and punishment of
malpractices such as over-consumption of sanctioned electric 0
load which are not covered by the provisions relating to theft;
all of which had significant bearing upon the revenue focus
intended by the Legislature. This is the legislative history and
objects and reasons for enacting the 2003 Act.
3. To ensure better regulatory, supervisory and revenue E
recovery system, as expressed in the objects and reasons of
the 2003 Act, there was defipite concerted effort in preventing
unauthorized use of electricity on the one hand and theft of
electricity on the other. The present case falls in the former.
According to the appellant, there was breach of the terms and F
conditions of the Standard Agreement Form for Supply of
Electrical Energy by the Grid Corporation of Orissa Ltd.
(hereinafter, 'the Agreement') as the consumer (respondent
herein) had consumed electricity in excess of the contracted
~~- G
FACTS
4. We may briefly refer to the facts giving rise to the present
appeal. Respondent herein, a partnership firm, claims to be a
H
240 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A small scale industrial unit engaged in the production of rice. For
carrying on the -;aid business, it had obtained electric supply
under the Agreement. Between the present appellant No.1 and
the respondent the Agreement dated 9th December, 1997 was
executed for supply of power to the respondent. Keeping in view
B the contracted load, the respondent was classified as 'medium
industry category'. This category deals with the contract demand
of 99 KVA and above but below 110 KVA. According to the
respondent, since the day of connection of power supply, the
meter and all other associated equipments had been inspected
c by the appellants. On 10th June, 2009, the Executive Engineer,
Jeypore Electrical Division and SDO, Electrical MRT Division,
Jeypore inspected the business premises of the respondent's
unit and dump was conducted. These officers issued a dump
report by noticing as follows:
D "Dump of the Meter taken. Calibration of meter done and
error found within limit. If any abnormality detected in Dump,
it will be intimated later on."
5. It is the case of the respondent that no intimation was
E given to it as to finding of defects if any, in dump. On 25th July,
2009, provisional assessment order bearing No.854 was
issued by the appellants to the respondent. Intimation bearing
No.853 had also been issued on the same day which informed
the respondent that there was unauthorized use of electricity
F falling squarely within the ambit of provisions of Section 126
of the 2003 Act. In the dump report dated 10th June, 2009, it
was stated that there was unauthorized use of electricity and
Maximum Demand (hereinafter MD) had been consumed up
to 142 KVA. On this basis, the appellant passed the order of
G provisional assessment by taking the contracted demand as
that applicable to large industry. The demand was raised,
assessing the consumer for the period from June 2008 to
August 2009 for a sum of Rs.7,77,300/-. This was computed
for 15 months at the rate of Rs.200 per KVA (i.e., tariff for large
H industry) multiplied by two times, aggregating to the claimed
EXECUTIVE ENGINEER AND ANR. v. SRI 241
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
amount. Vide the provisional assessment order dated 25th July, A
2009, assessment was made under Section 126(1) of the 2003
Act for unauthorized use of electricity, the respondent was
required to file objections, if any, and to also pay the amount.
The relevant part of the said provisional assessment order
reads as under : B
"And Whereas you are entitled to file objections against
the aforesaid provisional assessment order under Section
126(3) of Electricity Act, 2003, within 30 days from receipt
hereof and further entitled to appear before the
undersigned for an opportunity of being heard on C
25.08.2009 during working hours from 11.00 AM to 5.00
PM.
And Whereas you are further entitled u/s 126(4) to deposit
the aforesaid amount within 7 days and upon such deposit D
being made within 7 days, you shall not be subject to any
further liability or any action by any authority whatsoever.
And Whereas if you fail to file the objection within 30 days
from receipt hereof, the undersigned shall presume that E
you have no objection to the provisional assessment and
the undersigned shall proceed to pass final order u/s
126(3) on assessment of electricity charges payable by
you.
And Whereas, if you fail to appear before the undersigned F
at the aforesaid date and time after filing objections, if any,
the undersigned shall proceed to pass the final order under
section 126(3), based on the objection filed by you and
evidence available on record."
G
6. The respondent did not file its objections/reply but
challenged the said provisional assessment order and the
intimation of unauthorized use before the High Court of Orissa,
Cuttack by filing writ petition No.WP(C) No.12175 of 2009 on
the grounds of lack of authority and jurisdiction on the part of H
242 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R.
A the Executive Engineer to frame the provisional assessment by
alleging unauthorized use of electricity since 4th June, 2008. It
was also contended that no inspection had been conducted in
the business premises till date of dump, i.e., 10th June, 2009
when unauthorized use of electricity was found. The respondent
B also challenged the maintainability and sustainability of the
order of provisional assessment in calculating the dump
charges for a period of 15 months from June 2008 to August
2009 on the basis of dump charges relating to large industry
while the respondent was classified as medium scale industry.
C It was also the contention raised by the respondent before the
High Court that the provisions of Section 126 of the 2003 Act
were not attracted in the present case at all. This claim of the
respondent was contested by the appellants, as according to
them, unauthorized use of electricity as defined under Section
D 126 will come into play as per clause (b) of the Explanation
appended to Section 126 of the 2003 Act. The dump report
dated 10th June, 2009 and the intimation dated 25th July, 2009
had been sent showing overdrawal of MD where, according to
the appellants, the respondent had consumed electricity 'by
means unauthorized by the licencee (overdrawal of maximum
E demand)' and thereby breached the Agreement and, therefore,
the provisional assessment order and the intimation were fully
justified.
7. The High Court, vide impugned judgment, accepted the
F case of the re:;pondent and held that the words 'unauthorized
use of electricity' and 'means' as provided in Explanation to
Section 126 of the 2003 Act were exhaustive. Overdrawal of
MD would not fall under the scope of 'unauthorized use of
electricity' as defined under the 2003 Act, and the appellants
G had no jurisdiction to issue the intimation in question and pass
the assessment order in terms of Section 126 of the 2003 Act.
Aggrieved by the judgment of the High Court, the appellants
have filed the present appeal by way of a special leave petition
before this Court.
H
EXECUTIVE ENGINEER AND ANR. v. SRI 243
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
Questions for Determination : A
1. Wherever the consumer consumes electricity in
excess of the maximum of the contracted load,
would the provisions of Section 126 of the 2003 Act
be attracted on its true scope and interpretation? 8
2. Whether the High Court, in the facts and
circumstances of the case, was justified in ·
interfering with the provisional order of assessmenV
show cause notice dated 25th July, 2009, in
exercise of its jurisdiction under Article 226 of the C
Constitution of India?
3. Was the writ petition before the High Court under
Article 226 of the Constitution of India not
maintainable because of a statutory alternative D
remedy being available under Section 127 of the
2003 Act?
Discussion on Merits
1. Wherever the consumer consumes electricity in E
excess of the maximum of the connected load,
would the provisions of Section 126 of the 2003 Act
be attracted on its true scope and interpretation?
8. On the simple analysis of the facts as pleaded by the F
parties, it is contended on behalf of the respondent that the
provisions of Section 126 of the 2003 Act are not attracted and
no liability could be imposed upon them by the authorities in
exercise of their power under that provision. Even if the case
advanced by the appellants against the respondent without G
prejudice and for the sake of argument is admitted, even then,
at best, the demand could be raised under Regulation 82 of
the Orissa Electricity Regulatory Commission Distribution
(Condition of Supply) Regulations, 2004 (for short, 'the
R0gulations'). But recourse to the provisions of Section 126 H
244 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A was impermissible in law. The contention is that the case of a
consumer consuming the electricity in excess of maximum and
the installed load does not fall within the mischief covered under
Section 126 of the 2003 Act. To put it plainly, the argument is
that the appellants lack inherent authority to raise such demand
B with reference to the present case on facts and law both.
9. On the contra, submission on behalf of the appellants
is that the case of excessive consumption of power beyond the
sanctioned load would be a case falling within the ambit of
C Section 126 of the 2003 Act. Section 126 of the 2003 Act is
incapable of an interpretation which would render the said
provision otiose in cases which do not specifically fall under
Section 135 of the 2003 Act. In order to answer these
contentions more precisely, we find it appropriate to examin~'
the question framed above, under the following sub-headings:
D
(a) Interpretation;
(b) Distinction between Sections 126 and 135 of the
2003 Act;
E (c) The ambit and scope of Section 126 with reference
to the construction of the words 'unauthorised use'
and 'means'; and
(d) Effect and impact of change in applicz 1ility of tariff
F upon the power of assessment in accordance with
the provisions of the 2003 Act and the relevant
Regulations in the facts of the case.
