Delhi High Court

M/S Rakesh Kumar Sharma & Sons vs Bses Rajdhani Power Ltd & Anr. on 1 June, 2011

Author: Rajiv Sahai Endlaw

           *IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                            Date of decision: 1st June, 2011

+        WP(C) No.5208/2010 & CM No.10270/2010 (for interim relief)

%      M/S RAKESH KUMAR SHARMA & SONS            ..... Petitioner
                    Through: Mr. Laliet Kumar with Mr. Deepak
                             Vohra, Advocates.

                                    Versus

    BSES RAJDHANI POWER LTD & ANR.        ..... Respondents
                 Through: Mr. Sunil Fernandes, Standing
                           Counsel with Mr. Vipin Pillai,
                           Advocates.
CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
1.     Whether reporters of Local papers may                       Yes
       be allowed to see the judgment?

2.     To be referred to the reporter or not?               Yes

3.     Whether the judgment should be reported              Yes
       in the Digest?

RAJIV SAHAI ENDLAW, J.

1. The present writ petition is a sequel to the Full Bench judgment of

this Court in BSES Rajdhani Power Ltd. Vs. Saurashtra Color Tones

Pvt. Ltd. AIR 2010 Delhi 14 and as per which, if a tenant leaves arrears of

electricity charges, the landlord can be denied electricity in the premises if

does not clear the said arrears.

2. The petitioner is the owner of the first floor of property bearing

No.E-5, South Extension Part-II (Market), New Delhi. The said property

has been let out to the respondent no.2 M/s Saraf Projects Pvt. Ltd. The

respondent no.2 tenant has obtained an electricity connection in the said

tenanted premises in its own name from the respondent no.1. Disputes

and differences arose between the petitioner and the respondent no.2

resulting in the filing of CS(OS) No.842/2009 by the petitioner in this

Court for eviction of the respondent no.2. In the said suit, a settlement

was arrived at between the petitioner and the respondent no.2 and under

which settlement, the respondent no.2 has inter alia agreed to vacate the

premises on or before 7th January, 2013.

3. The petitioner has filed this writ petition averring that to the

knowledge of the petitioner, the respondent no.2 has outstanding arrears

of over Rs.55,00,000/- to the respondent no.1 towards electricity charges

and expressing apprehension that unless the respondent no.1 recovers the

said amount from the respondent no.2 immediately or disconnects electricity

supply to the respondent no.2 in the tenanted premises immediately, so as to

compel the respondent no.2 to make payment, the petitioner may be

saddled with the said liability upon the respondent no.2 vacating the

premises.

4. The petitioner thus seeks a direction to the respondent no.1 to take

appropriate steps to recover upto date dues with respect to the premises

from the respondent no.2 only, to ensure that the petitioner upon being put

back into possession of the premises is not saddled with liability for dues

of electricity consumed by the respondent no.2.

5. Considering the nature of the controversy, need was not felt to call

for the counter affidavit or to issue notice to the respondent no.2 tenant

and the counsel for the petitioner and the counsel for the respondent no.1

have been heard finally on the petition.

6. The counsel for the respondent no.1 has contended that the

petitioner has concealed from this Court that there is a dispute pending

between the respondent no.2 tenant and the respondent no.1 with respect

to the electricity dues aforesaid. It is stated that the respondent no.2

tenant had filed a complaint against the respondent no.1 before the State

Consumer Disputes Redressal Forum and which was decided in favour of

the respondent no.2 tenant on 16 th December, 2008; the respondent no.1

preferred an appeal to the National Consumer Disputes Redressal

Commission which was decided in favour of the respondent no.1 on 7th

August, 2009; the respondent no.2 tenant has now preferred a Special

Leave Petition No.25343/2009 which is pending consideration before the

Supreme Court. It is contended that the relief sought in this writ petition

of directing the respondent no.1 to recover the dues of over Rs.55,00,000/-

from the respondent no.2 tenant is contrary to the aforesaid dispute which

is pending. The counsel for the respondent no.1 however on enquiry

informs that there is no stay by the Supreme Court of any action by the

respondent no.1 to recover the dues from the respondent no.2 tenant.

7. It is further the contention of the counsel for the respondent no.1

that the relief sought by the petitioner is contrary to Regulation 15 of the

Delhi Electricity Supply Code & Performance Standards Regulations,

2007 whereunder the respondent no.1 is entitled to refuse electricity

supply to the premises aforesaid after the respondent no.2 tenant has

vacated the premises if any arrears of electricity dues remain. The

counsel for the respondent no.1 has also taken me through paragraphs 10

to 14 of the judgment in Paschimanchal Vidyut Vitran Nigam Limited

Vs. DVS Steels and Alloys Private Limited (2009) 1 SCC 210 in this

regard.

