Karnataka High Court

Bharat Sachar Nigam Limited vs Managing Director Anr on 9 November, 2021

Author: M.I.Arunpresided Bymiaj

                               1


            IN THE HIGH COURT OF KARNATAKA
                   KALABURAGI BENCH

       DATED THIS THE 9TH DAY OF NOVEMBER, 2021

                            BEFORE

            THE HON'BLE MR. JUSTICE M.I.ARUN

       WRIT PETITION NO.82895/2012 (GM-KEB)

Between:

Bharat Sanchar Nigam Limited
Through its General Manager,
Dist : Gulbarga.
                                                 ... Petitioner

(By Sri Deeapk V.Barad, Advocate)

And:

1. Managing Director,
   GESCOM, Main Road,
   Gulbarga.

2. Assistant Executive Engineer (Electricity)
   O and M, Sub-Div, GESCOM,
   Kalagi, Tq : Chittapur,
   Dist : Gulbarga.
                                           ... Respondents

(By Sri Ravindra Reddy, Advocate)

      This Writ Petition is filed under Articles 226 and 227
of the Constitution of India praying to quash the order of
respondent vide order No.C.EA(«)/UÀÄ/G¯É¤/¸À¯/É »¸À-2/EvÀgÀ/J¥sï-
109/12-13/ ¹ªÉÊJ¸ï-77 dated 17.05.20121 which is marked as
                                        2


Annexure-F           and    order    No.¸À.PÀ.C.(«)/PÁ¼ÀV/».¸À./12-13/1573-73
dated 11.07.2012 which is marked as Annexure-G to meet
the ends of justice and equity.

      This petition coming on for Final Hearing this day,
the Court made the following:

                                   ORDER

Petitioner is a Government of India undertaking and

is involved in the business of providing communication by

way of telephone and mobile services to the public at

large. In this regard, a telephone exchange was

established at Kalagi Village, Chittapur Taluk. It has

availed power supply from the respondents-Company,

which is a State of Karnataka undertaking.

2. The respondents-Company has issued a notice

on 03.11.2011 to the petitioner claiming an amount of

`9,37,973/- towards back billing charges. Aggrieved by the

same, the petitioner preferred an appeal before

respondent No.1. The respondent No.1 has forwarded the

same to the Superintendent of Engineer of respondent-

Company, who has rejected the appeal of the petitioner

vide order dated 17.05.2012, which is produced as

Annexure-F to the writ petition.

3. In the meanwhile, the petitioner had deposited

certain amounts. By virtue of Annexure-F to the writ

petition, it is demanded that the petitioner pay the balance

amount of `4,18,122/-. Aggrieved by the same, the instant

writ petition is filed.

4. The case of the petitioner is that the

respondent-Company cannot demand amounts caused by

short claim/erroneous billing which has happened prior to

two years from the date of billing and in the instant case,

the back billing is for the period from 24.05.2005 to

August, 2011 which is impermissible.

5. The petitioner relies upon Clause 29.08 of

Conditions of Supply of Electricity of Distribution Licensees

in the State of Karnataka (hereinafter referred to as the

'Code') and Section 56 of the Electricity Act. Section 56 of

the Electricity Act reads as under :

"56. Disconnection of supply in default of payment.- (1) Where any person neglects to pay any charge for electricity or any sum other than a charge for electricity due from him to a licensee or the generating company in respect of supply, transmission or distribution or wheeling of electricity to him, the licensee or the generating company may, after giving not less than fifteen clear days' notice in writing, to such person and without prejudice to his rights to recover such charge or other sum by suit, cut off the supply of electricity and for that purpose cut or disconnect any electric supply line or other works being the property of such licensee or the generating company through which electricity may have been supplied, transmitted, distributed or wheeled and may discontinue the supply until such charge or other sum, together with any expenses incurred by him in cutting off and reconnecting the supply, are paid, but no longer:

Provided that the supply of electricity shall not be cut off if such person deposits, under protest,--

(a) an amount equal to the sum claimed from him, or

(b) the electricity charges due from him for each month calculated on the basis of average charge for electricity paid by him during the preceding six months, whichever is less, pending disposal of any dispute between him and the licensee.

(2) Notwithstanding anything contained in any other law for the time being in force, no sum due from any consumer, under this section shall be recoverable after the period of two years from the date when such sum became first due unless such sum has been shown continuously as recoverable as arrear of charges for electricity supplied and the

licensee shall not cut off the supply of the electricity."

6. Clause 29.08 of the Code reads as under :-

"a) At any time during verification of the Consumer's account, if any short claims caused by erroneous billing are noticed, the consumer is liable to pay the difference. The Licensee shall follow the procedure laid down under Clause 29.03 in such cases for preferring the supplemental claims. However, the Licensee shall not recover any arrears after a period of 2 years from the date when such sum became first due, unless such sum has been shown continuously in the bill as recoverable as arrears of the charges of electricity supplied."