1\a) Interpretation
G 10. First and foremost, we have to examine how provisions
like Section 126 of the 2003 Act should be construed. From
the objects and reasons stated by us in the beginning of this
judgment, it is clear that 'revenue focus' was one of the principal
considerations that weighed with the Legislature while enacting
H this law. The regulatory regime under the 2003 Act empowers
EXECUTIVE ENGINEER AND ANR. v. SRI 245
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
the Commission to frame the tariff, which shall be the very basis A
for raising a demand upon a consumer, depending upon the
category to which such consumer belongs and the purpose for
which the power is sanctioned to such consumer. We are not
prepared to accept the contention on behalf of the respondent
that the provisions of Section 126 of the 2003 Act have to be B
given a strict and textual construction to the extent that they have
to be read exhaustively in absolute terms. This is a legislation
which establishes a regulatory regime for the generation and
distribution of power, as well as deals with serious fiscal
repercussions of this entire regime. In our considered view, the c
two maxims which should be applied for interpretation of such
statutes are ex visceribus actus (construction of the act as a
whole) and ut res magis valeat quam pereat (it is better to
validate a thing than to invalidate it). It is a settled cannon of
interpretative jurisprudence that the statute should be read as
0
a whole. In other words, its different provisions may have to be
construed together to make consistent construction of the whole
statute relating to the subject matter. A construction which will
improve the workability of the statute, to be more effective and
purposive, should be preferred to any other interpretation which E
may lead to undesirable results.
11. It is true that fiscal and penal laws are normally
construed strictly but this rule is not free of exceptions. In given
situations, this Court may, even in relation to penal statutes,
decide that any njlrrow and pedantic, literal and lexical F
construction may not be given effect to, as the law would have
to be interpreted having regard to the subject matter of the
offence and the object that the law seeks to achieve. The
provisions of Section 126, read with Section 127 of the 2003
Act, in fact, becomes a code in itself. Right from the initiation G
of the proceedings by conducting an inspection, to the right to
file an appeal before the appellate authority, all matters are
squarely covered under these provisions. It specifically provides
the method of computation of the amount that a consumer would
be liable to pay for excessive consumption of the electricity and H
..
246 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R.
A for the manner of conducting assessment proceedings. In other
words, Section 126 of the 2003 Act has a purpose to achieve,
i.e., to put an implied restriction on such unauthorized
consumption of electricity. The provisions of the 2003 Act,
applicable regulations and the Agreement executed between
B the parties at the time of sanction of the load prohibit
consumption of electricity in excess of maximum sanctioned/
installed load. In the event of default, it also provides for the
consequences that a consumer is likely to face. It embodies
complete process for assessment, determination and passing
c of a demand order. This defined legislative purpose cannot be
permitted to be frustrated by interpreting a provision in a
manner not intended in law. This Court would have to apply the
principle of purposive interpretation in preference to textual
interpretation of the provisions of Section 126 of the 2003 Act.
We shall shortly discuss the meaning and scope of the
0
expressions used by the Legislature under these provisions. At
this stage, suffice it to note that this Court would prefer to adopt
purposive interpretation so as to ensure attainment of the object
and purpose of the 2003 Act, particularly, of the provisions of
Section 126 in question. We may usefully refer to the judgment
E of this Court in the case of Bairam Kt mawat v. Union of India
& Ors. [(2003) 7 SCC 628] wherein this Court discussed
various tenets of interpretation and unambiguously held that
these principles could be applied even to the interpretation of
a fiscal or a penal statute. This Court held as under :
F
"20. Contextual reading is a well-known proposition of
interpretation of statute. The clauses of a statute should be
construed with reference to the context vis-a-vis the other
provisions so as to make a consistent enactment of the
G whole statute relating to the subject-matter. The rule of 'ex
visceribus actus' should be resorted to in a situation of this
nature.
21. In State of West Bengal v. Union of India [1964] 1 SCR
371], the learned Chief Justice stated the law thus:
H
..
EXECUTIVE ENGINEER AND ANR. v. SRI 247
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
"The Court must ascertain the intention of the A
Legislature by directing its attention not merely to
the clauses to be construed but to the entire statute;
it must compare the clause with the other parts of
the law, and the setting in which the clause to be
interpreted occurs." B
22. The said principle has been reiterated in R. S.
Raghunath v. State of Kamataka and Anr. [AIR 1992 SC
81).
23. Furthermore, even in relation to a penal statute any C
narrow and pedantic, literal and lexical construction may
not always be given effect to. The law would have to be
interpreted having regard to the subject matter of the
offence and the object of the law it seeks to achieve. The
purpose of the law is not to allow the offender to sneak out D
of the meshes of law. Criminal Jurisprudence does not say
so.
xxx xxx xxx
25. A statute must be construed as a workable instrument. E
Ut res magis valeat quam pereat is a well-known principle
.:if law. In Tinsukhia Electric Supply Co. Ltd. v. State of
Assam [AIR 1990 SC 123], this Court stated the law thus
F
"118. The courts strongly lean against any construction,
which tends to reduce a statute to a futility. The provision
of a statute must be so construed as to make it effective
and operative, on the principle "ut res magis valeat quam
perear. It is, no doubt, true that if a statute is absolutely G
vague and its language wholly intractable and absolutely
meaningless, the statute could be declared void for
vagueness. This is not in judicial review by testing the law
for arbitrariness or unreasonableness under Article 14; but
what a court of construction, dealing with the language of H
248 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A a statute, does in order to ascertain from, and accord to,
the statute the meaning and purpose which the legislature
intended for it. In Manchester Ship Canal Co. v.
Manchester Racecourse Co. (1900) 2 Ch 352, Farwell J.
said : (pp. 360-61)
B
"Unless the words were so absolutely senseless
that I could do nothing at all with them, I should be
bound to find some meaning and not to declare
them void for uncertainty."
c In Fawcett Properties Ltd. v. Buckingham County Council
[(1960) 3 All ER 503] Lord Denning approving the dictum
of Farwell, J. said :
"But when a Statute has some meaning, even
D though it is obscure, or several meanings, even
though it is little to choose between them, the courts
have to say what meaning the statute to bear rather
than reject it as a nullity."
It is, therefore, the court's duty to make what it can of the
E statute, knowing that the statutes are meant to be operative
and not inept and that nothing short of impossibility should
allow a court to declare a statute unworkable. In Whitney
v. Inland Revenue Commissioners [1928 AC 37] Lord
Dunedin said :
F
"A statute is designed to be workable, and the
interpretation thereof by a court should be to secure
that object, unless crucial omission or clear
direction makes that end unattainable."
G xxx xxx xxx
27. The Courts will therefore reject that const. uction which
will defeat the plain intention of the Legislature even though
there may be some inexactitude in the language used.
H [See Salmon v. Duncombe (1886) 11 AC 827]. Reducing
EXECUTIVE ENGINEER AND ANR. v. SRI 249
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
the legislation futility shall be avoided and in a case where A
the intention of the Legislature cannot be given effect to,
the Courts would accept the bolder construction for the
purpose of bringing about an effective result. The Courts,
when rule of purposive construction is gaining momentum,
should be very reluctant to hold that the Parliament has B
achieved nothing by the language it used when it is
tolerably plain what it seeks to achieve. [See BBC
Enterprises v. Hi-Tech Xtravision Ltd., (1990) 2 All ER
118]."
12. Further, in the case of Superintendent and C
Remembrancer of Legal Affairs to Government of West
Bengal v. Abani Maity [(1979) 4 SCC 85], this Court held as
under:
"Exposition ex visceribus actus is a long recognised rule D
of construction. Words in a statute often take their
meaning from the context of the statute as a whole. They
are therefore, not to be construed in isolation. For instance,
the use of the word "may" would normally indicate that the
provision was not mandatory. But in the context of a E
particular statute, this word may connote a legislative
imperative, particularly when its construction in a
permissive sense would relegate it to the unenviable
position, as it were, "of an ineffectual angel beating its
wings in a luminous void in vain". If the choice is between F
two interpretations", said Viscount Simon L. C. in Nokes
v. Doncaster Amalgamated Collieries, Ltd. [(1940) A.C.
1014] :
'the narrower of which would fail to achieve the
manifest purpose of the legislation we should avoid G
a construction which would reduce the legislation to
futility and should rather accept the bolder
construction based on the view that Parliament
would legislate only for the purpose of bringing
about an effective result'." H
250 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R
A 13. The relevancy of objects and reasons for enacting an
Act is a relevant consideration for the court while applying
various principles of interpretation of statutes. Normally, the
court would not go behind these objects and reasons of the Act.
