Supreme Court of India
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTDversusM/S BABA BAIJANATH ROLLER AND FLOUR MILL P. LTD.
- Citation
- 2014 INSC 207
- Decided
- 26 March 2014
- Disposal
- Appeal(s) allowed
- Bench
- GYAN SUDHA MISRA
Holding
Section 26(6) of the Electricity Act, 1910 does not govern disputes involving fraud or meter tampering, and the electricity supplier may impose penal charges under the Code, rendering the High Court's order quashing the penalty invalid.
Summary
The electricity supplier inspected the consumer's premises and discovered tampering of the high‑tension meter and associated seals, subsequently levying penal charges and disconnecting supply. The consumer challenged the penalty, alleging violation of natural justice and claiming the meter was defective, seeking quashing of the penalty and refund. The High Court set aside the penalty, holding that the inspection was not conducted in accordance with procedural safeguards. On appeal, the Supreme Court held that Section 26(6) of the Electricity Act, 1910 applies only to disputes over the correctness of a meter and not to cases of fraud or tampering; therefore the supplier could lawfully levy penal charges under the Orissa Electricity Regulatory Commission Code. The Court also found that the inspection was carried out in the presence of the consumer’s manager, and the High Court erred in ignoring the Code provisions. Consequently, the Supreme Court set aside the High Court’s order, dismissed the writ petitions and upheld the supplier’s right to impose the penal bill.
Issues considered
- The applicability of Section 26(6) of the Electricity Act, 1910 to cases of alleged meter tampering or fraud.
- Whether the High Court correctly quashed the penal charges on the ground of violation of natural justice.
- Whether the electricity supplier is entitled to levy penal charges under the Orissa Electricity Regulatory Commission Distribution (Conditions of Supply) Code, 1998 for unauthorized consumption.
- Whether the inspection of the meter complied with procedural requirements, including presence of the consumer’s representative.
- Whether the consumer could obtain relief under Section 110 of the Code versus the supplier’s statutory right to penalise.
Legislation cited
- Electricity Act, 1910s. 26
- Orissa Electricity Reforms Act, 1995s. 54
- Orissa Electricity Regulatory Commission Distribution (Conditions of Supply) Code, 1998s. 105, s. 110, s. 115, s. 54, s. 56, s. 64
Subjects
meter tamperingelectricity theftpenal chargesSection 26 Electricity Actnatural justiceconsumer protectionElectrical InspectorOrissa Electricity Regulatory Commission Code
Judgment
[2014] 4 S.C.R. 121
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTD A
& ORS.
v.
M/S BABA BAIJANATH ROLLER AND FLOUR MILL P.
LTD.
(Civil Appeal No. 4023 of 2014) B
MARCH 26, 2014
[GYAN SUDHA MISRA AND
PINAKI CHANDRA GHOSE, JJ.)
c
Electricity Act, 1910: s.26 - Applicability of, in case of
tampering of meter- Held: s.26 is applicable only when there
is any difference or a dispute in connection with correctness
of a meter - In that case, upon being applied by either party,
the matter has to be decided by an Electrical Inspector and if D
in the opinion of the Inspector the meter is found to be
defective, the Inspector shall estimate the amount of energy
supplied to the consumer or the electrical quantity contained
in the supply during such time not exceeding six months - But
if there is a question of fraud in tampering with the meter, in E
that case there is no question of applicability of s. 26 of the
Act - In the instant case, the respondent never asked or
applied for checking of the meter by the Electrical Inspector
on the ground of defective meter - Therefore, the ingredients
of s.26(6) were not followed by the respondent to meet the F
necessity of checking the meter in question in accordance
with the said provision - The inspection was made in the
presence of the representative of the respondent who was a
Manager of the said company and in his presence the meter
was checked up and was found to be tampered with - Electricity G
supply company was right in raising penal charges and penal
bill on the respondent on the ground of unauthorised
consumption by way of tampering the metering equipment.
