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Judgment
E. Padmanabhan, J.—W.P. No. 12264 of 1998: The Petitioner M/s. Southern Petrochemical Industries Corporation Limited has prayed for the issue of a writ of certiorarified mandamus to call for the records relating the proceedings of the first Respondent in 11721/HT/A1/96-3 dated 21.5.1996, quash the same and direct the first Respondent to refund the sum of Rs. 6,52,422/- collected as belated payment of surcharge from the Petitioner.
The very same Petitioner also filed W.P. No. 12265 of 1998 praying for the issue of a writ of certiorarified mandamus to call for the records relating to the proceedings of the first Respondent in SC/CEDC/North/ R/A3/HT/1294/D549/98. dated 28.4.1998. quash the same and direct the first Respondent to refund the sum of Rs. 11.13,402/- collected as belated payment of surcharge from the Petitioner.
Heard Mr. C. Natarajan, learned Senior Counsel appearing for the Petitioner and Mr. N. Muthusamy, learned Standing Counsel appearing for the Respondents in both the writ petitions.
It would be sufficient to refer to the facts in one of the writ petitions as the bone of contention raised in both the writ petitions is one and the same.
The Petitioner-Company engaged in the manufacture of fertilizers is a consumer of electricity and holding Account Nos. 15 and 49 with the first Respondent. The Petitioner is consuming High Tension power for the manufacture of fertilizer. The Bills for the energy supplied are issued periodically on the basis of meter reading. According to Clause 19 of the Terms and Conditions, the energy supplied will be metered and billed and such bills should be settled within 8 days from the date of the bill. Clause 19.05 provides for mode of payment. Clause 20 of the Regulations provides surcharge at 2% per mensem for the belated payment. The Electricity Board issued working instructions in BPMS 112, Technical Branch, dated 29.5.1989. According to the working instructions with regard to clauses 19 and 20, it is stated that interest/surcharge will be calculated for the number of days taking less than 15 days as 15 days and over above 15 days as one month. However the maximum surcharge per month is 2%. Month is defined as English Calendar month.
The Petitioner was served with a High Tension Energy bill against Account Nos. 15 and 49 for the month of December 1995 on 30.12.1995. The Petitioner was informed that the account bill has to be remitted on or before 5.1.1996. As there was financial constraints, the Petitioner applied to the Respondent on 4.1.1996 seeking permission to remit the Bill amount on or before 5.2.1996. The second Respondent by letter dated 5.1.1996 directed the Petitioner to pay the bill amount on 5.2.1996. The Petitioner had also remitted the bill amount on 5.2.1996. Thereafter the Petitioner was called upon to remit 4% of the sum paid on 5.2.1996 as belated payment surcharge in the bill dated 12.2.1996. Protesting the same, the Petitioner represented to the Chief Financial Controller TNEB and made a representation on 11.3.1996. By a reply dated 3.4.96, the Petitioner was informed that the request to waive surcharge is not feasible. In the meanwhile, the Petitioner had made further representation to the TNEB as well as to the Energy Department, Government of Tamil Nadu. However the Petitioner had to deposit 4% of the additional surcharge for both the accounts respectively amounting to Rs. 6,52, 422/- and Rs. 6,52,422/- since their representations have been rejected. The Petitioner paid the amount under protest. According to the Petitioner, the levy of belated payment surcharge over and above 2% in all is illegal and not warranted.
It is further contended that the demand of surcharge at 4% is per se illegal and arbitrary. The Petitioner contends that electricity charges which fell due on 5.1.1996 have been remitted on 5.2.1996. As a result, there is only a delay of 30 days calculated from the due date and surcharge if any cannot exceed 2% and there is no justification to demand surcharge for a period of two months. Even according to the working instructions, the demand at 4% surcharge is illegal and not in conformity with the working instructions.
It is contended that the Regulations provide for remittance of surcharge only for the actual number of days. Being aggrieved by the illegal levy of 4 % surcharge while admitting liability to pay only 2% as surcharge, the present writ petitions have been filed challenging the liability in excess of 2%.
The Respondents have not filed their counter, but Mr. N. Muthusamy, learned Standing Counsel has made his submissions.
There is no dispute about the date on which the Electric bill has been served and the last date on which the bill amount has to be paid. Extension of time has been granted subject to payment of belated payment surcharge. This also is not in dispute. As seen from the letter of the Superintending Engineer, the first Respondent dated 12.2.1996 the due date for the bill was 5.1.1996 and it was paid on 5.2.1996. For the said payment, according to the Respondents the first phase of the delay has to be calculated between 6.1.1996 and 31.1.1996 which comes to 26 days and the second phase being 1.2.1996 to 5.2.1996 which comes to 5 days and therefore for the first month as the delay exceeds 15 days the Petitioner is liable to pay 2% and for the next 5 days which spread over to the following month, another 2% surcharge has to be paid. In other words, it is claimed that the Petitioner is liable to pay belated payment surcharge for two months i.e.4%. Admittedly the Petitioner had remitted at the rate of 2%. The Petitioner was called upon to pay the differences of 2% within 7 days from the date of receipt of the said letter dated 12.2.1996. Though the Petitioner has taken up the matter with the Respondent higher authorities in the Board, the Petitioner''s request has been turned down and hence they are before the Court.
