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M/s. Sri Kanaka Durga Castings (P) Ltd, Pondicherry Rep by Managing Director v/s The Executive Engineer II, Electricity Department, Puducherry & Others

    W.P.No.20744 of 2012

    Decided On, 09 November 2012

    At, High Court of Judicature at Madras

    By, THE HONOURABLE MR. JUSTICE V. DHANAPALAN

    For the Petitioner: R. Muthukumarasamy, Senior Counsel, Mrs. Pushpa Satyanarayana, Advocate. For the Respondents: T. Murugesan, Government Pleader (Pondicherry), A. Tamilvanan, Government Advocate (Pondicherry).



Judgment Text

(Prayer: Writ Petition filed under Article 226 of the Constitution of India praying for the issuance of a Writ of Certiorari calling for the records of the 1st respondent in connection with the impugned order No.447/ED/EE-II/JE-Tech/JE-Tech/F-SKDC/2012-13 dated 30.04.2012 and compounded in Letter No.1385/ED/EE-II/JE/F-SKDC/2012-13 dated 26.06.2012, quash the same.)

1. This Writ Petition is filed praying to quash the impugned order of the 1st respondent made in No.447/ED/EE-II/JE-Tech/JE/F-SKDC/2012-13, dated 30.04.2012 and compounded in Letter No.1385/ED/EE-II/JE/F-SKDC/2012-13 dated 26.06.2012.

2. Facts of the case as put forth in the affidavit would run thus:

(i) The petitioner Company is a Private Limited Company registered with the Registrar of Companies, Puducherry and it is also registered as a small scale industry with District Industrial Centre, Puducherry. It is into the business of manufacturing ingots, billets and alloy steel castings. The Consumer service was released on 03.07.2000. Ever since, the petitioner has been paying the consumption charges regularly and had never defaulted any payment. The petitioner Company is provided with HT service bearing No.521/HT-1(b), having a total contracted load of 3500 KVA, 3000 KW and connected load of 2500 KW + 195 HP + 6KW as assessed by the Inspectors' team during the course of inspection on 28.03.2012. The petitioner never violated the rules and regulations issued by the respondent Department. The Inspecting Officers of the respondent have been periodically visiting the petitioner's premises. The meter reading of the unit was taken by a responsible Officer of the respondent Department and they have never commented about any irregularity so far. There was no complaint against the petitioner.

(ii) While so, from 10.05.2011, the energy meter installed in the premises became non-functional as a result of failure of metering cubicle, which fact was made known to the respondents and a team of Officers from the respondent Department also inspected the equipment on the same day. Since then, billing of the service was made as per the consumption recorded in the check meter installed by the Department. The check meter was already installed outside the petitioner's premises during the year 2007. The check meter was installed for the verification of billing pattern of energy meter as the readings in both the energy meter as well as the check meter were compared before billing. Though the non-functioning of the energy meter was reported as early as on 10.05.2011 and the respondent has also acknowledged the said fact, the respondent had not cared to install a new meter or rectify the defect in the old meter. The respondent ought to have rectified the shortcoming either by repairing or replacing the energy meter within a reasonable time stipulated, but no such measure was initiated by the respondent.

(iii) The consumption pattern was recorded in the installed meter in the petitioner Company by the respondent as well as Check Meter fixed outside the petitioner's premises for counter checking prior to the non-functioning of the petitioner's energy meter. Even while following the recorded consumption from the check meter, the consumption pattern was constant and there was no variation whatsoever. The Inspecting Officers also have never pointed out any irregularity. In fact, as per Schedule – III (9) IV of the Joint Electricity Regulatory Commission (standard of performance) Regulations 2009, the rectification or replacement of defective meter is to be compared within 15 days of declaring the meter defective. In the instant case, no remedial measures were initiated. In fact, as per the same provision, a fine of Rs.50/- for each day of default is attracted.

(iv) On 22.03.2012, an inspecting team carried out inspection at the petitioner's premises. The Inspecting team directed the petitioner to provide separate entrance near metering cubicle and further directed to fence the metering cubicle yard to an extent of 5m height. A second Inspection was conducted by HTM wing on 27.03.2012 along with officers of the Anti-power theft squad. It was certified that:

(a) The genuineness of the number seals on the meter and the meter terminal cover have been checked by the HTM wing and found in order.