8. The counsel for the respondent no.1 has further contended that as

per paragraph 14 of the judgment of the Full Bench in Saurashtra Color

Tones Pvt. Ltd. (supra), the petitioner ought to have incorporated in the

Lease Deed, the obligation of the respondent no.2 tenant to pay the

electricity dues up to the date of vacation of the premises. It is urged that

the Lease Deed has intentionally not been filed.

9. The counsel for the petitioner states that the petitioner is not a party

to the proceedings between respondent no.1 and respondent no.2 and thus

no question of concealment arises. It is further stated that the electricity

charges are always the responsibility of tenant and more so when the

connection itself is in the name of the tenant. It is further stated that Lease

Deed if required, can be filed.

10. The Full Bench of this Court in the judgment aforesaid has held that

the question of mala fides does not arise in the enforcement of Regulation

15 aforesaid and the said Regulation is to be enforced even if the owner or

subsequent transferee or purchaser of the property was unaware of the

electricity dues and has no truck with the person leaving the arrears.

11. The petitioner, atleast by way of the present petition has made the

respondent no.1 aware of the last date when the respondent no.2 is to

vacate the premises. The counsel for the petitioner also relies upon

Regulation 49 whereunder the respondent no.1 is required to immediately

disconnect the electricity supply for non-payment of the arrears. It is

contended that notwithstanding there being no stay against the respondent

no.1 from the Supreme Court, the respondent no.1 is not taking any steps

for recovery of huge dues and which may ultimately fall on the petitioner.

Both petitioner as well as respondent no.1 allege collusion of the

respondent no.2 with other.

12. The counsel for the respondent no.1 states that the respondent no.1 as

a matter of policy does not take coercive steps during the pendency of a

litigation, even if there be no stay order.

13. It has at the outset to be examined whether the relief sought is in the

face of Regulation 15 supra. The same is as under:

"15. General--(i) The Licensee shall prominently display at all offices where application for new connection is accepted, the detailed procedure for new connection and the complete list of documents required to be furnished along with the application. No other document, which has not been listed, shall be asked to be submitted by the applicant. Rate/amount of security and cost of service line to be deposited by the applicant in accordance with the stipulation in the regulations shall also be displayed.

(ii) Where applicant has purchased existing property and connection is lying disconnected, it shall be the duty of the

applicant to verify that the previous owner has paid all dues to the Licensee and has obtained "no-dues certificate" from the Licensee. In case "no-dues certificate" is not obtained by the previous owner, the applicant before purchase of property may approach the Business Manager of the Licensee for a "no-dues certificate". The Business Manager shall acknowledge receipt of such request and shall either intimate in writing outstanding dues, if any, on the premises or issue "no-dues certificate" within one month from the date of application. In case the Licensee does not intimate outstanding dues or issues "no-dues certificate" within specified time, new connection on the premises shall not be denied on ground of outstanding dues of previous consumer.

(iii) Where a property/premises has been sub-divided, the outstanding dues for the consumption of energy on such premises, if any, shall be divided on prorata basis based on area of sub-division.

(iv) A new connection to such sub-divided premises shall be given only after the share of outstanding dues attributed to such sub-divided premises is duly paid by the applicant. A Licensee shall not refuse connection to an applicant only on the ground that dues on the other portion(s) of such premises have not been paid, nor shall the Licensee demand record of last paid bills of other portion(s) from such applicants.

(v) In case of complete demolition and reconstruction of the premises or the building, the existing installation shall be surrendered and agreement terminated. Meter and service line will be removed, and only fresh connection shall be arranged for the reconstructed premises or building, treating it as a new premises after clearing the old dues on the premises by the consumer(s)."

14. It would thus be seen that Regulation 15 imposes an obligation on a

purchaser of existing property electricity connection wherein is lying

disconnected. The present is not a case of sale-purchase of property. The

petitioner is the owner having inducted respondent no.2 as the tenant and

the dues subject matter of this writ petition are the dues of electricity

connection obtained by the respondent no.2 tenant himself in its own

name in the premises.

15. Both Saurashtra Color Tones Pvt. Ltd. and Paschimanchal Vidyut

Vitran Nigam Limited also were concerned with sale-purchase of

property and not with a case of tenancy as the present case is, though I

must record that in the order of reference to Full Bench in Saurashtra

Color Tones Pvt. Ltd., there indeed is a reference to "previous tenant".

Saurashtra Color Tones Pvt. Ltd. however does not refer to Regulation

15 (supra) but bases the entitlement to recover outstanding dues against

the premises and/or disconnected connection on General Conditions of

Supply of electricity which were held to be binding and statutory in

nature. It was held since as a condition of supply in Delhi the consumer is

bound to pay / deposit outstanding dues, the consumer could not be heard

to contend otherwise. The Division Bench of this Court in Madhu Garg

Vs. North Delhi Power Ltd. 129 (2006) DLT 213 approved by the Full

Bench in Saurashtra Color Tones Pvt. Ltd. had also held that whenever a

person purchases a property, it is his duty to find out whether there are

outstanding electricity dues in relation to the premises and he cannot be

allowed to say later that he was unaware that there were dues of the

previous occupant.

