ORDER
K.A. Swami, J.
1. At the stage of preliminary hearing, the respondents are notified. Accordingly, they have put in appearance through Sri Ashok R. Kalyana Shetty, Advocate and have filed statement of objections also.
2. As this petition can be disposed of on a short ground, rule is issued and it is heard for final disposal.
3. In this petition under Article 226 of the Constitution, the petitioner has sought for quashing the demand notice dated 7-11-1989 bearing No. AEEE.ESD.3: AA01:SAII: 759J-602 Assistant (Annexure-A) issued by the Assistant Executive Engineer (Electrical), K.E.B., E.S.D.3, Bangalore-1, In the impugned demand notice, the respondents have called upon the petitioner to pay a sum of Rs.4,03,903-00 being the back-billing charges from June 1987 to October 1989.
4. The contention of the petitioner is that the demand made by respondent-2 as per Annexure-A is hit by Section 26(6) of the Indian Electricity Act, 1910 (hereinafter referred to as the ‘Act’). Therefore, it is liable to be quashed.
5. On the contrary, it is contended by the learned Counsel appearing for the respondents that the provisions of Section 26(6) of the Act are not attracted to a case where there is a wrong connection of R-Phase C.T. connection. Therefore, the demand made by the respondent-2 as per Annexure-A is valid in law.
6. In the light of the contentions urged on both sides, the points that arise for consideration are as follows:
1) Whether the provisions of Section 26(6) of the Indian Electricity Act, 1910 are attracted to the case on hand?
2) Whether the demand made as per Annexure-A is valid in law? 7. Both the points are inter-connected, hence it is just and proper to consider both of them together.
8. The facts necessary for the purpose of deciding the aforesaid points are not in dispute. There is a lodging house known as “Curzon Court” in Brigade Road, Bangalore which is run by the petitioner. The K.E.B. is supplying electrical energy to the lodging house. In the month of May 1987, the load was bifurcated. During the course of bifurcating the load, according to the case of the respondents, R-Phase C.T. connection was made in a reverse order. As a result thereof, out of three phases, only one phase was recording. There was no recording in other two phases on account of nullification of the production torque in 2 phases. It is necessary to reproduce the statement made by the respondents In their statement of objections. The relevant averments are contained paragraphs-4, 5 and 6 of the statement of objections which are as follows:
“4. It is true that the load was bifurcated in the month of May 1987. During the month of July 1989 and August 1989, the consumption recorded was 2016 and 1076 units respectively. Earlier, the consumption used to be around about 3000 units per month. Hence in view of fall in the consumption for the month of July 1989 and August 1989, the concerned Assistant Executive Engineer (Electrical), ESD-3, Bangalore, rquested the Executive Engineer (Electrical), Meter Testing Division, K.E.B. Bangalore, to arrange for the rating of the installation in question. Accordingly, the installation was inspected by the technical audit cell staff along with MT division staff on 17-10-1989 and rating was done in the presence of the petitioner’s representative. His signature has been taken. It was found that the ‘R’ Phase C.T. (current transformer) connection was reversed and this amounted to wrong connection of CT connection. It was also found that the meter was recording 89.6% slow. In view of these aspects, the installation had to be back-billed and accordingly, demand for Rs. 4,03,903-00 towards back-billing charges vide Annexure-A was raised and the petitioner was called upon to pay the same giving the details as stated therein. The demand made therein is in accordance with the provisions of Electricity Supply Regulations and there is no illegality whatsoever.
5. On account of wrong connection (R-phase CT connection reversed), the meter was recording slow by 66-2/3% instead of recording 100%. The meter in question is a 3 phase four wire meter. On account of wrong CT connection, out of 3 phases, only 1 phase was recording and there was no recording in other two phases on account of nullification of the production torque in 2 phases and as such there was recording of only 33-1/3%. For the period from June 1987 to April 1989, the consumption, for the reasons stated above, recorded was 53644 units instead recording 1,60,900 units. If all the three phases were recording, then the consumption would have been 1,60,900 units. As the consumption recorded was just 53,644 units instead of 1,60,900 units the difference 1,07,256 units had to be billed and accordingly, the said units (1,07,256) are billed now at normal rates and a demand for Rs. 1,98,423-60 p.s has been raised vide Annexure-A, the supplemental claim of the bill. And this amount now claimed denotes the difference amount of the consumption charges. The petitioner has consumed 1,60,900 units for the period from June 1987 to April 1989, but on account of wrong CT connection, entire consumption was not recorded and as such the installation was billed for lesser units instead of billing the units actually consumed. The demand vide Annexure-A for wrong CT connection is in accordance with Regulation 30.08 of the Electricity Supply Regulations. As per agreement, the petitioner is required to pay for the electrical energy supplied to him by the K.E.B. In this case, 1,60,900 units of electrical energy has been supplied to the petitioner.
