[Cites 2, Cited by 0]
Madras High Court
Aravind Eye Hospital vs Tamilnadu Generation And Distribution ... on 26 February, 2026
Author: R.Vijayakumar
Bench: R.Vijayakumar
WP(MD).No.12808 of 2019
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
ORDER RESERVED ON : 17.02.2026
ORDER PRONOUNCED ON : 26.02.2026
CORAM:
THE HONOURABLE MR.JUSTICE R.VIJAYAKUMAR
W.P.(MD).No.12808 of 2019
WMP(MD).Nos.9537 to 9539 of 2019
Aravind Eye Hospital
through its Manager
Palani Road
Dindigul ....Petitioner
Vs
Tamilnadu Generation and Distribution Corporation Ltd.,
(TANGEDCO)
Represented by its Assistant Executive Engineer
Nehruji Nagar Division, Dindigul ....Respondent
Prayer: This Petition filed under Article 226 of the Constitution of India, to
issue a Writ of Certiorari calling for the proceedings of the respondent in
Ka.No.Oo.Se.Po(Saa)/Ne.Na/Thigal/Va.Aa.Koo.Kattu/A.No.079.18 dated
04.05.2018 and quash the same.
For Petitioner : Mr.A.R.M.Ramesh
For Respondents :Mr.S.Deenadhayalan
Standing Counsel
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WP(MD).No.12808 of 2019
ORDER
The present writ petition has been filed seeking to quash the order
passed by the respondent herein wherein the petitioner hospital has been
directed to pay a sum of Rs.1,12,299/- as compensation charges.
(A).Factual Matrix:
2.The petitioner herein is running an eye hospital and had obtained
four service connections for domestic purpose under Tariff-IA. An inspection
was conducted on 01.09.2012 by Anti Theft Squad with regard to the above
said service connections. As per Observation Mahazer dated 01.09.2012, it
was found that the premises was used as staff quarters. Therefore, the
authorities had arrived at a finding that the domestic service connection
falling under Tariff-IA is not applicable, but it would fall under Tariff-V.
Similarly four observation mahazers were issued to the petitioner hospital.
3.A working sheet was served upon the writ petitioner demanding a
sum of Rs.44,335/-. Out of which, the compounding charges to a tune of
about Rs.12,000/- was paid by the hospital under protest on 01.09.2012. On
03.09.2012, a communication was addressed by the petitioner hospital to the
respondent to the effect that the charges have been wrongly levied under
commercial tariff for a residential premises. They have requested for reviving
the charges under domestic tariff. In the said letter, they have contended that
the places are used only as residential places by staff nurse working in the
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hospital and therefore, they have requested the respondent to change the tariff
again to domestic charges.
4.The petitioner hospital had filed WP(MD).No.12027 of 2012 seeking
a mandamus forbearing the respondents from levying electricity charges
under commercial Tariff-V. The said writ petition was disposed of on
10.11.2017 with a direction to the respondent to consider the representation
of the petitioner dated 03.09.2012 and pass appropriate orders on merits and
in accordance with law after giving opportunity to the writ petitioner.
5.In compliance with the order of this Court, the present impugned
order has been passed on 04.05.2018 wherein the respondent has reiterated
that after payment of compounding charges, the petitioner hospital has not
paid the compensation charges and they have demanded a sum of
Rs.1,12,299/-. Challenging the said order, the petitioner has chosen to prefer
an appeal before the Tamil Nadu Electricity Ombudsman. The Electricity
Ombudsman had chosen to reject the appeal on 10.11.2018 on the ground that
they do not have any jurisdiction.
6.In the light of the above said facts, the present writ petition has been
filed to quash the order dated 04.05.2018.
(B).Submissions of the learned counsel appearing on either side:
7.The learned counsel appearing for the petitioner had contended that
the petitioner hospital is a well known public charitable hospital of
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M/s.Govel Trust running eye hospitals not only in Dindigul but also in
Madurai, Theni, Tirunelveli, Coimbatore, Salem, Puducherry and other
places. He further submitted that the petitioner hospital had taken on rent two
properties one for running hospital and the other for providing quarters to the
doctors and nursing staff of the hospital. According to him, three electricity
service connections are utilized by the hospital building and they are charged
under commercial tariff. However, the service connection for quarters of the
hospital staff, domestic tariff is being charged.
8.According to the learned counsel for the writ petitioner, the quarters
is being provided to the doctors and nursing staff without collecting any rent.
The electricity charges are also paid only by the hospital. He had further
submitted that under threat of disconnection of electricity supply, the
petitioner hospital was constrained pay a sum of Rs.12,000/-under protest as
compounding charges.
9.According to the respondent, they have incurred a loss of
Rs.1,12,299/- in view of payment of charges under domestic tariff instead of
commercial tariff. According to the petitioner, when the building is used only
as quarters for doctors and nursing staff, the correct applicable tariff is
domestic tariff and not commercial tariff. He had further submitted that even
as per the observation mahazar, it is clear that the building is being used only
as a quarters for the doctors and the staff nurse. In such circumstances, the
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usage cannot be considered to be an unauthorized usage and therefore, the
demand for payment of compensation charges under impugned order is liable
to be set aside.
10.The learned counsel for the petitioner also relied upon a circular of
TANGEDCO dated 03.08.2016 wherein it has been held that where a
premises is taken on rent for the employees of a shop, Tariff-V is not
applicable and only the domestic tariff is applicable. Hence, he prayed for
allowing the writ petition.