The appellant conducted inspection at the premises
121 H
122 SUPREME COURT REPORTS [2014] 4 S.C.R.
A of the respondent and noted meter tampering and
accordingly raised bill imposing penal charges and
issued notice of disconnection in default of payment of
penal charges. The respondent did not make payment
and the electricity supply was disconnected. Aggrieved,
B the respondent filed a writ petition. The High Court held
that the representation filed by the respondent was never
considered before the imposition of penalty, far less
giving an opportunity of hearing. Accordingly, the High
Court held that this action of the appellant was in clear
c violation of the principles of natural justice and set aside
the penalty charges. The inspection report was also
quashed on the ground that such inspection was never
done in the presence of the authorised persons of the
respondent. In these circumstances, the High Court
further directed the appellant to refund the amount so
0
paid within three months. Hence the instant appeal.
Allowing the appeals, the Court
HELD: 1. Section 26 of the Electricity Act, 1910 is
E relevant only when there is any difference or a dispute
in connection with correctness of a meter. In that case
the matter shall be decided, upon being applied by either
party, by an Electrical Inspector and in the opinion of the
Inspector if it is found that the meter is defective, the
F Inspector has to estimate the amount of energy supplied
to the consumer or the electrical quantity contained in the
supply during such time not exceeding six months but if
there is a question of fraud in tampering with the meter,
in that case there is no question of applicability of Section
G 26 of the said Act. In the instant case, the respondent
never asked or applied for checking of the meter by the
Electrical Inspector on the ground of defective meter.
Therefore, the ingredients of Section 26(6) were not
followed by the respondent to meet the necessity of
checking the meter in question in accordance wlth the
H
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTD. v. BABA BAIJANATH 123
ROLLER & FLOUR MILL P. LTD.
said provision. [Para 11] [136-D-H] A
2. The inspection was made in the presence of the
representative of the respondent who was a Manager of
the said company and in his presence the meter was
checked up and was found to be tampered with. The plea B
of duress or coercion in signing the inspection report
was raised by the respondent but in reality no allegation
was made by the respondent before an appropriate
authority excepting such bald allegations were made
before the writ court without any basis or pvidence.
Therefore that fact has no bearing in deciding this matter.
c
The said fact cannot be ignored while dealing with the
matter concerning tampering of meter. The said aspect
escaped the attention of the High Court and therefore, the
High Court failed to appreciate the facts in their proper
perspective. Therefore, on this ground, the High Court D
has misconstrued the facts and the provisions of law in
dealing with the matter. The provision of law which deals
with tampering of metering equipments, i.e. clauses 56,
64 and 105 of the Code have not been considered by the
High Court and the High Court has failed to construe E
such provisions and erred in deciding the matter ignoring
the said provisions. The High Court accepted the position
submitted on behalf of the respondent/writ-petitioner that
it was a case of defective meter and there was no
question of any tampering with the meter in question. The F
High Court has failed to appreciate that the inspection
was made and the fact of tarnpering of meter would
appear from the inspection report and such inspection
report was signed on behalf of the respondent/writ-
petitioner. Therefore, the High Court ignoring the said G
fact, came to the conclusion without giving any reason,
that the inspection report was bad and has (!rred in
setting aside such inspection report. Hence, such
findings of the High Court cannot be sustained.
Therefore, the High Court was also wrong in not H
124 SUPREME COURT REPORTS [2014] 4 S.C.R.
A considering the rights of the appellant to raise penal
charges on the respondent on the ground of
unauthorised consumption by way of tampering the
meter or metering equipment and has a right to raise
penal bill in accordance with the provisions of Code. On
B this ground the High Court has erred in allowing the writ
petition in favour of the1 respondent, quashing the penal
charges and further the direction given to refund the
amount. [Para 12 and 13) [137-A-H; 138-A-B]
Madhya Pradesh Electricity Board & Ors. v. Smt.
C Basantibai 1988 (~) SCC 23; Sub-Divisional Officer (P),
UHBVNL v. Dharam Pal 2006 (12) SCC 222: 2006 (8) Suppl.
SCR 1175 - relied on.
Belwal Spinning Mills Ltd. v. U.P. State Electricity Board
D 1997 (6) SCC 740: 1997 (2) Suppl. SCR 197 - referred to.
Case Law Reference:
1997 (2) Suppl. SCR 197 Referred to Para 8
1988 (1) sec 23 Relied on Para 8
E
2006 (8) Suppl. SCR 1175 Relied on Para 14
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
4023 of 2014.
F From the Judgment and Order dated 03.08.2010 of the
High Court of Orisa at Cuttack in WPC No. 4072 of 2002.