The discussion of a Standing Committee to a Bill may not be
B a very appropriate precept for tracing the legislative intent but
in given circumstances, it may be of some use to notice some
discussion on the legislative intent that is reflected in the
substantive provisions of the Act itself. The Standing Committee
on Energy, 2001, in its discussion said, 'the Committee feel
c that there is a need to provide safeguards to check the misuse
of these powers by unscrupulous elements'. The provisions of
Section 126 of the 2003 Act are self-explanatory, they are
intended to cover situations other than the situations specifically
covered under Section 135 of the 2003 Act. This would further
0 be a reason for this Court to adopt an interpretation which would
help in attaining the legislative intent.
14. By applying these principles to the provisions of this
case requiring judicial interpretation, we find no difficulty in
stating that the provisions of Section 126 of the 2003 Act
E should be read with other provisions, the regulations in force
and they should be so interpreted as to achieve the aim of
workability of the enactment as a whole while giving it a
purposive interpretation in preference to textual interpretation.
F 1(b) Distinction between Sections 126 and 135 of the
2003 Act
15. Upon their plain reading, the mark differences in the
contents of Sections 126 and 135 of the 2003 Act are obvious.
They are distinct and different provisions which operate in
G different fields and have no common premise in law. We have
already noticed that Sections 126 and 127 of the 2003 Act read
together constitute a complete code in themselves covering all
relevant considerations for passing of an order of assessment
in cases which do not fall under Section 135 of the 2003 Act.
H Section 135 of the 2003 Act falls under Part XIV relating to
EXECUTIVE ENGINEER AND ANR. v. SRI 251
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
'offences and penalties' and title of the Section is 'theft of A
electricity'. The Section opens with the words 'whoever,
dishonestly' does any or all of the acts specified under clauses
(a) to (e) of Sub-section (1) of Section 135 of the 2003 Act so
as to abstract or consume or use electricity shall be punishable
for imprisonment for a term which may extend to three years B
or with fine or with tioth. Besides imposition of punishment as
specified under these provisions or the proviso thereto, Sub-
section (1A) of Section 135 of the 2003 Act provides that
without prejudice to the provisions of the 2003 Act, the licensee
or supplier, as the case may be, through officer of rank c
authorized in this behalf by the appropriate commission, may
immediately disconnect the supply of electricity and even take
other measures enumerated under Sub-sections (2) to (4) of
the said Section. The fine which may be imposed under Section
135 of the 2003 Act is directly proportional to the number of
0
convictions and is also dependent on the extent of load
abstracted. In contradistinction to these provisions, Section 126
of the 2003 Act would be applicable to the cases where there
is no theft of electricity but the electricity is being consumed in
violation of the terms and conditions of supply leading to
malpractices which may squarely fall within the expression E
'unauthorized use of electricity'. This assessment/proceedings
would commence with the inspection of the premises by an
assessing officer and recording of a finding that such consumer
is indulging in an 'authorized use of electricity'. Then the
assessing officer shall provisionally assess, to the best of his F
judgment, the electricity charges payable by such consumer, as
well as pass a provisional assessment order in terms of
Section 126(2) of the 2003 Act. The officer is also under
obligation to serve a notice in terms of Section 126(3) of the
2003 Act upon any such consumer requiring him to file his G
objections, if any, against the provisional assessment before
a final order of assessment is passed within thirty days from
the date of service of such order of provisional assessment.
Thereafter, any person served with the order of provisional
assessment may accept such assessment and deposit the H
252 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A amount with the licensee within seven days of service of such
provisional assessment order upon him or prefer an appeal
against the resultant final order under Section 127 of the 2003
Act. The order of assessment under Section 126 and the period
for which such order would be passed has to be in terms of
B Sub-sections (5) and (6) of Section 126 of the 2003 Act. The
Explanation to Section 126 is of some significance, which we
shall deal with shortly hereinafter. Section 126 of the 2003 Act
falls under Chapter XII and relates to investigation and
enforcement and empowers the assessing officer to pass an
c order of assessment.
16. Section 135 of the 2003 Act deals with an offence of
theft of electricity and the penalty that can be imposed for such
theft. This squarely falls within the dimensions of Criminal
Jurisprudence and mens rea is one of the relevant factors for
D finding a case of theft. On the contrary, Section 126 of the 2003
Act does not speak of any criminal intendment and is primarily
an action and remedy available under the civil law. It does not
have features or elements which are traceable to the criminal
concept of mens rea.
E
17. Thus, it would be clear that the expression
'unauthorized use of electricity' under Section 126 of the 2003
Act deals with cases of unauthorized use, even in absence of
intention. These cases would certainly be different from cases
F where there is dishonest abstraction of electricity by any of the
methods enlisted under Section 135 of the 2003 Act. A clear
example would be, where a consumer has used excessive load
as against the installed load simpliciter and there is violation
of the terms and conditions of supply, then, the case would fall
G under Section 126 of the 2003 Act. On the other hand, where
a consumer, by any of the means and methods as specified
under Sections 135(a) to 135(e) of the 2003 Act, has abstracted
energy with dishonest intention and without authorization, like
providing for a direct connection bypassing the installed meter,
the case would fall under Section 135 of the Act. Therefore,
H
EXECUTIVE ENGINEER AND ANR. v. SRI 253
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
there is a clear distinction between the cases that would fall A
under Section 126 of the 2003 Act on the one hand and Section
135 of the 2003 Act on the other. There is no commonality
between them in law. They operate in different and distinct
fields. The assessing officer has been vested with the powers
to pass provisional and final order of assessment in cases of B
unauthorized use of electricity and cases of consumption of
electricity beyond contracted load will squarely fall under such
power. The legislative intention is to cover the cases of
malpractices and unauthorized use of electricity and then theft
which is governed by the provisions of Section 135 of the 2003 c
Act.
18. Section 135 of the 2003 Act significantly uses the
words 'whoever, dishonestly' does any of the listed actions so
as to abstract or consume electricity would be punished in
accordance with the provisions of the 2003 Act. 'Dishonesty' D
is a state of mind which has to be shown to exist before a
person can be punished under the provisions of that Section.
19. The word 'dishonest' in normal parlance means
'wanting in honesty'. A person can be said to have 'dishonest E
intention' if in taking the property it is his intention to cause gain,
by unlawful means, of the property to which the person so
gaining is not legally entitled or to cause loss, by wrongful
means, of property to which the person so losing is legally
entitled. 'Dishonestly' is an expression which has been F
explained by the Courts in terms of Section 24 of the Indian
Penal Code, 1860 as 'whoever does anything with the intention
of causing wrongful gain to one person or wrongful loss to
another person is said to do that thing dishonestly'. [The Law
Lexicon (2nd Edn. 1997) by P. Ramanatha Aiyar] G
20. This Court in the case of Dr. S. Dutt v. State of U.P.
[AIR 1966 SC 523] stated that a person who does anything with
the intention to cause wrongful gain to one person or wrongful
loss to another is said to do that dishonestly.
H
254 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A 21. Collins English Dictionary explains the word
'dishonest' as 'not honest or fair; deceiving or fraudulent'.
Black's Law Dictionary (Eighth Edition) explains the expression
'dishonest act' as a fraudulent act, 'fraudulent act' being a
conduct involving bad faith, dishonesty, a lack of integrity or
B moral turpitude.
22. All these explanations clearly show that dishonesty is
a state of mind where a person does an act with an intent to
deceive the other, acts fraudulently andwith a deceptive mind,
to cause wrongful loss to the other. The act has to be of the
C type stated under Sub-sections (1)(a) to (1)(e) of Section 135
of the 2003 Act. If these acts are committed and that state of
mind, mens rea, exists, the person shall be liable to punishment
and payment of penalty as contemplated under the provisions
of the 2003 Act. In contradistinction to this, the intention is not
D the foundation for invoking powers of the competent authority
and passing of an order of assessment under Section 126 of
the 2003 Act.
1(c) The ambit and scope of Section 126 with
E reference to the construction of the words
'unauthorised use' and 'means'
23. Having dealt with the principle of interpretation of these
provisions and the distinction between Sections 126 and 135
of the 2003 Act, we shall now discuss the ambit and scope of
F Section 126. The provisions of Section 126 contemplate the
following steps to be taken :
(i) An assessing officer is to conduct inspection of a
place or premises and the equipments, gadgets,
G machines, devices found connected or used in such
place.
(ii) The formation of a conclusion that such person has
indulged in unauthorized use of electricity.
H (iii) The assessing officer to provisionally assess, to the
EXECUTIVE ENGINEER AND ANR. v. SRI 255
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
best of his judgment, the electricity charges payable A
by such person.
(iv) The order of provisional assessment to be served
upon the person concerned in the manner
prescribed, giving him an opportunity to file 8
objections, if any, against the provisional
assessment.
(v) The assessing officer has to afford a reasonable
opportunity of being heard to such person and pass
a final order of assessment within 30 days from the C
date of service of such order of provisional
assessment.
