Madhya Pradesh High Court
Vishad Padmanabh Mafatlal vs Madhya Pradesh Madhya Kshetra Vidhyut ... on 5 May, 2025
Author: Gurpal Singh Ahluwalia
Bench: G. S. Ahluwalia
NEUTRAL CITATION NO. 2025:MPHC-GWL:10191
1 SA. No. 842 of 2025
IN THE HIGH COURT OF MADHYA PRADESH
AT GWALIOR
BEFORE
HON'BLE SHRI JUSTICE G. S. AHLUWALIA
ON THE 5th OF MAY, 2025
SECOND APPEAL No. 842 of 2025
VISHAD PADMANABH MAFATLAL AND OTHERS
Versus
MADHYA PRADESH MADHYA KSHETRA VIDHYUT VITRAN CO.LTD.
AND OTHERS
Appearance:
Shri N.K. Gupta- Senior Advocate with Shri Ashish Saraswat- Advocate for
appellants.
JUGDMENT
This Second Appeal, under Section 100 of CPC, has been filed against
the judgment and decree dated 19.02.2025 passed by District Judge, Lateri,
District Vidisha (M.P.) in Regular Civil Appeal No.15/2024 thereby reversing
the judgment and decree dated 13.03.2024 passed by Civil Judge, Senior
Division, Sironj, District Vidisha (M.P.) in RCS No.55A/2021.
2. The facts, necessary for disposal of present appeal, in short, are that
appellants filed a suit for declaration that electricity bill raised by defendants on
23.05.2014 and 24.12.2020 for recovery of Rs.13,13,643/- is null and void.
Signature Not Verified
Signed by: PAWAN
DHARKAR
Signing time: 5/14/2025
9:33:44 AM
NEUTRAL CITATION NO. 2025:MPHC-GWL:10191
2 SA. No. 842 of 2025
3. It is the case of plaintiffs that plaintiff No.8, namely, Shri Sadguru Sewa
Sangh Trust is a charitable trust operating a hospital in Tahsil Lateri, District
Vidisha (M.P.) thereby providing the treatment free of cost. Plaintiff No.8-
Shri Sadguru Sewa Sangh Trust was registered under the M.P. Public Trust
Act. Plaintiffs No.1 to 7 are the trustees of plaintiff No.8. Plaintiffs No.1 to 6
have executed a power of attorney in favour of plaintiff No.7 and accordingly,
plaintiff No.7 is authorized to file the suit. It was the case of plaintiffs that on
13.06.2005, plaintiffs filed an application for allotment of an electricity
connection of 48 Kw and accordingly, Electricity Connection No.572552 was
granted. In the year 2006, the load was increased to 60 KVA and the new
agreement was executed; in the year 2008 load was increased to 90 KVA; and
in the year 2012 the load was increased to 120 KVA. It is the case of plaintiffs
that plaintiffs were making payment of electricity charges regularly.
Defendants sent a notice to plaintiff No.8 on 23.05.2014 mentioning that A.G.
Audit Party found that during the year 2009-13, the billing was being done
under the tariff category H.B.6.1/Block Residential User whereas the billing
should have been done in accordance with the tariff category H.V. 3.2 and
accordingly a demand notice of Rs.21,89,405/- was issued. Plaintiffs were
directed to deposit the aforesaid amount within a period of fifteen days. A reply
dated 06.06.2014 was sent by plaintiffs and it was claimed that plaintiff No.8 is
a charitable trust involved in free treatment of poor persons and bills were paid
regularly. Audit team had not carried out physical inspection of the building nor
enquiry report was prepared on the spot. Even the load was not physically
verified by Executive Engineer and thus, it was prayed that the recovery raised
in compliance of the audit objection be cancelled. However, it was pleaded that
the defendants did not cancel the recovery notice and sent a bill dated
Signature Not Verified
Signed by: PAWAN
DHARKAR
Signing time: 5/14/2025
9:33:44 AM
NEUTRAL CITATION NO. 2025:MPHC-GWL:10191
3 SA. No. 842 of 2025
23.05.2014 mentioning therein that amount of Rs.21,89,405/- be deposited
within a period of 15 days, failing which the electricity connection shall be
disconnected. It was further claimed that the demand raised by the defendants
was not in accordance with the provisions contained under Section 56(2) of the
Electricity Act, 2003. Once again by notice dated 10.07.2014 the plaintiffs were
directed to deposit the amount of Rs.21,89,000/-. Since the defendants were
putting excessive pressure on the plaintiffs, therefore, on 17.10.2014 and
13.11.2014, plaintiffs deposited an amount of Rs.8,75,357/- under protest. It
was claimed that the defendants can raise a demand of two years preceding the
date of notice and not prior thereto. Plaintiffs had taken the electricity
connection for running of an eye-hospital and are working in rural area. In case
if electricity supply is disconnected, then the plaintiffs would not be in position
to run the hospital and treatment of patients would not be possible. The
plaintiffs filed a proceeding before the Madhya Pradesh State Consumer
Disputes Redressal Commission seeking quashment of bill dated 23.05.2014.
