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Judgment
P.S. Mishra, C.J.—Heard the learned Counsel for the appellant. The question �Is a consumer of electricity entitled to choose payment of amount of consumption deposit or additional consumption deposit in Government security or National Savings Certificate, Bank guarantee etc., in lieu of the cash deposit as contemplated under 28.1 and 28.2 of the A.P.S.E.B. conditions of supply?'' is the question raised in the writ petition. The Court has dismissed the said petition holding that the Electricity Board is entitled to demand cash deposit only.
In exercise of the powers conferred by Section 49 of the Electricity (Supply) Act, 1948 and of all contractual, statutory and other powers, the A.P. State Electricity Board has notified terms and conditions of supply of electrical energy and incorporated therein as Clause 28 as follows:
"28. Consumption deposits:-
28.1 Initial Consumption deposit�
28.1.1 The consumer shall deposit with the Board a sum in cash equivalent to estimated three months'' consumption charges. The consumer coming under the L.T. Category ''domestic'' shall however pay at Rs. 30-00 per Kilowatt or part thereos connected load.
Provided that the Board may, in the case of Industrial consumers, accept by way of consumption deposit a sum equivalent to two months consumption charges during a period of three years from the date of first release of supply electricity.
28.1.2. In the event of the consumer failing to pay to the Board any sum that may become due for payment to the Board on the dates fixed for payment thereof, the Board may in addition to and without prejudice to the other rights of the Board, appropriate a part or whole of such deposit towards the sum due from the consumer.
28.2 Additional Consumption Deposit:- All consumers other than those L.T. Domestic consumers whose monthly bills are less than Rs. 500/- for a continuous period of six months, shall keep with the Board an amount equivalent to charges for three months demand and energy charges as consumption deposit. The adequacy of the Consumption Deposit shall be reviewed by the Board usually once in every year and/or at any time during the year if so warranted due to upward revision of tariffs, enhancement of the contracted demand by the consumer charges in the pattern of consumption by the consumer relaxation of power restrictions or such other factors which in the opinion of the Board, warrant review of the adequacy of the existing consumption deposit. The review shall take into account the following factors�
(i) In the case of consumers where there is no change in the Contracted Demand, the average consumption for the preceding twelve months after taking into consideration the quantum and nature of restrictions imposed, if any, during that period shall be the basis.
(ii) In the case of consumers who were sanctioned additional demand and availed it during a part of the period, average recorded consumption for the period of review shall be from the date of utilisation of increased demand to the date of review after taking into consideration the nature and quantum of restrictions imposed if any during that period.
(iii) The demand shall be contracted demand of the consumer at the time of review.
(iv) The rates, at which the demand or energy charges shall be calculated, will be tariff rates prevailing as on the date of review.
Based on such review, if the consumption deposit of the consumer is found inadequate or has fallen short on account of adjustments made as indicated in Clause 28-1-2 hereof the consumer shall deposit within 30 days of receipt of notice in this regard such additional amount as may be required by the Board or replenish the required amounts as the case may be.
28.3 Interest on Consumption Deposit:- Interest shall be paid by the Board on deposits of more than Rs. 60-00 made in cash at the rate of 3% per annum or such other rate as may be fixed by the Board from time to time. Full calendar months only shall be taken into account for the purpose of calculating interest and interest shall be calculated to nearest five paise. The interest accruing to the credit of the consumer shall be adjusted every year in the month of April in the Electricity Supply Bills.
28.4 Disconnection for non-payment of consumption deposit:- If the consumer does not make payment of amount of consumption deposit or additional consumption deposit or where the deposit is given Government security or National Saving Certificate Bank guarantee etc., he fails to replace them by deposit in cash when so demanded by Board within the notice period of 30 days, supply of the consumer shall be liable for disconnection.
28.5 ''The Consumption Deposit so calculated as per the Clauses 28.1 and/or 28.2 above shall not be less than three times the monthly minimum charges, applicable to the consumer under the category to which he belongs.''