Based on the said provisions, the petitioner contends that

the above said demands raised by the respondent-

Company is bad in law and is not maintainable.

7. Per contra, the learned counsel for the

respondent-Company relies upon the decision of this Court

passed in Writ Petition No.17255/2007 dated 05.11.2008,

wherein it has been held that two years as contemplated in

Clause 29.08 of the Code has to be reckoned from the date

of respondent-Company coming to know of the short

claim.

8. Paragraphs 11 and 12 of the said order reads

as under :-

"11. After perusal of the judgments relied upon by both the parties, this court has to examine wither two years period stipulated under Cl.29.08 has to be reckoned from out of wrong classification of the installation or from the date on which petitioner company came to know of such wrong classification. In view of Cl.29.03, it is clear that unfettered right is given to the petitioner-company to raise a supplemental claim on account of faulty meter or short claim caused due to erroneous billing. In the instant case, supplemental claim is made by the petitioner on account of wrong classification. At the time of installation, instead of raising as HT-2A it was wrongly treated as HT-2B as a result of which there was a loss of revenue to the petitioner-company. This fact was not known to the petitioner company till the audit wing sent a report to the petitioner calling upon the petitioner to recover the difference amount. The said audit report is produced by the respondent as Annexure- R13. Annexure-R13 is dated 5.3.2007 and thereafter as per Annexure-A on 26.3.2007 a demand is raised. Now this court has to examine whether the demand made by the petitioner as per Annexure-A dated 26.3.2007 has to be restricted only for the short claim of 2 years prior to 26.3.2007 or from the date of installation from which date there is loss of revenue to the petitioner-company.

12. Clause 29.08 (a) reads hereunder :-

"At any time during verification of the Consumer's account, if any short claims caused by erroneous billing are noticed, the Consumer is liable to pay the difference. The Licensee shall follow the procedure laid down under Clause 29.03

in such cases for preferring the supplemental claims.

However, the Licensee shall not recover any arrears after a period of 2 years from the date when such sum became first due, unless such sum has been shown continuously in the bill as recoverable as arrears of the charges of electricity supplied.

In case the verification of the Consumer's account shows excess claims made in the past, the excess amount shall be credited to the Consumer's account along with the interest at Bank Rate from the date of payment up to the date of credit. This shall be done within one month from the date of pointing out the excess claims. If for any reason there is delay in crediting the amount to the Consumer's account, interest at 2% per month shall be paid to the Consume for the period beyond two months."

Middle paragraphs of Cl.29.08(a) deals with the period of Limitation of 2 years. According to Mr.Gupta two years period has to be reckoned on which date short claim was noticed by the petitioner and even after noticing such short claim if the petitioner had slept over the matter for more than two years, in such circumstances, period of 2 years has to be restricted only from the date of demand and so far as the present case is concerned, immediately after noticing short claim based on the audit report, demand is raised as per Annexure-A dated 23.6.2007. Therefore he contends that petitioner came to know of such short claim and within 2 years from that date billing has been raised, therefore order passed by R-2 has to be quashed. Per contra, Mr.Reddy contends that the same paragraph has to be read holding that two years period has to be reckoned

only in respect of the short claim for a period of 2 years from the date of issuance of demand and not earlier to that. If the contention of R-1 is accepted inCl.29.03 itself, there would not have been restriction in regard to the demand of a short claim. Cl.29.08 has to be considered for the purpose of calculation of period of 2 years only from the date of knowledge and not from the date on which the first sum became due. It is not in dispute that the short claim was made known to the petitioner only when it received the audit report. The same date has to be considered as the date on which such sum became first due. There was no occasion for the petitioner to raise a bill prior to the receipt of the audit report. Therefore, this court is of the opinion that the period of two years has to be counted from the day on which petitioner-company has come to know of such short claim. This paragraph has to be interpreted to restrict the period of two years if the petitioner- company has slept over the matter even after two years after noticing short claim or wrong classification. Therefore, point No.1 has to be answered in favour of the petitioner."

9. It is the contention of the respondent-

Company that the said claim has been made within two

years after the respondents-Company came to know of the

said short billing.

10. However, it is noticed that the impugned order

under challenge (Annexure-F to the writ petition) does not

consider the contentions raised by the petitioner including

the limitation aspect. For the said reason, I deem it

appropriate to set-aside the order passed by the

Superintendent of Engineer which is dated 17.05.2012

bearing No.C.EA(«)/UÀÄ/G¯É¤/¸À¯É/»¸À-2/EvÀg/À J¥sï-109/12-13/

¹ªÉÊJ¸ï-77 at Annexure-F to the writ petition and remand