BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED : 16/04/2009 Coram The HONOURABLE MR.JUSTICE K.K.SASIDHARAN W.P.(MD)No.3074 of 2009 and M.P.(MD).Nos.1 and 2 of 2009 Sri Vignesh Industries, Rep. by its Sole Proprietor, S.Ramesh Sundar ... Petitioner vs. 1.The Chairman -cum- Managing Director, Tamil Nadu Electricity Board, Anna Salai, Chennai. 2.The Executive Engineer (I/C), Tamil Nadu Electricity Board/Distribution, O&M, Tuticorin Electricity Distribution Circle, Kovilpatti, Tuticorin District. ... Respondents PRAYER Writ Petition filed under Article 226 of the Constitution of India praying for the issue of a Writ of Certiorarified Mandamus, calling for the records relating to the order made in Lr.No.EE/D, KPT/TA/F.Theft/D.No.665/09 dated 19.02.2009 passed by the second respondent and quash the same and consequently, direct the respondents to restore and continue to supply electric energy to the service connection bearing HTSC No.207, belongs to the petitioner. !For Petitioner ... Mr.G.Ethirajulu ^For Respondents... Mr.M.Sureshkumar ****** :ORDER
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This Writ Petition is directed against the order passed by the
second respondent in proceedings No.Lr.No.EE/D,KPT/TA/F.Theft/D.No.665/09, dated
19.02.2009, whereby and whereunder the petitioner was directed to pay a sum of
Rs.82,43,460/- on account of dishonest abstraction of electricity.
PETITIONER’S VERSION:-
2. The petitioner is running a factory in the name and style of “Sri
Vignesh Industries”, and is engaged in the manufacture of Calcium Corbide. They
were provided with a service connection by the respondents as per Policy
No.HTSC-207. Even though the allotted power was 400 KVA, it was reduced to 250
KVA from time to time on account of the power shortage. Apart from the cut
imposed by the Electricity Board, there was also power off during the period
from 06.00 p.m. to 10.00 p.m. Subsequently, 40% cut was imposed with effect from
November 2008. In such circumstances, the production of the factory has come to
a standstill. While so, on 27.11.2008, an inspection was conducted in the
factory premises by the officials of the second respondent and it was found that
all the meter seals were intact and an endorsement to that effect was also made.
Subsequently, on 27.12.2008 also a joint inspection was conducted by MRT,
Tuticorin as well as the Enforcement, Tirunelveli and in the said inspection
also, there were no malpractices found and they have also changed the meter
chamber log seals and an endorsement was also made to that effect.
3. While so, on 25.01.2009, the Assistant Engineer, Tirunelveli
conducted inspection at the premises and removed the meter and handed over the
same to the Pasuvanthanai Police Station on the ground that there was an act of
theft of energy in the factory premises of the petitioner. Subsequently, the
meter was released and it was handed over to the Section Officer for safe
custody on 28.01.2009. Later, a provisional assessment was stated to have been
made on 27.01.2009 by the second respondent. However, no such assessment order
was received by the petitioner and, therefore, they were not in a position to
submit their explanation. While so, they received the impugned order dated
19.02.2009 calling upon them to pay the amount assessed by the second
respondent. Aggrieved by the said order, the petitioner has filed the writ
petition.
SUBMISSIONS:-
4. The learned counsel appearing for the petitioner contended that
the procedure adopted by the second respondent was violative of Regulation 23-AA
as amended by the Tamil Nadu Electricity Supply (Second Amendment) Code, 2007.
According to the learned counsel, a prescribed procedure has been incorporated
as per the said amendment. The amended provision pre-supposes that before
directing the consumer to pay the electricity charges on account of theft of
energy, it should be established that there was a theft of energy. According to
the learned counsel, Regulation 23-AA(7) is very clear as it provides that,
where it is established that there is a theft of energy, the authorised officer
shall assess the quantum of energy consumption for the past 12 months as per the
assessment formula given in Form-8. By placing reliance on the said Regulation,
the learned counsel for the petitioner contended that there was nothing
indicated in the impugned order to the effect that the second respondent has
established that there was a theft of energy and as such, the very procedure
adopted by the second respondent is violative of the mandatory conditions for
passing an order of assessment.
5. The learned counsel further contended that even before the expiry
of the time prescribed for submitting the objection, the second respondent has
passed the impugned order and as such, the petitioner was prevented from filing
an effective explanation in respect of the provisional assessment made by the
second respondent and as such, serious prejudice has been caused to the
petitioner.