28.6 ''All consumers shall pay the Consumption Deposit or additional consumption deposit within thirty days from the date of the demand notice. If there be any delay in payment, the consumer shall pay surcharge thereon equal to 1 1/2% per month or such other percentage to be fixed by the Board from time to time, of the demanded amount for each month of delay or part thereof. This will be prejudice to the Board''s right to disconnect supply of electricity.''
Learned Single Judge has held however:
".... When the right of the consumer to earn interest on his deposit becomes as valid as the right of the supplier to have consumption deposit, the matter, to my mind, is not free from doubt. But I am bound by the decisions of the two cases cited above because of constructive res judicata. For that reason alone, I dismiss the writ petition."
The above observation, it seems, has encouraged the appellant herein to contend specifically in the appeal that the words "a sum in cash equivalent to estimated three months'' consumption charges" in 28.1.1 should be read to include the choice of the consumer to deposit any Government Security or National Saving Certificate or Bank guarantee and take recourse to disconnection only when he (consumer) failed to replace them by depositing cash when so demanded by the Board within the notice period of 30 days. In Kistna Cement Works, Tadepalli Vs. The Secretary, APSEB, Vidyut Soudha, Hyderabad and Others, a Bench of this Court has gone into the various aspects of the consumption deposits including its validity and opined that a consumer can be compelled by the Board to make consumption deposit in cash only. In the case of Ferro Alloys Corpn. Ltd. Vs. A.P. State Electricity Board and another, the Supreme Court has affirmed the Judgment of this Court in Southern Steel Ltd. Hyderabad Vs. The Andhra Pradesh State Electricity Board, Somajiguda, Hyderabad, and held inter alia:
"(i) In imposing condition of non-payment of interest on consumption security deposit the board could not be said to have acted as a private trader.
(ii) The plea that the Board is monopolistic in character and therefore the consumers have no other option but to enter into contract is misconceived.
(iii) The rate of interest on security deposit cannot be equated with the rate of interest on the fixed deposit.
There is rationale in the demand of additional security deposit."
Any arguments thus indicating any loss of interest to the consumer because only a fixed interest is stipulated under the above clauses of the terms and conditions of supply, in our opinion, is misconceived and is contrary to the law declared by the Supreme Court as above. The demand of consumption deposit does not fall within the ordinary and calculated commercial activity of the Board although for all purposes the Board is a seller of the electricity and the consumer a purchaser of the electricity and once rationale for consumption deposit is established the demand of the Board for the deposit whether carrying interest or carrying no interest cannot be assailed on the ground of any loss of interest to the consumer. We have not been able to find in the above terms and conditions for consumption deposits both initial and additional, any contemplation of deposit in the shape of Government security or National Saving Certificate or Bank guarantee. 28.4 has to be read as a provision extending to cases where under given circumstances under a law or under a contract Government Security, Bank guarantee or National Saving Certificate is accepted in lieu of initial consumption deposit or additional consumption deposit, the Board shall have discretion to ask the consumer to replace the same by depositing cash and in case the demand of the Board to deposit in cash is not carried out within the notice period of 30 days to disconnect the supply of the consumer. 28.4 in itself is not a charging provision. The charging provisions are in 28.1 and 28.2. 28.4 however gives to the Board the power to demand for the cash deposit in cases of deposits in Government security or National Saving Certificate etc. Consumer does not have any option but to carry out the demand of the Board. Failure to do so will invite disconnection. We are not impressed by the contention of the learned Counsel for the appellant that the consumer has no (sic.) option and he can ask the Board to accept the Bank guarantee or a National Saving Certificate in place of the deposit in cash. The doubts expressed by the learned Single Judge, in our opinion, do not arise at all. It is too late for any consumer in the State of Andhra Pradesh to find any legal or constitutional infirmity in the provision for initial consumption deposit or advance consumption deposit even on the ground that it vests the Board with arbitrary power. Constitutional vires has already been upheld. Merely because a term is introduced by a statute and which has reasonable nexus with the objective to be achieved, because it is harsh to the consumer, it cannot be said it is arbitrary and thus violative of Article 14 of the Constitution. There is no merit in the appeal. The appeal is accordingly dismissed.