[Cites 24, Cited by 0]
Punjab-Haryana High Court
Gulpreet Kaur Bedi And Anr vs Union Territory Chandigarh And Ors on 23 April, 2026
207 IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
****
CWP-38170-2025 (O&M)
Date of Decision: 23.04.2026
Gulpreet Kaur Bedi and Another
...Petitioners
Versus
Union Territory, Chandigarh and Others
...Respondents
CORAM:- HON'BLE MR. JUSTICE JAGMOHAN BANSAL
Present:- Mr. Piyush Aggarwal, Advocate
for the petitioners.
Mr. Pritpal Singh Nijjar, Addl. Standing Counsel with
Mr. Viraj Gandhi, Jr. Panel Counsel
for U.T. Chandigarh.
Mr. Nitin Bhasin, Advocate and
Ms. Bharti Bhatia, Advocate
for respondents No.3 and 4.
****
JAGMOHAN BANSAL, J. (ORAL)
1. The petitioners through instant petition under Articles
226/227 of the Constitution of India are seeking setting aside of assessment
order dated 10.12.2025 whereby respondent has rejected their objections
and raised demand of Rs.14,77,823/-.
2. The petitioners are resident of Chandigarh. They are holding
non-residential electricity connection. The respondent inspected their
premises on 17.11.2025 and formed an opinion that correct multiplication
factor was not applied while preparing bill. By mistake, multiplication
CWP-38170-2025 (O&M) -2-
factor of '20' was applied whereas correct multiplication factor was '40'.
The respondent on the basis of said opinion issued notice dated 26.11.2025
raising demand of Rs.14,77,823/-. In the title, the notice was treated as
provisional assessment. The petitioners were asked to make payment
within 15 days from the date of receipt of notice. The petitioners filed
objections and respondent vide order dated 10.12.2025 framed final
assessment. The demand was confirmed alleging wrong application of
multiplication factor.
3. Learned counsel for the petitioners submits that Chandigarh
Power Distribution Limited (for short 'CPDL') came into existence w.e.f.
24.04.2022. The Company was incorporated under the Companies Act,
2013. It was got incorporated by Administrator, U.T. Chandigarh. The
Chandigarh Administration vide notification dated 31.01.2025 framed a
scheme whereby assets and liabilities of the electricity wing of the
Engineering Department were transferred to aforesaid Company. In the
scheme, there was no provision which authorized respondent-Company to
make assessment and raise demand prior to 31.01.2025 i.e. date of
notification of the scheme. The scheme transferred assets, liabilities and
employees of the Administration, however, there was no specific provision
which empowered Company to raise demand for the period prior to
31.01.2025. The respondent has raised demand without jurisdiction, thus,
writ petition is maintainable and may be entertained.
4. Learned counsel representing the respondents submits that
impugned demand has not been raised under Section 126 of Electricity Act,
(for short '2003 Act'). The demand has been raised on account of
miscalculation. By mistake, multiplication factor of '20' instead of '40'
CWP-38170-2025 (O&M) -3-
was applied. The respondent has every right to correct its mistakes. The
petitioners are liable to pay charges for electricity consumed. The
petitioners have alternative remedy to approach Consumer Grievances
Redressal Forum. They may further approach Ombudsman constituted
under Section 42(6) of 2003 Act. They have not challenged vires of Section
131 of 2003 Act or notification dated 31.01.2025, thus, in the wake of
availability of alternative remedy, writ petition should not be entertained.
In the notification dated 31.01.2025 expressions 'assets', 'liabilities', 'past
arrears' and 'proceedings' have been defined. Part D of the notification
provides that electricity distribution and retail supply undertaking
including assets, liabilities and proceedings as set out in Schedule 'B' shall
stand transferred to CPDL-respondents No.3 and 4. In the Schedule 'B',
assets, proceeding and liabilities transferred to the company are
underscored. As per Clause IV(e) of the Schedule 'B', proceedings which
are exclusively or primarily associated with or related to distribution are
transferred to respondent No.3.
5. Heard the arguments and perused the record.
6. The respondents have raised preliminary question of
maintainability. As per respondent, the petitioner has alternative remedy,
thus, writ petition should not be entertained. The petitioners claim that
respondent has raised demand beyond jurisdiction, thus, writ petition is
maintainable. From the arguments of petitioners, it is evident that
petitioners are claiming that respondent in terms of notification dated
31.01.2025 has no jurisdiction to raise demand for the period prior to
31.01.2025. The respondent can raise demand with respect to 'past arrears'
and demand raised in the present case does not fall within definition of
CWP-38170-2025 (O&M) -4-
'past arrears', thus, respondents have acted beyond jurisdiction.
