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Elegant Fashion Accessories Pvt. Ltd v/s Calcutta Electric Supply Corporation Limited

    W.P. Appeal No. 2013 of 2001

    Decided On, 11 March 2002

    At, High Court of Judicature at Calcutta

    By, THE HONOURABLE MR. JUSTICE PRABIR KUMAR SAMANTA

    For the Appearing Parties: ---------------



Judgment Text

(1) THE Court : In this writ petition the petitioners have prayed for a direction upon the Respondent/cesc Limited to provide supply of electricity in the name of the petitioner No. 1 at Premises No. 20, Ashutosh Mukherjee Road, Calcutta - 700 020. Pursuant to the application made by the petitioner No. 2 on behalf of the petitioner No. 1 the Respondent/cesc Limited by a letter dated 5th August, 1999 intimated to the petitioners that there are outstanding dues in respect of consumption of electricity at the above premises and consequently asked the petitioners to obtain a clearance in respect of the same. Accordingly, this writ petition has been filed for the direction as above upon contention that the petitioners are not at all liable for making payment of the said outstanding dues, if there be any, in respect of consumption of electricity in the aforesaid premises by consumers to whom such electricity was supplied.


(2) THE petitioner No. 1 is one of the Companies and/or Partnership Firms belonging to a particular group of companies headed by the petitioner No. 2 who is the Managing Director of the petitioner No. 1. The premises No. 20, Ashutosh Mukherjee Road, Calcutta - 700 020 comprised in a three stored building situated on a land measuring approximately 2 Cottahs 4 Chittaks originally belonged to one Mr. Rajesh Goel from whom the same was purchased by Marks Supermarkets (Private Limited) in the year 1993. The said property was secured for various loans taken by the said Marks Supermarkets (Pvt. Ltd.). The said Supermarkets failed to pay back the respective loans to release the said property from various charges created by way of mortgages. Accordingly, various legal proceedings were initiated by the creditors. The petitioners and its sister concerns in order to settle the claims of the creditors entered into separate agreements for purchase of the said property with the Director of the said Supermarkets (Pvt. Ltd.). The petitioners upon such agreement intervened in the various legal proceedings and settled the claims of all the creditors and the said property was freed from all encumbrances.


(3) THEREAFTER by four conveyance deeds dated 27th June, 2001 the petitioners and its sister concerns purchased the aforesaid property in their respective shares and were put into possession. In the aforesaid premises electricity was being supplied through several electric meters in the name of P. S. E. Carriers (P.) Limited, Mr. Amarjyot Singh Lamba, Mrs. Chand Kaur Lamba, Mr. Subodh Kumar Ghosh and Mr. Rajesh Goel under their respective consumer members. At the time of taking possession of the said premises by the petitioners all such electric connections except in the name of Mr. Rajesh Goel under his respective consumer number stood disconnected. Upon taking possession of the said premises as above, the petitioners continued to enjoy the supply of electricity through the supply line existing in the said premises in the name of Mr. Rajesh Goel under his consumer number.


(4) THE Respondent/cesc Limited upon appearance contested this writ petition by filing an affidavit-in opposition to the same. In the said affidavit-in opposition the Respondent/cesc Limited did not specifically deny the facts relating to the acquisition of the said property by the petitioners and it's sister concern. It was stated therein that in the said premises there are outstanding dues from the registered consumers namely Mrs. Chand Kaur Lamba, M/s. P. S. L. Carriers (P.) Ltd, Mr. Amarjyot Singh Lamba and Mr. Subodh Kunmar Ghosh to the tune of Rs. 5,63,599. 64p. , Rs. 2,40,941. 65p. , Rs. 1,59,361. 32p. and Rs. 4,783. 61p. respectively. Because of non-payment of aforesaid outstanding dues of the Respondent/cesc Limited by the respective consumers the supply lines were disconnected. It was further stated that the supply line existing in the name of Mr. Rajesh Goel has not yet been disconnected but in respect of the same there are also outstanding dues for a sum of Rs. 12, 393. 70p. to the Respondent/cesc Limited and for non-payment of the same such supply line is also liable to be disconnected. The Respondent/cesc Limited accordingly alleged that for the purpose of supply of electricity in the name of the petitioners in the aforesaid premises, the petitioners are liable to make payment of all the said outstanding dues of the Respondent/cesc Limited.


