Madhya Pradesh High Court
Madhya Pradesh Paschim Kshetra Vidhyut ... vs M/S R D Weaving Mills Llp A Partnership ... on 9 May, 2024
1
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE VINAY SARAF
ON THE 9 th OF MAY, 2024
WRIT PETITION No. 25952 of 2023
BETWEEN:-
MADHYA PRADESH PASCHIM KSHETRA VIDHYUT
VITRAN COMPANY LIMITED A COMPANY
INCORPORATED UNDER COMPANIES ACT 1956
THROUGH ITS OFFICER IN CHARGE OF THE CASE
SUPERINTENDENT ENGINEER( O AND M) MPPKVVC
LTD HAVING IT REGISTERED UNDER CORPORATE
OFFICE AT GPH COMPOUND, POLO GROUND, INDORE
(MADHYA PRADESH)
.....PETITIONER
(BY SHRI PRAKASH UPADHYAY - ADVOCATE)
AND
1. M/S R D WEAVING MILLS LLP A PARTNERSHIP
FIRM THROUGH ITS PARTNER MOHD IQBAL
KHAN S/O NOT KNONW AGED ABOUT NOT
KNONW R/O PODDAR COMPOUND NEW TIT
ROAD GURUDWARA, BURHANPUR, DISTRICT
BURHANPUR (MADHYA PRADESH)
2. ELECTRICITY CONSUMER GRIEVANCE
REDRESSAL FORUM INDORE AND UJJAIN
DIVISION, POLO GROUND, INDORE (MADHYA
PRADESH)
.....RESPONDENTS
(SHRI DHEERAJ SINGH PANWAR - ADVOCATE WITH MS. TANVI KHARE -
ADVOCATE)
This petition coming on for admission this day, th e court passed the
following:
ORDER
Madhya Pradesh Pachim Kshetra Vidyut Vitran Company Limited
(hereinafter referred to as "MPPKVVC Ltd.") licencee company has preferred
the present petition assailing the order dated 22.9.2022 passed by the Electricity
Consumer Grievance Redressal Forum, Indore/respondent No.2 (hereinafter
referred to as "the Forum"), which is statutory forum established under Section
42 (5) of the Electricity Act, 2003 for redressal of consumer grievances in WO
520422, whereby the forum has allowed the complaint submitted by M/s. R.D.
Waving Mills LLP/respondent No.1, a registered limited liability partnership firm
(in short "LLP") and ordered to extend the benefit of rebate to respondent No.1
according to the Retail Supply Tariff Order FY 2017-18.
2. The facts of the case are not in dispute and the relevant undisputed facts in
short suffice for redressal of the present petition, are as under:
(i) The unit established by the LLP/respondent No.1 falls under the category
of Green Field Project.
(ii) The respondent No.1 made a request to MPPKVVC Ltd. for supply of
High Tension connection with contract demand of 500KVA at 33 KV supply
and an agreement was executed between the petitioner and respondent No.1 on
25.01.2016.
(iii) Executive Engineer (O&M) MPPKVVC Ltd. Burhanpur issued a letter
on 4.8.2016 to Electrical Engineer Power Energy for the purpose of joint survey
and test charge of 33KV line installed for the purpose of electricity supply to
the premises of the respondent No.1 and on 27.8.2016 issued a letter to
respondent No.1/LLP for carrying out the deficiencies pointed out by the
surveyor.
(iv) On 29.8.2016, respondent No.1/LLP completed the work and electricity
line was verified, handed over, connected and charged by supplying the
electricity.
(v) Rebate was allowed to the respondent No.1 as regulated by yearly tariff
order issued by Madhya Pradesh Electricity Regulatory Commission, Bhopal
(hereinafter referred to as 'MPERC Bhopal') for the FY 2016-17.
(vi) MPERC issued Retail Supply Tariff Order for FY 2017-18, whereby
according to the Special Terms and Conditions (e) of Tariff Schedule HV-3, a
rebate was announced for new HT consumer connection for which agreement
for availing supply from licencee were finalized during FY 2016-17 and FY
2017-18, provided the connections are served to Green Field project.
(vii) Respondent No.1 applied for extending the benefit of tariff order FY
2017-18 by allowing rebate of Rs.1/unit or 20%, which ever would be less from
the applicable energy charges.
(viii) The request of respondent No.1 company was turned down by
Additional S.E. (HT Billing Cell) MPPKVVCL Indore, by order dated
13.10.2017 on the ground that agreement was executed on 25.01.2016 and
therefore, as per clause (e) of Tariff Schedule HV-3 of Retail Supply Tariff
Order FY 2017-18, respondent No.1 is not eligible for the rebate.
(ix) Respondent No.1 preferred the complaint before Electricity Consumer
Grievance Redressal Forum Indore and Ujjain Division, Indore for extending
the benefit of rebate, which was allowed by order dated 22.9.2022, which is
under challenge in the present petition.