7. As per respondent, the impugned demand does not relate to
unauthorized use of electricity, thus, provisions of Sections 126 and 135
are inapplicable. Argument of respondent deserves to be countenanced,
accordingly it is hereby held that impugned demand does not relate to
provisions of Sections 126 and 135 of 2003 Act.
8. It is settled proposition of law that writ petition is
maintainable where question of vires or violation of principles of natural
justice or jurisdiction is involved. Hon'ble Supreme Court in 'Radha
Krishan Industries v. State of H.P.', (2021) 6 SCC 771 has laid down
principles with respect to maintainability of writ despite availability of
alternative remedies. Supreme Court has clearly held that where question
of jurisdiction is involved, writ petition is maintainable. Relevant extracts
of the judgment read as:
"C.1. Maintainability of the writ petition before the
High Court
24. The High Court has dealt with the
maintainability of the petition under Article 226 of
the Constitution. Relying on the decision of this
Court in CCT v. Glaxo Smith Kline Consumer Health
Care Ltd. [CCT v. Glaxo Smith Kline Consumer
Health Care Ltd., (2020) 19 SCC 681 : 2020 SCC
OnLine SC 440], the High Court noted that although
it can entertain a petition under Article 226 of the
Constitution, it must not do so when the aggrieved
person has an effective alternate remedy available in
law. However, certain exceptions to this "rule of
alternate remedy" include where, the statutory
authority has not acted in accordance with the
provisions of the law or acted in defiance of the
fundamental principles of judicial procedure; or has
CWP-38170-2025 (O&M) -5-
resorted to invoke provisions, which are repealed; or
where an order has been passed in violation of the
principles of natural justice. Applying this
formulation, the High Court noted that the appellant
has an alternate remedy available under the GST Act
and thus, the petition was not maintainable.
25. In this background, it becomes necessary for this
Court, to dwell on the "rule of alternate remedy" and
its judicial exposition. In Whirlpool Corpn. v.
Registrar of Trade Marks [Whirlpool Corpn. v.
Registrar of Trade Marks, (1998) 8 SCC 1] , a two-
Judge Bench of this Court after reviewing the case
law on this point, noted : (SCC pp. 9-10, paras 14-
15)
"14. The power to issue prerogative writs under
Article 226 of the Constitution is plenary in nature
and is not limited by any other provision of the
Constitution. This power can be exercised by the
High Court not only for issuing writs in the nature of
habeas corpus, mandamus, prohibition, quo
warranto and certiorari for the enforcement of any
of the Fundamental Rights contained in Part III of
the Constitution but also for "any other purpose".
15. Under Article 226 of the Constitution, the High
Court, having regard to the facts of the case, has a
discretion to entertain or not to entertain a writ
petition. But the High Court has imposed upon itself
certain restrictions one of which is that if an effective
and efficacious remedy is available, the High Court
would not normally exercise its jurisdiction. But the
alternative remedy has been consistently held by this
Court not to operate as a bar in at least three
contingencies, namely, where the writ petition has
been filed for the enforcement of any of the
Fundamental Rights or where there has been a
violation of the principle of natural justice or where
the order or proceedings are wholly without
CWP-38170-2025 (O&M) -6-
jurisdiction or the vires of an Act is challenged.
There is a plethora of case-law on this point but to
cut down this circle of forensic whirlpool, we would
rely on some old decisions of the evolutionary era of
the constitutional law as they still hold the field."
26. Following the dictum of this Court in Whirlpool
[Whirlpool Corpn. v. Registrar of Trade Marks,
(1998) 8 SCC 1] , in Harbanslal Sahnia v. Indian Oil
Corpn. Ltd. [Harbanslal Sahnia v. Indian Oil Corpn.
Ltd., (2003) 2 SCC 107] , this Court noted that :
(Harbanslal Sahnia case [Harbanslal Sahnia v.
Indian Oil Corpn. Ltd., (2003) 2 SCC 107] , SCC p.
110, para 7)
"7. So far as the view taken by the High Court that
the remedy by way of recourse to arbitration clause
was available to the appellants and therefore the writ
petition filed by the appellants was liable to be
dismissed is concerned, suffice it to observe that the
rule of exclusion of writ jurisdiction by availability
of an alternative remedy is a rule of discretion and
not one of compulsion. In an appropriate case, in
spite of availability of the alternative remedy, the
High Court may still exercise its writ jurisdiction in
at least three contingencies : (i) where the writ
petition seeks enforcement of any of the fundamental
rights; (ii) where there is failure of principles of
natural justice; or (iii) where the orders or
proceedings are wholly without jurisdiction or the
vires of an Act is challenged. (See Whirlpool
Corpn.v. Registrar of Trade Marks [Whirlpool
Corpn. v. Registrar of Trade Marks, (1998) 8 SCC
1] .) The present case attracts applicability of the
first two contingencies. Moreover, as noted, the
appellants' dealership, which is their bread and
butter, came to be terminated for an irrelevant and
non-existent cause. In such circumstances, we feel
that the appellants should have been allowed relief
CWP-38170-2025 (O&M) -7-
by the High Court itself instead of driving them to the
need of initiating arbitration proceedings."