WITH
Civil Appeal No. 4024 of 2014.
G
Suresh Chandra Tripathy for the Appellants .
.Sibo Sankar Mishra, M.K. Pandey, Adbhut Pathak for the
Respondent.
H The Judgment of the Court was. delivered by
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTD. v. BABA BAIJANATH 125
ROLLER & FLOUR MILL P. LTD.
PINAKI CHANDRA GHOSE, J. 1. Leave granted. A
2. This appeal is directed against an order dated August
3, 2010 passed by the High Court of Orissa allowing the writ
petition filed by the respondent, quashing the bill issued by the
appellant for a sum of 5, 10,930/- as well the notice of B
disconnection dated October 5, 2010.
3. The respondent-writ petitioner is a registered company,
inter alia, carrying on its business under the name and style of
M/s. Baba Baijnath Roller and Flour Mill Pvt. Ltd., having
installed a Mill in the district of Jharsuguda and is the consumer C
of the appellant herein.
4. The facts of the case, briefly, are as follows:
4.1 The respondent alleged in the writ petition that on an
inspection conducted by the appellant on September 9, 2002
0
at the premises of the respondent, the appellant intimated that
at the time of inspection it was found that H.T. Meter, T.P Box's
inner door and meter terminal cover quick seals, plastic seals
and paper seals were tampered. In addition, L.T.T.P Box inner
door quick seals, plastic seals and paper seals were found E
tampered. The B-Phase P.T wire was found cut as such the
meter was not getting B-Phase potential.
4.2 It was further brought to the notice of the respondent
by the appellant that the interference with the metering F
arrangement was made by the respondent in order to prevent
the meter from recording actual consumption which attracts
Regulation 64 of the Orissa Electricity Regulatory Commission
Distribution (Conditions of Supply) Code, 1998 (hereinafter
referred to as "the Code"). Accordingly, the penal charges as G
per rules were intimated and raised on the respondent on
September 30, 2002. The appellant further called upon the
respondent to submit its representation, if any, within seven
days. It was intimated that in default of payment of such charges
within seven days from the date of receipt of the penal bill, the
H
126 SUPREME COURT REPORTS [2014] 4 S.C.R.
A power supply to the premises will be disconnected without any
further notice. The penal bill was raised on the respondent/writ
petitioner for a sum of 5, 10,930/-. On October 5, 2002 the
electricity supply was disconnected since the respondent failed
to make the payment.
8
4.3 In these circumstances, a writ petition was filed by the
respondent challenging the action on the part of the appellant
before the High Court. The respondent-writ petitioner made out
a case that the bill used to be received by the writ petitioner
was around 80,000/- per month and according to the writ
C petitioner/respondent, the meter was defective and recording
excessive consumption.
4.4 The writ petitioner/respondent challenged the action on
the part of the appellant that when the inspection was made,
D at that point of time the officers of the appellant made a demand
for illegal gratification since refused by the Manager of the
respondent-company, the officers of the appellant raised such
allegations and further the Manager was forced to sign several
papers under duress and coercion.
E
4.5 It was urged before the High Court on behalf of the
respondent-company on the ground (i) that the penal bill had
been issued in violation of the principles of natural justice; (ii)
that the inspection was made without giving a notice and in the
F absence of the representative of the firm; (iii) that the allegation
of tampering with seals cannot be sustained as there was no
allegation that the outer seal of T.P. box was broken or
tampered with; and (iv) that the penal bill could not have been
raised since the meter was defective and was not recording
proper consumption. By filing a counter affidavit, the appellant
G herein duly contested the writ petition and stated that an
alternative remedy was available to the respondent under the
Code. It was further submitted that in the instant case, there is
no question of alleging that the meter is defective. It is a clear
case of theft of electricity by the consumer and Section 26 of
H
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTD. v. BABA BAIJANATH 127
ROLLER & FLOUR MILL P LTD. [PINAKI CHANDRAGHOSE, J.]
the Indian Electricity Act, 1910 (hereinafter referred to as "the A
Act of 1910") has no application. It is submitted that Section
26(6) of the Act of 1910 is attracted only when a meter is
defective and is incapable of recording the correct consumption
of electricity. It was further contended on behalf of the appellant
before the High Court that inspection of the meter was done in B
the presence of the representative of the writ-petitioner/
respondent.