The questions that arise for consideration are:
(i) Whether the Petitioner is liable to pay 4% as demanded by the Respondent towards belated payment surcharge of 2% as contended by the Petitioner?
(ii) To what relief the Petitioner is entitled to?
It is essential to refer to the terms and conditions of supply and Section 49 of the Electricity (Supply) Act, 1948. Section 49 empowers the electricity Board to prescribe such terms and conditions as it thinks fit for supplying electricity to any person other than licensee. The terms and conditions of supply of electricity had been framed by the Respondent board. The definition Clause 2.01 (xi) defines the "Month" as hereunder:
"MONTH" unless otherwise specified means the Gregorian (English) Calendar month with reference to billing and payment in respect of high Tension service connection means the period between the date of meter reading in a particular month and the corresponding date of meter reading of the immediately succeeding or preceding month as the context requires.
Clause 19.00 provides for billing and payment. Clause 19.03 prescribes that in case of high Tension service connections, the Board will, as far as possible within four days after the expiry of each month, cause to be delivered to every consumer a bill of charges stating the amount payable by the consumer in connection with supply of electricity by the Board. Clause 19.05 provides that All High Tension Bills, including those on account of miscellaneous charges are to be paid within eight days from the date of the bill. If the payment is not received within seven days (notice period) from the expiry of the 8 days period allowed for payment, the supply will be disconnected. Clause 20.00 of the terms and conditions provides for belated payments. Surcharge is payable from the date following the last due date for payment of any bill. No surcharge will be levied on surcharge. The surcharge will be for a minimum period of fifteen days if the delay in payment is less than fifteen days. If the delay is more than fifteen days and less than a month, the surcharge will be for a month. If the delay is more than a month, the surcharge will be for the months delayed and for the fraction of the month, it will be proportionate to the number of days. The month means full month and not calendar month.
The above is the provisions contained in the terms and conditions of supply. The rate of surcharge had been revised or modified as of today. But the surcharge has to be calculated on the basis of per mensem. The definition clause has already been referred to as regards "month". With reference to billing and payment in respect of high Tension service connection, it means the period between the date of meter reading in a particular month and the corresponding date of meter reading of the immediately succeeding or preceding month as the context requires.
The rate of surcharge being 2% per mensem. The expression "month" has been defined in Section 2(37) of the General Clauses Act 1887 as a month reckoned according to the British Calendar in calculating a period, a month or a specified number of months that had elapsed after the occurrence of a specified event such as the giving of the notice. The general rule is that period ends on the corresponding date in the appropriate subsequent month irrespective of whether some months are longer than others. If the month in which the period expires has no corresponding date because it is too short, the period given by the notice ends on the last date of that month.
Month has to be reckoned by looking at the calendar. In computing a calendar month, it is sufficient to go from one day in one month to the numerical corresponding day in the next month and to exclude from the computation the day from which the month or year is calculated Section 24 of the Indian Limitation Act provides for working out limitation. According to the Gregorian calendar as has been held by this Court in Achuthan Nair v. Achuthan Nair reported in 1941 MLJ 502. Therefore, viewed from in any manner in the present case the belated payment of surcharge to be paid is on the basis of per mensem or a month and therefore it follows that on the facts, the Petitioner is liable to pay only 2% surcharge as within one month from the date on which the consumption charge is payable, the said charge have been admittedly paid. It may be that such a period of month may fall on the succeeding month of the corresponding date. But on that score, the Respondent cannot charge 4% by reckoning the same as two months. This is impermissible in law and it is contrary to the terms and conditions of supply.
Even as per the working calculation or instructions issued by the Respondent Board itself it will be only 2% and not 4%. Further 2% surcharge per month itself works out to 24% interest per annum, which is per se shocking and usurious, if it is considered as interest. However 2% is levied with a view to deter the consumer from delaying the remittance. On facts all 2% surcharge alone will be just and reasonable and for 30 days if 4% is collected, it will work out to 48% which is highly onerous and interorum. Hence the Petitioner is liable to pay only 2% towards surcharge. Therefore the excess collection of 2% has to be returned to the Petitioner. Therefore the excess collection of 2% is liable to be refunded to the Petitioner. The Petitioner is liable to pay only 2% of surcharge and collection of 4% by the Respondent is totally unauthorized and illegal and the amount collected in excess of 2% is liable to be refunded to the Petitioner in both the writ petitions.
In the circumstances, the writ petitions are allowed and the Respondent shall refund the amount collected in excess of 2% towards surcharge, within four weeks from the date of communication of this order and it is well open to the Respondent to set off such excess collection which the Respondent is liable to refund and adjust the same towards the current bill payable by the Petitioner. The impugned communication is quashed and the writ petitions are allowed.
Consequently, connected WM Ps are closed. The parties shall bear their respective cost.