Madras High Court

V.R.Steel Industries vs The Chairman on 2 December, 2021

                                                                      W.P.No.12931 of 2017


                                  IN THE HIGH COURT OF JUDICATURE AT MADRAS

                                              DATED : 02.12.2021

                                                     CORAM

                           THE HONOURABLE MR.JUSTICE KRISHNAN RAMASAMY

                                              W.P.No.12931 of 2017
                                                      and
                                             W.M.P.No.13796 of 2017

                  V.R.Steel Industries,
                  Represented by its Proprietrix,
                  Mrs.Hawakanwar,
                  W/o.Vishal Singh,
                  No.2, Sadayankuppam Village,
                  Ponneri High Road, Chennai – 600 103.                 ... Petitioner

                                                     Versus
                  1.The Chairman,
                    Tamil Nadu Electricity Board,
                    (TANGEDCO)
                    No.222, Anna Salai,
                    Chennai – 600 002.

                  2.The Executive Engineer,
                    Operation and Maintenance,
                    Tamil Nadu Electricity Board,
                    (TANGEDCO)
                    Tondiarpet, Chennai – 600 021.

                  3. The Assistant Executive Engineer,
                    Operation and Maintenance,
                    (TANGEDCO)
                    Tamil Nadu Electricity Board,
                    Manali New Town, Chennai – 600 103.


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                                                                                   W.P.No.12931 of 2017


                  4.The Assistant Audit Officer,
                    AP3 Chennai North Region,
                    BOAP, TANGEDCO,
                    Chennai.                                                  ... Respondents

                  PRAYER: Writ Petition filed under Article 226 of the Constitution of India,
                  for the issuance of Writ of Certiorarified Mandamus, calling for the records of
                  the 2nd respondent i.e., the Executive Engineer, Tamil Nadu Electricity Board,
                  TANGEDCO, Tondiarpet, Chennai – 600 021 culminating in Lr.No.EE/O-
                  M/TPT/AAO/TPT/CNI/RB/AS/5/F Audit/D/27/17 dated 27.04.2017 and
                  quash the same and further direct the respondents 2 and 3 not to insist the
                  petitioner to pay the alleged sum of Rs.72,507/- the revised average
                  consumption charges in respect of service connection A/c.No.014-033-628,
                  Tariff 3B of the petitioner premises situated at No.2, Sadayankuppam
                  Village, Ponneri High Road, Chennai – 600 103.
                                  For Petitioner  :      Mr.K.Balakrishnan
                                  For Respondents :      Mr.L.Jai Venkatesh
                                                         Standing Counsel

                                                    ORDER

This Writ Petition has been filed seeking for issuance of a Writ of

Certiorarified Mandamus, to call for the records of the 2nd respondent i.e., the

Executive Engineer, Tamil Nadu Electricity Board, TANGEDCO, Tondiarpet,

Chennai – 600 021 culminating in Lr.No.EE/O-

M/TPT/AAO/TPT/CNI/RB/AS/5/F Audit/D/27/17 dated 27.04.2017 and

https://www.mhc.tn.gov.in/judis W.P.No.12931 of 2017

quash the same and further direct the respondents 2 and 3 not to insist the

petitioner to pay the alleged sum of Rs.72,507/- the revised average

consumption charges in respect of service connection A/c.No.014-033-628,

Tariff 3B of the petitioner premises situated at No.2, Sadayankuppam

Village, Ponneri High Road, Chennai – 600 103.

2. It is the case of the petitioner that based on the account summary

slip dated 06.02.2016, the 4th respondent demanded a sum of Rs.72,507/-

towards arrears of C.C. Charges. The 4th respondent has furnished the details

of the arrears due and payable by the petitioner during the period between

10/11 and 01/12 for a total sum of Rs.72,507/-. By referring to the said

details, the learned counsel for the petitioner submits that the respondents

claimed arrears of C.C. Charges for the years 2011 to 2012 belatedly, that too

after a lapse of 4 years, in the year 2016. The learned counsel would submit

that, in terms of Section 56(2) of the Electricity Act, 2003, the period of

limitation prescribed for collecting the arrears was prescribed as two years

from the date when such sum becomes first due. In the present case, since

the demand was made beyond the period of limitation and therefore, the

impugned demand cannot be sustained and the same is liable to be quashed.

