Surya Alloy Industries Limited & ... vs West Bengal Electricity ...
2021 Latest Caselaw 1339 Cal

     11
11.02.2021

Ct. No.23 PP/sb/pg.

IN THE HIGH COURT AT CALCUTTA CONSTITUTIONAL WRIT JURISDICTION APPELLATE SIDE (Via Video Conference)

WPA 3882 of 2021

Surya Alloy Industries Limited & Anr.

Vs.

West Bengal Electricity Regulatory Commission & Ors.

Mr. Surojit Nath Mitra, Sr. Advocate Mr. Tanoy Chakraborty Mr. Siddharth Shroff ... For the petitioners

Ms. Sharmistha Ghosh Ms. Neha Chakraborty ... For WBERC

Mr. Jaydip Kar, Sr. Advocate Mr. Prasun Mukherjee Mr. Deepak Agarwal ... For DVC

The petitioner no.1 is a consumer under Damodar

Valley Corporation (in short "DVC") for its factory situated

at Barjora Kadasole, Bankura. The petitioners in this writ

petition have challenged the summary statement raised by

DVC, the licensee, dated 1st January, 2021 along with the

amended bills claiming a sum of Rs.8,07,57,922/- and the

disconnection notice dated 28th January, 2021 issued in

terms thereof threatening to disconnect the supply of

petitioner no.1 within 15 days from the date of issuance of

the said notice. The 15 days time period from 28th January,

2021 takes us to 12th February, 2021. The petitioners say

that nothing is payable according to the demand made and

therefor has not paid the amount claimed or any part

thereof. The petitioners apprehend disconnection by

tomorrow. The disconnection, if effected, will stop the

operation of the factory and will cause immense loss to the

work-in-progress. The employees of the petitioner no.1

including the petitioner no.2 will be deprived of their

livelihood if the disconnection takes place.

The brief facts leading to the petitioners disputing

the summary statement and the bill raised in terms thereof

are as follows:-

(i) The Electricity Act, 2003 (hereinafter referred

to as the "said Act") came into effect on 10th June,

2003. DVC was required to approach the Central

Commission within a time frame as per the said Act

for determining of the tariff which DVC failed to do.

The Central Commission, in such circumstances,

initiated suo motu proceeding and by an order dated

29th March, 2005 directed DVC to submit its

application for approval of its tariff for the tariff

period 1st April, 2004 to 31st March, 2009. DVC

accordingly made an application on 8th June, 2005.

DVC was, however, raising bill as per their own

tariff schedule during this period.

(ii) By an order dated 3rd October, 2006, the first

tariff order determining the tariff for generation and

transmission for the period from 1st April, 2006 to

31st March, 2009 was determined by the Central

Commission.

(iii) DVC challenged the said order before the

Appellate Tribunal for electricity. The said Appellate

Tribunal by an order dated 10th May, 2010

dismissed the appeal so preferred by DVC.

(iv) The order of the Appellate Tribunal was

carried in appeal before the Hon'ble Supreme. By an

order dated 9th July, 2010, the order of refund of

the excess amount from the customers including

petitioner no.1 as directed by the Appellate Tribunal

was stayed. The appeal was ultimately dismissed on

3rd December, 2018.

(v) The order of the Appellate Tribunal being

upheld, save the direction for refund, DVC was

required to approach the West Bengal Electricity

Regulatory Commission (in short "WBERC") for

fixation of the retail tariff in West Bengal and to the

other State Commissions for the States wherein

DVC has its operation.

(vi) The West Bengal Electricity Regulatory

Commission (Terms and Conditions of Tariff)

Regulations, 2005 (in short "Tariff Regulations

2005") was notified on 21st November, 2005 and

came into effect from that date. The Tariff

Regulations 2005 was, however, repealed by

promulgation of the West Bengal Electricity

Regulatory Commission (Terms and Conditions of

Tariff) Regulations, 2007 (in short "Tariff

Regulations 2007") notified on 9th February, 2007

which came into effect from that date.

(vii) Despite there being a Commission set up for

the State of West Bengal, DVC did not approach the

said State Commission in time and, as such,

continued to raise bills without there being any

fixed tariff according to the petitioners. It is also the

case of the petitioners that in absence of any fixed

tariff, there was no obligation on the part of the

petitioners to make payment of the bills which were

arbitrary. The petitioners, however, made certain ad

hoc payments but not according to the bill date and

the value of the bills that were raised by DVC from

time to time as according to the petitioners the

same were not on the basis of any tariff fixed by

WBERC.

(viii) Ultimately, by an order dated 19th March,

2020, the WBERC fixed the retail tariff for the year

2009-10, 2010-11 and 2012-13. By another order

dated 19th June, 2020, WBERC fixed the retail tariff

for the year 2006-07 and 2008-09.