27. The principles of law which emerge are that:
27.1. The power under Article 226 of the Constitution
to issue writs can be exercised not only for the
enforcement of fundamental rights, but for any other
purpose as well.
27.2. The High Court has the discretion not to
entertain a writ petition. One of the restrictions
placed on the power of the High Court is where an
effective alternate remedy is available to the
aggrieved person.
27.3. Exceptions to the rule of alternate remedy arise
where : (a) the writ petition has been filed for the
enforcement of a fundamental right protected by Part
III of the Constitution; (b) there has been a violation
of the principles of natural justice; (c) the order or
proceedings are wholly without jurisdiction; or (d)
the vires of a legislation is challenged.
27.4. An alternate remedy by itself does not divest the
High Court of its powers under Article 226 of the
Constitution in an appropriate case though
ordinarily, a writ petition should not be entertained
when an efficacious alternate remedy is provided by
law.
27.5. When a right is created by a statute, which itself
prescribes the remedy or procedure for enforcing the
right or liability, resort must be had to that particular
statutory remedy before invoking the discretionary
remedy under Article 226 of the Constitution. This
rule of exhaustion of statutory remedies is a rule of
policy, convenience and discretion.
27.6. In cases where there are disputed questions of
fact, the High Court may decide to decline
jurisdiction in a writ petition. However, if the High
Court is objectively of the view that the nature of the
controversy requires the exercise of its writ
CWP-38170-2025 (O&M) -8-
jurisdiction, such a view would not readily be
interfered with."
[Empasis supplied]
9. In the present case, the petitioner has raised question of
jurisdiction, thus, writ petition is maintainable and deserves to be
entertained. Accordingly, preliminary objection of the respondents is
hereby rejected. The petitioners have not challenged Section 131 of 2003
Act as well as notification dated 31.01.2025, however, jurisdiction of
respondents to raise demand is assailed. Therefore, non-challenge to
Section 131 or notification dated 31.01.2025 cannot restrain petitioners
from invoking writ jurisdiction of this Court.
10. In the wake of rejection of contention of respondent qua
maintainability/entertainability, the matter needs to be adjudicated on
merits.
11. The U.T. Administration has transferred its electricity
distribution business to CPDL. The transfer has been effected in terms of
Section 131 of 2003 Act read with notification dated 31.03.2025. Section
131 empowers State Government or Board to transfer property, interest in
property, rights and liabilities to a company. It provides that a transfer
scheme shall be prepared by the State Government to give effect to the
objects and purposes of the Act. The assets and liabilities of the State
Electricity Board shall vest in the State Government on such terms as may
be agreed between the State Government and the Board. Any property,
interest in property, rights and liabilities vested in the State Government
shall be re-vested by the State Government in a Government Company or
any company or companies in accordance with transfer scheme. Section
CWP-38170-2025 (O&M) -9-
131 reads as:
"131. Vesting of property of Board in State Government.-
(1) With effect from the date on which a transfer scheme,
prepared by the State Government to give effect to the
objects and purposes of this Act, is published or such further
date as may be stipulated by the State Government
(hereafter in this Part referred to as the effective date), any
property, interest in property, rights and liabilities which
immediately before the effective date belonged to the State
Electricity Board (hereinafter referred to as the Board) shall
vest in the State Government on such terms as may be
agreed between the State Government and the Board.
(2) Any property, interest in property, rights and liabilities
vested in the State Government under sub-section (1) shall
be re-vested by the State Government in a Government
company or in a company or companies, in accordance with
the transfer scheme so published along with such other
property, interest in property, rights and liabilities of the
State Government as may be stipulated in such scheme, on
such terms and conditions as may be agreed between the
State Government and such company or companies being
State Transmission Utility or company or transmission
licensee or distribution licensee, as the case may be:
Provided that the transfer value of any assets transferred
hereunder shall be determined, as far as may be, based on
the revenue potential of such assets at such terms and
conditions as may be agreed between the State Government
and the State Transmission Utility or generating company
or transmission licensee or distribution licensee, as the case
may be.
(3) Notwithstanding anything contained in this section,
where,-
(a) the transfer scheme involves the transfer of any
property or rights to any person or undertaking not
wholly owned by the State Government, the scheme
shall give effect to the transfer only for fair value to
CWP-38170-2025 (O&M) -10-
be paid by the transferee to the State Government;
(b) a transaction of any description is effected in
pursuance of a transfer scheme, it shall be binding
on all persons including third parties and even if
such persons or third parties have not consented to
it.