11.Per contra, the learned Standing Counsel appearing for the
respondent had contended that the domestic tariff under Tariff IA would be
applicable only if the people are residing with family and it is used for
domestic purpose. In the present case, it was found that the premises is not
used for domestic purposes. But it was used as a stay place for the doctors
and nurses who are working the hospital. Therefore, it cannot be termed as a
domestic purpose. When a particular service connection does not fall under
domestic tariff, automatically it falls under commercial tariff, namely Tariff-
V. The learned Standing Counsel had further submitted that there is no sign of
any domestic usage in the said premises when inspection was conducted.
12.The learned Standing Counsel had further submitted that after
paying compounding fees, admitting the liability, the petitioner hospital
cannot turn around and contend that their usage is not an unauthorised and
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they are estopped from contending so. They cannot raise any objection for
payment of compensation charges. Hence, he prayed for sustaining the order
impugned in the writ petition.
13.I have considered the submissions made on either side and perused
the material records.
(C).Discussion:
14.In Paragraph No.4 of the writ affidavit, it is specifically averred that
the building is used as quarters for doctors and nursing staff and the hospital
is not collecting any rent or electricity charges from them. This averment is
not disputed in the counter. In fact, in Paragraph No.3 of the counter, it is
pointed out that the hospital has obtained service connection for domestic
purpose, but it is used as staff quarters and therefore, it will fall under Tariff-
V.
15.The issue that arises for consideration is, when the petitioner
hospital has taken on rent, a building for accommodating the doctors and staff
who are employed in the hospital, whether the service connection provided to
the said premises could be termed to be domestic or commercial.?
16.This Court had an occasion to consider a similar issue in W.P.No.
8344 of 2012 dated 24.09.2012 (R.Muthulakshmi and another Vs.The
Authorised Officer Cum Assistant Executive Engineer, Namakkal and
others) wherein the ground floor and first floor were used as textile shop and
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the other floors were rented out to the employees who were serving in the
textile shop. Paragraph Nos.15 and 16 of the said judgment are extracted as
follows:
“15.In my view, there is no basis for the first respondent to treat
2nd, 3rd and 4th floors as commercial establishment. The stay of the
students or stay of the employees would not make the same as
commercial establishment. Various tariff for domestic purposes and
non-commercial purposes make it clear that even studios, cinema
theatres and private educational institutions are treated as
non-commercial establishments for the purpose of energy
consumption.
16.In my view, renting the premises for stay of employees of the
shop would not make it commercial establishment and Low Tension
Tariff V is not applicable to the same. The payment of rent by the
textile shop to its employees would not make the occupation as
commercial, when admittedly no commercial activity is carried on.”
17.Referring to the order of this Court in W.P.No.8344 of 2012,
TANGEDCO had issued a proceeding on 03.08.2016 wherein an instruction
has been issued to all the officials of TANGEDCO not to treat the
accommodation of the employees of the shop under commercial tariff-V but
to treat them as domestic tariff.
18.Recently our High Court had an occasion to consider a similar
issued in a judgment reported in 2025 SCC Online Mad 9765 ( M.Divya and
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others Vs. Senior Revenue Officer and others) wherein the demand notices
issued by the Municipal Corporation to working women hotel for converting
property tax from residential tariff to commercial tariff were put to challenge.
Our High Court was pleased to rely upon the judgment of the Hon'ble
Supreme Court reported in (2021) 5 SCC 602 (Government of Kerala and
another Vs. Mother Superior Adoration Convent) and arrived at a
conclusion that the hostel rooms which are used by working women/ students
as sleeping apartments, after their avocation has to be considered only as a
residential unit and proceeded to quash the demand notices issued by the
Municipal Corporation.
19.In the present case, admittedly the petitioner hospital is using the
premises only as quarters for the doctors and staff nurses who are working in
the hospital. They are not collecting any rent or electricity charges from them.
When this Court was pleased to hold that, even if rent is collected from the
working women staying in a hostel (in the judgment cited supra), would be
treated as a residential unit, rent free quarters offered by the petitioner
hospital would certainly fall within the domestic tariff. There is no
commercial activity whatsoever in the said premises. Even as per the
observation mahazar dated 01.09.2012, the doctors and the staff nurses are
residing there after their avocation time. In such circumstance, levy of
commercial tariff under Tariff-V is not legally sustainable.
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20.The payment of compounding charges of Rs.12,000/- has been
made only under protest. In fact, there is no unauthorised use of electricity. In
such circumstances, the payment of compounding charges under threat of
criminal prosecution or under the threat of disconnection of electricity supply
would not take away the right of the petitioner hospital to challenge the
imposition of compensation charges upon them.
21.In view of the above said facts, when there is no commercial
activity or any unauthorised use of electricity, the demand of Rs.1,12,299/- as
compensation is not legally sustainable, especially in the light of the
judgment cited supra.
(D).Conclusion:
22.In view of the above said discussion, the order impugned in the writ
petition is set aside and the writ petition stands allowed. No costs.
Consequently, connected miscellaneous petitions are closed.
26.02.2026
Internet : Yes/No
Index : Yes/No
NCC : Yes/No
msa
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R.VIJAYAKUMAR, J.
msa
Pre-delivery order made in
WMP(MD).Nos.9537 to 9539 of 2019
26.02.2026
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