4.6 The High Court after hearing the parties held that in
case of violation of principles of natural justice even if C
alternative remedy is available, a writ court can interfere for
redressal of grievance of the petitioner. The High Court further
held that the representation filed by the writ petitioner was never
considered before the imposition of penalty, far less giving an
opportunity of hearing to the writ petitioner. Accordingly, the
High Court held that this action of the appellant is in clear D
violation of the principles of natural justice. In these
circumstances, the High Court set aside the penalty charges
imposed by the appellant on the writ petitioner/respondent. The
inspection report was also quashed on the ground that such
inspection was never done in the presence of the authorised E
persons of the writ petitioner. The High Court further held that
since the penalty is untenable, the appellant was not entitled to
levy delayed payment surcharge on the penal charges treating
it as old arrears or current arrears. In these circumstances, the
High Court further directed to refund the amount so paid within F
three months.
4.7 Being aggrieved, this appeal has been filed by the
appellant.
5. Learned counsel appearing on behalf of the appellant G
contended before us that the High Court has erred in holding
that the matter should come within the purview of Section 26(6)
of the Act of 1910. He submitted that the High Court ignoring
the judicial pronouncements on this question undermined the
authority of the licensee (appellant) to impose penalty as a H
128 SUPREME COURT REPORTS [2014] 4 S.C.R.
A consequence on a consumer even if the consumer has
committed theft of electricity. By this process, the provisions of
the statutory Code have been made nugatory. The meter could
be subjected to tampering in various ways. The methods as
detected on inspection by the officers of the appellant are more
B than sufficient to conclude that the meter was tampered with
and did not record the actual consumption of energy consumed
by the writ petitioner/respondent. He further contended that the
theft of electricity is governed by the Code and not under the
provisions of the Act of 1910.
c 6. The relevant provisions of the Act of 1910 as well as
the Code, in particular Clauses 54, 56, 64, 105, 110 and 115,
were duly placed before us. It will be proper for us to reproduce
those hereunder:
D "Section 26 - Meters. - (1) In the absence of an
agreement to the contrary, the amount of energy supplied
to a consumer or the electrical quantity contained in the
supply shall be ascertained by means of a correct meter,
and the licensee shall, if required by the consumer, cause
E the consumer to be supplied with such a meter:
Provided that the licensee may require the consumer
to. give him security for the price of a meter and enter into
an agreement for the hire thereof, unless the consumer
elects to purchase a meter.
F
(2) Where the consumer so enters into an agreement for
the hire of a meter, the licensee shall keep the meter
correct, and, in default of his doing so, the consumer shall,
for so long as the default continues, cease to be liable to
G pay for the hire of the meter.
(3) Where the meter is the property of the consumer, he
shall keep the meter correct and, in default of his doing
so, the licensee may, after giving him seven days' notice,
for so long as the default continues, cease to supply energy
H
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTD. v. BABA BAIJANATH 129
ROLLER & FLOUR MILL P LTD. [PINAKI CHANDRA GHOSE, J.]
through the meter. A
(4) The licensee or any person duly authorised by the
licensee shall, at any reasonable time and on informing the
consumer of his intention, have access to and be at liberty
to inspect and test, and for that purpose, if he thinks fit, 9
take off and remove, any meter referred to in sub-section
(1); and, except where the meter is so hired as aforesaid,
all reasonable expenses of, and incidental to, such
inspecting, testing, taking off and removing shall, if the
meter is found to be otherwise than correct, be recovered C
from the consumer, and, where any difference or dispute
arises as to the amount of such reasonable expenses, the
matter shall be referred to an Electrical Inspector, and the
decision of such Inspector shall be final:
Provided that the licensee shall not be at liberty to D
take off or remove any such meter if any difference or
dispute of the nature described in sub-section (6) has
arisen until the matter has been determined as therein
provided.
E
(5) A consumer shall not connect any meter referred to in
sub-section (1) with any electric supply-line through which
energy is supplied by a licensee, or disconnect the same
from any such electric supply-line, but he may by giving not
less than forty-eight hours' notice in writing to the licensee
F
require the licensee to connect or disconnect such meter
and on receipt of any such requisition the licensee shall
comply with it within the period of the notice.