The said complaint was dismissed by the Madhya Pradesh State Consumer
Disputes Redressal Commission by order dated 04.11.2020 by holding that it
has no jurisdiction to hear the matter as plaintiff No.8/trust is not an individual
and therefore it cannot be treated as consumer. It was claimed that the
defendants had raised electricity bill for the first time on 13.05.2014.
Thereafter, plaintiffs raised a dispute before Madhya Pradesh State Consumer
Disputes Redressal Commission on 10.11.2014 which was dismissed by order
dated 04.11.2020. Thus, it was claimed that the period from 10.11.2014 till
04.11.2020 is liable to be excluded. It was further claimed that the defendants
have once again raised another bill dated 24.12.2020 and therefore, the suit is
Signature Not Verified
Signed by: PAWAN
DHARKAR
Signing time: 5/14/2025
9:33:44 AM
NEUTRAL CITATION NO. 2025:MPHC-GWL:10191
4 SA. No. 842 of 2025
within limitation and accordingly, it was prayed that the bills raised by
defendants be quashed.
4. Defendants filed their written statement. The enhancement of load was
accepted. It was accepted that on 23.05.2014, a notice was sent by defendants.
It was also accepted that a difference of Rs.21,89,405/- was pointed out by the
audit team. It was denied that the audit team had not carried out any spot
inspection. It was also denied that audit team had not prepared enquiry report
on the spot and it was also denied that executive engineer had not carried out
the detailed inspection of the load. All other pleadings with regard to issuance
of bills and notices were admitted. It was also admitted that the plaintiffs have
deposited Rs.8,75,357/- on 17.10.2014 and 13.11.2014. However, all the
adverse pleadings were denied. It was further pleaded that on 10.01.2006,
plaintiff No.8 had taken a new High Tension Connection in which the purpose
was shown to be residential consumption of power. In that agreement, the word
hospital was not mentioned. Accordingly, electricity bills were raised in
accordance with tariff category HV6.1. Thereafter, plaintiffs got the load
enhanced twice but it never disclosed that hospital was being run. When A.G.
Audit Team carried out spot inspection, then it was found that the electricity
was being consumed by the hospital and accordingly, the A.G. audit party
treated the said connection to be a non-residential connection and accordingly
held that the billing should have been done as per HV3.2. As a result, a demand
notice of Rs. 21,89,000/- was issued. On 16.10.2014, plaintiff No.8 sent a letter
to the defendants seeking permission to deposit the amount of Rs.21,89,405/- in
installments and it was also mentioned that whatever legal notice has been sent
by its lawyer is hereby withdrawn and it was assured that whatever installment
is fixed by the defendants, then the same shall be deposited. Accordingly, on
Signature Not Verified
Signed by: PAWAN
DHARKAR
Signing time: 5/14/2025
9:33:44 AM
NEUTRAL CITATION NO. 2025:MPHC-GWL:10191
5 SA. No. 842 of 2025
16.10.2014 itself, a permission was granted to the plaintiffs to deposit the
amount of Rs.21,89,000/- in five equal monthly installments. Accordingly,
plaintiff No.8 deposited Rs.4,37,881/- by way of first installment on 17.10.2014
through Cheque No.060537 and the second installment of Rs.4,37,881/- was
deposited through Cheque No.680933. Therefore, it was claimed that the
plaintiffs have already deposited an amount of Rs.8,75,762/-. The plaintiffs had
admitted the liability to deposit the amount of Rs.21,89,000/-, out of which they
have already deposited two installments. It was also claimed that the suit is
barred by limitation.