(b) The genuineness of the number seals of the metering CTPT units have been verified by HTM and found in order.

(c) Ratio tests have been conducted by the HTM wing on the metering CTPT units and found in order from the above observation given by the Anti-power theft squad along with MRT Department, it was made clear that CTPT unit was not tampered and the same was intact.

This report of the inspection was given around 11.00 pm on 27.03.2012. They also seized the meter bearing Sl.No.07292461, L&T make of the check meter. They replaced the old meter of the check meter with the new meter.

(v) The Anti-power theft squad in its High Tension service connection Inspection Report dated 27.03.2012 in Clause 17 that metering cubicle fault and only standby meter i.e. check meter is used for billing purpose. The power flow through meter was tested by Ratio Test by HTM wing on metering CTPT units of the check meter and found in order. The report further said that the monthly consumption from March 2009 to February 2012 at substation end and consumer end was reviewed and the recording at the consumer end is not matching with the recording at the sub-station end and that the missing consumption should have been used by the petitioner Company. In fact, the finding and the conclusion of the inspecting team specifically states that there is only Suspected Loss of Energy and the billing meter is released for performance test. Based on the above Report, the respondent has seized the meter bearing Sl.No.07292461 of L&T kept in sealed bag to be sent to the authority concerned for performance test, thereby releasing the meter of the HT 11 KV feeder from Adavipolam Substation. The seizure report dated 28.03.2012 recorded the findings as tampering of CTPT unit and dishonest abstraction of energy/theft of energy.

(vi) The respondent vide Notice No.946/ED/AEY/F.32/2011-12, dated 28.03.2012 informed the petitioner that the HT service connection has been disconnected on 28.03.2012 due to theft of energy detected by Anti-Power Theft Squad (APTS), Electricity Department, Puducherry as per 10.5(8) of JERC Supply Code. The first respondent also vide initial Assessment Notice No.5420/ED/JE-Tech/EE-II/F.SKDC/2011-12, dated 29.03.2012 had informed that the petitioner Company was directly or indirectly involved in the act of unauthorised use of electricity/theft of electricity for which the service connection was disconnected along with the initial assessment bill from March 2011 to February 2012 for a sum of Rs.28,54,61,320/-, which, if not paid along with re-connection charges, the service connection already disconnected shall not be re-connected. Non-payment of the amount or the assessment of the bill shall be treated as arrears. It was a rude shock to the petitioner to receive the said Notice which was almost 25 times the net book value of the company itself. The petitioner met with an accident and was hospitalized on 20.03.2012 and therefore, he could not instruct or respond to the said assessment Notice. In the meanwhile, the 1st respondent herein issued the Final Assessment Notice No.447/ED/EE-II/JE-Tech/F.SKDC/2012-13 dated 30.04.2012 calling upon the petitioner to pay the sum of Rs.28,54,63,320/- within 15 days from the date of receipt of the Notice, failing which, the same would attract an interest at the rate of 16% p.a. The amount claimed by the respondent at any stretch of imagination cannot be so huge especially when the same is arrived at unilaterally without any conclusive evidence of the alleged theft. Therefore, the petitioner gave a representation on 18.05.2012 to offer an opportunity to represent their case by granting a personal hearing. In the said representation, the petitioner Company had narrated all their grievances and represented before the 1st respondent, who was kind enough to give a personal hearing on 11.06.2012 and the objection and grievances on the part of the petitioner Company was also placed on record.

(vii) On 29.03.2012, the 1st respondent had taken a Letter from the petitioner Company alleged to have been executed by the authorized signatory, undertaking to pay the compounding charges. Though the compounding charges are payable under Section 152, the letter mentions the same as per Section 135, which itself shows that the letter has been obtained not on free will, but under coercion. The said signatory to the letter is not an authorised representative of the petitioner Company, though he is an employee of the Company. Without considering the objections raised by the petitioner and recorded in the Minutes of the proceedings, the 1st respondent had compounded the offence under Section 152 of the Electricity Act, 2003 vide Letter No.1385/ED/EE-II/F.SKDC/2012-13 dated 26.06.2012, calling upon the petitioner to pay Rupees Seven Crores.