(ix) As per records it is an admitted position that

a net principal amount of Rs.9,03,32,353/- was an

excess payment made by the petitioners for the

period 2006-09. DVC has given 6% interest to the

petitioners in terms of the order dated 10th May,

2010 passed by the Appellate Tribunal for

electricity. The interest at the rate of 6% on the

principal sum of Rs.9,03,32,353/- come to

Rs.4,90,53,787/-.

(x) It is the case of the petitioners that from the

principal sum of Rs.9,03,32,353/-, the electricity

bills dated 10th June, 2010, 3rd February, 2010, 8th

March, 2010, 8th April, 2010 and 6th May, 2010

have deducted which brings the figure of

Rs.9,03,32,353/- to Rs.5,97,03,006/- being the net

principal amount refundable.

(xi) Against an aggregate interest of

Rs.4,90,53,787/-, DVC has adjusted the Delayed

Payment Surcharge (in short "DPS") alleging that an

aggregate DPS of about Rs.6.87 crore is payable by

the petitioner No.1 for the period 2010-2013. This

alleged DPS, according to DVC, is in terms of the

agreement between the petitioners and DVC. After

the adjustment of Rs.6.87 crore from the said sum

of Rs.4,90,053,787/-, a sum of Rs.1,96,84,884/-

has allegedly become realisable by DVC from the

petitioner no.1. After adjusting Rs.1,96,84,884/-

from the net principal sum of Rs.5,97,03,006/- a

sum of Rs.4,00,18,122/- is arrived at. In terms of

the order dated 5th March, 2019, the petitioners

made payment of the bills after deducting

Rs.25,00,000/- from the exact bill value of the bills

raised by DVC. On this account, a deficit of Rs.5.5

crore has been arrived at by DVC. DVC has also

charged on account of arrears of bills for the period

between 2009 to 2013 an aggregate sum of Rs.5.55

crore. DVC has thereafter added the said sum of

Rs.5.50 crore with Rs.5.55 crore and a sum of

Rs.1.03 crore on account of DPS for the period

January 2019 to November 2020 and have deducted

therefrom a sum of Rs.4,00,18,122/- to arrive at a

net due of Rs.8,07,57,922/-. This is the claim for

DVC in the bill dated 1st of January, 2021. There is

no due date for payment of the said sum.

(xii) The petitioners have by an letter dated 12th

January, 2021 disputed the calculation made by

DVC and have further requested DVC to recalculate

the bill dated 1st January, 2021.

(xiii) The petitioner no.1 was served with a

disconnection notice dated 28th January, 2021

which has been protested against by the petitioner

no.1 vide its letter dated 30th January, 2021.

On behalf of the petitioners, it is submitted that

DVC has wrongfully charged DPS though such DPS is

neither realisable by DVC nor payable by the petitioners.

There has been no delay on the part of the petitioner no.1

in making payment as the bill raised by DVC without the

tariff order being fixed cannot be said to be bills payable by

the petitioners. DVC has in an unauthorised manner

reduced the principal sum by deducting the unpaid bill

value therefrom after a period of at least seven (7) years

from the bill date. These bills are barred by limitation

under the provisions of Section 56(2) of the said Act. There

is, as such, according to the petitioners, no amount

payable if a proper account is taken in the matter. The

petitioners further say that DVC, if claims that bills for the

year 2010 to 2013 having remained unpaid and are

adjustable in 2021, then such bills are barred by

limitation. On the other hand, if DVC claims to have raised

bills in terms of the orders dated 19th March, 2020 and 19th

June, 2020, then DPS is not realisable as there is no delay

on the part of the petitioner no.1 in making payment. DVC,

therefor, cannot claim the said sum of Rs.8,07,57,922/- on

either count. There is no due date for making payment of

the bill dated 1st January, 2021 and, as such, there can be

no default on the part of the petitioner no.1. The

disconnection notice allegedly issued under Section 56(1) of

the said Act is, therefor, bad and issued arbitrarily in

colourable exercise of power. The disconnection notice is

required to be stayed as an interim measure and set aside.

The petitioners have relied upon a judgment

reported in (2020) 4 SCC 650 (Assistant Engineer (DI),

Ajmer Vidyut Vitran Nigam Limited & Anr. v.

Rahamatullah Khan Alias Rahamjulla) to demonstrate

that in case of claims wherein limitation under the

provisions of Section 56(2) of the said Act are attracted like

the case in hand, no coercive mode like disconnection of

electric supply can be adopted by DVC as against the

petitioners.

On behalf of DVC it is submitted that the bill has

been raised in terms of the various orders passed in the

proceedings inter se between the parties as also in terms of

the order of the Central and the State Electricity Regulatory

Commission. There is, as such, no error in the bill and the

petitioners are liable to pay the said sum of

Rs.8,07,57,922/-. It is further submitted on behalf of DVC

assuming without admitting that the amount of Rs.1.96

crore payable to DVC and Rs.4.01 crore payable to the

petitioners involve certain claims allegedly barred by

limitation, then also DVC is entitled to realise from the

petitioner no.1 a huge sum on account of less payment for

the period January, 2019 to November, 2020 in terms of the

order dated 5th March, 2019 which the petitioners cannot

deny. It is also submitted on behalf of DVC that the

petitioners have disputed the bill raised by DVC. A billing

dispute is required to be adjudicated by the Regional

Grievance Redressal Officer, (in short, RGRO) set up in

terms of Section 42(5) of the said Act and then by the

electricity Ombudsman under Section 42(6) of the said Act.