(4) The State Government may, after consulting the
Government company or company or companies being
State Transmission Utility or generating company or
transmission licensee or distribution licensee, referred to in
sub-section (2) (hereinafter referred to as the transferor),
require such transferor to draw up a transfer scheme to vest
in a transferee being any other generating company or
transmission licensee or distribution licensee, the property,
interest in property, rights and liabilities which have been
vested in the transferor under this section, and publish such
scheme as statutory transfer scheme under this Act.
(5) A transfer scheme under this section may-
(a) provide for the formation of subsidiaries, joint
venture companies or other schemes of division,
amalgamation, merger, reconstruction or
arrangements which shall promote the profitability
and viability of the resulting entity, ensure economic
efficiency, encourage competition and protect
consumer interests;
(b) define the property, interest in property, rights
and liabilities to be allocated-
(i) by specifying or describing the property,
rights and liabilities in question; or
(ii) by referring to all the property, interest in
property, rights and liabilities comprised in a
described part of the transferor's undertaking;
or
(iii) partly in one way and partly in the other;
(c) provide that any rights or liabilities stipulated or
described in the scheme shall be enforceable by or against
CWP-38170-2025 (O&M) -11-
the transferor or the transferee;
(d) impose on the transferor an obligation to enter into such
written agreements with or execute such other instruments
in favour of any other subsequent transferee as may be
stipulated in the scheme;
(e) mention the functions and duties of the transferee
(f) make such supplemental, incidental and consequential
provisions as the transferor considers appropriate including
provision stipulating the order as taking effect; and
(g) provide that the transfer shall be provisional for a
stipulated period.
(6) All debts and obligations incurred, all contracts entered
into and all matters and things engaged to be done by the
Board, with the Board or for the Board, or the State
Transmission Utility or generating company or
transmission licensee or distribution licensee, before a
transfer scheme becomes effective shall, to the extent
specified in the relevant transfer scheme, be deemed to have
been incurred, entered into or done by the Board, with the
Board or for the State Government or the transferee and all
suits or other legal proceedings instituted by or against the
Board or transferor, as the case may be, may be continued
or instituted by or against the State Government or
concerned transferee, as the case may be.
(7) The Board shall cease to be charged with and shall not
perform the functions and duties with regard to transfers
made on and after the effective date.
Explanation. For the purposes of this Part,-
(a) "Government company" means a Government
company formed and registered under the
Companies Act, 1956;
(b) "company" means a company to be formed and
registered under the Companies Act, 1956 to
undertake generation or transmission or distribution
in accordance with the scheme under this Part."
12. The U.T. Administration with intent to corporatize electricity
CWP-38170-2025 (O&M) -12-
distribution license functions, incorporated limited liability company in the
name of CPDL. The said company was got registered with Registrar of
Company, Chandigarh under Companies Act, 2013. It was incorporated
w.e.f. 24.04.2022. Electricity Wing of the Engineering Department of the
U.T. Administration (for short 'EWEDC') was undertaking functions of
purchase, distribution and retail supply of electricity in the U.T.
Administration. The U.T. Administration in terms of Section 131 of 2003
Act issued notification dated 31.01.2025 whereby Chandigarh Electricity
Reforms Transfer Scheme, 2025 (for short 'Scheme') was introduced. The
scheme has been divided into Part A to Part L. Part B defines different
expressions used in the scheme. Part D provides for transfer of electricity
distribution business. Part G provides for pending suits, proceedings etc.
There are five Schedules i.e. Schedule 'A' to 'B'. As per definitions,
'proceedings' shall include all EWEDC proceedings, suits, appeals,
complaints, petitions, applications, consolatory proceedings, arbitration or
any other proceedings whether civil or criminal or otherwise related to the
distribution and retail supply business. As per said scheme, the electricity
distribution and retail supply undertaking including assets, proceedings
and liabilities as set out in the Schedule 'B' came to be transferred to
CPDL. The scheme came into force from the date of notification in the
official gazette. Relevant extracts of the scheme read as:
Part B Definitions
XXX XXX XXX XXX
c. "Assets" includes power systems, plants, machinery,
equipment including transmission/ distribution lines/
cables, wires, substations/ transformers, facilities, towers,
meters, information technology systems and office buildings
(not including land) and installations pertaining to and
CWP-38170-2025 (O&M) -13-
attached thereto, other moveable assets etc. which are
owned by EWEDC and are in exclusive use for distribution
and supply of electricity to the consumers in the Union
Territory of Chandigarh. Such assets however shall not
include land including land under the building/sub-stations
or shared/ rented office spaces which are in occupation and
use of EWEDC for discharging its functions as a
Distribution Licensee.