6. The demand for Rs. 2,05,479-50 is on account of slow recording by the installation to an extent of 89.6%. The installation is back-billed for a period of 6 months from May 89 to October 89 at normal rates. This 89.6% slow recording is inclusive of 66-2/3rd% slow recording on account of wrong CT connection and the remaining 23% slow recording (out of 89.6%) is on account of mechanical defect in the meter. (66-2/3% slow recording on account of wrong CT connection + 23% on account of mechanical defect in the meter – 89.6% slow recording). On account of slow recording due to mechanical defect in the meter (faulty meter) there was further fall in the consumption for the months of July and August 89, Regulation 28 of the E.S.R. deals with correctness of meter (faulty meter). Regulation 28 and Section 26(6) of I.E. Act are not attracted.”
It is the case of the petitioner also that there was bifurcation of load in the month of May 1987. That there was wrong C.T. connection in a reverse order; that one phase only was recording out of the three phases is not disputed. The billing has been made on re-rating the meter after proper C.T. connection. The installation was inspected by the Technical Audit Cell staff along with the M.T. Division staff and rating was done in the presence of the representative of the petitioner. It has been found by the respondents that 66-2/3rd% of the consumption was not recorded due to wrong C.T. connection. The Meter Testing Division of the K.E.B. further found that there was slow recording of the meter to the extent of 89.6%, out of which 66-2/3rd% was relatable to slow running of the meter due to wrong R-Phase C.T. connection and the remaining 23% was on account of mechanical defect in the meter. Therefore, It is stated by the respondents that 23% slow recording out of 89.6% has been charged in accordance with Regulation 28(2) of the Karnataka Electricity Board Supply Regulations, 1988 (hereinafter referred to as ‘Supply Regulations’) only for a period of six months and not beyond that. It is further explained in the Statement of objections as well as in the impugned demand notice the difference of the units to be billed due to slow recording of 66-2/3% and the amount payable by way of slow recording due to wrong R-phase C.T. connection in a reverse order for the period from June 1987 to April 1989. The amount payable was to the tune of Rs. 1,98,423-60 ps. The relevant portion of Annexure-A also makes this aspect clear which is as follows:
With reference to the above, I wish to inform you that the above installation was inspected by the Technical Audit Cell Staff along with M.T. Division staff on 17-10-89 and noticed the ‘R’ phase C.T. connection was reversed and the meter was recording 89.6% slow. Hence the installation was back-billed at normal rates from the date of bifurcation of load i.e., June 87 to April 89 at 66-2/3% for wrong connection and for slow recording of meter by 89.6% for six months from April 89 to October 89.
The back-billing charges worked out on
normal rates as below:
a) Slow recording
by 66-2/3% from June 1987 – consumption recorded from 6/87 to 4/89
53,644 unit’s
Actual
consumption as the meter was recording 66-2/3% slow
1,60,900units
Difference of
units to be billed now
1,07,256units
Back billing
charges at normal rates 1,07,256x 1.75
Rs. 1,87,698-00
Additional tax at
10 ps. on 1,07,256 units
10,725-60
Therefore total back-billing
charges
Rs. 1,98,423-60
b) Slow recording
by 89.6% for six months consumption
recorded from 5/89 to 10/89
12,892 units
Actual
consumption as the meter was recording 89.6%slow
1,23,962units
Difference of units to be billed now
1,11,070 units
Back billing charges at normal rates 1,11,070 x 1.75
Rs. 1,94,372-50
Additional tax @
10 paise on 1,11,170units
Rs. 11,107-00
Therefore total back billingcharges
Rs. 2,05,479-50
Total back billing
charges from 6/87 to 10/89
Rs. 1,98,423-60
Rs. 2,05,479-50
Rs. 4,03,903-10
Hence you are requested to pay the above-said amount within 15 days of this letter otherwise further action will be taken without further notice.”