(vi) The person, upon whom the provisional order of
assessment is served, is at liberty to pay the said D
amount within seven days of the receipt of such
order and where he files such objections, final order
of assessment shall be passed, against which such
person has a right of appeal under Section 127 of
the 2003 Act within the prescribed period of E
limitation.
Assessment and Computation
24. Wherever the assessing officer arrives at the
conclusion that unauthorized use of electricity has taken place, F
the assessment shall be made for the entire period during which
such unauthorized use of electricity has taken place and if such
period cannot be ascertained, it shall be limited to a period of
12 months immediately preceding the date of inspection and
the assessment shall be made at the rate equal to twice the G
tariff applicable for the relevant category of service specified
under these provisions. This computation has to be taken in
terms of Sections 126(5), 126(6) and 127 of the 2003 Act. The
complete procedure is provided under these sections. Right
from the initiation of the proceedings till preferring of an appeal H
256 SUPREME COURT REPORTS (2011) 15 (ADDL.) S.C.R.
A against the final order of assessment and termination thereof,
as such, it is a complete code in itself. We have already
indicated that the provisions of Section 126 do not attract the
principles of Criminal Jurisprudence including mens rea. These
provisions primarily relate to unauthorized use of electricity and
B the charges which would be payable in terms thereof.
25. To determine the controversy in the present case, it will
be essential to examine the implication of the expression
'unauthorised use of electricity' as contained in Explanation (b)
of Section 126 of the 2003 Act.
c
26. In order to explain these expressions, it will be
necessary for us to refer to certain other provisions and the
Regulations as well. These expressions have to be understood
and given meaning with reference to their background and are
D incapable of being fairly understood, if examined in isolation.
It is always appropriate to examine the words of a statute in
their correct perspective and with reference to relevant statutory
provisions.
E 27. The expression 'unauthorized use of electricity' on its
plain reading means use of electricity in a manner not authorized
by the licensee of the Board. 'Authorization' refers to the
permission of the licensee to use of electricity', subject to the
terms and conditions for such use and the law governing the
subject. To put it more aptly, the supply of electricity to a
F consumer is always subject to the provisions of the 2003 Act,
State Acts. Regulations framed thereunder and the terms and
conditions of supply in the form of a contract or otherwise.
Generally, when electricity is consumed in violation of any or
all of these, it would be understood as 'unauthorized use of
G electricity'. But this general view will have to be examined in
the light of the fact that the legislature has opted to explain this
term for the purposes of Section 126 of the 2003 Act. The said
provision, along with the Explanation, reads as under: -
H "126. Assessment.- (1} If on an inspection of any place
EXECUTIVE ENGINEER AND ANR. v. SRI 257
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
or premises or after inspection of the equipments, A
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 unauthorised use of electricity, he shall
provisionally assess to the best of his judgment the B
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 C
of the place or premises in such manner as may be
prescribed.
(3) The person, on whom an order has been served under
sub-section (2), shall be entitled to file objections, if any,
against the provisional assessment before the assessing D
officer, who shall, after affording a reasonable opportunity
of hearing to such person, pass a final order of assessment
within thirty days from the date of service of such order of
provisional assessment, of the electricity charges payable
by such person. E
(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:
F
(5) If the assessing officer reaches to the conclusion that
unauthorised use of electricity has taken place, the
assessment shall be made for the entire period during
which such unauthorised use of electricity has taken place
and if, however, the period during which such unauthorised G
use of electricity has taken place cannot be ascertained,
such period shall be limited to a period of twelve months
immediately preceding the date of inspection.;
'
(6) The assessment under this section shall be made at a H
258 SUPREME QOURT REPORTS (2011) 15 (ADDL.) S.C.R.
A rate equal to twice 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
B 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-
c (i) by any artificial means; or
(ii) by a means not authorised by the concerned person
or authority or licensee; or
o (iii) through a tampered meter; or
(iv) for the purpose other than for which the usage of
electricity was Authorized; or
(v) for the premises or areas other than those for which the
E supply of electricity was authorised."
28. The 'unauthorized use of electricity' means the usage
of electricity by the means and for the reasons stated in sub-
clauses (i) to (v) of clause (b) of Explanation to Section 126 of
F the 2003 Act. Some of the illustratively stated circumstances
of 'unauthorised use' in the section cannot be construed as
exhaustive. The 'unauthorized use of electricity' would mean
what is stated under that Explanation, as well as such other
unauthorized user, which is squarely in violation of the above-
G mentioned statutory or contractual provisions.
29. The Black's Law Dictionary (Eighth Edition) defines
'unauthorized' as 'done without the authority, made without
actual, implied or apparent authority'. 'Unauthorized' is a
concept well-recognized under different statutes, for example,
H
'
EXECUTIVE ENGINEER AND ANR. v. SRI 259
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
under Section 31A of the Delhi Development Act, 1957 (the A
'ODA Act') the authority has the power to seal the 'unauthorized'
development, if the misuser of the premises would come within
the ambit of unauthorized development. But if such misuse
does not come within the ambit of 'unauthorized development',
such power is not available to the authority. Simplicitor misuse, B
therefore; may not fall within the. ambit of unauthorized
de\,elopment under the provisions of the ODA Act. In M.C.
MJ/ita v. Union of India [(2006) 3 SCC 391], this Court held
that· jf the misuse was in violation of the permission, approval
or sanction or in contravention of any conditions, subject to C
which the said permission/approval has been granted in terms
of Section 30 of the DOA Act, then it will be 'unauthorized use'.
30. We have primarily referred to this.case to support the
reasoning that 'unauthorized development' is one which is
contrary to a master plan or zonal d.evelopment plan as was D
the case under the ODA Act. Just as the right to develop a
property is controlled by the restrictions of law as well as the
terms and conditions of the permission granted for that purpose,
the use of electricity is similarly controlled by the statutory
provisions and the terms and conditions on which such E
permission is granted to use the electricity.
31. The unauthorized use of electricity in the manner as is
undisputed on record clearly brings the respondent 'under
liability and in blame' within the ambit and scope of Section 126 F
of the 2003 Act. The blame is in relation to excess load while
the liability is to pay on a different tariff for the period prescribed
in law and in terms of an order of assessment passed by the
assessing officer by the powers vested in him under the
provisions of Section 126 of the 2003 Act.
G
32. The expression 'means' used in the definition clause
of Section 126 of the 2003 Act can have different connotations
depending on the context in which such expression is used. In
terms of Black's Law Dictionary (Eighth Edition) page 1001,
'mean' is - 'of or relating to an intermediate point between two H
260 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A points or extremes' and 'meaning' would be 'the sense of
anything, but esp. of words; that which is conveyed'. The word
ordinarily includes a mistaken but reasonable understanding of
a communication. 'Means' by itself is. a restrictive term and
when used with the word 'includes', it is construed as
B exhaustive. In those circumstances, a definition using the term
'means' is a statement of literal connotation of a teym and the
courts have interpreted 'means and includes' as an expression
defining the section exhaustively. It is to be kept in mind that
while determining whether a provision is exhaustive or merely
c illustrative, this will have to depend upon the language of the
Section, scheme of the Act, the object of the Legislature and
its intent.
33. 'Purposive construction' is certainly a cardinal principle
of interpretation. Equally true is that no rule of interpretation
D should either be over-stated or over-extended. Without being
over-extended or over-stated, this rule of interpretation can be
applied to the present case. It points to the conclusion that an
interpretation which would attain the object and purpose of the
Act has to be given precedence over any other interpretation
E which may not further the cause of the statute. The development
of law is particularly liberated both from literal and blinkered
interpretation, though to a limited extent.
34. The precepts of interpretation of contractual •·ocuments
F have also undergone a wide ranged variation in the recent
times. The result has been subject to one important exception
to assimilate the way in which such documents are ;nterpreted
by judges on the common sense principle by which any serious
utterance would be interpreted by ordinary life. In other words,
G the common sense view relating to the implication and impact
of provisions is the relevant consideration for interpreting a term
of document so as to achieve temporal proximity of the end
result.
35. Another similar rule is the rule of practical
H
EXECUTIVE ENGINEER AND ANR. v. SRI 261
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
interpretation. This test can be effectuatedly applied to the A
provisions of a statute of the present kind. It must be understood
that an interpretation which upon application of the provisions
at the ground reality, would frustrate the very law should not be
accepted against the common sense view which will further
such application. B
36. Once the court decides that it has to take a purposive
construction as opposed to textual construction, then the
legislative purpose sought to be achieved by such an
interpretation has to be kept in mind. We have already indicated
that keeping in view the legislative scheme and the provisions C
of the 2003 Act, it will be appropriate to adopt the approach of
purposive construction on the facts of this case. We have also
indicated above that the provisions of Section 126 of the 2003
Act are intended to cover the cases over and above the cases
which would be specifically covered under the provisions of D
Section 135 of the 2003 Act.