The petitioners should be asked to approach the concerned

RGRO for redressal of his disputes. Some of the consumers

in similar circumstances have approached the RGRO. DVC

also says that in terms of the agreement between the

petitioners and respondents there is an arbitration

agreement and the disputes raised by the petitioners are

squarely covered by the arbitration clause and as such they

could have approached the arbitrator. The writ petition is

not maintainable in view of the subsistence of the

arbitration agreement and availability of a statutory forum.

On behalf of West Bengal Electricity Regulatory

Commission (in short, WBERC), it is submitted that on the

issue of disconnection, WBERC has nothing to say as it is

inter se dispute between the petitioner and DVC. So far as

the dispute regarding the bill raised by DVC, WBERC says

that RGRO and then electricity Ombudsman are the

statutory authorities before which the grievance has to be

ventilated by the petitioners. In this regard, WBERC has

relied upon a judgment reported in (2007) 8 SCC 381

(Maharashtra Electricity Regulatory Commission vs.

Reliance Energy Ltd. & Ors.). Relying upon paragraphs

22, 31 and 33 it is submitted that RGRO is the only forum

which can be approached by the petitioners.

After considering the respective submissions and

the materials on record, the issue as to the limitation, the

right of DVC to realise DPS and the accounting procedure

as raised by the petitioners cannot be gone into without

calling for affidavits.

So far as the interim protection as to the threat of

disconnection is concerned, the Court is required to balance

the scales. It is an admitted position that a sum of

Rs.9,03,32,353/- is the net principal amount payable by

DVC to the petitioners. It is also an admitted position that a

sum of Rs.4,90,53,787/- has accrued as interest on the

principal sum as per the order of Appellate Tribunal for

Electricity. The aggregate sum of such interest and

principal is in excess of Rs.13 crore. The bills payable on

10th January, 2010, 3rd February, 2010, 8th March, 2010,

5th April, 2010 and 8th May, 2010 and the DPS realised are

issues required to be adjudicated after filing of affidavits.

With regard to the realization of DPS, I also find

substance in the contention of the petitioners at this stage.

As to whether DVC can realize DPS is dependant on various

factors like the interpretation of the clause for the same in

the agreement, the limitation as to the bills, the

interpretation of various orders. The issues cannot be gone

into without complete disclosure in the affidavits to be filed.

At this stage, the adjustment of the interest payable to the

petitioner against DPS, the arrear for the period 2009 to

2013 and the DPS for the period January, 2019 to

November, 2020 cannot be said to be realiasable from the

petitioners without there being detailed enquiry in this

regard after filing of affidavits. The fact, therefor, remains

that as against an admitted sum in excess of Rs.13 crore, a

sum of Rs.5.5 crore is due and realiasable for the deficit

during the period from January, 2019 to November, 2020

as the petitioners paid lesser amount in terms of the order

dated 5th March, 2019. DVC also did not take any steps to

disconnect the electricity between 2009 - 2013 when

according to them bills remained unpaid. The balance of

convenience and inconvenience is therefor tilted in favour of

the petitioners. The petitioners have also made out a prima

facie case and are, therefor, entitled to an order of

injunction restraining DVC from disconnecting the supply

of the petitioners for non-payment of the amount claimed in

the bill dated 1st January, 2021, till the final disposal of the

writ petition. The petitioner no.1, however, shall continue to

pay the regular consumption bills that may be raised by

DVC from time to time during the pendency of the writ

petition.

With regard to the contention raised by DVC and

WBERC that the matter should be sent to the RGRO, I am

of the view that the dispute in hand is not a classical billing

dispute wherein either the meter is defective or erroneous

meter reading involving any outstanding energy charge for

the consumption made by the petitioners in regular course

as considered by the Commission in case of Reliance

Energy (supra). The bill is on account of alleged arrears

after adjustment of an admitted sum. The adjustment

includes the legality to realise DPS and bills for the period

2009 to 2013 after about seven years. These issues also

cannot be effectively decided by the RGRO or the arbitrator.

This Court is empowered to go into the legality of realisation

of DPS and adjustment on account thereof as also for bills

unrealised for over seven years.

Since I have admitted the writ petition for being

finally heard after the affidavits, I have not dealt with the

judgments cited in details.

Let affidavit-in-opposition be filed within a period of

three weeks from date. Reply thereto, if any, be filed within

two weeks thereafter.

Liberty to mention for inclusion in the list under the

heading "Hearing" after six weeks.

(Arindam Mukherjee, J.)