k. "Liabilities" shall include liabilities, debt, dues,
obligations and other outgoing/outstandings of whatever
nature transferred to the Company as per the Opening
Balance Sheet to be notified and shall include the applicable
consumer related contingent liabilities which may arise in
regard to dealings prior to the Transfer Date in respect of
the Distribution Licensee functions of EWEDC.
m. "Past Arrears" are amounts overdue from consumers as
on the Transfer Date which are not included as receivables
in Opening Balance Sheet of the Company as provided in
SCHEDULE 'E';
o. "Proceedings" shall include all EWEDC proceedings,
suits, appeals, complaints, petitions, applications,
conciliatory proceedings, arbitrations or any other
proceedings whether civil or criminal or otherwise related
to the distribution and retail supply business.
Part D. Transfer of Electricity Distribution Business
1. Subject to the provisions of this Scheme and with effect
from such date as may be notified by the Administration as
the Transfer Date:
a. The functions of electricity distribution and retail
supply of EWEDC shall stand transferred to and
vested with Chandigarh Power Distribution Limited
without any further act, deed or things to be done by
the Administration or the Company or any other
person.
b. The electricity distribution and retail supply
undertakings of EWEDC including Assets,
CWP-38170-2025 (O&M) -14-
Proceedings and Liabilities as set out in SCHEDULE
'B' shall stand transferred to and vested in the
Company.
c. The Personnel as set out in SCHEDULE 'D' shall
be transferred and assigned to the Company as
provided under Part E of this Scheme.
2. On such transfer and vesting of the electricity distribution
and retail supply function of EWEDC as per the terms of
Para(5) of Part D, the Company shall be vested with and
shall stand responsible for the contracts, rights, deeds,
schemes, bonds, agreements, and other instruments of
whatever nature to the extent transferred, to which the
Administration was a party, subsisting or having effect on
the Transfer Date, in the same manner as the Administration
was liable immediately before the Transfer Date and the
same shall be in full force and effect against or in favour of
the Company and shall be enforced as fully and effectively
as if the Company had been a party thereto instead of the
Administration.
3. If any of the Assets transferred to the Company is subject
to any security interest or arrangements in favour of third
parties for any financial assistance or obligation, such
Assets shall stand transferred to the Company subject to
such security interest or arrangements.
4. The opening balance sheet of the Company along with
details in the Schedules to the Balance Sheet shall be drawn
as on the Transfer Date giving effect to the provisions
contained in this Scheme and the finalized Opening Balance
sheet of the Company shall be notified by the Administration
separately within twelve (12) months of notification of this
Scheme.
5. The transfers within this Scheme shall remain provisional
for a period of twelve(12) months from the Transfer Date,
specifically in order to enable the Administration to exercise
the right to alter, vary, modify, add or otherwise change the
terms of such transfers including the value of Assets,
CWP-38170-2025 (O&M) -15-
Proceedings and Liabilities transferred in such manner as
the Administration may consider appropriate. After the said
period of twelve(12) months, the said provisional transfer,
as altered or varied or modified or changed, shall stand
confirmed without any further act or deed.
6. From the Transfer Date, EWEDC shall cease to be
charged with the duty to perform the functions, duties,
rights, powers and obligations to the extent the same are
transferred and vested in the Company in accordance with
the provisions of this Scheme.
7. The transaction of any description as effected in
pursuance of this Scheme shall be binding on all persons
including third parties, even if such persons or third parties
have not consented to it.
8. The functions, duties, Personnel, Assets, Liabilities and
Proceedings as set out in SCHEDULE 'C' shall not be
transferred to the Company and shall remain with the
EWEDC.
XXX XXX XXX XXX
Part G. Pending suits, proceedings etc.
1. The proceedings of whatever nature by or against the
Administration pending on the Transfer Date in regard to
the power distribution function of EWEDC and transferred
to the Company as per the SCHEDULE 'B' shall not abate
or discontinue or otherwise in any way prejudicially be
affected by reason of the transfer under this Scheme and
such proceedings may be continued, prosecuted and
enforced by or against the Company, as the case may be.
2. The proceedings mentioned in Para(3) of Part G may be
continued in the same manner and to the extent as it would
or might have been continued, prosecuted and enforced by
or against the Administration if the transfer specified under
this Scheme had not been made.
3. The proceedings mentioned in SCHEDULE 'C' would
continue with the EWEDC/Administration.