37. In other words, the purpose sought to be achieved is
to ensure stoppage of misuse/unauthorized use of the electricity
as well as to ensure prevention of revenue loss. It is in this E
background that the scope of the expression 'means' has to
be construed. If we hold that the expression 'means' is
exhaustive and cases of unauthorized use of electricity are
restricted to the ones stated under Explanation (b) of Section
126 alone, then it shall defeat the very purpose of the 2003 Act,
F
inasmuch as the different cases of breach of the terms and
conditions of the contract of supply, regulations and the
provisions of the 2003 Act would escape the liability sought to
be imposed upon them by the Legislature under the provisions
of Section 126 of the 2003 Act. Thus, it will not be appropriate G
for the courts to adopt such an approach. The primary object
of the expression 'means' is intended to explain the term
-'unauthorized use of electricity' which, even from the plain
reading of the provisions of the 2003 Act or on a common
sense view cannot be restricted to the examples given in the
H
262 SUPREME COURT REPORTS (2011) 15 (ADDL.) S.C.R.
A Explanation. The Legislature has intentionally omitted to use the
word 'includes' and has only used the word 'means' with an
intention to explain inter alia what an unauthorized use of
electricity would be. It must be noticed that clause (iv) of
Explanation (b) and sub-Section (5) of Section 126 of the 2003
B Act were both amended/substituted by the same amending Act
26 of 2007, with a purpose and object of preventing
unauthorised use of electricity not amounting to theft of
electricity within the meaning of Section 135 of the 2003 Act.
This amendment, therefore, has to be given its due meaning
C which will fit into the scheme of the 2003 Act and would achieve
its object and purpose.
38. The expression 'means' would not always be open to
such a strict construction that the terms mentioned in a definition
clause under such expression would have to be inevitably
D treated as being exhaustive. There can be a large number of
cases and examples where even the expression 'means' can
be construed liberally and treated to be inclusive but not
completely exhaustive of the scope of the definition, of course,
depending upon the facts of a given case and the provisions
E governing that law. In the case of K. V. Muthu v. Angamuthu
Ammal [(1997) 2 SCC 53], this Court was dealing with a case
under the Tamil Nadu Rent Act and the expression 'member of
his family' as defined under Section 2(6-A) of that Act. Section
2(6-A) provides that 'member of his family' in ;elation to a
F landlord means his spouse, son, daughter, grand-child or
dependent parents. If the principle of construction advanced by
the learned counsel appearing for the respondent is to be
accepted, then even in that case, the Court could not have
expanded the expression 'members of his family' to include any
G other person than those specifically mentioned under that
definition. The definition and the expression 'means', if
construed as exhaustive would necessarily imply exclusion of
all other terms except those stated in that Section but this Court,
while adopting the principle of purposive construction, came to
H the conclusion that even a foster son, who is obviously not the
EXECUTIVE ENGINEER AND ANR. v. SRI 263
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
real son or direct descendant of a person, would be included. A
This Court, observing that there was consensus in precedent
that the word 'family' is a word of great flexibility and is capable
of different meanings, held as under :
"While interpreting a definition, it has to be borne in mind 8
that the. interpretation placed on it should not only be not
repugnant to the context, it should also be such as would
aid the achievement of the purpose which is sought to be
served by the Act. A construction which would defeat or
was likely to defeat the purpose of the Act has to be C
ignored and not accepted.
Where the definition or expression, as in the instant case,
is preceded by the words "unless the context otherwise
requires·, the said definition set out in the section is to be
applied and given effect to but this rule, which is the normal D
rule may be departed from if th~re be something in the
~ontext to show that the definition could not be applied."
39. Another comparable example of such interpretation by
this Court can be traced out in the case of Union of India v. E
Prabhakaran Vijaya Kumar & Ors. [(2008) 9 SCC 527)
wherein it was dealing with the provisions of Section 123(c) of
the Railways Act, 1989 which read as under:
"123 (c) "untoward incident" means- (1) (i) the
commission of a terrorist act within the meaning of sub- F
section (1) of section (3) of the Terrorist and Disruptive
Activities (Prevention) Act, 1987 ; or
(ii) the making of a violent attack or the commission of
robbery or dacoity; or G
(iii) the indulging in rioting, shoot- out or arson, by any
person in or on any train carrying passengers, or in a
waiting hall, cloak room or reservation or booking office ·
or on any platform or in any other place within the precincts
H
264 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R.
A of a railway station; or
(2) the accidental falling of any passenger from a train
carrying passengers."
40. As is obvious from the bare reading of the above
B provision, the provision used the expression 'untoward incident
means' and under clause (2) of that provision 'accidental falling
of any passenger from a train carrying passengers' is included.
If it was to be understood as an absolute' rule of law that the
use of the term 'means' unexceptionally would always require
C an exhaustive interpretation of what is stated in or can be
construed to that provision, then a person who was climbing
on the train which was carrying passengers and who meets
with an accident, would not be covered. However, this Court,
while repelling this contention, held that by adopting a restrictive
D meaning to the expression 'accidental falling of a passenger
from a train carrying passengers' in Section 123(c) of the
Railways Act, 1989, this Court would be depriving a large
number of railway passengers from receiving compensation in
railway accidents. Treating the statute to be a beneficial piece
E of legislation, this Court applied purposive interpretation, while
observing as under :
"No doubt, it is possible that two interpretations can be
given to the expression "accidental falling of a passenger
from a train carrying passengers", the first being that it only
F applies when a person has actually got inside the train and
thereafter falls down from the train, while the second being
that it includes a situation where a person is trying to board
the train and falls down while trying to do so. Since the
provision for compensation in the Railways Act is a
G beneficial piece of legislation, in our opinion, it should
receive a liberal and wider interpretation and nc• a narrow
and technical one. Hence, in our opinion the l;itter of the
abovementioned two interpretations i.e. the one which
advances the object of the statute and serves its purpose
H
EXECUTIVE ENGINEER AND ANR. v. SRI 265
SEETARAM RtCE MILL [SWATANTER KUMAR, J.]
should be preferred vide Kuna/ Singh v. Union of India A
[(2003) 4 SCC 524 para 9], B.D. Shetty v. Ceat Ltd.
[(2002) 1 SCC 193 - para 12) and Transport Corpn. Of
India v. ES/ Corpn. [(2000) 1 SCC 332]"
41. The above judgments clearly support the view that we
have taken with reference to the facts and law of the present B
case. It cannot be stated as an absolute proposition oi law that
the expression 'means' wherever occurring in a provision would
inevitably render that provision exhaustive and limited. This rule
of interpretation is not without exceptions as there could be
statutory provisions whose interpretation demands somewhat C
liberal construction and require inclusive construction. An
approach or an interpretation which will destroy the very
purpose and object of the enacted law has to be avoided. The
other expressions used by the Legislature in various sub-
clauses of Explanation (b) of Section 126 of the 2003 Act are D
also indicative of its intent to make this provision wider and of
greater application. Expressions like 'any artificial means', 'by
a means not authorised by the licensee' etc. are terms which
cannot be exhaustive even linguistically and are likely to take
within their ambit what is not specifically stated. For example, E
'any artificial means' is a generic term and so the expression
'means' would have to be construed generally. This Court in the
case of Eureka Forbes Ltd. v. Allahabad Bank [(2010) 6 SCC
193], while examining the interpretation and application of the
word 'debt', held that it was a generic term and, thus, of wide F
amplitude :
"50. In this background, let us read the language of Section
2(g) of the Recovery Act. The plain reading of the Section
suggests that legislature has used a general expression
in contra distinction to specific, restricted or limited G
expression. This obviously means that, the legislature
intended to give wider meaning to the provisions. Larger
area of jurisdiction was intended to be covered under this
provision so as to ensure attainment of the legislative
H
266 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A object, i.e. expeditious recovery and providing provisions
for taking such measures which would prevent the wastage
of securities available with the banks and financial
institutions.
51. We may notice some of the general expressions used
B by the framers of law in this provision:
(a) any liability;
(b) claim as due from any person;
c (c) during the course of any business activity
undertaken by the Bank;
(d) where secured or unsecured;
D (e) and lastly legally recoverable.