(5) ACCORDINGLY, the question arises for a decision in this writ petition as to whether the petitioners are liable to make payment of the same. This question has been dealt with in detail by this Court in the case of Subhendu Banerjee and Ors. v. CESC Limited (W. P No. 6614 (W) of 2001) and has already been answered in the negative by a judgment and order dated 8th March, 2002 made therein. In the said judgment it has been held that section 49b of the Electricity (Supply) Act, 1948 as introduced by West Bengal Act, 50 of 1994 did not bring about any change in the very provisions of the Act upon which the Supreme Court decision reported in (1995)2 SCC 648 (Isha Marbles v. Bihar State Electricity Board and Another) was based. The Supreme Court in the said decision held that under section 24 of the Indian ELECTRICITY ACT, 1910 there is no change over the property. Where that premises comes to be owned or occupied by the auction purchaser, when such purchaser seeks supply of electric energy he cannot be called upon to clear the past arrears as a condition precedent to supply. What matters is the contract entered into by erstwhile consumer with the Board. The Board cannot seek the enforcement of contractual liability against the third party. Of course, the bonafides of the sale may not be relevant.


(6) IN view of the aforesaid decision the petitioners are not at all liable for making payment of any of the outstanding dues of the CESC Limited standing in the name of the consumers to whom the electricity was supplied in the aforesaid premises and which supply stood disconnected for non-payment of the same when the petitioners took possession of the said property as above. The Petitioners therefore cannot be asked to clear off the outstanding dues of the CESC Limited in respect of the consumers namely Mrs. Chand Kaur Lamba, M/s. P. S. L. Carriers (P) Ltd. Mr. Amarjyot Singh Lamba and Mr. Subodh Kr Ghosh as a condition precedent for supply of electricity in their favour.


(7) HOWEVER, it is evident from the facts and circumstances of this case that the supply of electricity in the name of Mr. Rajesh Goel has been in existence at the time of purchase and taking over possession of the said premises by the petitioners. The petitioners are consuming electricity that is being supplied in the name of Mr. Rajesh Goel. Therefore, the petitioners are beneficiaries of such supply which has not yet been disconnected for non-payment of the outstanding dues of the CESC Limited. Now the question is whether supply of energy in the name of the petitioners should be with the condition precedent for payment of all outstanding dues in the consumer name of Mr. Rajesh Goel. In this connection reference may be made to the Clause (c) in the first proviso in sub clause (1) in Clause VI of the Schedule to the Indian ELECTRICITY ACT, 1910, as inserted by West Bengal Act LV of 1994. The said Clause (c) reads as under :-"clause (c). If any prospective consumer, who has been a beneficiary to a disconnected connection, applies for fresh connection or restoration of disconnection, he may be allowed such connection or restoration, as the case may be, if he makes payment of the outstanding dues along with late payment fees in respect of the disconnected connection to which he has been a beneficiary. Explanation.-'beneficiary' includes any member of the family of the consumer and, in the case of industrial or commercial supply, the employees of the consumer".


(8) THIS Court in the aforesaid judgment in the case of Subhendu Banerjee (supra) has held that this Clause (c) in substance is directed towards a person who intends to defraud the licensee of it's lawful dues that accrued in respect of a disconnected supply to a consumer through whom the said person has consumed electricity Nand virtually placed himself in the position of a consumer of electricity, by applying for a new connection in his favour. This provision also therefore, does not create any obligation upon any person, who applies for supply, for making payment of the outstanding dues for the energy supplied to any third person where such person has not been benefited by such supply of energy to that third person for which the dues arose.


