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Rajasthan State Electricity Board Vs. Shree Sadu Textiles Ltd. - Court Judgment

LegalCrystal Citation
SubjectElectricity
CourtRajasthan High Court
Decided On
Case NumberS.B. Civil First Appeal No. 88 of 1972
Judge
Reported in1985WLN(UC)112
AppellantRajasthan State Electricity Board
RespondentShree Sadu Textiles Ltd.
DispositionAppeal dismissed
Cases ReferredShiv Steel Works v. Union of India
Excerpt:
electricity act, 1910 - section 52 and electricity (supply) act, 1948--section 82--suit for damages against electricity board--held, it is maintainable;inspite of section 56 of the indian electricity act, 1910 and section 82 of the indian electricity (supply) act, 1948 a suit for damages against the electricity board is maintainable.;(b) electricity act - section 24--disconnection--violation of section 24--held, there is clear finding and decree suffers from no infirmity;since there is a clear finding of violation of section 24 of the act and this finding appears wholly justified on the record, the grant of the decree in favour of the plaintiff suffers from no infirmity.;appeal dismissed. - - the amount stated in the notice must be accurate and if it is in excess of what is legally due..........is a consumer of defendant no. 1 before the supply of bharka electricity to the plaintiff company, electricity was supplied by the electrical and mechanical department of the rajasthan government and later on by the defendant no. 1 which generated the electricity at ganganagar. execution of the agreement is admitted. the demand charges along with other conditions of the tarif were made applicable to the plaintiff and all other consumers and the plaintiff were informed through letter no 2074 dated 30-8 60. the gazette notification was duly published in the raj. gazette on 6-12-62 and was made applicable retrospectively from 1-5-60 to all consumers. at the request of the plaintiff it is admitted that power load was increased from 750kw to 850kw it is also alleged that the.....
Judgment:

Guman Mal Lodha, J.

1. This is a defendant's appeal against the decree passed by the trial court for an amount of Rs. 4738/-. The plaintiff has filed a cross-objection for an amount of Rs. 7437.54/-.

2. The plaintiff has filed the suit for recovery of Rs. 20,000/- as damages on account of illegal discontinuance of supply of electricity. It is alleged that the plaintiff is a company, incorporated under the Companies Act and carries on business of cotton ginnig, pressing, spinning and weaving. The defendant Nos. 2 and 3 are its officers. The plaintiff company is a consumer of electricity supplied by defendant No. 1 and generated from Bhakra Project. It is alleged that an agreement for supply of energy was entered into between the plaintiff company and defendant No. 1 on 24-2-60. The defendant agreed to supply a load of 750 KW subsequently raised to 850 KW at a schedule rate of two annas per unit till revised by the Board and difference if any to be adjusted. This agreement was to be read and construed as subject in all respect of the provisions of the Indian Electricity Act 1910 and law on the subject. The defendant No. I issued notification on 6-12-62 giving the rates to be charged in area served by the Bhakra Project and this tariff was made applicable from 1st May, 1960, but it was applicable to the plaintiff company from March, 1960. According to this tarifs the plaintiff company was to pay demand charges Rs. 5.75 per K.V.A. per month and energy charges at the rate specified in the notification. This notification further provided that if the monthly bill is not paid in full within the time specified in the bill surcharge of 1% shall be levied for each 30 days successive period or part thereof until the amount is paid in full. It was also alleged that correct metres were to be supplied by the defendant No. 1 and the plaintiff was to give security for the price of the meters. The defendant did not provide the metres to the plaintiff company inspite of the repeated requests. Consequently demand charges for the consumption of the electricity were made arbitrarily and without any legal basis. The claim of the demand charges was objected to by the plaintiff company and payments of the bill were made under protest from 1960 onwards. The plaintiff had made payments in protest exceeding Rs. 70,000. The defendants were grossly and culpably negligent in not making adjustments of the claims and over payments made by the plaintiff company.