52. All the above expressions used in the definition clause
clearly suggest that, expression 'debt' has to be given
general and wider meaning, just to illustrate, the word 'any
liability' as opposed to the word 'determined liability' or
E 'definite liability' or 'any person' in contrast to 'from the
debtor'. The expression 'any person' shows that the
framers do not wish to restrict the same in its ambit or
application. The legislature has not intended to restrict to
the relationship of a creditor or debtor alone. General
F terms, therefore, have been used by the legislature to give
the provision a wider and liberal meaning. These are
generic or general terms. Therefore, it will be difficult for
the Court, even on cumulative reading of the provision, to
hold that the expression should be given a narrower or
G restrict~d meaning. What will be more in consonance with
the purpose and object of the Act is to give this expression
a general meaning on its plain language ratner than apply
unnecessary emphasis or narrow the scope and
interpretation of these provisions, as they are likely to
H frustrate the very object of the Act."
EXECUTIVE ENGINEER AND ANR. v. SRI 267
SEETARAM RICE MILL [SWATANTER KUMAR, J.)
42. The expressions 'means', 'means and includes' and A
'does not include' are expressions of different connotation and
significance. When the Legislature has used a particular
expression out of these three, it must be given its plain meaning
while even keeping in mind that the use of other two
expressions has not been favoured by the Legislature. To put B
it simply, the Legislature has favoured non-use of such
expression as opposed to other specific expression. In the
present case, the Explanation to Section 126 has used the
word 'means' in contradistinction to 'does not include' and/or
'means and includes'. This would lead to one obvious result that c
even the Legislature did not intend to completely restrict or limit
the scope of this provision.
43. Unauthorised use of electricity cannot be restricted to
the stated clauses under the explanation but has to be given a
wider meaning so as to cover cases of violation of terms and D
conditions of supply and the regulations and provisions of the
2003 Act governing such supply. 'Unauthorised use of
electricity' itself is an expression which would, on its plain
reading, take within its scope all the misuse of the electricity
or even malpractices adopted while using electricity. It is difficult E
to restrict this expression and limit its application by the
categories stated in the explanation. It is indisputable that the
electricity supply to a consumer is restricted and controlled by
the terms and conditions of supply, the regulations framed and
the provisions of the 2003 Act. The requirement of grant of F
licence itself suggests that electricity is a controlled commodity
and is to be regulated by the regulatory authorities. If a person
unauthorisedly consumes electricity, then he can certainly be
dealt with in accordance with law and penalties may be
imposed upon him as contemplated under the contractual, G
regulatory and statutory regime. The Orissa Electricity
Regulatory Commission, in exercise of its powers under
Section 181(2)(t), (v), (w) and (x) read with Part VI of the 2003
Act, Orissa Electricity Reforms Act, 1995 and all other powers
enabling it in that behalf, made the regulations to govern H
268 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R
A distribution and supply of electricity and procedure thereof such
as system of billing, modality of payment, the powers, functions
and applications of the distribution licensees form for supply
and/or suppliers and the rights and obligations of the
consumers. These were called 'Orissa Electricity Regulatory
B Commission Distribution (Conditions of Supply) Code, 2004
(hereinafter referred to as 'Conditions of Supply) vide
notification dated 21st May, 2004. The Agreement has been
placed on record. This Agreement was undisputedly executed
between the parties. Clause (2) of the Agreement deals with
c Conditions of Supply. It states that consumer had obtained and
perused a copy of the Grid Corporation of Orissa Ltd. (General
Conditions of Supply) Regulations, 1995, understood its content
and undertook to observe and abide by all the terms and
conditions stipulated therein to the extent they are applicable
to him. The respondent was a consumer under the 'medium
0
industry category'. Clause (A) of the terms and conditions
applicable to medium industry category reads as under :
"This tariff rate shall be applicable to supply of power at a
single point for industrial production purposes with contract
E demand/connected load of 22 KV and above up to but
excluding 110 KVA where power is generally utilized as a
motive force."
44. Minimum energy charges are to be levied with
F reference to 'contract demand' at the rate prescribed under the
terms and conditions. These clauses of the Agreement clearly
show that the charges for consumption of electricity are directly
relatable to the sanctioned/connected load and also the load
consumed at a given point of time if it is in excess of the
G sanctioned/connected load. The respondent could consume
electricity up to 110 KVA but if the connected load exceeded
that higher limit, the category of the respondent itself could stand
changed from 'medium industry' to 'large industry' which will be
governed by a higher tariff.
H 45. Chapter VII of the Conditions of Supply classifies the
EXECUTIVE ENGINEER AND ANR. v. SRI 269
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
consumers into various categories and heads. The electricity A
could be provided for a domestic, LT Industrial, LT/HT Industrial,
Large Industry, Heavy Industries and Power Intensive Industries,
etc. In terms of Regulation 80, the industry would fall under LT/
HT category, if it relates to supply for industrial production with
a contract demand of 22 KVA and above but below 110 KVA. E
However, it will become a 'large industry' under Regulation
80(10) if it relates to supply of power to an industry with a
contract demand of 110 KVA and above but below 25,000
KVA. Once the category stands changed because of excessive
consumption of electricity, the tariff and other conditions would c
stand automatically changed. The licensee has a right to
reclassify the consumer under Regulation 82 if it is found that
a consumer has been classified in a particular category
erroneously or the purpose of supply as mentioned in the
agreement has changed or the consumption of power has
0
exceeded the limit of that category etc. The Conditions of
Supply even places a specific prohibition on consumption of
excessive electricity by a consumer. Regulation 106 of the
Conditions of Supply reads as under :
"No consumer shall make use of power in excess of the E
approved contract demand or use power for a purpose
other than the one for which agreement has been executed
or shall dishonestly abstract power from the licensee's
system."
F
46. On the cumulative readiflg of the terms and conditions
of supply, the contract executed between the parties and the
provisions of the 2003 Act, we have no hesitation in holding
that consumption of electricity in excess of the sanctioned/
connected load shall be an 'unauthorised use' of electricity in G
terms of Section 126 of the 2003 Act. This, we also say for the
reason that overdrawal of electricity amounts to breach of the
terms and conditions of the contract and the statutory
conditions, besides such overdrawal being prejudicial to the
public at large, as it is likely to throw out of gear the entire
H
270 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R.
'A supply system, undermining its efficiency, efficacy and even
increasing voltage fluctuations. In somewhat similar
circumstances, where the consumer had been found to be
drawing electricity in excess of contracted load and the general
conditions of supply of electricity energy by the Board and
B · clause 31(f) of the same empowered the Board to disconnect
supply and even levy higher charges as per the tariff applicable,
this Court held that such higher tariff charges could be
recovered. While noticing the prejudice caused, the Court in the
case Bhi/ai Rerollers & Ors. v. M.P. Electricity Board & Ors.
c. ((2003) 7 sec 185], held as under:
"21. The respondent-Board, therefore, is entitled to raise
the demand under challenge since such right has been
specifically provided for and is part of the conditions for
supply and particularly when such drawal of extra load in ·
D excess of the contracted load is bound to throw out of gear
the entire supply system undermining its efficiency, efficacy
not only causing stress on the installations of the Board but
considerably affect other consumers who will experience
voltage fluctuations. Consequently, we see no merit in the
E challenge made on behalf of the appellants. The appeals,
therefore, fail and shall stand dismissed but with no costs."
47. Similar view was taken by this Court in the case of
Orissa State Electricity Board & Anr. v. /Pl Steel Ltd. & Ors.
F [(1995) 4 sec 328].
48. It will also be useful to notice that certain malpractices
adopted by the consumer for consuming electricity in excess
of the contracted load could squarely fall within the ambit and
scope of Section 126 of the 2003 Act as it is intended to
G provide safeguards against pilferage of energy and
malpractices by the consumer. The Regulations framed in
exercise of power of subordinate legislation or terms and
conditions imposed in furtherance of statutory provisions have
been held to be valid and enforceable. They do not offend the
H provisions of the 2003 Act. In fact, the power to impose penal
EXECUTIVE ENGINEER AND ANR. v. SRI 271
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
charges or disconnect electricity has been held not violative A
even of Article 14 of the Constitution of India. The expression
'malpractices' does not find mention in the provisions under the
'· 2003 Act but as a term coined by judicial pronouncements.
Thus, the expression 'malpractices' has to be construed in its
proper perspective and normally may not amount to theft of B
electricity as contemplated under Section 135 of the 2003 Act.