(viii) As the respondent Department has disconnected the HT service connection on the basis that there was a suspected loss of energy, which cannot be attributed only to the consumer without any conclusive evidence, the petitioner Company has come to a stand-still without energy from 28.03.2012 and the demand of more than 28 crores alleged to have compounded to 7 crores by any stretch of imagination is very high and the claim is absolutely baseless and unsustainable. Aggrieved by the same and left with no other alternative, the petitioner has come up with the present writ petition.

3. First respondent has filed a counter affidavit, stating as under :

(i) The contention of the petitioner industry that they have never committed any irregularity is absolutely false and mischievous. For quite a long time, the petitioner industry was under suspicion for theft of electricity. The power consumption pattern of the industry was not commensurate with the contracted demand of the industry. Apart from the electricity meter provided inside the premises of the industry, to record the electricity consumption of the petitioner industry, a standby meter was also installed in 2007, just outside the compound of the industry to enable the Department to compare the recordings of the meters. On a simple comparison of the monthly recordings of the electricity sent out of the new 33/11 KV Adaivipolam sub-station through the 11 KV dedicated feeder and the recordings of the electricity consumed by the industry, it was clear that the industry was up to some mischief, as there was a wide difference between the electricity sent out and the electricity recorded at the industry end. Circumstantial evidence pointed to a clear case of theft of electricity being committed by the industry. A surprise inspection was carried out on 21.03.2012 by the Superintending Engineer-I, accompanied by the Executive Engineer-VII. At the time of inspection, it was noticed that the petitioner industry was running but the standby energy meter installed in the industry did not reflect the power being utilised. A cross-check with the sub-station indicated that the petitioner industry was availing full power at that time. A joint inspection of the petitioner industry was conducted by the Anti-Power Theft Squad and the High Tension Metering Section along with the jurisdictional officers in the presence of Village Administrative Officer, Revenue Department, Yanam, and the consumer representative on 27.03.2012. The representative of the industry was present throughout the period of inspection. The inspection team confirmed the difference in reading. Suspecting foul play, the team released the billing meter for performance test. An inspection report was prepared for the day's inspection and a copy of the same was served on the petitioner under acknowledgement. The team also noticed the additional insulators on the double pole structure and concluded that it could be used to bypass the meter for direct abstraction of electricity. The inspection team returned the next day on 28.03.2012 and continued with the inspection. On such inspection, it was found that the petitioner industry had tampered with the functioning of CTPT unit and provided an additional circuit in the secondary side of the current transformer in such a way that the current through the meter could be bypassed or allowed to flow through the meter at will, thus controlling the recording of the energy meter and preventing it from registering the actual electricity consumer by the petitioner industry. This amounted to a direct evidence of theft of electricity within the meaning of section 135 (b) of the Electricity Act, 2003. The petitioner had tampered with the metering equipment with a dishonest intention of abstracting electricity in such a way that the electricity meter recording the power consumption of the industry would record less than the actual consumption, thereby causing wrongful loss to the Department and wrongful gain to the petitioner.

(ii) On detection of direct evidence of theft of electricity, the power supply to the petitioner industry was immediately disconnected on the same day i.e., 28.03.2012 and a complaint was preferred in the Yanam Police Station on 29.03.2012. The complaint under Section 135 of the Act was accepted and an FIR No.48 of 2012 dated 29.03.2012 was registered.

(iii) Initial Assessment Notice, as provided for in Regulation 10.5(b)(i) of the JERC (Electricity Supply Code) Regulations, 2010, was served on the petitioner vide No.5420/ED/JE-Tech/EE-II/F.SKDC/2011-2012, dated 29.03.2012. The assessed amount of Rs.28,54,62,230/- was communicated and the petitioner industry was directed to deposit the amount for restoration of supply. As the petitioner industry neither responded to the notice nor raised any objection to it, the order of Final Assessment confirming the amount due was served on the petitioner industry vide No.447/ED/EE-II/JE-Tech/F.SKDC/2012-13, dated 30.04.2012.