(6) Where any difference or dispute arises as to whether
any meter referred to in sub-section (1) is or is not correct, G
the matter shall be decided, upon the application of either
party, by an Electrical Inspector; and where the meter has,
in the opinion of such Inspector ceased to be correct, such
Inspector shall estimate the amount of the energy supplied
to the consumer or the electrical quantity contained in the H
130 SUPREME COURT REPORTS [2014] 4 S.C.R.
A supply, during such time, not exceeding six months, as the
meter shall not, in the opinion of such Inspector, have been
correct; but save as aforesaid, the register of the meter
shall, in the absence of fraud, be conclusive proof of such
amount or quantity:
B
Provided that before either a licensee or a consumer
applies to the Electrical Inspector under this sub-section,
he shall give to the other party not less than seven days'
notice of his intention so to do.
c (7) In addition to any meter which may be placed upon the
premises of a consumer in pursuance of the provisions of
sub-section (1 ), the licensee may place upon such
premises such meter, maximum demand indicator or other
apparatus as he may think fit for the purpose of
D ascertaining or regulating either the amount of energy
supplied to the consumer, or the number of hours during
which the supply is given, or the rate per unit of time at
which energy is supplied to the consumer, or any other
quantity or time connected with the supply:
E
Provided that the meter, indicator or apparatus shall
not, in the absence of an agreement to the contrary be
placed otherwise than between the distributing mains of
the licensee and any meter referred to in sub-section (1 ):
F Provided also that, where the charges for the supply
of energy depend wholly or partly upon the reading or
indication of any such meter, indicator or apparatus as
aforesaid, the licensee shall, in the absence of an
agreement to the contrary, keep the meter, indicator or
G apparatus correct; and the provisions of sub-sections (4),
(5) and (6) shall in that case apply as though the meter,
indicator or apparatus were a meter referred to in sub-
section (1).
H Explanation.-A meter shall be deemed to be "correct" if it
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTD. v. BABA BAIJANATH 131
ROLLER & FLOUR MILL P. LTD. [PINAKI CHANDRA GHOSE, J.]
registers the amount of energy supplied, or the electrical A
quantity contained in the supply, within the prescribed limits
of error, and a maximum demand indicator or other
apparatus referred to in sub-section (7) shall be deemed
to be "correct" if it complies with such conditions as may
be prescribed in the case of any such indicator or other B
apparatus."
"CHAPTER - IV
METERS
c
54. Initial power supply shall not be given without a correct
meter. Meters will be installed at the point of supply or at
a suitable place as the engineer may decide. The same
shall be fixed preferably in the basement or ground floor
in multi-storied buildings where it will be easily accessible D
for reading and inspection at any time. The consumer shall
run his wiring from such point of supply and shall be
responsible for the safety of the meter or metering
equipment on his premises from theft, damage or
interference. E
xxx
56. The meters and associated equipment shall be
properly sealed by the engineer and consumer's
acknowledgement obtained. The seals, nameplates, F
distinguishing numbers or marks affixed on the said
equipment or apparatus shall not be interfered with,
broken, removed or erased by the consumer. The meter,
metering equipment, etc. shall on no account be handled
or removed by any one except under the authority of the G
engineer. The engineer can do so in the presence of the
consumer or his representative. An acknowledgement shall
be taken from the consumer or his representative when
seal is broken.
H
132 SUPREME COURT REPORTS [2014] 4 S.C.R.
A xxx
64. If a meter or metering equipment has been found to
have been tampered or there is resistance by the
consumer to the replacement of obsolete or defective
8 meters by the engineer, the engineer may disconnect the
supply after giving seven clear days show cause notice
and opportunity to the consumer to submit his
representation.
xxx
c
Penal Charges --
105. (1) On detection of unauthorised use in any manner
by a consumer, the load connected in excess of the
D authorised load shall be treated as unauthorised load. The
quantum of unauthorised consumption shall be determined
in the same ratio as the unauthorised load stands to the
authorised load.
(2) The period of unauthorised use shall be determined by
E the engineer as one year prior to the date of detection or
from the date of initial supply if the initial date of supply is
less than one year from the date of detection. If the
consumer provides evidence to the contrary, the period
may be varied according to such evidence. The engineer
F may levy penal charges in addition to the normal charges
for aforesaid period of unauthorised use. Where addition
of the unauthorised installation or sale or diversion would
result in a reclassification according to this Code, the
whole of the power drawn shall be deemed to have been
G drawn in the reclassified category. The consumer shall also
be required to execute a fresh agreement under the
reclassified category.