Such acts/malpractices would fall within the mischief of
unauthorized use of electricity as stipulated under Section 126
of the 2003 Act. Cases of pilferage of electricity by adopting
malpractices which patently may not be a theft would be the c
cases that would fall within the jurisdiction of the Board in
furtherance to the terms and conditions of supply. Reference
in this regard can be made to the judgment of this Court in the
case of Hyderabad Vanaspathi Lts. v. A.P. State Electricity
Board & Anr. [(1998) 4 sec 471]. D
49. There is another angle from which the present case
can be examined and obviously without prejudice to the other
contentions raised. It is a case where, upon inspection, the
officers of the appellant found that respondent was consuming
142 KVA of electricity which was in excess of the sanctioned E
load. To the inspection report, the respondent had not filed any
objection before the competent authority as contemplated under
Section 126(3) and had approached the High Court. Limited
for the purposes of these proceedings, excess consumption is
not really in dispute. As stated above, the contentions raised F
by the respondent were to challenge the very jurisdiction of the
concerned authorities. Consumption in excess of sanctioned
load is violative of the terms and conditions of the agreement
as well as of the statutory benefits. Under Explanation (b)(iv),
'unauthorised use of electricity' means if the electricity was used G
for a purpose other than for which the usage of electricity was
authorised. Explanation (b)(iv), thus, would also cover the cases
where electricity is being consumed in excess of sanctioned
load, particularly when it amounts to change of category and
tariff. As is clear from the agreement deed, the electric H
272 SUPREME COURT REPORTS [2011) 15 (ADDL.) S.C.R.
A connection was given to the respondent on a contractual
stipulation that he would consume the electricity in excess of
22 KVA but not more than 110 KVA. The use of the negative
language in the condition itself declares the intent of the parties
that there was an implied prohibition in consuming electricity
B in excess of the maximum load as it would per se be also
prejudiced. Not only this, the language of Regulations 82 and
106 also prescribe that the consumer is not expected to make
use of power in excess of approved contract demand otherwise
it would be change of user falling within the ambit of
c 'unauthorised use of electricity'. Again, there is no occasion for
this Court to give a restricted meaning to the language of
Explanation (b)(iv) of Section 126. According to the learned
counsel appearing for the respondent, it is only the actual
change in purpose of use of electricity and not change of
0 category that would attract the provisions of Section 126 of the
2003 Act. The contention is that where the electricity was
provided for a domestic purpose and is used for industrial
purpose or commercial purpose, then alone it will amount to
change of user or purpose. The cases of excess load would
E not fall in this category. This argument is again without any
substance and, in fact, needs to be noticed only to be rejected.
We have already discussed in some detail above that the
expressions of the Explanation to Section 126 are to be given
a wider and amplified meaning so as to ensure the
implementation of the provisions in contradistinction to
F defeating the very object of the 2003 Act. Without being
innovative and while predicating, we only state the principles
which have been authoritatively pronounced by this Court in
different cases. In the case of Association of Industrial
Electricity Users v. State of A.P. & Ors. [(2002) 3 SCC 711],
G this Court, while expressing that fixation of tariff in electricity or
allied matters can hardly be a subject matter of judicial review.
The courts would not venture to examine the tariff on merit and
restrict its power of judicial review only to procedural matters
that too where it is ex facie arbitrary. The Court rejecting the
H contention raised before it that Section 126 of the Andhra
EXECUTIVE ENGINEER AND ANR. v. SRI 273
SEETARAM RICE MILL [SWATANTER KUMAR, J.)
Pradesh Electricity Reforms Act does rrot,~isage A
· classification of consumers according to the purpose for which
the electricity is used and held that the supply of electricity
permits differentiation according to the consumer's load factor
or power factor, total consumption of energy during the
specified period, the time at which the supply is required and 6
the need for cross-subsidisation or such tariff as is just and
reasonable and such as to promote economic efficiency in the
supply and consumption of electricity. The tariff may also be
such as to satisfy all other relevant provisions of the 2003 Act
and the relevant conditions of the Agreement. Thus, there is a C
direct relation between the quantum of electricity demanded,
supplied and tariff rate. The purpose, therefore. would include
by necessary implication, the category under which the
electricity supply is being provided by the licensee to the
consumer. Still, in another case of Punjab State Electricity
Board v. Vishwa Caliber Builders Private Ltd. [(2010) 4 SCC 0
539), this Court was primarily concerned with the question
whether the ombudsman would have the jurisdiction to issue
directions for regularization of unauthorized electricity.
Answering the same in the negative and dealing with the
question of excess load, this Court held as under : E
"The fact that the appellant could not release connection
with a load of 2548 KW on account of non-availability of
transformer necessary for transfer of 8 MVA load from 66
KV sub station, G.T. Road, Ludhiana had no bearing on F
the issue of consumption of electricity by the respondent
beyond the sanctioned load. Undisputedly, in terms of the
request made by the respondent, the Chief Engineer had
sanctioned connection on the existing system with a load
of 1500 KW, but the respondent used excess load to the G
tune of 481.637 KW and this amounted to unauthorized
use of electrical energy."
50. The consistent view of this Court would support the
proposition that the cases of excess load of consumption would
H
274 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A be squarely covered under Explanation (b)(iv) of Section 126
of the 2003 Act. Once this factor is established, then the
assessing officer has to pass the final order of assessment in
terms of Sections 126(3) to 126(6) of the 2003 Act.
Discussion on Question No.2 and 3
B
51. Under the procedure prescribed, the person (the
consumer) has to be served with the notice inviting him to file
objections, if any, within the stipulated time in terms of Section
126(3) and the assessing officer is required to pass a final
C order within 30 days from the date of service of such order of
provisional assessment. If the consumer does not pay the
provisional assessment amount, as required under Section
126(4) and file objections under Section 126(3), then after
affording opportunity to the consumer, the assessing officer
D shall assess the amount and pass an order of final assessment,
as stated in Section 126(5). Section 126(6) contemplates that
the assessment under the Section shall be made at a rate equal
to twice the tariff applicable for the relevant category of services
specified in Sub-section (5). The reference to the category in
E Section 126(6) fully substantiate the view that we have taken
that change of category by consumption of excess load will
automatically bring the defaulter within the mischief of
Explanation to Section 126(6). Once the order of assessment
is finally passed and is served upon the consumer, he is
F expected to pay the said charges unless. being aggrieved from
such an order, he prefers an appeal under Section 127 of the
2003 Act. The appeal under Section 127 would lie only against
the final order passed under Se1,;tion 126 that too within 30 days
of the said order. The appeal shall be filed, maintained and
dealt with in accordance with the procedure specified in Section
G 127 of the 2003 Act. A bare reading of the provisions of
Section 127 shows that it is the final order made under Section
126 which is appealable under Section 127 of the 2003 Act.
In other words, issuance of a notice or a provisional order of
assessment as may be made by the assessing officer in terms
H
EXECUTIVE ENGINEER AND ANR. v. SRI 275
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
of sub-section (1) to sub-section (3) of Section 126 of the 2003 A
Act would not bQ the order against which an appeal would lie.
52. It may be noticed that admittedly the present
respondent had not preferred any appeal against the
provisional order of assessment dated 25th July,.2009 and, in
8
fact, had preferred a writ petition against the very issuance of
a notice issued in terms of Sub-sections (2) and (3) of Section
126 of the 2003 Act. This brings us to the question as to what
is the scope of jurisdiction under Article 226 of the Constitution
of India in face of the provisions of Section 127 of the 2003 C
Act.
53. It is a settled canon of law that the High Court would
not normally interfere in exercise of its jurisdiction under Article
226 of the Constitution of India where statutory alternative
remedy is available. It is equally settled that this canon of law D
is not free of exceptions. The courts, including this Court, have
taken the view that the statutory remedy, if i;rovided under a
specific law, would impliedly oust the jurisdiction of the Civil
Courts. The High Court in exercise of its extraordinary
jurisdiction under Article 226 of the Constitution of India can E
entertain writ or appropriate proceedings despite availability of
an alternative remedy. This jurisdiction, the High Court would
exercise with some circumspection in exceptional cases,
particularly, where the cases involve a pure question of law or
vires of an Act are challenged. This class of cases we are F
mentioning by way of illustration and should not be understood
to be an exhaustive exposition of law which, in our opinion, is
neither practical nor possible to state with precision. The
availability of alternative statutory or other remedy by itself may
not operate as an absolute bar for exercise of jurisdiction by G
the Courts. It will normally depend upon the facts and
circumstances of a given case. The further question that would
inevitably come up for consideration before the Court even in
such cases would be as to what extent the jurisdiction has to
be exercised.
H
276 SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R.
A 54. Should the Courts determine on merits of the case or
should it preferably answer the preliminary issue or jurisdictional
issue arising in the facts of the case and remit the matter for
consideration on merits by the competent authority? Again, it
is somewhat difficult to state with absolute clarity any principle
B governing such exercise of jurisdiction. It always will depend
upon the facts of a given case. We are of the considered view
that interest of administration of justice shall be better subserved
if the cases of the present kind are heard by the courts only
where it involves primary questions of jurisdiction or the matters
c which goes to the very root of jurisdiction and where the
authorities have acted beyond the provisions of the Act.