(iv) In the meanwhile, the petitioner industry, vide its letter dated 29.03.2012, requested for compounding of the offence under Section 152 of the Act. The matter was referred to the Government and sanction of the Government was obtained vide G.O.Ms.No.56, dated 12.06.2012, for accepting the compounding of offence. The matter was communicated to the petitioner industry vide proceedings dated 26.06.2012 and 17.07.2012. After the final order of Assessment was issued, the petitioner industry addressed the Assessing Officer with a request to be heard in person, vide its letter dated 17.05.2012. The petitioner industry also submitted a representation dated 18.05.2012, wherein, it denied the allegations of theft of electricity and questioned the findings of the Assessing Officer. In spite of the final order of assessment being passed, the petitioner industry was given an opportunity of personal hearing on 11.06.2012 vide letter No.908/ED/EEII/JE/SKDC/2012-13, dated 28.05.2012, and the minutes of the personal hearing were recorded on 11.06.2012. An FIR has been filed before Yanam Police and the Special Court constituted under Section 153 for the purpose of Section 135 has seized of the matter. Hence, this Writ Petition is liable to be dismissed.

4. The gravamen of the contention of the learned Senior Counsel for the petitioner is that the procedure contemplated under Section 126 has not been followed. Even assuming that the respondent's case pertains to the procedures as per Section 135 of the Electricity Act, stringent procedures contemplated under Regulations 10.1 and 10.5 of the Joint Electricity Regulatory Commission (Electricity Supply Code) Regulations, 2010, were not followed by the respondent before passing the impugned order and hence the impugned order is liable to be set aside. It is his further contention that before passing the Final Assessment Order, no opportunity of hearing was given to the petitioner and therefore, the entire proceedings is vitiated in law.

5. Per contra, learned Government Pleader (Pondicherry) appearing for the respondents would contend that every procedure contemplated under the Act and Regulations were scrupulously followed by the respondents before passing the impugned order and ample opportunities were provided to the petitioner before passing of the order in question. He pointed out that the petitioner's request to provide him an opportunity of hearing vide his representation dated 18.05.2012 was considered by the respondents vide their letter dated 28.05.2012, fixing the personal hearing on 11.06.2012. Therefore, he would submit that the action of the respondents is in no way contrary to the established Rules and Regulations.

6. I have heard the learned counsel for the parties and also gone through the records.

7. A panoramic view of the case would reveal that the petitioner Company, which is in the business of manufacturing ingots, billets and alloy steel castings, is provided with HT service connection bearing No.521/HT-1(b), having a total contracted load of 3500 KVA, 3000 KW and connected load of 2500 KW + 195 HP + 6KW as assessed by the Inspectors' team during the course of inspection. They claim that they have been paying the consumption charges regularly and had never defaulted any payment. While so, the Superintending Engineer-I, accompanied by the Executive Engineer, carried out a surprise inspection in the petitioner industry on 21.03.2012 and noticed that the petitioner industry was running, but the standby energy meter installed in the industry did not reflect the power being utilised. A cross-check with the sub-station indicated that the petitioner industry was availing full power at that time. Thereafter, a joint inspection of the petitioner industry was conducted on 27.03.2012 by the Anti-Power Theft Squad and the High Tension Metering Section along with jurisdictional Officers in the presence of Village Administrative Officer, Revenue Department, Yanam, and the consumer representative. The Inspection team confirmed the difference in reading. An inspection report was prepared for the day's inspection and a copy of the same was served on the petitioner. It was also noticed that the additional insulators on the double pole structure could be used to bypass the meter for direct abstraction of electricity.