(3) The penal energy charges for unauthorised use of
power shall be two times the charges applicable to the
H
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTD. v. BABA BAIJANATH 133
ROLLER & FLOUR MILL P. LTD. [PINAKI CHANDRA GHOSE, J.]
particular category of consumer. A
(4) The penal demand charges for unauthorised use of
power in cases covered under two part tariff shall be
calculated on un-authorised connected load expressed in
KVA multiplied by two times the rate of demand charges 8
applicable.
xxx
CHAPTER - XII
c
CONSUMER PROTECTION
110. (1) A consumer aggrieved by any action or lack of
action by the engineer under this Code may file a
representation within one year of such action or lack of
0
action to the designated authority of the licensee, above
the rank of engineer who shall pass final orders on such a
representation within thirty days of receipt of the
representation.
(2) A consumer aggrieved by the decision or lack of E
decision of the designated authority of the licensee may
file a representation within forty five days to the chief
executive officer of the licensee who shall pass final orders
on such a representation within forty five days of receipt
of the representation. F
(3) In respect of orders or lack of orders of the chief
executive officer of the licensee on matters provided under
Section 33 of the Act, the consumer may make a
reference to the Commission under Section 37(1) of the G
Act.
xxx
Overriding effect --
H
134 SUPREME COURT REPORTS [2014) 4 S.C.R.
A 115. (1) The provisions of this Code shall override the
provisions of OSEB (General Condition of Supply)
Regulation, 1995.
(2) Nothing contained in this Code shall have effect, in so
B far as it is inconsistent with the provisions of Indian
Electricity Act, 1910, Electricity (Supply) Act, 1948 and
Rules framed thereunder as amended by the Act."
7. Therefore, it would be evident from Section 26(6) which
carves out an exception, that where there is an allegation of
C "fraud", the same provision is not attracted. He further
contended that invariably a plea is being taken by the consumer
found to have committed theft of electricity that his meter was
defective. In the instant case, in accordance with Section 26(4),
an inspection was conducted in the presence of the
D representative of the respondent. If the meter is found to be
defective on such inspection and if the respondent was
desirous of availing the benefit of Section 26(6), it is the duty
of the consumer under the said Section to move an application
before the Electrical Inspector for getting the meter tested.
E
8. It was submitted that the Orissa Electricity Regulatory
Commission (for short "OERC") by virtue of Section 54 of the
Orissa Electricity Reforms Act, 1995 has framed a Code on
different issues including the manner in which theft of energy
F is to be determined. They are statutory in character.
Accordingly, he submitted that the High Court has erred in
dealing with the matter without taking into account the clauses
of the Code which are framed to deal with the theft of electricity.
Factually also, the High Court was incorrect in recording that
the inspection was conducted in the absence of the consumer.
G It is further submitted that the decision relied on by the High
Court is totally inapplicable in the facts and circumstances of
this case since Be/wal Spinning Mills Ltd. v. U.P. State
Electricity Board1 did not deal with the Code of 1998 framed
H 1. 1997 (6) sec 740.
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTD. v. BABA BAIJANATH 135
ROLLER & FLOUR MILL P. LTD. [PINAKI CHANDRA GHOSE, J.)
by the Orissa Electricity Regulatory Commission and the A
distinguishable feature of the said decision is that the said
decision made it clear that when there is an allegation of fraud
or tampering of meter, Section 26(6) of the Act of 1910 has
no application. Learned counsel further relied upon the decision
in Madhya Pradesh Electricity Board & Ors. v. Smt. B
Basantibai2 and drew our attention to paragraph 9 of the said
decision and contended that Section 26(6) of the Act of 1910
has no application where there is a dispute regarding the
commission of fraud in tampering with the meter and breaking
the body seal is totally outside the ambit cf Section 26(6) of c
the said Act. It is further contended that after the inspection was
conducted in the presence of the representative of the
consumer, details of the illegalities found on such inspection
were shared with the respondent consumer, resulting in receipt
of a vague reply from the consumer and was processed to
0
raise a demand by way of a penal bill. Therefore, according to
him, the requirement under the law was followed before
issuance of the said penal bill. He further pointed out thaf'on
being aggrieved by such decision, the writ petitioner/respondent
could have followed the statutory remedy as envisaged under
Section 110 of the Code. It is further stated that the High Court E
did not even give any reason for the direction to refund the
delayed payment surcharge.