5. The Trial Court, by order dated 10.09.2022 framed the following issues:
1.
Whether the defendants are illegally trying to recover
remaining audit amount of Rs 13,13,643/- (Thirteen lakhs thirteen
thousand six hundred forty three) through bill dated 23.05.2014
and 24.12.2020 from Plaintiffs?
2. Whether the recovery of above stated remaining audit
amount is barred by Section 56(2) of The Electricity Act 2003?
3. Whether the present suit is barred by limitation?
4. Whether the Plaintiff has rightly valued the suit and paid
proper court fees?
5. Relief and costs, if any?
6. The Trial Court, after recording evidence, decreed the suit by judgment
and decree dated 13.03.2024 passed in RCSA No.55/2021. Being aggrieved by
the said judgment and decree, the defendants preferred appeal which was
registered as Regular Civil Appeal No.15/2024 and District Judge, Lateri,
District Vidisha (M.P.) by judgment and decree dated 19.02.2025 set aside the
NEUTRAL CITATION NO. 2025:MPHC-GWL:10191
judgment and decree passed by the Trial Court and dismissed the suit filed by
plaintiffs.
7. Challenging the judgment and decree passed by Appellate Court, it is
submitted by counsel for appellants that the demand notice was barred under
Section 56(2) of the Electricity Act, 2003. The deposit of Rs.8,75,762/- was
under protest. Therefore, it cannot be treated as an unconditional acceptance of
liability. It is submitted that plaintiff No.8 is a charitable trust running a
hospital and is giving treatment to the poor persons of the society free of cost
and accordingly proposed the following Substantial Questions of Law:
A- Whether the judgment and decree passed by the learned
lower appellate court deserves to be set aside by the Hon'ble Court
when the plaintiffs have duly proved the case of illegal, void and
time barred recovery before the learned trial court?
B- Whether the learned lower appellate court was justified in
holding that the recovery is not barred as per Section 56(2) of
Electricity Act, 2003 whereas the learned trial court has
specifically framed the issue no. 2 and has held the recovery is time
barred ?
C- Whether the judgment and decree passed the learned lower
appellate court is sustainable in the light of the finding recorded by
the learned trial court in para 25 and 32 that the defendants have
mesirably failed to establish that any commercial activity is carried
out by the plaintiffs and even no witness was got examined by the
defendants to establish that commercial activities are being carried
out ?
D- Whether the learned lower appellate court was justified in
relying on the defective audit report (Exh. P/14) the learned trial
court in para 32 of the judgment has specifically has dealt about the
discrepencies in the audit report?
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E- Whether the learned lower appellate court was justified in
reversing the entire judgment and decree passed by the learned trial
court merely on the basis of letter dt. 16.10.2014 (Exh. D-1)
whereas under the compelling conditions and considering the
safety and timely treatment of the patients no other option was
available with the plaintiffs to accept the conditions imposed by the
defendants ?
F- Whether the judgment and decree passed by the learned
lower appellate court deserves to be set aside when in Exh. P-26
they themselves had stated about the establishment of the hospital
while upgrading the load to 60 KVA?
G- Whether the judgment and decree passed by the learned
lower appellate court deserves to be set aside when in Exh. P-27
defendants have stated that no commercial activities is carried out
by the plaintiffs in the subjected premises?
8. Heard learned counsel for appellants.
9. Section 56 of Electricity Act, 2003 reads as under:
Section 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:
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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.
10. Now, the only question for consideration is as to whether Section 56(2)
of the Electricity Act, 2003, would preclude the licencee company from raising
a supplementary demand after expiry of period of two years or not?