8. It is further seen that the inspection team returned the next day on 28.03.2012 and continued with the inspection and found that the petitioner industry had tampered with the functioning of CTPT unit and provided an additional circuit in the secondary side of the current transformer in such a way that the current through the meter could be bypassed or allowed to flow through the meter at will, thus controlling the recording of the energy meter and preventing it from registering the actual electricity consumed by the petitioner industry. Therefore, the respondent Board has taken action under Section 135 of the Act and a First Information Report vide FIR No.48 of 2012 dated 29.03.2012 was registered. Based on the Inspection Report, Initial Assessment Notice, as provided for in Regulation 10.5 (b) (i) of the JERC (Electricity Supply Code) Regulations, 2010, was served on the petitioner on 29.03.2012, assessing the amount to Rs.28,54,62,230/- and directing the petitioner industry to deposit the same for restoration of supply.

9. As the petitioner did not raise any objection to the said Notice, the respondent passed the Final Assessment Notice, confirming the amount due by the petitioner, vide its order dated 30.04.2012. In the meanwhile, even before the Final Assessment Order, the petitioner industry sent a letter to the 1st respondent on 29.03.2012 undertaking the payment of Compounding Charges as per Section 135 of the Act. The matter was referred to the Government and sanction of the Government was obtained vide G.O.Ms.No.56, dated 12.06.2012, for accepting the compounding of offence and the same was communicated to the petitioner industry vide proceedings dated 26.06.2012 and 17.07.2012. After the final order of Assessment was issued, the petitioner industry addressed the Assessing Officer with a request to be heard in person, vide its letter dated 17.05.2012 and also submitted a representation dated 18.05.2012, denying the allegations of theft of energy. Taking note of the said representation, the petitioner was given an opportunity of personal hearing on 11.06.2012 vide letter No.908/ED/EEII/JE/SKDC/2012-13, dated 28.05.2012 and the minutes of the personal hearing were recorded on 11.06.2012. Thereafter, the respondent has proceeded further in accordance with law as per Section 135 of the Act.

10. Before examining the question raised in this matter, it is worth referring to relevant provisions of the Electricity Act, 2003, as under:

"126. Assessment :

(1) If on an inspection of any place or premises or after inspection of the equipments, gadgets, machines, devices found connected or used, or after inspection of records maintained by any person, the assessing officer comes to the conclusion that such person is indulging in unauthorised use of electricity, he shall provisionally assess to the best of his judgment the electricity charges payable by such person or by any other person benefited by such use.

(2) The order of provisional assessment shall be served upon the person in occupation or possession or in charge of the place or premises in such manner as may be prescribed.

(3) The person, on whom a notice has been served under sub-section (2), shall be entitled to file objections, if any, against the provisional assessment before the assessing officer, who may, after affording a reasonable opportunity of hearing to such person, pass a final order of assessment of the electricity charges payable by such person.

(4) Any person served with the order of provisional assessment may, accept such assessment and deposit the assessed amount with the licensee within seven days of service of such provisional assessment order upon him:

Provided that in case the person deposits the assessed amount, he shall not be subjected to any further liability or any action by any authority whatsoever.

(5) If the assessing officer reaches to the conclusion that unauthorised use of electricity has taken place, it shall be presumed that such unauthorised use of electricity was continuing for a period of three months immediately preceding the date of inspection in case of domestic and agricultural services and for a period of six months immediately preceding the date of inspection for all other categories of services, unless the onus is rebutted by the person, occupier or possessor of such premises or place.

(6) The assessment under this section shall be made at a rate equal to one-and-half times the tariff applicable for the relevant category of services specified in sub-section (5).

135. Theft of electricity:

(1) Whoever, dishonestly,

(a) Taps, makes or causes to be made any connection with overhead, underground or under water lines or cables, or service wires, or service facilities of a licensee; or

(b) Tampers a mater, installs or uses a tampered meter, current reversing transformer, loop connection or any other device or method which interferes with accurate or proper registration, calibration or metering of electric current or otherwise results in a manner whereby electricity is stolen or wasted; or

(c) Damages or destroys an electric meter, apparatus, equipment, or wire or causes or allows any of them to be so damaged or destroyed as to interfere with the proper or accurate metering of electricity, so as to abstract or consume or use electricity shall be punishable with imprisonment for a term which may extend to three years or with fine or with both :

11. To examine the contentions of the learned counsel for the parties, it is relevant to refer to Regulations 10.1, 10.2, 10.4 and 10.5 of the Joint Electricity Regulatory Commission (Electricity Supply Code) Regulations, 2010.