3. It is alleged that the plaintiff made payments of the regular bills till February, 1963. On 6th March, 1963 a statement of accounts was sent by the defendants showing the details of the dues payable by the plaintiff company which was at variance with the regular bills and in contravention of the tariff schedule. It is alleged that false and inflated demand was created on account of demand charges and amount of Rs. 11,027/-regarding factory lighting from January 1960 to September 1962 was not adjusted and which were illegally collected by the defendants. Similarly Rs. 34,791/- illegally demanded and paid under protest regarding multiplier and admitted by the defendants to have been wrongly received was not adjusted and there were other errors and omissions in the account. Thus there was long standing and bonafide dispute between the plaintiff and the defendants as to what was the actual amount payable by the plaintiff to the defendant. The plaintiff alleged that according to it an amount of Rs, 70,261.00 was outstanding against the defendants whereas the defendants had claimed Rs. 77,549.62 from the plaintiff. The plaintiff was served with a notice under Section 24(1) of the Indian Electricity Act on 20-2-1963. The said notice is challenged by the plaintiff on the grounds that the plaintiff did not neglect to pay the amount claimed within the meaning of Section 24 as there was no amount legally payable by the plaintiff to the defendant. The amount stated in the notice must be accurate and if it is in excess of what is legally due then the notice is bad in law. Powers under Section 24 being drastic and strict compliance of the provisions of this section is mandatory. The plaintiff also alleged that the amount shown to be outstanding in the statement of accounts was entirely different from the claim mentioned in the regular bills and in no regular bills previous balance was shown. The plaintiff also challenged the notice on the ground that the defendants could recover the amount by filing a Civil Suit.

4. The plaintiff alleged that the defendants disconnected and discontinued the supply of electricity on 14-3-63 at 5 P.M. and it remained disconnected for 22/1-2 hours and was reconnected under the orders of Additional Chief Engineer R.S.E.B. Jaipur on 15-3-63 at 3.50 P.M. It is stated that this act of defendant No. 2 & 3 is malafide and misuse of authority vested in them by law. It is alleged that the Officers and employees of the plaintiff company were put to a lot of trouble and inconvenience. The business got suspended. The plaintiff suffered great loss in production. There was labour unrest; even the amenities of water and lighting were denied to hundreds of families. The company suffered an irreparable loss in prestige and reputation in business circle. The plaintiff claimed the following amount of damages on different heads:

(1) Workers wages for one day includingGinning Labour Rs. 3360/-(2) Loss of Profit on one day'sproduction Rs. 2500/-(3) Staff Salary for one day Rs. 1065/-(4) Depreciation-interest andInsurance for one day Rs. 5277/-(5) Coal and Water charges forone day Rs. 640/-(6) Electric demand charges forone day Rs. 200/-(7) Telegram and Telephone charges Rs. 500/-(8) Travelling expenses in connectionwith Shut down Rs. 1300/-(9) One days' cotton (Kapas) which could not be ginned and got damageddue to rain Rs. 4000/-(10) Mental worries and physical discomfort to the officers and employees of the company Rs. 2158/----------------Rs. 20,000/----------------

On these facts the plaintiff prayed for a decree of Rs. 20,000/- with costs against the defendants.

5. The defendants submitted joint written statement. The defendants did not admit the fact of incorporation and the certificate of commencement of business by the plaintiff company though it is admitted that the plaintiff company is carrying on the business as alleged. With regard to the status of the defendants it is admitted that defendant No. 1 is a body corporate and defendants No. 2 and 3 are on deputation and are public officers and they carried out their duties as required by law. It is also admitted that the plaintiff is a consumer of defendant No. 1 Before the supply of Bharka Electricity to the plaintiff company, electricity was supplied by the Electrical and Mechanical Department of the Rajasthan Government and later on by the defendant No. 1 which generated the electricity at Ganganagar. Execution of the agreement is admitted. The demand charges along with other conditions of the tarif were made applicable to the plaintiff and all other consumers and the plaintiff were informed through letter No 2074 dated 30-8 60. The Gazette Notification was duly published in the Raj. Gazette on 6-12-62 and was made applicable retrospectively from 1-5-60 to all consumers. At the request of the plaintiff it is admitted that power load was increased from 750KW to 850KW It is also alleged that the plaintiff company was informed about the different rates of energy consumed in residential quarters and the street lightening of the colony. Para 8 of the plaint regarding supply of correct metres by the defendant No. 1 was not admitted. It is alleged that the licencee if required by the consumer shall cause the consumer to supply with metres and the consumer is to keep the metres correct if it is his property under Section (3) of the Electricity Act. The defendants stated that energy metre was installed but no request was made by the plaintiff for the maximum demand meter. On the other hand the plaintiff offered to provide the aforesaid meter in the month of September, 1962 and the same was installed in the month of December, 1962. Regarding the demand charges she plaintiff's allegations were denied and it alleged that they were calculated on the basis of records of consumer maximum meter for the period of January February, 1963. The assessment of the demand charges for the period on meter was installed was done on the average taken during the period the plaintiff had installed his meter. The maximum demand meter had shown 1080 KVA to 1100 KVA during January February, 1963 and plaintiff was assessed on 1000 KVA for the period the meter was not installed. It is also alleged that the consumer had made the payments under protest but did not inform as to how and to what extent the amount was not due or for what amount they had the protest to deposit. The payments under protest became a matter of habit with the consumer rather than as any genuine protest. The plaintiff was asked on 8-4 63 to furnish a statement of amounts deposited under protest but it was no furnished. The legal basis of charging demand charges has been the BN tarrif notified by the State Government. The consumer was at liberty to pay at the original rate of annas two per unit if it did not agree to the metering arrangements. The defendants denied the bills to be wrong and it was alleged that the plaintiff could have sought remedy under Sections 24 and 26 of the Indian Electricity Act by referring the matter to the Electrical Inspector and it is alleged that there was no genuine dispute.