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3. Per contra, the learned Standing Counsel appearing for the

respondents would submit that admittedly, the petitioner has not paid the

shortfall for the period between 10/11 and 01/12 and therefore, the 2 nd

respondent has rightly issued the demand notice by furnishing all the details.

He would also submit that during audit inspection, it was found that the

petitioner was due to pay the arrears and as per audit report, the demand has

been made and without making the payment, the petitioner has approached

this Court and hence, he prayed to dismiss Writ Petition.

4. Heard the learned counsel for the petitioner as well as the learned

Standing Counsel appearing for the respondents and perused the materials

available on records.

5. It is relevant to extract Section 56(2) of the Electricity Act, 2003,

which reads as under:

“56 (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

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electricity supplied and the licensee shall not cut off the supply of the electricity.”

6. A perusal of the above, it is clear that 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. Therefore, the provision of Section 56 does not empower the 1st

respondent to recover any amount if the period of two years has elapsed no

electricity supply be cut off for non-payment of those dues. In other words,

what is sought to be contended is that if the demand or part of the demand is

time barred the provisions of Section 56 would be attracted.

7. In the present case, admittedly, the impugned demand has been

made after the prescribed period of two years. Therefore, it is clearly barred

by limitation by virtue of Section 56(2). Further, it is not the case of the

respondents that such sum has been shown continuously as recoverable as

arrear of charges for electricity supplied in the books of account. In this

regard, it is also worthwhile to refer a decision of the Hon'ble Supreme Court

in C.A.No.1672 of 2020 dated 18.02.2020, wherein, it was made it clear that

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no claim can be made beyond the period of two years. The relevant portion of

the judgment is extracted hereunder:

"9. Applying the aforesaid ratio to the facts of the present case, the licensee company raised an additional demand on 18.03.2014 for the period July, 2009 to September, 2011.

The licensee company discovered the mistake of billing under the wrong Tariff Code on 18.03.2014. The limitation period of two years under Section 56(2) had by then already expired.

Section 56(2) did not preclude the licensee company from raising an additional or supplementary demand after the expiry of the limitation period under Section 56(2) in the case of a mistake or bona fide error. It did not however, empower the licensee company to take recourse to the coercive measure of disconnection of electricity supply, for recovery of the additional demand.

As per Section 17(1)(c) of the Limitation Act, 1963, in case of a mistake, the limitation period begins to run from the date when the mistake is discovered for the first time.

In Mahabir Kishore and Ors. v. State of Madhya Pradesh,5 this Court held that :–

Section 17(1)(c) of the Limitation Act, 1963, provides that in the case of a suit for relief on the ground of mistake, the period of limitation does not begin to run until the plaintiff had discovered the mistake or could with reasonable diligence, have discovered it. In a case where payment has been made under a mistake of law as contrasted with a

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mistake of fact, generally the mistake become known to the party only when a court makes a declaration as to the invalidity of the law. Though a party could, with reasonable diligence, discover a mistake of fact even before a court makes a pronouncement, it is seldom that a person can, even with reasonable diligence, discover a mistake of law before a judgment adjudging the validity of the law.” (emphasis supplied)

In the present case, the period of limitation would commence from the date of discovery of the mistake i.e. 18.03.2014. The licensee company may take recourse to any remedy available in law for recovery of the additional demand, but is barred from taking recourse to disconnection of supply of electricity under sub-section (2) of Section 56 of the Act. "

8. In the light of the above discussion, the impugned demand made by

the 2nd respondent cannot be sustained and hence, the same is liable to be set

aside.

9. In view of the above, this Writ Petition is allowed and the impugned

notice issued by the second respondent is quashed. No costs. Consequently,

connected miscellaneous petitions are closed.

02.12.2021

https://www.mhc.tn.gov.in/judis W.P.No.12931 of 2017

Index: Yes/No Internet: Yes/No Speaking Order/Non-Speaking Order

sp / jd

1.The Chairman, Tamil Nadu Electricity Board, (TANGEDCO) No.222, Anna Salai, Chennai – 600 002.

2.The Executive Engineer, Operation and Maintenance, Tamil Nadu Electricity Board, (TANGEDCO) Tondiarpet, Chennai – 600 021.