3. It is apt to reproduce the relevant clause of the Retail Supply Tariff Order
FY 2017-18:-
(e) Rebate for new HT connections: A rebate of Rs 1/Unit or 20% whichever
would be less is applicable in energy charges for new connection for the
consumption recorded. The rebate shall be allowed for a period of five years
from the date of connection for such new projects for which agreements for
availing supply from licensee are finalized during FY 2016-17 and FY 2017-
18. Provided these connections are served to green field projects only and no
rebate is applicable for new connections obtain by virtue of change in
ownership in existing connection. Note: the green field project shall be those
projects where the consumer invests in the construction of new industry/plant
from the ground up and there was no prior construction/structure on that
particular land."
4. The respondent No.1 claimed the benefit of rebate as announced in the
clause (e) by claiming that the agreement was executed on 25.1.2016 but the
Electricity Line was completed, verified and connected on 29.8.2016 when the
supply was also started by charging the line. As per respondent No.1, the date
of execution of agreement cannot be treated as the finalization of agreement and
the date of connection of the line for the purpose of supply of electricity should
be treated as date of finalizing of agreement and the same was done on
29.8.2016, within the FY 2016-17, therefore, respondent No.1 is entitled for the
rebate, whereas MPPKVVC Ltd. rejected the claim of rebate on the ground that
agreement was executed on 25.1.2016 and the date of execution of agreement
will be the date of finalizing the agreement, and the date of finalizing the
agreement was FY 2015-16, Therefore, respondent No.1 was not entitled for
the rebate.
5. The core question involved in the present matter is that, whether the
date of execution of agreement may be treated as date of finalization of
agreement, or the date of commencement of agreement or the date of
connection of line for the purpose of receiving energy or the date of
commencement of supply of energy may be treated as date of finalization
of agreement.
6. Learned counsel for the petitioner submits that date of execution of
agreement is the date when the agreement was finalized between the parties and
therefore, the same should be treated as date of finalization of agreement also.
For bolster his interpretation, he relied on the definition of agreement provided
in Chapter-II clause 2.1 (b) of the M.P. Electricity Supply Code, 2013
(hereinafter referred to as 'Code, 2013), which reads as under:-
"2.1(b): 'Agreement' with its grammatical variations and cognate expressions
means an agreement entered between the licensee and the consumer under this
Code."
7. He further relied clause 2(a) of the agreement dated 25.01.2015, which
provides that, "commencement of this agreement shall dealt either from the
actual date or which the consumer has begun to take electric energy under
this agreement or the day immediately following the expiry of prescribed
notice period of intimation of 30 days as per Electricity Supply Code, 2013 as
in force." He further relied on clause No.5 of the agreement. He further submits
that the date of commencement of agreement cannot be treated as date of
finalization of the agreement and when the agreement was signed by the parties,
the agreement came into force and therefore, the said date will be treated as date
of finalization of agreement.
8. He further submits that in the matte of State of Maharashtra vs. Shri
Vile Parle Kalvani Mandal and others, (2022) 2 SCC 725, the Apex Court
has held that, taxing or fiscal statute should be construed strictly and it is not
opened to the Court to ignore the provisions of the taxing statute and if the
eligibility criteria laid down in exemption notification, it required to be construed
strictly and once it is found that applicant satisfied the same, only thereafter the
exemption notification may be applied. He relied on the following paras of the
judgment:-
"11. While answering the aforesaid question/issue, law on how to interpret and/or
consider the statutory provisions in the taxing statute and the exemption
notifications is required to be analyzed first.
12. In Dilip Kumar [Commr. of Customs v. Dilip Kumar & Co., (2018) 9 SCC 1]
, five-Judge Bench of this Court has held that in every taxing statute--the charging,
the computation and exemption provisions at the threshold stage should be
interpreted strictly. In case of ambiguity in case of charging provision, the benefit
necessarily must go into favour of the subject/assessee. This means that the subject
of tax, the person liable to pay tax and the rate at which the tax is to be levied have
to be interpreted and construed strictly. If there is any ambiguity in any of these
three components, no tax can be levied till the ambiguity or defect was removed by
the legislature [see paras 53 to 55 in Dilip Kumar [Commr. of Customs v. Dilip
Kumar & Co., (2018) 9 SCC 1] ]. However, in case of exemption notification or
clause, same is to be allowed based wholly by the language of the notification, and
exemption cannot be gathered by necessary implication, or on a construction
different from the words used by reference to the object and purpose of granting
exemption [see Hansraj Gordhandas v. CCE [Hansraj Gordhandas v. CCE, AIR
1970 SC 755] ].
13. Further it is for the assessee to show by construction of the exemption
clause/notification that it comes within the purview of exemption. The
assessee/citizen cannot rely on ambiguity or doubt to claim benefit of exemption.