"Regulation 10.1 deals with unauthorised use of electricity, as per which, the following acts on the part of consumers are to be considered as unauthorised use of electricity for the purpose of assessment under the provisions of Section 126 of the Act :

(i) Use of electricity by any artificial means; or

(ii) Unauthorised use of electricity by means without the permission of the concerned person or authority or licence; or

(iii) Use of electricity through a tampered meter; or

(iv) Use of electricity for the purpose other than for which the supply of electricity was given; or

(v) Use of electricity for the premises or areas other than those for which the supply of electricity was authorised; or

(vi) Use of electricity in the premises where supply is disconnected by the licensee.

As per Regulation 10.2, the following acts on the part of consumers shall also be considered as unauthorised use of electricity for the purpose of assessment under the provisions of Section 126 of the Act:

(i) Increase in connected or contracted load in excess of the sanctioned load as per the agreement;

(ii) Extension of power supply beyond the permitted area of use as in the agreement;

(iii) Shifting of location of meter or unauthorised alterations in the installation;

(iv) Disconnection of neutral; or

(v) Tampering with meter or equipments associated with metering provided by the licensee and not reported to the licensee.

On the other hand, Regulations 10.4 and 10.5 deal with theft of electricity.In Regulation 10.4, theft of electricity has been defined in Section 135 of the Act. Regulation 10.5 defines the procedure to be adopted by licensee for inspection, provisional assessment, hearing and final assessment in case of theft of electricity as under :

(a) Inspection :

(i) The officer as authorised by the appropriate Government suo motu or on receipt of reliable information regarding theft of electricity shall promptly conduct inspection and search such premises.

(ii) The authorised officer shall, if required, produce photo ID card to the consumer/person in occupation or possession or in charge of the premises or place. Photo ID card shall be carried by all those persons who accompany the authorised officer.

(iii) The provisions of the Code of Criminal Procedure, 1973, relating to search and seizure shall also apply, to searches and seizure under these regulations.

(iv) A list of all items seized in course of search shall be prepared and signed by all consumers/persons present during the search and seizure. The occupant of the place or premises or any person on his behalf shall remain present during the inspection.

(v) In all cases of inspection, a report shall be prepared at site giving details of connected load, condition and details of old seals, working of meter, details of new seals and clearly mention any irregularity noticed which may lead to theft of electricity in the format given in Annexure-5. The authorised officer shall carry seals for this purpose. Any damage/destruction to the electric meter, metering equipments, apparatus, line, cable or electrical plant of the licensee caused or allowed to be caused by the consumer/persons so as to interfere with the proper or accurate metering of electricity or for theft of electricity shall also be duly recorded in the report. The authorised officer shall also prepare a diagram illustrating the arrangements found during inspection for theft of electricity, wherever feasible and such diagram shall form a part of inspection report.

(vi) The report shall clearly indicate whether a prima facie case for theft of electricity has been established. The report shall be signed by the authorised officer and a copy of report served to the occupant of the premises or his/her representative at site immediately as per regulation 11.3.

(vii) The authorised officer upon detection of such theft of electricity disconnects the supply of electricity immediately.

(viii) As per the provisions of the Act, the authorised officer shall lodge a complaint in writing relating to committing of offence in police station having jurisdiction within twenty four hours from the date of detection of theft of energy and disconnection of supply of electricity to the premises.

(b) Provisional Assessment and Notice to the Consumer

(i) After the authorised officer comes to the conclusion that theft of electricity has taken place in the premises (as defined under Section 135 of the Act), he shall serve a provisional assessment order upon the person in occupation or in-charge of the premises, giving 7 days time under proper receipt, for filing objections, if any, against the Provisional Assessment Order and fixing a date of hearing. The assessment shall be done as per guidelines provided in Annexure-7 and a notice shall be issued in the format at Annexure-6 appended to these regulations.

(ii) Any consumer/person served with the order of provisional assessment shall accept such assessment and deposit the assessed amount with the licensee within seven days of service of such provisional assessment order upon him.