[Emphasis supplied]
CWP-38170-2025 (O&M) -16-
SCHEDULE 'B'
ASSETS, PROCEEDINGS AND LIABILITIES
TRANSFERRED TO THE COMPANY
Unless otherwise specified by the Administration, Company
shall be vested with and shall comprise of Assets, Liabilities
and Proceedings concerning electricity distribution and
retail supply activities of EWEDC-forming part of the
Opening Balance Sheet and excluding Assets, Liabilities,
Personnel and Proceedings specified under SCHEDULE
'C', and the same shall consist of:
I. Distribution Assets:
a) All existing and under-construction 220 kV, 66 kV, 33 kV,
11 kV, LT (single phase 2 wire and 3 phase 5 wire) lines
(including overhead lines, aerial bunched cables,
underground cables) and sub-stations on different types of
supports with various sizes of conductors and step up/ step
down transformers, breakers, protective and metering
devices and control rooms, testing laboratories, right of way
buildings (used exclusively for distribution business), roads,
diesel generating sets, service connections and installations
inside consumer's premises as on the Transfer Date.
b) The land shall not be transferred to the Company. This
includes land under the distribution assets or other assets
transferred to Company. However, the Company shall have
the right to use such land to the extent required for the
purpose of carrying out the transferred functions, as given
in Schedule 'A'. Such land, presently in use and occupation
of the EWEDC, shall be made available by the
Administration to the Company on a right to use basis on
payment of nominal charges to be specified by the
Administration.
c) A nominal charges @ Rs.1.00 lac per month shall be
payable by the Distribution Company/successor entity for
Right to Use of Land. However, ownership shall remain with
the Chandigarh Administration. The above Right to Use is
further subject to the following conditions:
1) The Distribution Company/Successor entity will
CWP-38170-2025 (O&M) -17-
follow all relevant Building Byelaws duly notified by
the Chandigarh Administration from time to time
with amendments upto date.
2) The Distribution Company/Successor entity shall
not carry out construction/addition/alteration
without prior approval/concurrence of Engineering
Department and Department of Urban Planning.
3) The Distribution Company/Successor entity shall
not use the premises/assets for any commercial
activity other than the transferred functions
assigned.
4) The Distribution Company/Successor entity shall
allow the entry of the officials of Chandigarh
Administration in the premises for official purpose,
whenever required.
5) All the statutory act, rules/regulations and
provisions made therein as applicable in Chandigarh
shall be remained applicable.
(List of buildings and offices to be provided on right
to use basis is enclosed as Schedule-B1)
II. Power Purchase Agreements/Transmission Agreements:
a. All existing PPAs as on Transfer Date.
b. Transmission Service Agreements/Wheeling
Agreements/Bulk Power Transmission Agreement and other
agreements with transmission licensees/CTU/STU etc. as on
Transfer Date.
III. General Assets:
(a) Special tools and equipment, material handling
equipment, heavy and light vehicles, furniture, fixtures,
office equipment, air conditioners, refrigerators, computers
and signal systems, spares, consumables, raw materials,
civil work installations, testing laboratories, and
equipment, training centres, workshops, work in progress,
machinery and equipment for repairs, scraps and Obsolete
etc.
(b) Buildings dedicatedly/ solely occupied and used by
CWP-38170-2025 (O&M) -18-
EWEDC for its power distribution function. This does not
include the land including land under the buildings.
IV. Miscellaneous:
a) Contracts, agreements, interest and arrangements to the
extent they are exclusively or primarily associated with or
related to electricity distribution and retail supply activities.
b) Loans, secured and unsecured to the extent specified in
the Opening Balance Sheet.
c) Cash and bank balance to the extent specified in Opening
Balance Sheet, other current assets to the extent they are
exclusively or primarily associated with or related to
distribution and retail supply activities.
d) Current and other liabilities and provisions to the extent
specified in the Opening Balance Sheet and all contingent
liabilities;
e) Proceedings to the extent they are exclusively or
primarily associated with or related to distribution and
retail supply and laboratory/ meter testing activities or
assets referred to in the items I, II and III and IV (a) above
except those enumerated in SCHEDULE 'C'.
[Emphasis supplied]
SCHEDULE 'C'
FUNCTIONS, ASSETS, PROCEEDINGS AND
LIABILITIES NOT TRANSFERRED TO THE
COMPANY
Unless otherwise specified by the Administration, the
Assets, Liabilities, Personnel and Proceedings in relation to
the following shall not be transferred to the Company:
1. Functions not transferred:
a. Functions of State Transmission Utility for the UT of
Chandigarh.
b. Functions of policy making, planning and coordination.
c. Functions which are not specifically transferred to the
Company under this Scheme.
d. Functions of State Load Despatch Centre.