6. It is alleged that even after the application of the BN tarrif the following bills were either not paid or were under paid by the plaintiff.

BILLS NOT PAIDS. No. Month Amount(1) July, 1960 Rs. 19427.70 np.(2) August, 1960 Rs. 19165.40(3) September, 1960 Rs. 16015.95(4) October, 1961 Rs. 10526.22(5) April, 1962 Rs. 26027.70(6) May, 1962 Rs. 23670.70BILLS PARTLY PAIDS.No. Month Billed. Paid less(1) June, 1960 Rs. 21848.46 Rs. 14734.10(2) December, 1961 Rs. 25440.14 Rs. 23828.88(3) August, 1962 Rs. 36077.89 Rs. 24242.92(4) October, 1962 Rs. 26323.77 Rs. 23742.14(5) November, 1962 Rs. 25215.35 Rs. 22929.26(6) December, 1962 Rs. 27798.31 Rs. 24964.19(7) January, 1962 Rs. 27549 41 Rs. 24453.18

It is alleged that a notice was issued in Feb/March 1963 for the payment of Rs. Rs. 77549/- and this statement was in accordance with tariff of schedule and the plaintiff is liable to pay all the dues. The plaintiff paid Rs. 25524 or* 29-4-63 out of the said sum. The statement is alleged to be correct and it is stated that the amount referred to in para 14 of the plaint was rightly collected and the amount paid had been adjusted and no over payments were taken from the plaintiff. The existence of any dispute much less a genuine dispute was denied and it is alleged that the plaintiff has been a habitual defaulter in payment of the electricity bills as there has been deliberate attempt on the part of the plaintiff not to pay the legitimate dues so the notice issued under Section 25(1) is valid. The amount was legally payable and the plaintiff had neglected to pay the same. The defendants admitted the discontinuance of supply and its restoration under the orders of the Additional Chief Engineer and it is alleged that the supply was disconnected in the ordinary course of duty because of the acts and omissions of the plaintiff. With regard to defendant No. 2 and 3 it is alleged that they are not necessary parties. The suit is bad for misjoinder of parties and they have been impleaded in order to terrify them. Their action is protected under Section 36 of the Indian Electricity Act and Section 82 of the Electricity (Supply) Act. Para 19 of the plaint regarding claim of damages was denied and it is alleged that the plaintiff company did not suffer any loss. If any loss is proved, it is on account of plaintiff's own acts. It is also alleged that the amount of loss calculated is unrealistic, inflated and multifold. It is further alleged that the action was taken in good faith and as provided by law and the act complained is protected under Sec 56 of the Indian Electricity Act and Section 82 of the Electricity (Supply) Act. It is further alleged that the plaintiff is not entitled to bring a suit and under Section 76 of the Electricity Act, 1948, this court is barred to try the suit.

7. In the additional pleas an objection is taken that the defendants Nos. 2 and 3 were public officers and no notice under 80 CPC is given so the suit is liable to be rejected. An objection is further taken that it was obligatory for the plaintiff to refer the matter to be determined by Arbitrator and the suit is not maintainable and as is barred under Section 76 of the Electricity (Supply) Act read with Schedule VI of the same. In the end the defendants prayed that the plaintiff's suit be dismissed with costs and compensatory costs to the extent of Rs. 1,000/- be awarded to the defendants.

8. On the pleadings of the parties the following issues were framed:

(1) Whether the plaintiff Company is incorporated under the Companies Act and commenced its business ?

(2) Whether the defendants No. 2 and 3 are not public servants, Hence the suit is maintainable in the absence of notice under Section 80 C.P.C.

(3) Whether the rate of energy used in residential quarters, street, lightening of the colony etc., would be charged at different rate under the agreement if so from what date ?

