Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | 22 1910-Sections 2(c) Rule 2A(f)-Electricity (Supply) Act clause VI of Schedule 24 1948-Section 26 Electricity Act |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Disposed Off |
Headnote | Electricity Act, 1910-Sections 2(c), 22, 24, clause VI of Schedule; Rule 2A(f)-Electricity (Supply) Act, 1948-Section 26- Arrears of consumption charges in respect of electricity supplied to premises-Failure of consumer to pay-Remedies of Electricity Board-Liability of transferee.The appellant was a purchaser of the mortgaged assets of an industry in an open auction sale held by the Bihar State Financial Corporation. The appellant paid a substantial sum towards the said transaction and thereafter got the possession of the industry. However, the electrical connection of the premises was disconnected. The appellant was called upon to discharge all the liabilities of the previous consumer. This was challenged in the writ petition on the ground that there was a transfer of a unit and as transferee it was not liable for energy consumed before such transfer. The writ petition was dismissed by a Division Bench of the High Court holding that the Bihar State Electricity Board would be entitled to take action in accordance with law. These appeals had been filed against the judgment of the High Court.The appellants urged that the appellant was the bonafide purchaser of the mortgaged assets of the industry in an auction sale held under the Corporation Act by the respondent - Corporation; that the appellant was neither the transferee nor the successor to the previous owner of the premises, it was an independent buyer under the Bihar Public Demands Recovery (Amendment) Act, 1982; that the dues towards the consumption of electricity could be recovered only if the appellant was a consumer and he could not be held to be a consumer since, factually, the appellant was yet to be given electricity connection; that the electricity dues by the previous industry was a contractual liability between the industry and the respondent Board, it was not statutory in nature since electricity was consumed by consumer on the basis of a written contract approved by Section 26 of the Indian Electricity Act, 1910; that Section 24 of the Electricity Act had no application since that presupposes an electricity connection which connection the appellant was yet to be given, therefore, the appellant could not be held liable for any default committed by the previous consumer; that neither under the scheme of the Electricity Act nor the Electricity (Supply) Act 1948, was there any concept of the premises of the consumer being liable for the electricity dues de hors the consumer, whose premises it was; that though by reason of the amendment made on 18.4.1982 to the Bihar and Orissa Public Demands Recovery Act, 1914 electricity dues were recoverable by bringing the property of the consumer concerned to sale in certificate proceedings, such a provision could not be invoked against a subsequent bonafide auction purchaser of the assets; that in so far as this appellant had not consumed electricity, it was merely seeking re-connection and there being no statutory dues towards consumption charges, the Board could not insist upon the respondent to pay the arrears owing by the erstwhile consumer, as a condition precedent to provide electricity connection, on the contrary, there was an obligation u/s 3(2)(f) and Section 22 of the Electricity Act read with clause VI of the Schedule I thereof to supply electricity; that the auction notice issued by the Corporation or even the subsequent transfer by it, did not mention anything about the outstanding electricity dues and therefore, the liability of the previous consumer could not be fastened to this appellant.On behalf of the Board, it was urged that the Board, after giving notice u/s 24 of the Electricity Act to the previous consumer for not receiving payment towards electricity bills in respect of the premises, had disconnected/cut off the supply to the premises and that premises was sold in auction by the corporation to the appellant; that Section 24 confers a statutory right to the Board to cut off the supply and this right is without prejudice to the right of the Board to file a suit and, therefore, the Board need not necessarily file a suit and when the Board had exercised its statutory right u/s 24 it could not be forced to reconnect the supply unless the entire charges due in respect of the building were paid off to the Board; that the Corporation had not given any notice to the Board and the auction purchasers could have easily ascertained the availability of electricity to the premises; that the bonafides of the purchaser could have no relevance to the issue nor the circular of the Board could be relied on to find a cause for reconnection; that electrical connection was already given to the premises in question, therefore, no new connection could be given u/s 24 of the Act unless the previous arrears had been cleared off and the transferee by purchasing the unit in the auction sale held u/s 29 of the Corporation Act could not be said to have discharged the liabilities of the transferor who was in arrears of electricity due under the Act for not making payment for electricity connection had been cut off in the premises. |
Judge | Hon'ble Mr. Justice S. Mohan |
Neutral Citation | 1995 INSC 95 |
Petitioner | M/s Isha Marbles Etc. Etc. |
Respondent | Bihar State Electricity Board And Anr. Etc. Etc. |
SCR | [1995] 1 S.C.R. 847 |
Judgement Date | 1995-02-03 |
Case Number | 1418 |
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