9. In. these circumstances, it is submitted that the order of
the High Court cannot be sustained under the provisions of law. • F
The penal bill was quashed only on the ground that the unit of
the respondent was closed. Such fact is immaterial and
irrelevant in respect of demand of a penal bill. The approach
of the High Court is patently erroneous.
G
10. Per contra, it is submitted on behalf of the respondent
that the argument of the appellant could have succeeded if the
appellant could prove that the respondent had indulged in theft
of electricity. It is pointed out that on October 10, 2002, the High
2. 1988 (1) sec 23. H
136 SUPREME COURT REPORTS [2014] 4 S.C.R.
A Court directed the respondent to deposit 30,000/- without
prejudice and for restoration of power supply since the
electricity was disconnected on October 5, 2002. The power
supply was restored on deposit of 10,000/- and subsequently,
the respondent further deposited a sum of 20,000/- in terms of
B the direction. It is submitted that in spite of the interim order
passed by the High Court directing stay of realisation of the
penal bill, the appellants went on charging delayed payment
surcharge on the penal charges in monthly bills raised
subsequently on the respondent. It is submitted that the meter
c had actually inherent defects as only the inner seal was broken
but the outer seal was intact. It is true that the matter was not
referred to Electrical Inspector. It is further stated that in case
of a dispute between the Central Act and the State Act, Central
Act will prevail upon the State Act.
D 11. We have noticed the facts in this case. We have also
considered the Sections of the Act of 1910 and it appears to
us that Section 26 is relevant only when there is any difference
or a dispute arises in connection with correctness of a meter,
in that case the matter shall be decided, upon being applied
E by either party, by an Electrical Inspector and in the opinion of
the Inspector if it is found that the meter is defective, the
Inspector shall estimate the amount of energy supplied to the
consumer or the electrical quantity contained in the supply
during such time not exceeding six months but if there is a
F question of fraud in tampering with the meter, in that case there
is no question of applicability of Section 26 of the said Act in
such a matter. In the instance case, we have asked the learned
counsel appearing for the respondent whether following Section
26(6), the respondent ever asked or applied for checking of the
G meter by the Electrical Inspector on the ground of defective
meter. The answer was in the negative. Therefore, it shows that
the ingredients of Section 26(6) were not followed by the
respondent to meet the necessity of checking the meter in
question in accordance with the said provision.
H
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTD. v. BABA BAIJANATH 13 7
ROLLER & FLOUR MILL P. LTD. [PINAKI CHANDRA GHOSE, J.]
12. We have further noticed that the inspection was made A
in the presence of the representative of the respondent who is
a Manager of the said company and in his presence the meter
was checked up and was found to be tampered with. We have
also noticed that the plea of duress or coercion in signing the
inspection report was raised by the respondent but in reality B
no allegation was made by the respondent before an
appropriate authority excepting such bald allegations have been
made before the writ court without any basis or evidence.
Therefore that fact cannot have any bearings in deciding this
matter. We cannot brush aside the said fact from the mind while c
dealing with the matter concerning tampering of meter. It
appears to us that the said aspect has escaped the attention
of the High Court and therefore, in our opinion, the High Court
failed to appreciate the facts in their proper perspective.
Therefore, on this ground, we find that the High Court has 0
misconstrued the facts and the provisions of law in dealing with
the matter. The provision of law which deals with tampering of
metering equipments, i.e. clauses 56, 64 and 105 of the Code
have not been considered by the High Court and in our opinion
the High Court has failed to construe such provisions and erred
E
in deciding the matter ignoring the said provisions. The High
Court accepted the position submitted on behalf of the
respondent/writ-petitioner that it was a case of defective meter
and there is no question of any tampering with the meter in
question. The High Court has failed to appreciate that the
inspection was made and the fact of tampering of meter would F
appear from the inspection report and such inspection report
was signed on behalf of the respondent/writ-petitioner.
Therefore, the High Court ignoring the said fact, came to the
conclusion without giving any reason, that the inspection report
is bad and has erred in setting aside such inspection report. G
Hence, such findings of the High Court cannot be sustained.