II. Assets not transferred:
CWP-38170-2025 (O&M) -19-
a. Land in occupation of EWEDC,
b. Buildings of the Administration occupied for other
purposes, where EWEDC has a shared occupancy for
distribution and retail supply related activities.
c. The Company shall return the Past Arrears as and when
collected from consumers to the Administration after
keeping an incentive of twenty percent (20%) on recovery of
Past Arrears from permanently disconnected consumers
and ten percent (10%) on recovery of Past arrears from
consumers other than permanently disconnected
consumers. The Administration shall have the right to audit
the collection against Past Arrears on periodic basis."
[Emphasis supplied]
13. From the perusal of above quoted clauses, it is evident that
liabilities shall include consumer related contingent liabilities which may
arise in regard to dealings prior to transfer date. The respondent is claiming
that on the part of petitioners there was short payment of electricity dues,
thus, it was consumer related contingent liability. Contention of the
respondent is misconceived because expression 'liabilities' covers
liabilities of the company and does not cover liabilities of the consumer.
The petitioners are consumers. As per said Clause, at any stage i.e. post
transfer date, liability of the company may arise with past transactions of
consumer. The said liability is covered under aforesaid expression. It may
be understood with an example. There may be a consumer who has not
utilized electricity, however, invoice was raised. At a later stage, it is
established that consumer was not liable to pay amount depicted in the
invoice. The company would be liable to refund the said amount. This
liability is contingent liability which may arise in future. The respondent
has wrongly relied upon expression "liabilities" used in the notification.
There is fundamental difference between assets and liabilities. The demand
CWP-38170-2025 (O&M) -20-
from consumer is 'contingent or current asset' of the company whereas
amount payable to consumers is 'current or contingent liability'.
14. Expression 'assets' has been defined in the scheme. In the
definition of 'assets', amount which may be recoverable from consumer
with respect to electricity supplied before the transfer date has not been
included. The position is rather contrary. Entry II(c) of Schedule 'C'
provides that company shall return past arrears as and when collected from
the consumer to the U.T. Administration after keeping an incentive of 20%.
This makes it clear that scheme has not transferred assets which may be in
the form of contingent liabilities of the consumer.
15. The respondent has further relied upon expression 'past
arrears' as defined in the scheme. As per scheme, 'past arrears' are amounts
overdue from consumers as on the transfer date which are not included as
receivable in the opening balance sheet of the company. The definition
makes it clear that past arrears are not part of receivables shown in the
opening balance sheet of the company. It is apt to notice here that as per
accounting principles, recoverable amount is counted under heading
'Receivables' or 'Sundry Debtors'. The scheme has not transferred 'past
arrears' to CPDL leaving aside amount which may become recoverable on
a future date.
16. The respondent has further relied upon expression
'proceedings' defined in the scheme. The respondent claims that as per
Part-D of the Scheme, the electricity distribution and retail supply
undertaking including assets, proceedings and liabilities stand transferred
to the company. As per Part-D, assets, proceedings and liabilities as set out
in Schedule 'B' have been transferred to the company. All the assets and
CWP-38170-2025 (O&M) -21-
proceedings have not been transferred to the company e.g. land of the U.T.
Administration has not been transferred. There are many assets as noticed
in Schedule 'C' which have not been transferred to the company. Perusal
of Schedule 'B' reveals that there are many assets which are transferred to
the company. Clause IV(e) of Schedule 'B' provides that proceedings to
the extent they are exclusively or primarily associated with or related to
distribution and retail supply and laboratory/meter testing activities or
assets referred to in the items I, II and III and IV(a) shall transfer to the
company. The expression 'proceedings' has been defined in Part B of the
scheme. Part G of the scheme provides for proceedings of whatever nature
by or against the Administration pending on the transferred date shall not
abate or discontinue and such proceedings may be continued, prosecuted
or enforced by or against the company. The proceedings mentioned in
Schedule 'C' would continue with the Administration. The proceedings
mentioned in Para 3 of Part G may be continued in the same manner and
to the extent as it would or might have been continued, prosecuted and
enforced by or against the Administration if the transfer specified under
the scheme had not been made. From the conjoint reading of Part G and
definition of 'proceedings', it is evident that Administration has transferred
all the proceedings either civil or criminal which were pending on the
transfer date. The proceedings mentioned in the Schedule 'C' are not
transferred and shall continue to be followed by Administration. The
aforesaid Part of the Scheme does not provide that proceedings which may
be initiated against the consumer subsequent to transfer date, however,
with respect to past period are transferred to CPDL. In the absence of
transfer of right to inspect, assess and raise demand with respect to past
CWP-38170-2025 (O&M) -22-
period, the company cannot raise demand while relying upon scheme
notified by aforesaid notification.
