Shishir Jain vs Paschimanchal Vidyut Vitran Nigam Ltd.

The petitioner is the owner of Plot No. 10-D, Block E-15, Shatabdi Vihar, Sector 61, NOIDA having purchased the same for residential house. An electricity connection of a contracted load of 7.5 KW was sanctioned in the said premises by the respondent-Paschimanchal Vidyut Vitran Nigam Limited. The Rate Schedule applicable to the premises for residential/domestic purposes is LMV-1. The petitioner let out the said plot to the working girls through Nestway Technologies Private Ltd. which is a company engaged in the business of building a technology platform, facilitating rental services to the owner of the house. The petitioner also entered into a license agreement with the tenants of the premises.

The inspection was carried out in the premises of the petitioner on 19.12.2016. A First Information Report was lodged against the petitioner on 20.12.2016 for theft of electricity under Section 135(1)(e) of the Electricity Act, 2003 on the allegation that a private girls hostel was being run and managed by the petitioner in the premises which is a commercial activity and thus it ought to be billed under Rate Schedule LMV-2. The provisional assessment bill was issued to the petitioner which was challenged by him by filing a Writ Petition No. 1161 of 2017 which was disposed of by Division Bench of this Court vide judgment and order dated 11.01.2017 by making following order :-

"The petitioner is aggrieved by the action taken by the Executive Engineer, Pachimanchal Vidyut Vitran Nigam Ltd. in disconnecting the electricity supply.

It is stated that an inspection was carried in the premises of the petitioner on 19.12.2016. It was revealed that a "private boys hostel" was being run. A First Information Report was lodged against the petitioner on 20.12.2016 for theft of electricity under Section 135(1)(e) of the Electricity Act, 2003 and the power supply to the premises of the petitioner was also disconnected.

Sri. Chandan Agarwal, learned counsel for the respondents has stated that a provisional assessment bill of Rs. 1,74,725/- has been issued to the petitioner.

Learned counsel for the petitioner has submitted that, in fact, the electric supply was being used only for residential purposes and the stand of the Department that it was used for commercial purposes is not correct.

It will not be appropriate for the Court to examine the action of the respondents at this stage when the petitioner can file objections to the provisional assessment bill.

However, if the petitioner deposits 50% of the amount mentioned in the provisional assessment bill, the power connection of the petitioner shall be restored. The petitioner may also file an objection to the provisional assessment bill within 15 days from today so that a decision can be taken.

The petition is disposed of with the aforesaid observations."

In pursuance of the aforesaid order passed by this Court, the petitioner filed his objection before the Executive Engineer on 27.01.2017 and 50% amount of the provisional assessment bill was also deposited and the power connection was restored.

Thereafter a notice dated 04.03.2017, termed as final notice, was issued to the petitioner mentioning that the charges of theft of electricity was proved to be correct and the assessment made in accordance with the tariff of LMV- 2 to the tune of Rs. 1,74,725/- was correct and the said amount be deposited within 15 days. Another copy of the same notice was served again on the petitioner on 17.03.2017.

Learned counsel for the petitioner contends that without considering the objection filed by the petitioner to the provisional assessment and without giving any notice or opportunity of hearing, it appears that some final assessment has been made and the notice has been issued to deposit the amount. The same is in gross violation of the provisions of Section 126(3) of the Electricity Act and Section 8.1 of the Electricity Supply Code.

Sri Anshul Singhal, learned counsel appearing for the respondents states that the subsequent notice dated 04.03.2017 challenged by the petitioner is only a provisional assessment.

We are not at all convinced with the arguments. Provisional assessment was made on 10.01.2017 which was challenged by the petitioner before this Court in Writ Petition No. 1161 of 2017 and was disposed of by the Court vide order dated 11.01.2017. In pursuance of the aforesaid order, petitioner filed his objections against the said assessment. We do not see any ground or reason for the respondent authority to issue another provisional assessment as the provisional assessment bill had already been issued and objection had already been filed.

In the facts and circumstances of the case, we find force in the submission advanced by learned counsel for the petitioner that without considering the objection, some final assessment has been made in their record by the respondent and without supplying copy of the said order, notices are being issued to the petitioner to pressurize him to deposit the said amount.

From the pleadings, it is clear that no notice or opportunity of hearing to the petitioner has been accorded. Without considering the objections of the petitioner and without any opportunity of hearing and making any actual final assessment in accordance with the prescribed procedure, the petitioner is being pressurized to deposit the amount which was mentioned in the provisional assessment bill treating it to be final assessment by issuing notices.