How~ver, it should only be for the specialized Tribunal or the
appellate authorities to examine the merits of assessment or
even factual matrix of the case. It is argued and to some extent
correctly that the High Court should not decline to exercise its
0
jurisdiction merely for the reason that there is a statutory
alternative remedy available even when the case falls in the
above-stated class of cases. It is a settled principle that the
Courts!Tribunal will not exercise jurisdiction in futility. The law
E will not itself attempt to do an act which would be vain, lex nil
frustra facit, nor to enforce one which would be frivolous-lex
neminem cogit ad vana seu inutilia-the law will .not force any
one to do a thing vain and fruitless. In other words, if exercise
of jurisdiction by the Tribunal ex facie appears to be an exercise
of jurisdiction in futility for any of the stated reasot 5, then it will
F be permissible for the High Court tcrinterfere in exercise of its
jurisdiction. This issue is no longer res integra and has been
settled by a catena of judgments of this Court, which we find
entirely unnecessary to refer to in detail. Suffices it to make a
reference to the judgment of this Court in the case of Whirlpool
G Corporation v. Registrar of Trade Marks, Mumbai [(1998) 8
sec 1] where this Court was concerned with the powers of the
Registrar of Trade Marks and the Tribunal under the Trade and
Merchandise Marks Act, 1958 and exercise of jurisdiction by
the High Court in face of availability of a remedy under the Act.
H This Court while referring to various judgments of this Court and
EXECUTIVE ENGINEER AND ANR. v. SRI 277
SEETARAM RICE MILL [SV-JATANTER KUMAR, J.]
specifying the cases where the alternative remedy would not A
bar the exercise of jurisdiction by the Court, held as under: -
"14. The power to issue prerogative writs under Article 226
of the Constitution is plenary in nature and is not limited
by any other provision of the Constitution This power can 8
be exercised by the High Court not only for issuing writs
in the nature of Habeas Corpus, Mandamus, prohibition,
Qua Warranto and Certiorari for the enforcement of any
of the Fundamental Rights contained in Part Ill of the
Constitution but also for "any other purpose".
c
15. Under Article 226 of the Constitution, the High Court,
having regard to the facts of the case, has a discretion to
entertain or not to entertain a writ petition. But the High
Court has imposed upon itself certain restrictions one of
which is that if an effective and efficacious remedy is D
available, the High Court would not normally exercise its
jurisdiction. But the alternative remedy has been
consistently held by this Court not to operate as a bar in
at least three contingencies, namely, where the writ petition
has been filed for the enforcement of any of the E .
Fundamental Rights or where there has been a violation
of the principle of natural justice or where the order or
proceedings are wholly without jurisdiction or the vires of
an Act is challenged. There is a plethora of case law on
this point but to cut down this circle of forensic whirlpool F
we would rely on some old decisions of the evolutionary
era of the constitutional law as they still hold the field.
xxx xxx xxx
19. Another Constitution Bench decision in Calcutta G
Discount Co. Ltd. v. /TO Companies Distt: [1961] 41 ITR
191 (SC) laid down :
"Though the writ of prohibition or certiorari will not
issue against an executive authority, the High H
278 SUPREME COURT REPORTS (2011] 15 (ADDL.) S.C.R.
A Courts have power to issue in a fit case an order
prohibiting an executive authority from acting
without jurisdiction. Where such action of an
executive authority acting without jurisdiction
subjects or is likely to subject a person to lengthy
B proceedings and unnecessary harassment, the
High Court will issue appropriate orders or
directions to prevent such consequences. Writ of
certiorari and prohibition can issue against Income
Tax Officer acting without jurisdiction Under Section
c 34 Income Tax Act."
20. Much water has since flown under the bridge, but there
has been no corrosive effect on these decisions which
command though old, continue to hold the field with the
result that law as to the jurisdiction of the High Court in
D entertaining a writ petition under Article 226 of the
Constitution, in spite of the alternative statutory remedies,
is not affected, specially in a case where the authority
against whom the writ is filed is shown to have had no
jurisdiction or had purported to usurp jurisdiction without
E any legal foundation.
21. That being so, the High Court was not justified in
dismissing the writ petition at the initial stage without
examining the contention that the show cause 11otice issued
F to the appellant was wholly without jurisdiction and that the
Registrar, in the circumstances of the case, was not
justified in acting as the 'Tribunal'."
55. Even in the case of Union of India v. State of Haryana
[(2000) 10 SCC 482], this Court took the view that the question
G raised was a legal one which required determination as to
whether provision of telephqne connections and instruments
amounted to sale and why the Union of India should not be
exempted from payment of sales tax under the respective
statutes. Holding that the question was fundamental in character
H
EXECUTIVE ENGINEER AND ANR. v. SRI 279
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
and need not even be put through the mill of statutory appeals A
in hierarchy, this Court remitted the matter to the High Court
for determination of the questions of law involved in that case.
56. Applying these principles to the facts of the present
case, it is obvious that no statutory appeal lay against a 8-
provisional order of assessment and the responc!ents herein
were required to file objections as contemplated under Section
126 (3) of the 2003 Act. It was only when a final order of
assessment was passed that the respondents could prefer a
statutory appeal which admittedly was not done in the case in C
hand.
57. In the present case, the High Court did not fall in error
of jurisdiction in entertaining the writ petition but certainly failed
to finally exercise the jurisdiction within the prescribed
limitations of law for exercise of such jurisdiction. Keeping in D
view the functions and expertise of the specialized body
constituted under the Act including the assessing officer, it
would have been proper exercise of jurisdiction, if the High
Court, upon entertaining and deciding the writ petition on a
jurisdictional issue, would have remanded the matter to the E
competent authority for its adjudication on merits and in
accordance with law. In the facts of the present case, the High
Court should have answered the question of law relating to lack
of jurisdiction and exercise of jurisdiction in futility without
travelling into and determining the validity of the demand which F
squarely fell within the domain of the specialized authority. The
High Court should have remanded the case to the assessing
officer with a direction to the respondent to file its objections
including non-applicability of the tariff before the assessing
authority and for determination in accordance with law. G
58. Having dealt with and answered. determinatively the
questions framed in the judgment, we consider it necessary to
precisely record the conclusions of our judgment which are as
follows:-
H
280, SUPREME COURT REPORTS [2011] 15 (ADDL.) S.C.R
.A 1. Wherever the consumer commits the breach of the
terms of the Agreement, Regulations and the
provisions of the Act by consuming electricity in
excess of the sanctioned and connected load, such
consumer would be 'in blame and under liability'
B within the ambit and scope of Section 126 of the
2003 Act.
2. The expression 'unauthorized use of electricity
means' as appearing in Section 126 of the 2003
Act is an expression of wider connotation and has
c to be construed purposively in contrast to contextual .
interpretation while keeping in mind the object and
purpose of the Act. The cases of excess load
consumption than the connected load inter alia
would fall under Explanation (b)(iv) to Section 126
D of the 2003 Act, besides it being in violation of
Regulations 82 and 106 of the Regulations and
terms of the Agreement.
3. In view of the language of Section 127 of the 2003
E Act, only a final order of assessment passed under
Section 126(3) is an order appealable under
Section 127 and a notice-cum-provisional
assessment made under Section 126(2) is not
appealable.
F
4. Thus, the High Court should normally decline to
interfere in a final order of assessment passed by
the assessing officer in terms of Section 126(3) of
the 2003 Act in exercise of its jurisdiction under
Article 226 of the Constitution of India.
G
5. The High Court did not commit any error of
jurisdiction in entertaining the writ pr•tition against
the order raising a jurisdictional challenge to the
notice/provisional assessment order dated 25th
H July, 2009. However, the High Court transgressed
EXECUTIVE ENGINEER AND ANR. v. SRI 281
SEETARAM RICE MILL [SWATANTER KUMAR, J.]
its jurisdictional limitations while travelling into the A
exclusive domain of the Assessing Officer relating
to passing of an order of assessment and
determining factual controversy of the case.
6. The High Court having dealt with the jurisdictional 8
issue, the appropriate course of action would have
been to remand the matter to the Assessing
Authority by directing the consumer to file his
objections, if any, as contemplated under Section
126(3) and require the Authority to pass a final C
order of assessment as contemplated under
Section 126(5) of the 2003 Act in accordance with
law.
59. For the reasons afore-recorded, the judgment of the
High Court is set aside and the matter is remanded to the D
Assessing Officer to pass a final order of assessment
expeditiously, after providing opportunity to the respondent
herein to file objections, if any, to the provisional assessment
order, as contemplated under Section 126(3) of the 2003 Act.
E
60. The appeal is allowed in the above terms, while leaving
the parties to bear their own costs.
D.G. Appeal allowed.
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