13. Therefore, in our opinion, the High Court was also
wrong in not considering the rights of the appellant to raise
penal charges on the respondent on the ground of unauthorised H
138 SUPREME COURT REPORTS [2014] 4 S.C.R.
A consumption by way of tampering the meter or metering
equipment and has a right to raise penal bill in accordance with
the provisions of Code. On this ground the High Court has erred
in allowing the writ petition in favour of the respondent, quashing
the penal charges and further the direction given to refund the
B amount. The said order is without any reason and cannot be
sustained in the eyes of law. Hence, the same is set aside.
14. We have also noticed in Madhya Prade~h Electricity
Board & Ors. v. Smt. Basantibai (supra), this Court held:
c "9. It is evident from the provisions of this section that a
dispute as to whether any meter referred to in sub-section
(1) is or is not correct has to be decided by the Electrical
Inspector upon application made by either of the parties.
It is for the Inspector to determine whether the meter is
D correct or not and in case the lnspec~or is of the opinion
that the meter is not correct he shall estimate the amount
of energy supplied to the consumer or the electrical
quantity contained in the supply during a period not
exceeding six months and direct the consumer to pay the
E same. If there is an allegation of fraud committed by the
consumer in tampering with the meter or manipulating the
supply line or breaking the body seal of the meter resulting
in not registering the amount of energy supplied to the
consumer or the electrical quantity contained in the supply,
F such a dispute does not fall within the purview of sub-
section (6) of Section 26. Such a dispute regarding the
commission of fraud in tampering with the meter and
breaking the body seal is outside the ambit of Section
26(6) of the said Act. An Electrical Inspector has,
G therefore, no jurisdiction to decide such cases of fraud. It
is only the dispute as to whether the meter is/is not correct
or it is inherently defective or faulty not recording correctly
the electricity consumed, that can be decided by the
Electrical Inspector under the provisions of the said Act." .
H
WESTERN ELECTRICITY SUPPLY CO. OF ORISSA LTD. v. BABA BAIJANATH 139
ROLLER & FLOUR MILL P. LTD. [PINAKI CHANDRA GHOSE, J.]
In Sub-Divisional Officer (P), UHBVNL v. Dharam Pa/3, A
it appears to us that in case of tampering, there is no scope
for reference to Electrical Inspector. It was held :
"9. In State of WB. v. Rupa Ice Factory (P) Ltd. [2004 (10)
sec 635], it was observed as follows: (SCC p. 637, para 8
5)
"5. As regards the second claim, namely, the claim for the
period from December 1993 to December 1995, the
finding of the High Court is that the Vigilance Squad had
found that Respondent 1 had tapped the electric energy C
directly from the transformer to the LT distribution board
bypassing the meter circuit. If that is so, we do not know
as to why the High Court would go on to advert to Section
26 of the Electricity Act and direct reference to the
Electrical Inspector for decision under Section 26(6). In two D
aecisions of this Court in M.P Electricity Board v.
Basantibai [1988 (1) SCC 23] and J.M.D. Alloys Ltd. v.
Bihar SEB [2003 (5) SCC 226] it has been held that in
cases of tampering or theft or pilferage of electricity, the
demand raised falls outside the scope of Section 26 of the E
Electricity Act. If that is so, neither the limitation period
mentioned in Section 26 of the Electricity Act nor the
procedure for raising demand for electricity consumed
would arise at all. In this view of the matter, that part of the
order of the Division Bench of the High Court, directing that F
there should be a reference to the Electrical Inspector,
shall stand set aside. In other respects the order of the
High Court shall remain undisturbed. The appeal is allowed
accordingly."
15. In these circumstances, in our opinion, the High Court G
was wrong in bringing the matter within the scope of the
provision of Section 26(6) of the said Act, and further the High
Court was totally wrong in appreciation of facts even on the
3. 2oos c12i sec 222. H
140 SUPREME COURT REPORTS [2014] 4 S.C.R.
A question of inspection and stated that no representative was
present at that point of time. On the contrary, admittedly the
Manager of the respondent at the time of the inspection was
present.
16. In these circumstances, the appeals are allowed, the
8
writ petitions filed by the respondent/writ-petitioner are
dismissed and the order passed by the High Court is set aside.
D.G. Appeals allowed.
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