Andhra Pradesh High Court - Amravati

The Andhra Pradesh Southern Power ... vs Smt. Segu Siva Kumari on 13 October, 2023

      IN THE HIGH COURT OF ANDHRA PRADESH: AMARAVATI

   HON'BLE MR. JUSTICE DHIRAJ SINGH THAKUR, CHIEF JUSTICE
                                &
           HON'BLE MR. JUSTICE R. RAGHUNANDAN RAO

                        W.A.No.590 of 2022


The Andhra Pradesh Southern Power Distribution
Company Limited (Presently APCPDCL)
Rep. by its Chairman and Managing Director,
Tirupati, Chittoor District; and 3 Others.
                                                     ... Appellants

                              Versus

Smt. Segu Siva Kumari,
W/o. Venkaa Koteswara Rao,
Occ: Business, R/o. D.No.11-100/1,
Ananda Nilayam, 5th Lane,
Annapurna Nagar, East Amaravathi Road,
Gorantla, Guntur, Guntur District; and Another.
                                                   ...Respondents


Counsel for the Appellants        : Mr.V.R.Reddy Kovvuri,
                                    Standing Counsel


Counsel for the Respondents       : Mr. M. Venkata Rami Reddy
                                    - R1

                                    Mr. Syed Abdul Khadar
                                    - R2

                         Dt.: 13.10.2023

PER DHIRAJ SINGH THAKUR, CJ


     The present appeal under clause 15 of the Letters Patent has

been preferred against the judgment and order dated 31.10.2019
                                                                 HCJ & RRR, J
                                         2                      W.A.No.590 of 2022




passed in W.P.No.9383 of 2019. The writ court, by virtue of the

judgment and the order impugned, has directed the respondents in

the writ petition to give a new service connection to the petitioner.



2.     Briefly stated, the material facts are as under:

       The petitioner purchased a godown situate in Guntur District,

through online auction on 20.10.2018. The auction was conducted

by the Punjab National Bank through its branch office at Guntur.

The auction was conducted by the Bank on account of the fact that

the erstwhile owner was unable to repay the loan amount obtained

from the said Bank. A sale certificate was then issued by the Bank

to the petitioner and the possession of the property handed over to

her.



3.     Needless to say that the Bank accepted and acknowledged the

bid submitted by the petitioner inter alia on the following terms and

conditions:

              "1. The assets are being sold to you on "As is where is

       basis and As is what is basis".

              .......

.......

HCJ & RRR, J

8. All statutory dues/attendant charges/other dues

including registration charges, stamp duty, taxes etc., shall have

to be borne by you only.

.......

The intending bidder is advised to make their own

independent inquiries regarding the encumbrances on the

property including statutory liabilities, arrears of property tax,

electricity dues etc."

4. Thereafter, vide communication dated 20.10.2018, the

respondent Bank confirmed the sale of the petitioner. The

petitioner then approached the Southern Power Distribution

Company of Andhra Pradesh Ltd., for new service connection. This

application was submitted online. The Superintending Engineer

concerned, however, in his communication dated 23.04.2019 which

became the order impugned in the writ petition noticed that there

was a huge outstanding amount of Rs.80,44,199/- under service

connection No.1113102001096 and therefore rejected the request

of the petitioner for a new service connection on account of the

huge outstanding amount in regard to the property in question.

This communication was challenged by the petitioner in

W.P.No.9383 of 2019 which was allowed by virtue of judgment and

order impugned with a direction to the respondent Nos.1 to 4 in the HCJ & RRR, J

writ petition to give a new service connection to the petitioner. The

said writ petition was allowed following an earlier decision

rendered in W.P.No.28271 of 2018.

5. Learned counsel for the appellant contends that the view

expressed by the learned Single Judge is unsustainable in law

inasmuch as it ignored the general terms and conditions of supply

of distribution and retail supply licenses framed vide Order dated

06.01.2006 by the Andhra Pradesh Electricity Regulatory

Commission.

5.1 Reliance was placed upon clause 8.4 of the aforesaid general

terms and conditions which reads as follows:

"8.4 Transfer of Service Connection

The seller of the property should clear all the dues to the

Company before selling such property. If the seller did not clear

the dues as mentioned above, the Company may refuse to

supply electricity to the premises through the already existing

connection or refuse to give a new connection to the premises

till all dues to the Company are cleared."