The rationale is not to widen the ambit at the stage of applicability. However, once
the hurdle is crossed, the notification is constructed liberally [see CCE v. Parle
Exports (P) Ltd. [CCE v. Parle Exports (P) Ltd., (1989) 1 SCC 345 : 1989 SCC
(Tax) 84] and Union of India v. Wood Papers Ltd. [Union of India v. Wood
Papers Ltd., (1990) 4 SCC 256 : 1990 SCC (Tax) 422] ] Thus, distinction can be
made between the substantive requirements that require strict compliance, non-
compliance of which would render the assessee ineligible to claim exemption, and
the procedural or compliance provision which can be interpreted liberally [see
SCC paras 64 to 65 in Dilip Kumar [Commr. of Customs v. Dilip Kumar & Co.,
(2018) 9 SCC 1]]
9. He further relied on the judgment of Apex Court delivered in the matter of
Krishi Upaj Mandi Samiti, New Mandi Yard, Alwar vs. Commissioner of
Central Excise and Service Tax, Alwar, (2022) 5 SCC 62 , which provides
that, the onus lies on the assessee to show that he comes within the purview of
the exemption notification. Learned counsel for the petitioner further submits
that the forum has committed error in extending the benefit of rebate to
respondent No.1, who is not eligible for the rebate as the agreement was
finalized on 25.1.2016. He prays for setting aside the order passed by the
forum.
10. Per contra, learned counsel for respondent No.1 supported the order
passed by the forum on the ground that execution of agreement itself is not
sufficient for the purpose of supply of energy and after execution of agreement,
till commencement of agreement, several acts are required to be done. During
this period the electricity lines are required to be erected, verified by the
surveyor appointed by the Electricity Company and thereafter to be handed
over to the company for the purpose of charging the same and for supply of
electricity and therefore, the date of finalizing the agreement cannot be treated as
date of execution of agreement. He prays for dismissal of the petition.
11. Heard learned counsel for the parties with the consent for the purpose of
final disposal of the present petition.
12. Considered the arguments advanced by them, perused the documents
available on record.
13. It is not in dispute that on 25.01.2016, the agreement was executed for the
purpose of supply of energy to the premises of the respondent No.1. It is also
not in dispute that after the execution of agreement the electricity lines were
erected. Some deficiencies were found in the electric lines by the surveyor in its
report and the same was intimated to the respondent No.1 by petitioner
company on 27.8.2016 and after rectification of the defect pointed out by the
petitioner company, the line was handed over on 29.8.2016, and on the same
day these lines were charged and supply was started.
14. The definition of agreement relied by the learned counsel for the petitioner
provided under the Code, 2013 is material as in the definition of agreement, it is
specifically mentioned that agreement means an agreement entered between the
licencee and the consumer under this Code meaning thereby the document will
be treated as agreement for the purpose of Code, 2013, whenever the customer,
who execute the document in favour of DISCOM will, attained the status of
consumer. For the purpose of understanding the meaning of consumer, the
definition provided in Clause 2.1 (n) in Chapter-II of Code, 2013 is material,
which reads as under:-
"2.1 (n):-'Consumer' means any person who is supplied with electricity by the
licensee and includes any person whose premises are for the time being connected
for the purpose of receiving electricity from the licensee, persons who have applied
for an electricity connection, persons whose supply is not yet connected even after
due notice to avail connection or whose electricity supply has been disconnected.
A consumer is- (i)'Low Tension Consumer (LT Consumer)' if he obtains supply
from the licencee at low voltage. (ii) 'High Tension Consumer (HT Consumer)' if he
obtains supply from the licencee at High Voltage. (iii) "Extra High Tension
Consumer (EHT Consumer)' if he obtains supply from the licencee at Extra High
Voltage."
15. Similarly, definition of consumer is provided in Section 2(15) of the
Electricity Act, 2003, which reads as under:-
"2(15):- "consumer" means any person who is supplied with electricity for his
own use by a licensee or the Government or by any other person engaged in the
business of supplying electricity to the public under this Act or any other law for the
time being in force and includes any person whose premises are for the time being
connected for the purpose of receiving electricity with the works of a licensee, the
Government or such other person, as the case may be."