9. From the first portion of the bill it is clear that the petitioner has been billed for the period from June 1987 to April 1989 for slow recording at 66-2/3rd% on the basis of wrong C.T. connection. The amount claimed in this regard is Rs. 1,98,423-60. The second portion of the bill relates to the period May 1989 to October 1989 covering a period of six months. This includes 23% slow recording due to mechanical defect in the meter. According to the respondents, the 23% slow recording due to mechanical defect was also present in the previous period but as it is not permissible for them to claim more than six months as per Regulation 28 of the Supply Regulations, it is not claimed. The claim in this regard is restricted to the period of six months from May 1989 to October 1989. According to the latter portion of the bill, the total slow recording of the units was to the tune of 1,11,070 units. This included 66-2/3rd% slow recording due to wrong C.T. connection. The total amount demanded for this period is Rs. 2,05,479-50. Thus, under both the items, the demand is made for a sum of Rs.4,03,903-10.
10. The contention of Sri Mohandas N. Hegde, learned Counsel for the petitioner is that when it is found that the meter is recording slow due to mechanical defect, it is not open to the respondents to probe further into the matter and state that out of the total slow recording, certain percentage was referrable to wrong C.T. connection and certain portion to slow recording as a result of mechanical defect in the meter. In this regard, the learned Counsel for the petitioner has placed reliance on a decision of the Supreme Court as well as of this Court.
11. In M.P.E.B. v. BASANTIBAI, the Supreme Court has approved the decision of this Court in GADAG BETGERI MUNICIPAL BOROUGH, GADAG v. ELECTRICAL INSPECTOR, GOVERNMENT ELECTRICAL INSPECTORATE, GOVERNMENT OF MYSORE, AIR 1962 Mysore 209 and also the decision of the High Court of Madhya Pradesh in M.P.E.B. JABALPUR v. CHHAGANLAL, and has laid down thus:
“We are, however, unable to accept this contrary view, as it is obvious from the provisions of Section 26 Sub-section (6) of the said Act that dispute whether a meter is correct or faulty would come under the said provisions and not the dispute regarding tampering of meter. In our view, the view taken about the scope of Section 26(6) in the decisions cited above are correct.”
In Gadag Betageri Municipal Borough’s case this Court specifically observed thus:
“What the Inspector may decide under Sub-section (6) is whether or not the readings obtainable from the meter are accurate and whether the meter is faulty or mechanically defective, producing erroneous readings. That is the limited adjudication which in my opinion, an Inspector or other authority functioning under Sub-section (6) may make under its provisions.
XX XX XX
In my opinion, the legislative intent underlying Section 26(6) of the Act is similar. The only question into which the Inspector or other authority functioning under that subsection might investigate is, whether the meter is a false meter capable of improper use or whether it registers correctly and accurately the quantity of electrical energy passing through it. If in that sense, the meter installed by respondent-2 this case was a correct meter as it undoubtedly was and as it has been admitted to be, the fact that respondent-2, even if what the petitioner states is true, so manipulated the supply lines that more energy than what was consumed by the petitioner was allowed to pass through the meter would not render the meter which was otherwise correct an incorrect meter.”
Similarly in M.P.E.B. Jabalpur’s case also it has been held that where an electric meter is not registering correct consumption of energy not because there is any defect in the meter but because the wiring is defective, Section 26(6) will not be attracted and the meter not being defective, the question of arbitration by Electrical Inspector will not also arise.
In TOPASA RAMASA PATIL v. KARNATAKA ELECTRICITY BOARD, this Court followed the decision in Basantibai’s case. In the above decision, tampering with the meter or wrong C.T. connection was not involved. That was a simple case of mechanical defect in the meter and thereby the meter was not recording correctly. This Court, following the decision of the Supreme Court, held thus:
“The clear effect of the aforesaid decision of the Supreme Court is that in matters of slow or faulty recording of the meter, it is only the Electrical Inspector who is authorised to decide the dispute. If the meter is not working properly, that is undoubtedly a dispute and this dispute has to be decided by the Electrical Inspector. Therefore, if the Electricity Board wants to raise a bill in regard to the actual consumption of energy not correctly recorded by the meter, it has to approach the Electrical Inspector and get the same tested and settled. It cannot unilaterally raise a bill without reference to the Electrical Inspector as provided under Section 26(6) of the Electricity Act. For the reasons aforesaid, I hold that the Electricity Board does not have the jurisdiction to decide the functioning or otherwise of the meter.”
12. Thus it is clear that it is only the stow recording of the meter due to mechanical defect in the meter alone will attract the provisions of Section 26(6) of the Act. Slow recording of the meter due to any other reasons not relating to defect in the meter will not attract the provisions of Section 26(6) of the Act.
