SANJU PANDA, J. W.P.(C) NO.1666 OF 2010 (Decided on 11.08.2010). M/S. AGARWAL STRIPS PVT. LTD. ………. Petitioner. .Vrs. DEPUTY GENERAL MANAGER (Elct.) CESCO, ANGUL ELECTRICAL DIVN., ANGUL & ORS. ………... Opp.Parties. ORISSA ELECTRICITY REGULATORY COMMISSION DISTRIBUTION (CONDITIONS OF SUPPLY) CODE 2004 – CLAUSE 10 & 13 (10) (b). For Petitioner – M/s. M.Agarwal &T.K.Mishra For Opp.Parties- M/s. B.K.Nayak 1&2 S. PANDA, J. The petitioner has filed this writ petition challenging the letter dated 21.10.2009 issued by the Dy. General (Elect.), A.E.D., Angul and the letter dated 23.10.2009 issued by the Junior Manager, (Electrical) No.1, CESU, Angul directing the petitioner to pay the outstanding arrear electricity dues. 2. Maa Budhi Roller Flour Mills (Pvt.) Limited for setting up of the unit at Panchamahal, Angul took a loan from the State Bank of India. The said unit mortgaged and hypothecated the movable and immovable of its assets as security for payment of the loan. As Maa Budhi Roller Flour Mills (Pvt.) Limited failed to repay the loan amount, Authorised Officer and Chief Manager, State Bank of India, Angul, opposite party no.3, seized the said unit for default in payment of the dues of the Bank and took over possession of the said unit. Thereafter, all the part and parcel of the property in the name of Maa Budhi Roller Flour Mills (Pvt.) Limited consisting of land and building was offered for sale by calling for public auction by opposite party no.3 in exercise of power conferred under Section 13(4) of the Securitization and Reconstruction of Financial Asset and Enforcement of Security Interest Act, 2002 (In short, “SRFAESI Act, 2002”) read with rule 8(6) of the Security Interest (Enforcement) Rules, 2002. In pursuance of the said public auction, the petitioner participated and being the highest bidder purchased the said land and building. After taking over the assets of the unit, the petitioner made efforts to capitalize its entire entrepreneurial activities and for that purpose it approached opposite party no.2 for supply of electricity. The petitioner applied in the prescribed format for fresh connection of electricity to its plot. Opposite parties 1 and 2 by letters dated 21.10.2009 and 23.10.2009 rejected the application of the petitioner for fresh power supply to the land of the petitioner on the ground that there was an outstanding arrear dues against the erstwhile company. Hence this writ petition. 3. It is submitted by the learned counsel for the petitioner that as per the Electricity Act, 2003, on an application made by the owner or occupier of any premises, the authority has to supply electricity within one month from the date of receipt of the application. If a licencee fails to supply electricity within the stipulated time, he shall be liable to a penalty which may extend to one thousand rupees for each day of default. The regulation made under the above Act is known as “OERC Distribution (Conditions of Supply) Code, 2004” to govern distribution and supply of electricity and procedures thereof etc. Clause-13.5 of the said Code provides that the power supply shall be provided within a period of 90 days in case of 33 KV Supply. Though the petitioner submitted its application for providing power supply, opposite parties by letters dated 21.10.2009 and 23.10.2009 rejected the application of the petitioner. Therefore, the petitioner has filed this writ petition for redressal of its grievance. He further submitted that demand of the opposite parties 1 and 2 to clear the arrear electricity dues of the previous company is illegal and is not sustainable in the eye of law. Hence, the letters dated 21.10.2009 and 23.10.2009 issued by opposite parties 1 and 2 in favour of the petitioner is liable to be quashed. In support of his contention, he cited the decisions of this Court in the case of Anshuman Behera v. Orissa State Financial Corporation & others reported in AIR 2010 Orissa 10 and Ajay Kumar Agrawal v. O.S.F.C. & others reported in AIR 2007 Orissa 37. 4. In pursuance of the notice, opposite parties appeared through counsel, filed counter affidavit and argued the matter on merits. 5. Mr.B.K.Nayak, learned appearing on behalf of the opposite parties 1 and 2, submitted that in Dakshin Haryana Bijli Vitran Nigam Ltd. v. Paramount Polymers (P) Ltd. reported in (2006) 13 SCC 101, the apex Court has held that in cases where a consumer had defaulted in paying electrical charges and there had been consequent disconnection of supply, no fresh connection in respect of the premises would be given to a purchaser unless the purchaser cleared the amount that was left in arrears by the consumer whose undertaking had been purchased. In view of the said decision, the plea taken by the present petitioner is liable to be rejected and since it has not cleared the arrear electricity dues in respect of the premises, no fresh connection can be provided and the writ petition is liable to be rejected. 6. The learned counsel for the opposite parties further submitted that under sub-clause 10(b) of Clause 13 of Orissa Electricity Regulatory Commission Distribution (Conditions of Supply) Code, 2004 (in short, “OER Code”), the service connection from the name of a person to the name of another consumer shall not be transferred unless the arrear charges pending against the previous occupier are cleared. Therefore, the petitioner is liable to clear the arrear charges. 7. In reply to the above, learned counsel for the petitioner submitted that as per Clause-10 of the OER Code the petitioner is not coming under the expression, “the applicant in respect of an earlier agreement executed in his name or in the name of his spouse etc.”. Therefore, the question of the petitioner clearing the arrear dues as per the provision of Sub-clause 10(b) of Clause 13 of the OER Code, as contended by the opposite parties, does not arise. 