16. I may also notice that Regulation 46 makes a consumer of

electricity liable to get a special reading done at the time of change of

occupancy or on the premises falling vacant and to obtain No Dues

Certificate from the Distribution Company such as the respondent no.1

herein is. The respondent no.1 is also obliged to arrange for such special

reading and to deliver the final bill including all arrears till the date of

billing at least three days before the vacation of the premises. Upon such

final bill being raised, the Distribution Company as respondent no.1, is

left with no right to recover any amounts other than those subject matter

of the bill and is also required to disconnect the supply on its vacancy.

17. In my view, the right aforesaid of the respondent no.1 under

General Conditions of Supply has to be harmonized with its obligations

under Regulations 15, 49 & 46 supra. The respondent no.1 especially

after being warned cannot be negligent in complying with its obligations

and which non-compliance may be to the prejudice of the petitioner.

Even if it be the policy of the respondent no.1 to not disconnect electricity

supply during the pendency of legal proceedings, the respondent no.1 can

certainly in the said legal proceedings seek a direction for securing its

claims. The respondent no.1 cannot afford to be complacent in the belief

that its dues are secure and will be recovered if not from the respondent

no.2 then in any case from the petitioner. The provisions of Regulations

15, 46 & 49 have been made in public interest and the respondent no.1

cannot use it to the detriment of the public. If the Distribution Companies

such as the respondent no.1 are permitted to so allow the arrears of

electricity charges to accumulate and not take timely prompt action for

recovery thereof from the person liable therefor and then coerce the

subsequent occupant to pay the same, it would be a serious clog on

transferability of immovable properties. People would then hesitate in

acquiring properties for the fear of the unknown liability of electricity

dues. Cases are not unknown where the Distribution Companies have on

enquiry disclosed a certain amount of dues and subsequently demanded

manifold amounts. The Distribution Companies, when warned of the

likely date of vacation of the property by the consumer liable for

electricity dues, are obliged to ensure that the electricity charges do not

accumulate and are recovered before the consumer vacates the property so

that the electricity dues do not fall on the subsequent occupant. Just like

under Conditions of Supply the respondent no.1 is entitled to recover the

outstanding of previous occupant from the subsequent occupant, the

respondent no.1 is also entitled to (a) insist on the respondent no.2

obtaining a No Dues Certificate from the respondent no.1 under

Regulation 15(ii) as well as Regulation 46(i) before leaving the premises,

(b) take a special reading under Regulation 46(ii) seven days in advance

of the respondent no.2 vacating the premises, (c) deliver the final bill

under Regulation 46(iii) to the respondent no.2 at least three days before it

vacates the property and (d) under Regulation 46(iv) disconnect the

electricity supply immediately on the respondent no.2 vacating the

premises. All this can be ensured by the respondent no.1 calling upon the

respondent no.2 to furnish an affidavit or undertaking to comply with the

aforesaid Regulations and if the respondent no.2 fails to furnish such

affidavit/undertaking, to proceed to disconnect electricity supply

forthwith.

18. Mention may also be made of the recent dicta in Haryana State

Electricity Board Vs. Hanuman Rice Mills (2010) 9 SCC 145 laying

down that electricity arrears do not constitute a charge over the property

and because in general law a transferee of premises cannot be made liable

for the dues of the previous owner/occupier and further holding that only

where the statutory rules and terms and conditions of supply which are

statutory in character, authorize the supplier of electricity to demand from

the purchaser of a property claiming reconnection or fresh connection of

electricity, the arrears due from the previous owner/occupier in regard to

supply of electricity to such premises, can the supplier recover the arrears

from the purchaser. I am of the opinion that the supplier of electricity is

required to enforce all its rules and cannot be selective in the same and if

found to be negligent in enforcement of rules against the previous

occupant and to the detriment of the subsequent occupant, the subsequent

occupant would be entitled to resist such claims of the supplier of

electricity.

19. The writ petition is therefore disposed of with the following

directions:-

(i) the petitioner shall immediately serve notice on the

respondent no.1 of any change in terms with the respondent no.2

than as contained in the compromise/application in the suit, copy of

which is annexed to the writ petition. The petitioner to, in the event

of learning of the intent of the respondent no.2 to vacate the

premises prior to 7th January, 2013, immediately serve the

respondent no.1 with notice of the same.

(ii) the respondent no.1 is directed to secure itself in the manner

aforesaid and otherwise, qua the dues, if any from the respondent

no.2 and to ensure that all its claims against the electricity meter in

the name of the respondent no.2 in the premises aforesaid are paid

before the stipulated date of vacation of the premises. If the

respondent no.1 is found to be wanting in the same, it shall not be

entitled to deny the electricity connection to the petitioner or any

subsequent transferee/occupant thereof for the reason of the said

dues.