Ram Bahadur - Petitioner @HASH State of U.P and Others

Tarun Agarwala, J. - We have heard Sri Harish Chandra Singh,the learned counsel for the petitioner and Sri Krishna Agarawal, the learned counsel for the Electricity Department.

The petitioner applied for an electric connection for the purpose of running a tubewell. After completion of necessary formalities an electric connection was granted by the Electricity Department on 14.04.2015.

It transpires that the Electricity Department carried out an inspection and found that the petitioner was using the electricity unauthorisedly by-passing the meter and using it for running an "Aata Chakki". An inspection report dated 03.06.2015 was filed, based on which a provisional assessment order was issued on 12.06.2015 for a sum of Rs.5,73,682/-. The petitioner filed its objection on 20.07.2016, which was considered and rejected and a final assessment order for a sum of Rs. 5,73,682/- was passed on 27.10.2015. A recovery citation dated 20.08.2016 was issued. The petitioner, being aggrieved by the recovery citation and the final assessment order has filed the present writ petition.

A perusal of the final assessment order dated 27.10.2015 indicates that the calculation has been made on the basis of a formula contained in Annexure-6.3 prescribed under the Electricity Supply Code, 2005 (hereinafter referred to as the Code).

In order to understand the controversy it would be relevant to mention a few provisions of the Act and the Code. Assessment is required to be made under Section 126 of the Electricity Act, 2003 (hereinafter referred to as the Act). Section 126(5) of the Act states as under:

"(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 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."

The aforesaid provision indicates that if the Assessing Officer finds that unauthorised use of electricity had taken place, in that case, assessment shall be made for the entire period during which the unauthorised use of electricity had taken place and if the period of such unauthorised use of electricity could not be ascertained, in such case the period would be limited to a period of twelve months immediately preceding from the date of inspection.

The procedure for making the assessment has been given under Clause 6.8 of the Code. Clause 6.8 (c)(iii) of the Code provides as under:

"(iii) 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 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 for all categories of services, and he shall provisionally assess the consumption as per the procedure specified in Annexure-6.3.

Note. - The assessing officer can draw ''conclusions'' that unauthorised use of electricity has taken place, based on findings that reveal existence of conditions of "unauthorised use of electricity" given in "Explanation" of clause 6.8, and evidence found suggests that unauthorised use of electricity was not made with ''dishonest'' intentions, but due to ignorance of procedure or rules or compulsions that only warrant a suitable assessment commensurate with the Act."

The formula given under Annexure-6.3 of the Code, is extracted hereunder:

" Annexure-6.3 (Ref. Clause 6.8(c)( iii) & 8.1(b)(iv)

(A). Assessment in case of unauthorised use of electricity

Units Assessed = Rs. * F * D * H.

Where Rs. = is the connected load in kW and in KVA where KVAh rate is applicable.

H = is the actual no. of hours the supply is made available on the feeder if available for the period, or average number of hours per day the supply is made available for different categories as below:

(a) Single shift industry (Day/night only), Agriculture: 10 hrs

(b) Non-continuous industry (Day/night only): non-domestic general including restaurants, Hotels, guest-houses, petrol pumps, and nursing homes and private hospitals: 20 hrs

(c) Continuous process industry: 24 hrs

(d) Domestic: 8 hrs

(e) Temporary connections: 12 hrs

D = Period during which such unauthorised use of electricity has taken place, and if, however, the period during which such unauthorised use of electricity has taken place cannot be ascertained, such period shall be limited to a period of 12 months (365 days) immediately preceding the date of inspection.

Note: For determining the ''actual period'' of unauthorised use, the assessing officer shall satisfy himself by the report of meter reader/Junior engineer of the facts reporting first instance of the unauthorised use detected (ii) Further scanning by the assessing officer, by checking previous consumptions, and ''tamper'' evidence from meter reading records, MRI reports etc. (iii) Any other record or evidence acquired from the connected premise/installation or site.

F = connected load factor for different types of supply as given below:

(a) For Rs. & F and domestic power consumers F = 0.30

(b) For non-domestic Rs. & F and power consumers F = 0.50

(c) For Small and Medium power consumers F= 0.50

(d) For large and heavy power consumer F = 0.75

(e) Agriculture F=0.30

(f) Categories not covered above F= 0.50

The consumption so assessed shall be charged at one and half times the rate per unit of the tariff applicable to the consumer category after adjusting the amount paid by the consumer/person for the energy consumption assessed for the assessment period if any. The amount billed at this rate (one and half times rate) shall not be taken into consideration for the purpose of computing consumer''s liability to pay monthly/annually minimum charges, wherever applicable.

In cases where fix monthly tariff exist, monthly assessment shall be made at one and half times the monthly rate.

For the case where the usage of electricity is for premises or areas other than those for which the supply of electricity was authorised, the procedure mentioned at S1. No. 1 to 3, shall be followed."

Section 126(5) of the Act clearly indicates that where unauthorised use of electricity is found to have taken place, the assessment would be made for the entire period in which such unauthorised use of electricity had taken place and if the period cannot be ascertained then such period would be limited to a period of 12 months immediately preceding the date of inspection. Clause 6.8 (c) (iii) of the Code also speaks of the same thing. The assessment has been made on the basis of formula indicated in Annexure-6.3 of the Code.

We are confining the present controversy to the criteria ''D'' indicated in the formula which relates to the determination of the period during which such unauthorised use of electricity had taken place. The "Note" indicated in Annexure-6.3 of the Supply Code, 2005 indicates that for determining the "actual period" of unauthorised use of electricity, the Assessing Officer has to satisfy himself, which would become the actual period of unauthorised use.

In the instant case, we find that there has been no determination of the actual period of unauthorised use of the electricity by the Assessing Officer. No satisfaction has been recorded by the Assessing Officer. On the other hand, without application of mind and mechanically, a period of twelve months, i.e., 365 days has been determined as the actual period of unauthorised use based on which the assessment order has been passed.

This determination of 365 days is patently erroneous. This 365 days can only be used for making the assessment, when the Assessing Officer is satisfied that the actual period of unauthorised use cannot be ascertained. In the instant case, the electricity connection was granted on 14.04.2015. The unauthorised use of electricity was found during the course of inspection after two months on 03.06.2015. The period of unauthorised use can be determined from the date when the connection was granted, i.e., from 14.04.2015 onwards. unauthorised use of energy cannot be extended prior to the date of connection nor there can be a deemed presumption of unauthorised use of electricity for twelve months or 365 days, which precedes the date of actual date of connection being granted. We are of the opinion that when the electricity connection was granted on 14.042015 unauthorised use of energy at best can be determined from that date onwards.

Learned counsel for the respondents has placed reliance upon a decision of Supreme Court in J.M.D. Alloys Ltd. v. Bihar State Electricity Board and Ors., (2003) 5 SCC 226 and decisions of this Court in Lalit Kumar Kapoor v. Kanpur Electricity Supply Company, Kanpur and Another, 2011(11) ADJ 484 and in Sri Bhagwan Gupta v. Kanpur Electricity Supply Company Ltd. and Ors, 2005(2) AWC 1269.

The said decisions are distinguishable inasmuch as the period of unauthorised use of electricity could not be established and consequently, the maximum period was taken into consideration for computation of the assessment as per the formula. In the instant case, the period is determined namely, from the date of grant of the electricity connection.

In the light of the aforesaid, the recovery certificate dated 20.08.2016 and the assessment order dated 27.10.2015 cannot be sustained and are quashed. The writ petition is allowed. The Executive Engineer is directed to pass a fresh assessment order in the light of the observations made above.