5.2 Reliance was also placed upon judgment of the Apex Court

rendered in the case of Paschimanchal Vidyut Vitran Nigam HCJ & RRR, J

Limited and Others Vs. DVS Steels and Alloys Private Limited and

Others1. The Supreme Court in paragraph Nos.12, 13 and 14 held

thus:

"12. But the above legal position is not of any practical help

to a purchaser of a premises. When the purchaser of a premises

approaches the distributor seeking a fresh electricity connection

to its premises for supply of electricity, the distributor can

stipulate the terms subject to which it would supply electricity. It

can stipulate as one of the conditions for supply, that the arrears

due in regard to the supply of electricity made to the premises

when it was in the occupation of the previous owner/occupant,

should be cleared before the electricity supply is restored to the

premises or a fresh connection is provided to the premises. If any

statutory rules govern the conditions relating to sanction of a

connection or supply of electricity, the distributor can insist upon

fulfilment of the requirements of such rules and regulations. If the

rules are silent, it can stipulate such terms and conditions as it

deems fit and proper to regulate its transactions and dealings. So

long as such rules and regulations or the terms and conditions are

not arbitrary and unreasonable, courts will not interfere with

them.

(2009) 1 SCC 210 HCJ & RRR, J

13. A stipulation by the distributor that the dues in regard

to the electricity supplied to the premises should be cleared before

electricity supply is restored or a new connection is given to a

premises, cannot be termed as unreasonable or arbitrary. In the

absence of such a stipulation, an unscrupulous consumer may

commit defaults with impunity, and when the electricity supply is

disconnected for non-payment, may sell away the property and

move on to another property, thereby making it difficult, if not

impossible for the distributor to recover the dues. Having regard

to the very large number of consumers of electricity and the

frequent moving or translocating of industrial, commercial and

residential establishments, provisions similar to clause 4.3(g) and

(h) of Electricity Supply Code are necessary to safeguard the

interests of the distributor.

14. We do not find anything unreasonable in a provision

enabling the distributor/supplier to disconnect electricity supply if

dues are not paid, or where the electricity supply has already been

disconnected for non-payment, insist upon clearance of arrears

before a fresh electricity connection is given to the premises. It is

obviously the duty of the purchasers/occupants of premises to

satisfy themselves that there are no electricity dues before

purchasing/occupying a premises. They can also incorporate in

the deed of sale or lease, appropriate clauses making the

vendor/lessor responsible for clearing the electricity dues up to HCJ & RRR, J

the date of sale/lease and for indemnity in the event they are

made liable. Be that as it may."

6. In a recent judgment of the Apex Court in K.C.Ninan Vs.

Kerala State Electricity Board and Others; and connected appeals2,

the Apex Court summarized its conclusions as under:

"a. The duty to supply electricity under Section 43 of the

2003 Act is not absolute, and is subject to the such charges and

compliances stipulated by the Electric Utilities as part of the

application for supply of electricity;

b. The duty to supply electricity under Section 43 is with

respect to the owner or occupier of the premises. The 2003 Act

contemplates a synergy between the consumer and premises.

Under Section 43, when electricity is supplied, the owner or

occupier becomes a consumer only with respect to those

particular premises for which electricity is sought and provided

by the Electric Utilities;

.........

d. A condition of supply enacted under Section 49 of the

1948 Act requiring the new owner of the premises to clear the

electricity arrears of the previous owner as a precondition to

availing electricity supply will have a statutory character;

e. The scope of the regulatory powers of the State

Commission under Section 50 of the 2003 Act is wide enough to

Civil Appeal Nos.2109 & 2110 of 2004 HCJ & RRR, J

stipulate conditions for recovery of electricity arrears of previous

owners from new or subsequent owners;

..........

i. The implication of the expression "as is where is" basis is

that every intending bidder is put on notice that the seller does

not undertake responsibility in respect of the property offered for

sale with regard to any liability for the payment of dues, like

service charges, electricity dues for power connection, and taxes

of the local authorities; and

.........."

7. Testing the facts of the present case on the touchstone of the

ratio of the aforementioned judgments, it can be seen that the

refusal to supply the electricity through a new connection to the

premises of the petitioner was absolutely legal and in line with the

general terms and conditions prescribed by the Andhra Pradesh

Electricity Regulatory Commission framed in terms of Section 50 of

the Electricity Act, 2003.

8. We find that the view expressed by the Writ Court was

contrary to the well established principles of law laid down in the

judgments mentioned hereinabove and therefore we find that the

judgment and order impugned is unsustainable.

HCJ & RRR, J