(c) Hearing and Final Assessment

(i) On the date of hearing, the Assessing Officer shall hear to the consumer/person in occupation or possession or in charge of the place or premises. The Assessing Officer shall give due consideration to the facts submitted by such consumer/person and pass, within 7 working days, a speaking order. The order shall contain the brief of inspection report, submissions made by such consumer/person in his written reply, and during hearing.

A copy of the order shall be served to such consumer/person under proper receipt, and in case of refusal to accept the order or in absence of such person, shall be served on him under Registered Post/Speed Post/Courier post. The consumer/person in occupation or possession or in charge of the place or premises shall be required to make the payment within 15 days of receipt of final assessment order.

If the assessing officer reaches to the conclusion that the theft of electricity has taken place, the assessment shall be made for the entire period during which such theft of electricity has taken place and , if however, the period during which such theft 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."

12. Keeping the above provisions in mind, if we look at the present case, it is known that the power consumption pattern of the petitioner industry was not commensurate with the contracted demand of the industry; apart from the electricity meter provided inside the premises of the industry, to record the electricity consumption of the petitioner industry, a standby meter was also installed in 2007, just outside the compound of the industry to enable the Department to compare the recordings of the meters; on a comparison of the monthly recordings of the electricity sent out of the new 33/11 KV Adaivipolam sub-station through the 11 KV dedicated feeder and the recordings of the electricity consumed by the industry, it was clear that the industry was up to some mischief, as there was a vide difference between the electricity sent out and the electricity recorded at the industry end. Circumstantial evidence pointed to a clear case of theft of electricity being committed by the industry; a surprise inspection was carried out on 21.03.2012 by the Superintending Engineer-I, accompanied by the Executive Engineer-VII; at the time of inspection, it was noticed that the petitioner industry was running but the standby energy meter installed in the industry did not reflect the power being utilised; a cross-check with the sub-station indicated that the petitioner industry was availing full power at that time; a joint inspection of the petitioner industry was conducted by the Anti-Power Theft Squad and the High Tension Metering Section along with the jurisdictional officers in the presence of Village Administrative Officer, Revenue Department, Yanam, and the consumer representative on 27.03.2012; the representative of the industry was present throughout the period of inspection; the inspection team confirmed the difference in reading; suspecting foul play, the team released the billing meter for performance test; an inspection report was prepared for the day's inspection and a copy of the same was served on the petitioner under acknowledgement; the team also noticed the additional insulators on the double pole structure and concluded that it could be used to bypass the meter for direct abstraction of electricity; the inspection team returned the next day on 28.03.2012 and continued with the inspection; on such inspection, it was found that the petitioner industry had tampered with the functioning of CTPT unit and provided an additional circuit in the secondary side of the current transformer in such a way that the current through the meter could be bypassed or allowed to flow through the meter at will, thus controlling the recording of the energy meter and preventing it from registering the actual electricity consumed by the petitioner industry; which amounted to a direct evidence of theft of electricity within the meaning of section 135 (b) of the Electricity Act,2003 and the petitioner had tampered with the metering equipment with a dishonest intention of abstracting electricity in such a way that the electricity meter recording the power consumption of the industry would record less than the actual consumption, thereby causing wrongful loss to the Department.

13. It is also seen that on detection of direct evidence of theft of electricity, the power supply to the petitioner industry was immediately disconnected on the same day i.e., 28.03.2012 and thereafter, Initial Assessment Notice, as provided for in Regulation 10.5 (b) (i) of the JERC (Electricity Supply Code) Regulations, 2010, was served on the petitioner vide No.5420/ED/JE-Tech/EE-II/F.SKDC/2011-2012, dated 29.03.2012. The assessed amount of Rs.28,54,62,230/- was communicated and the petitioner industry was directed to deposit the amount for restoration of supply. As the petitioner industry neither responded to the notice nor raised any objection to it, the order of Final Assessment confirming the amount due was served on the petitioner industry vide No.447/ED/EE-II/JE-Tech/F.SKDC/2012-13, dated 30.04.2012.