SUPPLY CODE – PROVISION REGARDING THEFT OF ENERGY:-
6. The issue regarding method of assessment of the electricity
charges payable in case of theft of electricity pending adjudication by the
appropriate Court, disconnection of supply of electricity and the removal of the
meter, cable lines, electric plant and other apparatus in case of theft or
unauthorized use of electricity and measures to prevent diversion of
electricity, theft or unauthorized use of electricity as well as tampering were
considered by the Tamil Nadu Electricity Regulatory Commission and accordingly,
in exercise of the powers conferred as per Section 181 read with Section 50 of
the Electricity Act, 2003, the regulations framed under the Tamil Nadu
Electricity Supply Code were amended with effect from 15th June 2007. As per the
said amendment, the existing sub regulation 23-AA was substituted by fresh
regulation.
7. Regulation 23-AA (1) empowers the officer authorized under sub-
section (2) of Section 135 to conduct inspection of such place or premises for
the purpose of satisfying as to whether there was an act of theft. In the event
of finding any such act of theft or unauthorized distraction of electricity,
the said officer was required to prepare a report at the place itself. The
report should contain the details, like connected load, condition of seals and
the modus operandi adopted for theft of energy. Upon such detection of theft of
electricity, the officer of the licencee or supplier was entitled to disconnect
the supply line of electricity. He was also expected to make a complaint before
the concerned police station. As per Section 23-AA(3), in the event of suspected
theft by tampering of meter or metering equipment, the meter shall be removed
and sealed in the presence of the accused as well as witnesses. Similarly,
provisions are also made in case of theft of electricity by bypassing the meter
or metering equipment or theft by direct tapping from the licencee’s or
supplier’s lines.
8. The provision regarding preparation of provisional assessment as
well as issuance of notice to the consumer is contained in sub clause (7) and
(8) of the regulation. As per sub clause (7), where it was established that
there was a case of theft of energy, the amount has to be assessed by the
authorized officer as per the formula given in Form-8 and the said provisional
assessment should be served on the assessee in Form No.9. Such provisional
assessment should also indicate the time limit permitted for filing objection
against such provisional assessment. Sub clause (8) gives seven days time from
the date of issue of order of provisional assessment to submit the objection
against the assessment.
9. Sub clause (11) provides that in the event of the accused person
fails to submit his objection to the provisional assessment within seven working
days, the licencee or supplier concerned was within their powers to initiate
recovery action for realizing the amount as shown in the provisional assessment
order.
10. The procedure regarding submission of explanation as well as the
enquiry is contemplated in sub clause (12) of the Regulation 23-AA. As per the
said provision, in the event of submitting an explanation by the consumer within
seven working days from the date of receipt of provisional assessment order,
such explanation should be considered by the authorized officer and a personal
hearing also should be given to the accused person. The provision further
mandates three days notice to the accused person for his appearance for the
purpose of personal hearing. The accused was also entitled to produce documents
in support of his contention as well as written submissions in addition to the
submission earlier made by way of written explanation. It was only in the event
of the failure of the accused to appear for personal hearing, in spite of the
service of three days notice, a cause of action arises for passing final
assessment. The authorized officer was expected to consider the entire factual
matrix before proceeding further. Sub clause (13) is very clear when it says
that the authorized officer shall analyze the case after carefully considering
all the documents as well as the submissions by the accused person, facts on
record, and the consumption pattern. Therefore, an analysis of the entire matter
has to be made by the authorized officer. It was also not an empty formality, as
the final order to be passed by the authorized officer would involve civil
consequences to the accused. The computation of quantum of energy consumption
for the past twelve months for the purpose of making an assessment order was
also indicated in the regulation itself. The authorized officer was expected to
pass an order within seven working days from the date of enquiry to assess the
electricity charges and to pass the final assessment. In cases, wherein there
was no appearance of the accused, in response to the provisional assessment, the
authorized officer was within his powers to pass final orders within 15 days
from the issuance of provisional assessment order. The mode and manner passing
the order has also been indicated in sub clause (15). The authorized officer was
expected to indicate the submissions made by the accused in his objection as
well as during the personal submission, an analysis of the documents as well as
evidence produced by the accused and the reasons for acceptance or rejection of
the case projected by the accused. The authorized officer was also obliged to
serve a copy of the speaking order to the accused person under proper receipt
and he should be given seven working days from the date of receipt of the final
assessment order to pay the amount. In case of failure to pay the amount, even
after passing the final assessment order, the licencee was given the power to
remove the meter and service line after giving fifteen days notice.
11. As per the explanation appended to Regulation 23-BB, accused
person was intended to include the owner or occupier of the premises or his
authorized agent or representative. Therefore, there is an elaborate procedure
now incorporated in the Tamil Nadu Electricity Supply Code and as such, the
authorized officer has to discharge his function strictly as per the scheme of
the Code.