11. The question is no more res integra.
12. The Supreme Court in the case of Assistant Engineer (D1), Ajmer
Vidyut Vitaran Nigam Limited And Another Vs. Rahamatullah Khan
Alias Rahamjulla reported in (2020) 4 SCC 650 has held as under:
8. Section 56(2), however, does not preclude the licensee
company from raising a supplementary demand after the expiry of
the limitation period of two years. It only restricts the right of the
licensee to disconnect electricity supply due to non-payment of
dues after the period of limitation of two years has expired, nor
does it restrict other modes of recovery which may be initiated by
the licensee company for recovery of a supplementary demand.
Thus, it is clear that the period of limitation merely restricts the right of
the licensee to disconnect electricity supply due to non-payment of dues but it
NEUTRAL CITATION NO. 2025:MPHC-GWL:10191
does not restrict or preclude the licencee from adopting other modes of
recovery which may be initiated by the licensee company by raising a
supplementary demand. Therefore, supplementary demand raised by the
licencee company/defendants on the basis of report/objection raised by the
A.G. Audit Team was not barred by time.
13. It is next contended by counsel for appellants that defendants vide notice
dated 23.05.2014 Ex.P-7 had mentioned that A.G. Audit Team during the
period 2009-2013 had found that the billing was done in accordance with the
tariff category HV6.1 (Bulk Residential User) whereas the billing should have
been done in accordance with tariff category HV3.2 (non-residential) and
accordingly, a demand of Rs.21,89,405/- was raised. It is submitted that from
the chart which was sent along with this notice Ex.P-14 it is clear that the bill
was raised from April, 2006 to February, 2014. Thus, it is clear that excessive
amount was raised by notice dated 23.05.2014, Ex.P-7.
14. Considered the aforesaid submission made by counsel for appellants.
15. Alongwith notice dated 23.05.2014, the calculation sheet, bill and other
documents were also sent to the plaintiffs. A copy of audit report was also sent.
From the calculation-sheet which has been filed as Ex.P-14, it is clear that an
amount of Rs.21,89,405/- was calculated by the audit team by considering the
wrong billing from the month of April, 2006 till February, 2014 whereas it
appears that the Superintending Engineer of Madhya Pradesh Madhya Kshetra,
Vidyuit Vitaran Company Ltd. wrongly mentioned the year 2009-13 in his
notice dated 23.05.2014, Ex.P-7. The amount of Rs.21,89,405/- was common in
the show-cause notice dated 23.05.2014 Ex.P-7 and the calculation chart
prepared by the audit team. Thus, it is clear that there was no difference in the
outstanding amount decided by the audit team and claimed by the defendants.
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The plaintiffs in their plaint have never challenged that once the notice was
issued for payment of outstanding amount from the year 2009-13, then they
could not have claimed Rs.21,89,405/- which according to the audit team had
become due from April, 2006 till February, 2014. In absence of any difference
in the total outstanding amount, this Court is of considered opinion that a
mistake committed by the defendants in mentioning the incorrect period of
wrong billing in their notice dated 23.05.2014 will not have any adverse effect
on the claim raised by them.
16. So far as the claim of plaintiffs that it is running a hospital providing free
of cost treatment to the poor section of society is concerned, it is suffice to
mention here that the aforesaid contention raised by plaintiffs is not correct. Dr.
Vishnu Jovan Putra (PW-1), in para 9 of his cross-examination, has admitted
that the hospital is providing treatment and conducting operations of poor and
rich people. It was also admitted that in case if somebody wants to get a costly
lens implanted, then he has to bear expenses. He admitted that registration fee
is charged from the patients. He claimed that in case if the patient is not in a
position to bear the medical expenses, then expenses are not charged from him
but he admitted that expenses are charged from the patients who are financially
capable of bearing the expenses. He further admitted that money is charged by
the trust but it was claimed that it is less than the money charged by other
hospitals. He further claimed that the plaintiff/trust runs the hospital in two
manners i.e. some services are rendered free of cost and for some services
reasonable charges are collected. If patient wants a free of cost treatment, then a
service of that particular category is provided and if a patient wants a
chargeable service then the service as per charges is provided. Thus, it is clear
that the claim of the plaintiffs that it is running a charitable hospital providing
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free of cost treatment to the poorer section of the society is false. In fact
plaintiff/trust is running a hospital and charging money from patients. Since
plaintiffs have not filed the balance-sheet, therefore, it cannot be said that the
plaintiffs are running the business on no profit no loss basis. Thus, it is held that
plaintiff No.8/trust which is running a hospital is not a charitable trust but it is
functioning on chargeable basis.