(9) IN the present case supply of energy to the consumer namely Mr. Rajesh Goel under his consumer number has not yet been disconnected inspite of default in making payment of the outstanding dues for the energy supplied to him. Such supply of energy in the consumer name of Sri Rajesh Goel in the first place is not a disconnected connection. The petitioners upon purchase as above of the premises in question are consuming electricity through such supply in the consumer name of Mr. Rajesh Goel.


(10) THE Supreme Court in the case of Isha Marbles (supra) held as under in paragraphs :-


49. "it is important to note that though the purchasers asked for electricity connection as a new connection it cannot be regarded as a new connection. It is only a reconnection since the premises had already been supplied with electrical energy. Such a supply had been dis-connected owning to the default of the consumer. That consumer had bound himself to the Board to pay the dues. He also agreed to abide by the condition as stipulated in the Act and the Rules including the payment of the dues.


50. Under section 79 clause (j) read with section 49 of the Supply Act it is open to the Board to make Regulations to stipulate the terms and conditions of supply of electrical energy. One such stipulation is that the consumption charges must be paid. In Ferro Alloys Corpn. Ltd. v. A. P. SEB (at page 171) (to which one of us was a party) it was held thus (SCC para 102). "under the regulations framed by the Board in exercise of powers of section 49 read with section 79 (j) the consumer is only entitled and the Board has an obligation to supply energy to the consumer upon such terms and conditions as laid down in the regulations. If, therefore, the regulations prescribed a security deposit that will have to be complied with. It also requires to be noticed under clause VI of the Schedule to the ELECTRICITY ACT, 1910 that the requisition for supply of energy by the Board is to be made under proviso (a) after a written contract is duly executed with sufficient security. "


51. What then are the remedies of the Board should the consumer fail to pay? Undoubtedly, resort could be had to section 24 of the ELECTRICITY ACT, 1910. The provisions of this section come into play when; (a) the consumer neglects to pay any charge for energy due from him to a licensee, or (b) the consumer neglects to pay sums other than a charge for energy due from him to the licensee.


52. In these circumstances, the licensee may after giving the consumer a written notice of not less than seven clear days cut off the supply and continue to keep the supply cut off till the consumer shall have paid the sum or sums due.


53. We want to make it clear that resort to section 24 is not the only remedy available. The general remedy to file a suit will always be available to the Board. "


(11) IN view of the aforesaid observations by the Supreme Court and further by taking into consideration the situation that if supply is given to the petitioners, then the supply which exists in the name of Mr. Rajesh Goel will for all practical purposes undergo a mere change in the consumer number and the name of the consumer, the petitioners also cannot be called upon to clear off the dues for the energy consumed by Mr. Rajesh Goel, because such a situation has been brought about by the ina

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ction of the CESC Limited. Otherwise situations will galore where CESC Limited or the Board will not discharge their statutory duties and functions and will not act against the defaulting consumer at the required time but will make pray of bonafide consumers to recover it's past arrears upon duress in the name of supplying energy to them, even when the CESC Limited or the Board is not entitled to seek enforcement of contractual liability against third party. (12) IN all these views the Respondent/cesc Limited is directed to provide supply of electricity to the writ petitioners in the aforesaid premises without demanding payment of the past arrears for the electricity consumed in the aforesaid premises by the consumers other than the petitioners. However, the petitioners shall make payment of the arrears if there be any in the consumer name of Mr. Rajesh Goel since after purchase of the said premises by the petitioners inasmuch as it is the admitted position that since then the petitioners have been the beneficiaries of such supply. However, such supply shall be provided by the Respondent/cesc Limited upon compliance of all other necessary formalities in this regard by the writ petitioners, preferably within a period of one month there from. This writ petition is thus allowed without any order as to costs. Petition allowed
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