ON POINT:-
12. The premises of the petitioner was inspected by the officials of
the electricity department on 25.01.2009. As per the impugned order, it was
found that the petitioner was engaged in theft of energy through the process of
bypassing the meter by providing two loops in the current coils of the secondary
terminals of the metering set by opening the secondary terminal cover of the
metering set, after removing the seals provided and by refixing the terminal
cover of the metering set with bogus seals. Accordingly, a provisional
assessment was issued to the petitioner on 27.01.2009 requiring them to submit
their objections within a period of seven days. However, there was no reply from
the petitioner. Therefore, a second notice was issued to the petitioner on
10.02.2009 so as to enable them to submit their objections. Still, there was no
response from the petitioner and as such, the second respondent was constrained
to pass the final assessment order as per proceedings dated 19.02.2009.
13. The petitioner has contended that the provisional assessment
issued on 27.01.2009 was not served on them so as to enable them to submit their
explanation within the time prescribed. In any case, a fresh notice was issued
on 10.02.2009 calling upon the petitioner to submit their objections within
seven days from the date of receipt of the communication. The said communication
was received by the petitioner on 12.02.2009. Since the petitioner received the
notice only on 12.02.2009, the seven working days time would expire only by
19.02.2009. However, the impugned order was passed on 19.02.2009 itself. The
petitioner has contended that the seven days time expires only on 23.02.2009.
Since the notice was received on 12.02.2009, the petitioner was having time only
till 19.02.2009 to submit their reply. In any case, the final assessment was
made on 19.02.2009 itself. Since the time expires only on 19.02.2009, the second
respondent was expected to pass orders only after 19.02.2009.
14. The second respondent was not expected to issue a second notice
to the petitioner as per the provisions of the Tamil Nadu Electricity Supply
Code. However, it appears that only on account of the non service of the initial
notice sent on 27.01.2009, the second respondent has issued the second notice on
10.02.2009. When the second respondent himself has given the notice to the
petitioner granting seven clear days time to submit their objections, he was
required to wait till the expiry of the said period before passing the final
assessment order. Therefore, I am of the view that the petitioner should be
given an opportunity to submit their objection.
15. The learned counsel for the petitioner contended that the
assessment made by the second respondent was not in accordance with the
prescribed procedure. It was also his contention that on account of the power
cut imposed by the respondents, the petitioner was granted only 210 KVA instead
of 400 KVA with effect from September, 2008. Therefore, according to him, while
computing the consumption, it was only the actual consumption of 211 KVA has to
be taken into consideration. However, the computation was made on the basis of
the sanctioned kilovolts of 400 and as such, the very basis adopted was
incorrect.
16. The contention of the learned counsel in respect of the
provisional assessment order as confirmed by the final assessment order cannot
be looked into at this stage, as I am remanding the matter to the second
respondent for fresh consideration. Since the second respondent has issued the
notice on 10.02.2009 and as the petitioner is now permitted to file their
objections to the said notice, it would be open to the petitioner to incorporate
all their submissions in the written explanation and it would also be open to
them to substantiate their case by way of production of documents. Any
observation made with regard to the merits of the matter would affect the case
of both the parties in the adjudication proceedings to be conducted by the
second respondent. In such circumstances, I am of the view that the matter
should be considered by the second respondent afresh.
TO SUM UP:-
17. Accordingly, the impugned order dated 19.02.2009 is quashed and
the matter is remitted to the second respondent for fresh consideration. The
petitioner is granted seven working days time from the date of receipt of a copy
of this order to file their objections before the second respondent in response
to the notice dated 10.02.2009. On receipt of such objections, the second
respondent is directed to give an opportunity of personal hearing to the
petitioner and to produce documents to substantiate their contentions and to
dispose of the matter on merits. While deciding the matter, the second
respondent is expected to follow the mandatory procedure as contained in
Regulation 23-AA of the Tamil Nadu Electricity Supply Code. Since the service
connection has already been disconnected by the respondents, the second
respondent is directed to complete the assessment proceedings as expeditiously
as possible and in any case, within one month from the date of receipt of
objections from the petitioner.
18. The Writ Petition is allowed as indicated above. Consequently,
the connected miscellaneous petitions are closed. No costs.
SML
To
1.The Chairman -cum- Managing Director,
Tamil Nadu Electricity Board,
Anna Salai, Chennai.
2.The Executive Engineer (I/C),
Tamil Nadu Electricity Board/Distribution,
O&M, Tuticorin Electricity Distribution
Circle, Kovilpatti, Tuticorin District.