IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE SECOND DAY OF APRIL TWO THOUSAND AND NINE PRESENT THE HON'BLE MR JUSTICE R.SUBHASH REDDY WRIT PETITION NO : 7812 of 2001 Between: Zam Zam Corner(SSI Unit) Regd No.010846432 PMT SSi, Rep by its Partner Smt. Juveri Begum W/o. Abdul Arif Baig, R/o. 1-7-68/B, S.D.Road,Secunderabad. A Partnership firm having office at 1-7-228,139, opp Chandra Complex M.G.Road, Secunderabad. ..... PETITIONER AND Central Power Distribution Company of A.P. Limited, Grc, Rep by its Account Officer, General Revenue Circle, Mint Compounds, Hyderabad-500004. .....RESPONDENTS Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Affidavit filed herein the High Court will be pleased to issue any appropriate Writ , order or direction preferably a Writ in the nature of Mandamus declaring the action of the respondent in converting the consumer Service No.18-B-15132 of the Petitioner from Category III to category II Without any notice and raising an amount of R.1,70,662/- towards purported arrears as highly illegal, arbitrary and in violative of the principles of natural justice with a consequential direction to the Respondent to reclassify the Consumer Service No.18-B-15132 from Category II to category III forthwith and pass further or other orders as this Hon'ble Court any deem fit and proper in the circumstances of the case. Counsel for the Petitioner:MR.D.HANUMANTHA RAO Counsel for the Respondent No.: O.MANOHAR REDDY(SC FOR APTRANSCO) The Court made the following : THE HON'BLE MR. JUSTICE R.SUBHASH REDDY Writ Petition No.7812 of 2001 ORDER: Heard Sri D.Hanumantha Rao, the learned counsel for the petitioner and the learned standing counsel for the respondent company and perused the material on record. 2. In this Writ Petition, the petitioner seeks directions by way of a Writ of mandamus to declare the action of the respondent in converting the petitioner’s electricity consumer service No.18-B-15132 from category III (industrial) to category II (commercial) and taking steps to recover an amount of Rs.1,70,662/- towards arrears, as illegal and arbitrary. 3. Petitioner is a Small Scale Industrial Unit involved in the manufacturing of bread, bun, biscuits and cakes etc. It is registered with the Department of Industries as a small-scale industry. For the purpose of the said industrial activity, the petitioner has obtained the electricity service connection, which was granted under category-III i.e., for the industrial purpose. One of the officers of the respondent i.e., Divisional Engineer, D.P.E., has inspected the premises of the petitioner and found that power supply was being utilized for bakery, which comes under category-II. Based on the inspection and report prepared at the time of inspection, the service was re-categorized from category-III (industrial) to category-II (commercial) and in the month of March, 2001 apart from regular consumption charges of Rs.19,537/-, respondent has demanded an amount of Rs.1,70,662/-, which is differential amount from the category-III to category-II. 4. At the time of admission, this Court granted directions not to treat the petitioner’s consumer service No.18-B-15132 as category-II on condition of petitioner paying regular consumption charges of Rs.19,537/-. It appears, the said order passed by this Court continued all along. 5. Mainly, the impugned demand is questioned on the ground that the said demand is without conducting any enquiry and without issuing any prior notice. As stated in the reply-affidavit, it is the case of the petitioner that it is being continued as Small Scale Industrial Unit and the power supply is being utilized for industrial purpose. 6. In the counter-affidavit, filed by the Assistant Accounts Officer, it is stated that the inspection was made by the Divisional Engineer, DPE, on 12-12-2001 and inspecting officers have observed that the power supply was being used for bakery, which comes under category-II. It is also stated that when the inspection had taken place, representative of the consumer has stated that the bread factory was removed three years back to the date of inspection and power supply was being used for Zam Zam bakery, which is a commercial one. It is stated that in view of the inspection report and the re-categorization of the service from category- III (industrial) to category-II (commercial), a demand of Rs.1,50,642/- is raised towards the difference between category-III to category-II service. Further it is stated that as per the current terms and conditions of supply, the supply to shops, business, houses, offices, public buildings, hospitals etc., come under category-II only. 7. Although it is the case of the petitioner that the electricity service was being utilized only for industrial purposes, but in view of the inspection and allegations leveled, it cannot be accepted and finally be concluded by this Court that whether the petitioner was using the power connection for industrial activity or commercial activity. It is evident from the counter-affidavit that the revenue collecting authorities have revised the categorization, based on the report sent by the Inspecting Officer i.e., Divisional Engineer, DPE of respondent company. The supply of power is governed by the terms and conditions of supply, framed under the Electricity (Supply) Act, 1948, which terms and conditions are being followed presently while entering into the agreement for supply by the respondent company in favour of the consumer. As per the condition No.35 of the terms and conditions of supply of electricity, where a consumer has been classified under a particular category and he has been billed accordingly and when it is observed subsequently that classification is not correct, Board is empowered to alter the classification and issue suitable revised bills, if necessary, even retrospectively. In this case, when the original supply was sanctioned under category-III and when it is sought to be revised on the ground that petitioner-consumer is not using the service for industrial activity and using the same for commercial purpose, the respondent, at least, ought to have notified to the petitioner before revising the classification and issuing consequential bills. From the averments in the counter-affidavit it is clear that the revision of classification is done by the Electricity Revenue Authorities even without issuing any notice, based on the expert report sent by the Inspecting Officer i.e., Divisional Engineer, DPE. Though it is alleged by the petitioner that he is still using the said power supply only for the industrial purpose, as much as no notice is issued before revising the classification, this Court need not record any finding on the said allegation, in view of the order proposed to be passed by this Court. Though there is no express provision in the terms and conditions for issuance of notice, but once agreement is entered into for supply with a particular classification and if the same is to be reclassified, it is obligatory on the part of the respondent to give an opportunity to the petitioner by issuing notice, to meet the principles of natural justice. On the short ground viz., re-classification was undertaken without any notice and opportunity to the petitioner, the impugned demand is liable to be set aside. 8. For the aforesaid reasons, I set aside the impugned demand only to the extent of the arrears to a tune of Rs.1,50,642/- in the impugned bills. However, it is made clear that if the petitioner has changed the category and was using the service for category-II purposes, it is open to the respondent to issue notice to the petitioner by enclosing a copy of the inspection report and pass appropriate orders, after affording proper opportunity. 9. The Writ Petition is accordingly allowed to the extent indicated above. No order as to costs. ___________________ R.SUBHASH REDDY, J. 02nd April, 2009. skmr