17. Furthermore, the plaintiffs themselves had sent an application to the
defendants admitting their liability unconditionally and sought permission to
deposit the said amount i.e. Rs.21,89,405/- in equal installments. It was also
mentioned by Ravindra Upadhyaya (PW-2) that notices which were sent by
their counsel on previous occasion are hereby withdrawn and whatever
installment is fixed, the same shall be paid. The aforesaid application is Ex.D-1.
In response to the said application, permission was granted to deposit the
outstanding amount of Rs.21,89,000/- in five equal monthly installments, by
letter dated 16.10.2014, Ex.D-2. Although it is submitted by counsel for
appellants/plaintiffs that thereafter on 17.10.2014 Ex.P-9, two installments of
Rs.4,37,881/- each were deposited on 17.10.2014 without any protest,
therefore, it is clear that application which was made by plaintiffs on
16.10.2014 whereby unconditionally accepting its liability, was obtained under
pressure.
18. Considered the aforesaid submission made by counsel for appellants.
19. If appellant/Trust was of the view that letter dated 16.10.2014, Ex.D-1, in
which an unconditional acceptance of liability was made, was obtained by
defendants under pressure, then it should not have acted upon the same by
depositing two installments of Rs.4,37,881/- each. It appears that the plaintiffs
were playing the game of hide and seek with the defendants. On one hand, it
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unconditionally accepted its liability to pay Rs.21,89,000/- and as soon as the
permission to deposit the said amount in five enqual monthly installments was
granted vide Ex.D-1, then on the very next day i.e. 17.10.2014 plaintiffs took a
somersault and although acted upon the facility of deposit of Rs.2189000/- in
five equal monthly installments by depositing two installments of Rs.4,37,881/-
each but again mentioned that this amount is being deposited under protest. If
appellant/trust was of the view that acceptance of liability is under pressure and
coercion, then it should not have deposited even a single installment and it
should have simply mentioned that it would like to challenge the liability fixed
by the defendants and would not like to act upon the permission granted by
defendants to deposit the outstanding amount of Rs.21,89,000/- in five equal
installments. Plaintiffs cannot blow hot and cold at the same time. Either it
should have refused to act upon the permission granted by the defendants by
letter dated 16.10.2014, Ex.D-2, to deposit the outstanding amount in five equal
installments or should have acted upon without any protest. Therefore, in letter
dated 17.10.2014, Ex.P.-9, mere mention of word, that the aforesaid amount is
being deposited under protest cannot be said to be a denial of liability by the
plaintiffs. Even otherwise, if the plaintiff was intending to challenge the
liability of Rs.2189000/-, then it could have done so after depositing the entire
outstanding amount as undertaken by it in its letter dated 16.10.2014 Ex.D-1
but that was also not done. Thus, it is clear that plaintiff was interested in
utilizing the benefits of electricity for running a hospital on commercial basis
but at the same time was not intending to pay the difference of electricity
charges which accrued on account of wrong billing.
20. No other argument is advanced by counsel for appellants.
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21. Accordingly, this Court is of considered opinion that no substantial
question of law arises in the present appeal.
22. Ex. Consequenti, the judgment and decree dated 19.02.2025 passed by
District Judge, Lateri, District Vidisha (M.P.) in Regular Civil Appeal
No.15/2024 is hereby affirmed, with additional reasons.
23. Appeal fails and is hereby dismissed.
(G. S. AHLUWALIA)
JUDGE
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