16. As per the definition provided in Code, 2013 and the Electricity Act, 2003,
any person who falls under the definition of consumer, it is essential that the
electricity is being supplied to him by the lincencee and includes any person
whose premises is connected for the purpose of receiving electricity with the
works of a licencee or any notice is issued to him for completing the work, for
the purpose of receiving the energy or whose electricity supply has been
disconnected. Meaning thereby, mere entering into an agreement with the
Electricity Supply Company, the person will not fall under the definition of
consumer and whenever the person will fall under the definition of consumer as
per the definition given in the Code, 2013, the agreement will be treated as
agreement for the purpose of Code, 2013. It means that, until and unless,
customer falls under the definition of consumer, if any agreement is executed at
any pre stage, the same shall not be treated as an agreement for the purpose of
Code, 2013, therefore, the words finalization of agreement is purposely used in
the tariff. It cannot be accepted that the date of execution of agreement will be
the date of finalization of agreement otherwise there was no need to use the
word finalization of agreement and the words may be used as execution of
agreement. The execution of agreement is not the date of commnecment of
agreement and the date of supply of energy is the date of commencment of the
agreement. Meaning thereby, mere execution of agreement is not sufficient for
the purpose of commencement of agreement. Similarly, it is also not correct to
say that the date of finalizing the agreement is the date when the electricity
supply was started because as per the definition of consumer, if the electricity
lines is complete and connected for the purpose of receiving the energy in the
premises of the customer, the customer will fall under the definition of
consumer and the agreement will be treated as an agreement under the
provisions of Code, 2013. Therefore, the initiation of supply of energy is not
sine qua non for the purpose of treating as consumer. The similar view was
taken by the Apex Court in the matter of Uttar Pradesh Power Corporation
Limited and others vs. Anis Ahmad, (2013) 8 SCC 491 , which reads as
under:-
"36. Therefore, we hold that the complaints filed by the respondents were not
maintainable before the Consumer Forum.
Maintainability of a complaint before the Consumer Forum against final order of
assessment made under Section 126 of the Electricity Act, 2003 or action taken
under Sections 135 to 140 of the Electricity Act, 2003.
37. Section 2(15) of the Electricity Act, 2003 defines "consumer" in the
following manner: "2. (15) 'consumer' means any person who is supplied with
electricity for his own use by a licensee or the Government or by any other
person engaged in the business of supplying electricity to the public under this
Act or any other law for the time being in force and includes any person whose
premises are for the time being connected for the purpose of receiving electricity
with the works of a licensee, the Government or such other person, as the case
may be;"
38. From a bare reading of section aforesaid we find that the "consumer" as
defined under Section 2(15) includes any person who is supplied with electricity
for his own use by a licensee and also includes any person whose premises are
for the time being connected for the purpose of receiving electricity with the
works of a licensee, irrespective of the fact whether such person is supplied with
electricity for his own use or not. Per contra, under Section 2(1)(d) of the
Consumer Protection Act, 1986 those who are supplied with electricity for
commercial purpose and those who do not avail services for consideration,
irrespective of electricity connection in their premises do not come within the
meaning of "consumer."
17. The definition of consumer was also interpreted in Sesa Sterlite Limited
vs. Orissa Electricity Regulatory Commission and others, (2014) 8 SCC
444, wherein the Apex Court held that, if a person is receiving or purchasing
the electricity from the company, he qualifies to be a consumer under Section
2(15) of the Electricity Act, 2003. This proposition is reiterated by the Apex
Court in the matter of Karnataka Power Transmission Corporation
Limited vs. JSW Energy Limited, (2023) 5 SCC 541, wherein it is held that
there is no form for the concluded contract in the act and no penalty can be
imposed for not entering into power purchased agreement, which shows that
PPA is not an essential requirement under the Act and the word finalized in the
context of power purchase agreement cannot be played down in the context of
the previous correspondence at any rate. If a agreement is concluded contract
or not it will depend upon the facts and circumstances as well as intention of the
parties and after completing the work the agreement will be treated as concluded
contract.
18. The definition of work has been provided in Electricity Act, 2003 in
Section 2(77), which provides that the work will be completed when the
electricity lines are erected for the purpose of receiving electricity.
19. In view of the above discussion, the following result appears:-
(a) For the purpose of entering into a contract to supply the electricity, the
electricity company and consumer may execute an agreement but the same
cannot be treated as an agreement under the Code, 2013, unless and until, the
customer falls under the definition of consumer.
(b) If after the execution of agreement, erection of line and other works
required to be carried out, the agreement cannot be treated as concluded
contract and the date of commencement of contract will be different.
(c) Whenever the electricity lines are conveyed, verified and handed over to
the Electricity Company for the purpose of charging the same by electric
supply, the premises will be treated as connected with the lines and owner of
the premises will be treated as consumer. Therefore, the date on which the lines
were handed over for the purpose of charging the electricity shall be treated as
the date for finalizing the agreement, which is 29.8.2016 in the case in hand.
20. In view of above conspectus, the Forum has not committed any error in
holding that the M/s. R.D. Waving Mills LLP/respondent No.1 is entitled for the
rebate as declared in Retail Supply Tariff Order FY 2017-18 for the New High
Tension Projects falls under the definition of Green Field Project and
consequently, the petition fails and is hereby dismissed. The view taken by the
Forum is upheld. No order as to costs.
(VINAY SARAF)
JUDGE
irfan