(4) Whether it was the duty of the defendant to supply correct meters and whether they were not supplied inspite of repeated requests from the plaintiff ?

(5) Whether the plaintiff is entitled to pay demand charges at the original rate of annas two per unit, if he did not agree in the metering arrangement provided for by the defendant ?

(6) Whether the defendants were negligent in not making the adjustment of the claims and over payments made by the plaintiff company ?

(7) Whether the notice given by the defendant on 20-2-63 to the plaintiff was void for the reasons contained in para 16 of the plaint ?

(8) Whether the action of the defendant No. 2&3 in disconnecting the supply of electricity to the plaintiff company on 14-3-63 was mala-fide, malicious and misuse of the authority vested in them by law?

(9) Whether the plaintiff company suffered a loss of Rs. 20,000/- on account of disconnection of supply of electricity by the defendant and is entitled to get it from the defendant ?

(10) Is the suit of plaintiff barred by Section 76 of the Electricity (Supply) Act, 1948 read with Schedule VI of the Act ?

(11) Is the suit of plaintiff hit by Section 56 of the Indian Electricity Act. 1910 and Section 82 of Electricity (Supply) Act, 1948 ?

(12) Are the defendants entitled to compensatory costs ?

(13) To what relief the plaintiffs are entitled ?

9. Arguments on issue No. 2 were heard and it was decided against the plaintiff and the suit was dismissed on 14 3-66. Thereafter the plaintiff went in appeal before the Hon'ble High Court. The Hon'ble High Court accepted the appeal in part against the Rajasthan State Electricity Board and remended the case against Rajasthan State Electricity Board for decision in accordance with law. The Hon'ble High Court held that defendants Nos. 2 and 3 are not necessary parties. They are public officers as described under Clause H of Section 2 CPC. No notice under Section 80 CPC was served on them and the suit against them is not maintainable. After the receipt of the record, issues Nos. 10 & 11 were heard as preliminary issues on the plaintiff's application dated 5-6-71. The disposal of issue No. 11 was deferred as it involved matter of fact as well. Issue No. 10 was decided in favour of the plaintiff and against the defendant.

10. Patties produced oral and documentary evidence. The plaintiff examined P.W. 1 G P. Khanna, Agent, PW 2 P.L. Johar Accountant. The defendant No. 1 examined DW 1 Tilak Raj.

11. The above controversy ultimately resulted in the decree, as mentioned above.

12. The trial court decided that though there was no malice and malafide intention of the officers in disconnection, but on the basis of the finding of issues No. 4,5 and 7, the plaintiff was entitled to decree. It was held that there was bonafide dispute and, therefore, the plaintiff committed no mistake. Further, there was mistake of the amount in the notice as excess amount was demanded and notice was given Under Section 24, Clause (1). In view of the above fact, it was held that disconnection was illegal, without justification and against the provisions of law.

13. Before this Court, Mr. Bhandari assailed the finding of the trial court, but ultimately pressed the provisions of Section 56 of the Indian Electricity Act, 1910 and Section 82 of the Act as amended.

14. Mr. Mehta in reply, referred to the judgment of this Court in Sadul Shahar Cotton Ginning & Pressing Factory v. Rajasthan State Electricity Board 1972 RLW 1, in which it has been held that inspite of Section 56 of the Indian Electricity Act, 1910 and Section 82 of the Indian Electricity (Supply) Act, 1948 a suit for damages against the Electricity Board is maintainable.

15. Prima facie this judgment appears to fortify the contention of Mr. Mehta that suit could be entertained and Mr. Bhandari's plea for protection of Sections 56 and 82 cannot be accepted. In fact I am not inclined to make any reference to Division Bench for reconsideration of the above view as no such serious infirmity has been shown so far. Mr. Mehta further pointed out that this view is fortified by another judgment of Shiv Steel Works v. Union of India 1980 WLN 237. It is not necessary for me to discuss the latter case because it is under the Central Excise and Salt Act and has got indirect application only.

16. In view of the above, I am of the view that since there is a clear finding of violation of Section 24 of the Act and this finding appears wholly justified on the record, the grant of the decree in favour of the plaintiff suffers from no infirmity.

17. So far as the cross-objection of Mr. Mehta is concerned, it appears that there is no substance in it. Obviously, the plaintiff has not been able to prove the amount, which have been disallowed and nothing has been shown to persuade me to hold that those findings are incorrect.

18. I am, therefore, in agreement with the finding of the lower court on all the issues.

19. Consequently, the appeal as well as the cross-objections are dismissed without any order as to costs.


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