13. In the instant case, both the aspects are involved. It is the case of the respondents themselves that 66-2/3rd% slow recording was due to wrong C.T. connection and it was not due to mechanical defect in the meter. Therefore, 66-2/3rd% slow recording cannot be connected to and is not relatable to slow recording of the meter due to mechanical defect in it. So, this portion of the claim cannot be held to have been hit by Section 26(6) of the Act.
14. However, 23% slow recording due to mechanical defect in the meter for which the petitioner is called upon to pay falls under Section 26(6) of the Act. When it is possible to bifurcate and determine the two heads of slow recording under (1) slow recording of the meter due to wrong C.T. connection and (2) slow recording of the meter due to mechanical defect in the meter, it is not possible to hold that the entire demand made by the K.E.8. is vitiated. I do not propose to go Into the question whether 66-2/3rd% slow recording due to wrong C.T. connection has been correctly determined and the amount claimed on that count has been correctly calculated or not because there is a right of appeal available to the party aggrieved by the demand to approach the Chief Engineer, K.E.B. under Regulation 46.01 read with Regulation 46.09 of the Electricity Supply Regulations. The appeal lies both on facts and law. Therefore, the petitioner will be in a better position to canvas the questions of fact and law. Therefore, at this stage, it is sufficient to hold that the first portion of the demand termed as ‘(a)’ portion, is well within the power of the respondents; but the correctness of the same is left open to be determined by the Appellate Authority.
15. As far as the latter portion of the demand which is termed as ‘(b)’ portion is concerned, it includes both the claims viz., the claim based on slow recording of the meter due to wrong C.T. connection and slow recording of the meter due to mechanical defect in it. As the demand is made under both the heads together, it is not possible to bifurcate the same. Therefore, (b) portion of the claim is liable to be quashed reserving liberty to the respondents to issue a fresh bill confining it to 66-2/3% for the period May 1989 to October 1989 and further reserving liberty to them to refer the matter to the Electrical Inspector, Government of Karnataka regarding 23% slow recording of the meter due to mechanical defect in it.
16. For the reasons stated above, points Nos.1 and 2 are answered as follows:
(i) The demand made by the respondents in so far it relates to 66-2/3rd% slow reading due to wrong C.T. connection is not hit by Section 26(6) of the Indian Electricity Act, 1910.
(ii) The demand made as per Annexure-A, in so far it relates to (a) portion is concerned, it is well within the power of the respondents but the correctness of the amount claimed and the determination of 66-2/3rd% slow recording due to wrong C.T. connection are left open to be decided in the appeal.
(iii) As far as the demand made under (b) portion is concerned, it consists of both the claims – 66-2/3rd% slow recording due to wrong C.T. connection and 23% slow recording due to mechanical defect in the meter and the amount has been calculated on both the items together; it is not possible to specify the amount relatable to 66-2/3%. Therefore, to that extent, it is liable to be quashed reserving liberty to the respondents to issue a fresh demand confining it to 66-2/3% slow reading due to wrong C.T. connection and further to refer the matter relating to 23% slow reading due to mechanical defect in the meter to the Electrical Inspector of the Government of Karnataka under Section 26(6) of the Indian Electricity Act, 1910.
17. For the reasons stated above, this Writ Petition is disposed of in the following terms:
(i) The first portion of the demand (Annexure-A) termed as ‘(a)’ portion is not liable to be quashed. However, liberty is reserved to the petitioner to challenge that portion of the bill by way of an appeal under Regulation 46.01 read ‘with Regulation 46.09 of the Electricity Supply Regulations, 1988 as to the correctness of the percentage of slow recording and the amount calculated; within one month from today. If the petitioner fails to prefer an appeal in accordance with the aforesaid Regulations within a period of one month from today, it is open to the respondents to take such steps as are open to them in law to recover the amount demanded.
(ii) The latter portion of the demand (Annexure-A) termed as ‘(b)’ portion is quashed reserving liberty to the respondents to issue a fresh demand for the period from May 1989 to October 1989 confining it to 66-2/3% slow recording due to wrong C.T. connection. If such bill is issued, it is open to the petitioner to challenge the same by way of an appeal.
(iii) Liberty is also reserved to the respondents and also to the petitioner to have the matter in so far it relates to 23% slow recording of the meter due to mechanical defect in the meter referred to the Electrical Inspector, Government of Karnataka under Section 26(6) of the Indian Electricity Act, 1910.