Sub Section (1) of Section 126 of the 2003 Act provides that if on an inspection the Assessing Authority comes to the conclusion that consumer has indulged in unauthorized use of electricity, the Assessing Officer shall provisionally assess to the best of his judgment the electricity charges payable by such person or by any person benefited by such use. Therefore, the condition precedent to the provisional assessment under Section 126(1) is a conclusion by the Assessing Officer that the person concerned is indulged with unauthorized use of electricity. Such satisfaction cannot be permitted to be recorded on the mere vagaries of the Assessing Officer unless a fair opportunity of hearing in defence before the said authority is provided.

It is well settled that principles of natural justice, unless excluded by the act in question or by necessary implication cannot be held to be inapplicable when a person is being indulged to the charge like unauthorized use of electric energy, which may, in some cases, also amount to investigation under Section 135 of the Act. At this stage, it may also be relevant to notice Clause 8.1 (a) of the Electricity Supply Code, 2005 which provides the procedure to be adopted by licensee for inspection, provisional assessment hearing and final assessment in case of theft of electricity under Section 135 of the 2003 Act. Clause 8.1(b), relevant for the purpose of this case, is being reproduced as under :-

"(i) Within 3 working days of the date of inspection, the designated Authorised officer shall analyse the case after carefully considering all the evidences like documents, facts on record, the consumption pattern, wherever available and the report of inspection.

(ii) No theft case shall be booked for mere breakage of window glass or old seal of the energy meter. In such cases, if the average monthly consumption pattern for last one year is reasonably uniform as the assessed consumption (monthly), and there is no other prima facie evidence of theft/UUE found at the consumer premises, no further proceedings shall be taken for theft/UUE of electricity and the decision shall be communicated to the consumer under proper receipt within 7 working days of the date of inspection, and connection shall be restored through original meter after proper checking/resealing. The contents of such report recommending for dropping the case shall be communicated to the Special Court with a copy to the police station where the FIR was lodged.

(iii) If the Assessing Officer of the licensee suspects that theft of Electricity has taken place (as defined under Section 135 of the Act), he will serve the provisional assessment bill along with show cause notice to the consumer for hearing, giving 15 working days, under proper receipt. The notice shall invite objections in writing from the consumer, if any, against the charges and provisional assessment and require the presence of the consumer to answer to all the charges imposed by the licensee.

(iv) If, after hearing, the authorised officer finds that a case of theft has been established, the assessment shall be done for the energy consumption for past period as per the assessment formula given in Annexure 6.3 on [2 (two) times the rates as per applicable normal tariff to the purpose for which the energy is abstracted, used or consumed or wasted or diverted, whichever is higher and demand and collect the same by including the same in a separate bill. This is in addition to any civil / criminal proceedings that may be instituted as provided by the Act, and described in clause 8.2(vii).

(v) A copy of the order shall be served to the consumer under proper receipt and in case of refusal to accept the order or in absence of the consumer, shall be served on him under Registered Post/Speed Post. The Authorised officer may extend the last date of payment or approve the payment to be made in instalments on a consideration of the financial position and other conditions of the 16 licensee. The amount, the extended last date and/or time schedule of payment/instalments should be clearly stated in the speaking order."

We do not find from the record that the respondent authority has followed the procedure prescribed by Section 8.1(b) inasmuch as there is nothing on record to indicate that after objection was filed, any notice was given to the petitioner for personal hearing as required by Section 8(b) (iii) of the 2005 Code.

From the above facts and discussions, it becomes evident that procedure prescribed under Section 126 of the Electricity Act, 2003 and in Clause 8.1 of the 2005 Code issuing provisional assessment bill has not been followed at all as no opportunity was given to the petitioner for personal hearing nor there is anything on record to reflect that the objection filed by him was taken into consideration at all. Thus, the entire procedure adopted by the respondent is dehors the statutory provision.

The view being taken by us is fortified by various Division Bench judgments of this Court in the case of Ashok Kumar and others v. State of U.P. and others 2008(6) ADJ 660(DB), Kamil v. State of U.P. and others 2016(6) ADJ 11(DB) and Hazi Mohd. Yaseen v. Paschimanchal Vidyut Vitran Nigam Limited 2011(10) ADJ 261(DB).

Much emphasis has been laid by learned counsel for the respondent that the notices impugned in this petition have only been issued as a reminder to the petitioner which is merely a notice and no final assessment has been made till date.

Be that as it may, in case there is no final assessment as suggested by the learned Counsel for the respondent, the petitioner can not be compelled to deposit the amount of provisional assessment. Without making final assessment after considering the objection and giving opportunity to the petitioner, he cannot be compelled to deposit any amount. In such circumstances, the two impugned notices dated 04.03.2017 issued by respondent No. 2 are not liable to be sustainable and are hereby quashed.

The writ petition stands allowed. It shall, however, be open to the respondent to proceed with the final assessment proceedings in accordance with law and the procedure prescribed by the Act and the Electricity Code.