17. The transfer scheme was notified in terms of Section 131 of
2003 Act. As per said Section, scheme has to be framed. In the scheme,
rights, liabilities, assets, functions etc. to be transferred have to be
identified as well as incorporated. Section 131 does not provide for transfer
of right to initiate recovery proceedings with respect to past period. The
respondent is relying upon scheme and scheme as noticed hereinabove
does not empower respondent to initiate recovery proceedings with respect
to past period.
18. The Union Legislature w.e.f. 01.07.2017 introduced Central
Goods and Services Tax Act, 2017 (for short '2017 Act'). Section 174 of
2017 Act repealed Central Excise Act, 1944 and few other enactments.
Despite existence and availability of Section 6 of General Clauses Act,
1897, the Legislature saved pending as well as to be initiated proceedings
under repealed enactments. Tax liability under repealed Acts could arise
after introduction of 2017 Act e.g. evasion or short payment of excise duty
could be detected after July' 2017. To initiate proceedings under repealed
Act, the legislature in Section 174(2) of 2017 Act specifically made
provision. Section 174 of 2017 Act reads as:-
"174. Repeal and saving.--(1) Save as otherwise provided
in this Act, on and from the date of commencement of this
Act, the Central Excise Act, 1944 (1 of 1944) (except as
respects goods included in entry 84 of the Union List of the
Seventh Schedule to the Constitution), the Medicinal and
Toilet Preparations (Excise Duties) Act, 1955 (16 of 1955),
the Additional Duties of Excise (Goods of Special
Importance) Act, 1957 (58 of 1957), the Additional Duties
of Excise (Textiles and Textile Articles) Act, 1978 (40 of
CWP-38170-2025 (O&M) -23-
1978), and the Central Excise Tariff Act, 1985 (5 of 1986)
(hereafter referred to as the repealed Acts) are hereby
repealed.
(2) The repeal of the said Acts and the amendment of the
Finance Act, 1994 (32 of 1994) (hereafter referred to as
"such amendment" or "amended Act", as the case may be)
to the extent mentioned in the sub-section (1) or section 173
shall not--
(a) revive anything not in force or existing at the time
of such amendment or repeal; or
(b) affect the previous operation of the amended Act
or repealed Acts and orders or anything duly done or
suffered thereunder; or
(c) affect any right, privilege, obligation, or liability
acquired, accrued or incurred under the amended Act or
repealed Acts or orders under such repealed or amended
Acts: Provided that any tax exemption granted as an
incentive against investment through a notification shall not
continue as privilege if the said notification is rescinded on
or after the appointed day; or
(d) affect any duty, tax, surcharge, fine, penalty,
interest as are due or may become due or any forfeiture or
punishment incurred or inflicted in respect of any offence or
violation committed against the provisions of the amended
Act or repealed Acts; or
(e) affect any investigation, inquiry, verification
(including scrutiny and audit), assessment proceedings,
adjudication and any other legal proceedings or recovery of
arrears or remedy in respect of any such duty, tax,
surcharge, penalty, fine, interest, right, privilege,
obligation, liability, forfeiture or punishment, as aforesaid,
and any such investigation, inquiry, verification (including
scrutiny and audit), assessment proceedings, adjudication
and other legal proceedings or recovery of arrears or
remedy may be instituted, continued or enforced, and any
such tax, surcharge, penalty, fine, interest, forfeiture or
punishment may be levied or imposed as if these Acts had
CWP-38170-2025 (O&M) -24-
not been so amended or repealed;
(f) affect any proceedings including that relating to
an appeal, review or reference, instituted before on, or after
the appointed day under the said amended Act or repealed
Acts and such proceedings shall be continued under the said
amended Act or repealed Acts as if this Act had not come
into force and the said Acts had not been amended or
repealed.
(3) The mention of the particular matters referred to in sub-
sections (1) and (2) shall not be held to prejudice or affect
the general application of section 6 of the General Clauses
Act, 1897 (10 of 1897) with regard to the effect of repeal."
[Empasis supplied]
The above-quoted Section may not be directly applicable to
Electricity Act, 2003 being different kind of enactment, however, principle
seems to be applicable.
19. In the wake of above discussion and findings, this Court is of
the considered opinion that by notification dated 31.01.2025, the
Administration has not transferred right to respondent-company to raise
demand for the period prior to transfer date, thus, demand raised prior to
transfer date by respondent is bad in the eye of law. Therefore, the petition
deserves to be allowed and accordingly allowed. The assessment order
dated 10.12.2025 is hereby set aside.
20. Pending application(s), if any, shall also stand disposed of.
(JAGMOHAN BANSAL)
JUDGE
23.04.2026
Prince Chawla
Whether Speaking/reasoned Yes/No
Whether Reportable Yes/No