14. Further, as against the alleged theft of energy by the petitioner, the Department issued an Initial Assessment Notice, dated 29.03.2012, demanding Rs.28,54,63,320/-, which provides for an appeal to the appellate authority, namely, the Superintending Engineer-II, Electricity Department, Puducherry. However, the petitioner had not preferred any appeal nor did he raise any objection. Since the petitioner had not preferred any appeal or objection against the Initial Assessment Notice, the same was confirmed by the Final Assessment Notice, 30.04.2012, thereby directing the petitioner to remit the said sum within fifteen days from the date of receipt of the said notice. However, after the final order of Assessment was issued, the petitioner industry addressed the Assessing Officer with a request to be heard in person, vide its letter dated 17.05.2012. The petitioner industry also submitted a representation dated 18.05.2012, denying the allegations of theft of electricity and questioning

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the findings of the Assessing Officer. When the petitioner did not prefer the appeal in time so also raise any objections to the Initial Assessment Notice, the Department was left with no other option but to confirm the same. In other words, were petitioner really aggrieved over the initial action of the Department and not at fault, it would have preferred an appeal, as provided for in the Initial Assessment Notice, by raising objections. When the petitioner had not chosen to prefer an appeal before the appellate authority, the Department was not bound to consider the representation of the petitioner and also afford an opportunity. However, in spite of the final order of assessment being passed, the petitioner industry was given an opportunity of personal hearing on 11.06.2012 vide letter of the Department No.908/ED/EEII/JE/SKDC/2012-13, dated 28.05.2012, and the minutes of the personal hearing were also recorded on 11.06.2012, but the only thing is, the said minutes were not reflected in the Final Assessment Notice, as the said notice was prior to the personal hearing. 15. While so, the petitioner industry, vide its letter dated 29.03.2012, requested for compounding of the offence under Section 152 of the Act. Compounding of the offence provided for in Section 152 gives an opportunity to the first time offender under Section 135, a chance to relieve himself of the rigours of criminal proceedings, subject to acceptance of such an offer by the Government or any officer appointed by it on this behalf. Therefore, the matter was referred to the Government and, vide G.O.Ms.No.56, dated 12.06.2012, the Government accorded sanction for compounding of offence within the meaning of Section 152 consequent to the commission of theft of energy by the petitioner industry, for a sum of Rs.7,00,00,000/-(Rupees Seven Crores only). It is important to note here that the said sum of Rs.7.00 crores is as per the rate at which the sum of money for compounding to be collected per Kilowatt (KW)/Kilo Volt Ampere(KVA) of contracted demand for High Tension, as per Section 152. 16. That being the clear position, when the accord of the Government was communicated to the petitioner by the first respondent vide his proceedings dated 26.06.2012 for payment of Rs.7.00 crores towards compounding of the offence, the petitioner, instead of complying with the said proceedings, backtracked from its earlier stand and sought for quashing of the said proceedings as well in addition to the original proceedings dated 30.04.2012. Such an attitude of the petitioner has to be deprecated. 17. When the procedure contemplated under the Act and the Regulations as to what is the scheme to be followed in dealing with the theft of energy for provisional assessment and thereafter final assessment has been followed by the Department by issuing a necessary notice and holding an enquiry, the action of the respondents cannot be found fault with. Therefore, the challenge made to the impugned order of the first respondent questioning the liability as demanded by the respondent, especially when such a demand has been made after scrupulously following the due procedure, in the considered opinion of this Court, cannot be countenanced. 18. The legal and statutory obligations are to be followed by the authorities when the same are obligated as per the provisions of the Act and the Regulations. In the absence of any arbitrariness or mala fides coupled with actuation by bias in the act of the authorities, the scope of interference by this Court under Article 226 of the Constitution of India is not available. Therefore, looked at from any angle into the totality of facts and circumstances of the case and also the legal provisions, it is clear that the petitioner has not made out any case to interfere with the impugned proceedings of the respondent. Accordingly, finding no merit, this Writ Petition is dismissed. No costs. Consequently, the connected M.P.Nos.1 and 2 of 2012 are also dismissed.
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