8. From the above submissions of the parties and after going through the records, it appears that the petitioner has purchased the unit in the auction sale in pursuance of the advertisement published therefor and on payment of the consideration amount, sale was confirmed and possession of the unit was handed over to the petitioner. Admittedly, as stated above, as per the terms and conditions of the sale, the purchaser shall not be liable for payment of any dues relating to the Maa Budhi Roller Flour Mills (Pvt.) Ltd. which was put to auction for non-payment of loan amount to the Bank or before handing over the possession in pursuance of confirmation of the sale. 9. Having regard to the contention of the parties, in the present case it is to be considered by this Court, whether Clause-10 or Sub-clause 10(b) of Clause-13 of the OER Code is applicable to the petitioner. 10. For better appreciation, the said provisions of the OER Code are extracted below: “10. If the applicant in respect of an earlier agreement executed in his name or in the name of his spouse, parents or in the name of a firm or company with which he was associated either as a partner, director or managing director, is in arrears of electricity dues or other dues for the same premises payable to the licensee, the application for supply shall not be allowed by the engineer until the arrears are paid in full. 13. Licensee’s obligation to supply and power to recover expenditure – (1) to (9) xxx xxx xxx (10) Transfer of service connection – (a) xxx xxx xxx (b) The service connection from the name of a person to the name of another consumer shall not be transferred unless the arrear charges pending against the previous occupier are cleared. Provided that this shall not be applicable when the ownership of the premises is transferred under the provisions of the State Financial Corporation Act.” 11. On a plain reading of the above provisions, it is crystal clear that the petitioner being the purchaser of the unit on an advertisement made by opposite party no.3 is in no way connected with the previous owner of the premises as the petitioner purchased the unit from auction sale made by the State Bank of India. Therefore, Clause-10 is not applicable to the petitioner. 12. So far as Sub-clause 10(b) of Clause-13 is concerned, the petitioner did not apply for transfer of service connection from the name of a person to the name of another consumer. Rather, it was one for fresh connection to the petitioner-unit after it purchased the same from opposite party no.3. As per the terms and conditions of the sale, the present petitioner is not liable to clear any arrear dues of the erstwhile owner. The dues are not levied against the premises; rather it is levied against the person and the ownership of the premises is transferred under the provisions of the Companies Act. The opposite parties have also not contended that there was an agreement between the opposite parties and erstwhile owner of the premises that in case the premises in question would be transferred, the transferee has to clear all the arrear electricity dues. 13. So far as the decision cited by the learned counsel for the opposite parties in Dakshin Haryana Bijli Vitran Nigam Ltd.’s case (supra) is concerned, therein the licencee incorporated Clause 21-A on 22.11.2001 in the terms and conditions of supply of electrical energy and after that date the consumer applied for electrical connection. In view of the said clause, the apex Court observed that the purchaser was liable to clear the arrears in respect of the premises. However, whether that clause violates any fundamental rights of the parties was not considered by the High Court for which the matter was remanded. Therefore, the said decision is not applicable to the facts and circumstances of the present case. 14. Therefore, it is open to CESCO to take such steps as may be just and proper in consonance with the law for realization of the arrear dues, if any, from the consumer who has taken the electric connection from the persons who are liable to clear the dues on behalf of the Maa Budhi Roller Flour Mills (Pvt.) Ltd. 15. This Court in Anshuman Behera’s case (supra) has held that for grant of fresh connection, outstanding electricity dues of erstwhile owner cannot be recovered from the purchaser of premises in the auction held by the Financial Corporation under Section 29 of the SFC Act, 1951. Outstanding of electricity dues does not amount to charge on premises and in absence of such charge, subsequent occupier cannot be asked to pay the outstanding dues of the erstwhile occupier. 16. In Ajay Kumar Agrawal’s case (supra), this Court after perusing clause 9 made it clear that by not referring the name of its erstwhile consumer, namely, M/s. Maa Bhawani Rice Industries, WESCO in clause-9 of the agreement referred to the earlier agreement dated 24.12.1992 presumably with M/s. Maa Bhawani Rice Industries which provided that all arrears and liabilities under the old and superseded agreement shall be treated as arrears and liabilities under the present agreement held that WESCO has no such power under the statute to treat arrears under the superseded agreement as arrears under the present agreement. Therefore, the said clause on the face of it ultra vires the provision of Section 43 of the said Act which fastens an obligation on WESCO to supply electricity to a consumer. 3. In the case at hand, it appears from the auction notice that opposite party no.3 neither mentioned about the arrear dues nor disclosed the said fact at the time of confirmation of sale or transfer of the property in the name of the petitioner. Therefore, due to the suppression of the said fact, the petitioner is not liable to pay the said amount as he is the auction purchaser. At the time of purchase, there was no electricity in the unit. He being the auction purchaser cannot consume electricity without entering into a new contract and he is in no way connected with the previous occupier/company/industry/unit. 18. In view of the above position of law and the fact that the opposite parties had not mentioned before that the petitioner has to clear the arrear dues in respect of the premises, their demand against the petitioner to clear the arrear dues is arbitrary and illegal. 19. Considering the above background of facts, this Court quashes the letters dated 21.10.2009 and 23.10.2009 issued by the opposite parties and directs them to provide electricity to the petitioner- unit within a period of seven days from today. The petitioner is directed to pay the current dues and other deposit to supply fresh connection of electric line. The writ petition is accordingly allowed. Writ petition allowed.