JUDGMENT
S.N. Jha, J.
1. This writ petition has been filed for direction upon the Bihar State Electricity Board (in short ‘the Board’) to restore electric supply to Maa Mamta Cold Storage (P) Ltd., the petitioner herein or grant new electric connection to it. Further prayer is to command the Board not to realise the outstanding dues of the previous owner namely, Durga Bhawani Cold Storage.
2. The previous owners of the Cold Storage in question had taken loan from the Bihar State Financial Corporation (in short, the Corporation). They could not repay the loan and the Cold Storage was put on auction sale under Section 29 of the State Financial Corporations Act, 1951. One Nagendra Singh offered to purchase on payment of the balance outstanding. The offer was accepted and under registered instrument the Corporation sold the Cold Storage. After purchase the name of the Cold Storage was changed to Maa Mamta Cold Storage. The Corporation handed over possession of the Cold Storage on 6-3-90 to Nagendra Singh. No sooner possession was taken than on 8-3-90 the electric supply was disconnected on account of arrears of Rs. 4,28,947.52 outstanding against the Cold Storage with a notice that without paying the amount electric connection will not be restored.
3. The case of the petitioner is that being a bona fide purchaser in an auction sale, it is not liable for the dues of the predecessor-in-interest.
4. The writ petition was filed on 14-5-90. On 5-9-90 while admitting the case for hearing the Court passed an interim order directing the Board to give new connection to the petitioner subject to final decision in the case. It was clarified that the pendency of the case shall not prevent the Board from taking steps for realisation of the dues from the persons, besides the petitioner, liable to pay the same.
5. It is submitted by the counsel for the petitioner that the point at issue as to whether a purchaser at an auction sale under Section 29 of the State Financial Corporations Act is liable to discharge the liability of the previous consumer, has been decided by the Apex Court, in favour, in the case of Isha Marbles v. Bihar State Electricity Board, (1995) 2 SCC 648. Therein the Court held in no uncertain terms that :
“where the premises comes to be owned or occupied by the auction-purchaser, when such purchaser seeks supply of electric energy, he cannot be called upon to clear the past arrears as a condition precedent of supply. What matters is the contract entered into by the erstwhile consumer with the Board. The Board cannot seek enforcement of contractual liability against the third party”.
6. As far as the question of third party’s liability is concerned, in a case where the rights have been created by the defaulter consumer in favour of the third party, by sale or otherwise, it may be open to the Board to withhold supply of electricity to such third party, if the transfer is found to be fraudulent, an attempt to get rid the liability under the contract entered into by the consumer with the Board. The case of auction sale under the State Financial Corporations Act stands on a firm ground. As far as the purchaser is concerned, there is no question of any fraud between the erstwhile consumer and the purchaser. At least in the instant case there is nothing of the kind suggested. The only argument put forward on behalf of the Board is that at the time of admission of the case and passing of the interim order, Clause 3 (a) of the agreement (under which the petitioner purchased the Cold Storage from the erstwhile owner) was suppressed in the Court. I do not find any substance in this contention. Clause 3 (a) of the agreement, no doubt, provides that the sale of the mortgaged property, inter alia,
is subject to payment of statutory dues of the Bihar State Electricity Board, if any. But in view of the law laid down by the Apex Court in Isha Marbles’ case, (1995 (2) SCC 648) the said clause of the agreement could not be used as ground to withhold the connection.
7. Reliance was also placed on Swastic Industries v. Maharashtra State Electricity Board. (1997) 9 SCC 465 : (AIR 1997 SC 1101), 1 am afraid the decision has no application whatsoever in the instant case. While Interpreting Section 24 of the Electricity Act, 1910 the Court observed that the right to recover the charges is one part and right to discontinue supply of electrical energy to consumer who neglects to pay the charges is another part. Therefore, the mere fact that there is a right given to the Board to file a suit and the limitation has been prescribed to file a suit, it does not take away the right conferred on the Board under Sections 24 of the Electricity Act and 60A of the Electricity (Supply) Act to make demand for payment of the charges and on neglecting to pay the same, to discontinue the supply or cut off the supply, as the case may be.
8. The point at issue in the Instant case being completely different and covered by the decisions of the Apex Court, in favour of the petitioner, I have no difficulty in making the interim order dated 5-9-90 (supra) absolute. Thus, the petitioner will not be liable for the dues outstanding against the previous owner of the Cold Storage M/s. Durga Bhawani Cold Storage. The connection provided to it pursuant to the said order will be treated as final and the liability of the petitioner will be confined to the terms and conditions of the agreement entered Into by the parties.
9. This writ petition is disposed of in the above terms. There will be no order as to costs.
Prabhat Kumar Sinha, J.
10. I agree.