IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN TUESDAY, THE 1ST DECEMBER 2009 / 10TH AGRAHAYANA 1931 WP(C).No. 15931 of 2005(V) PETITIONER(S): 1. THE KERALA STATE ELECTRICITY BOARD, REPRESENTED BY ITS SECRETARY, VYDHYUTHI BHAVANAM, PATTOM, THIRUVANANTHAPURAM. 2. THE EXECUTIVE ENGINEER, K.S.E. BOARD, ELECTRICAL DIVISION, ALWAYE. 3. THE ASSISTANT EXECUTIVE ENGINEER, K.S.E. BOARD, ELECTRICAL SUB DIVISION, ALWAYE (TOWN). 4. THE SUB ENGINEER IN-CHARGE, ELECTRICAL SECTION, ALWAYE (NORTH). BY ADV. SRI.KODOTH SREEDHARAN, SC, KSEB RESPONDENT(S): 1. SRI. S.J. PREMKUMAR, EXPRESS TOWERS, FLAT A-2, LISIE JUNCTION, COCHIN-18. 2. THE CHIEF ELECTRICAL INSPECTOR, THIRUVANANTHAPURAM. 3. THE STATE OF KERALA, REPRESENTED BY THE SECRETARY TO GOVERNMENT, DEPARTMENT OF POWER,SECRETARIAT,THIRUVANANTHAPURAM ADV. SRI.P.GOPAKUMARAN NAIR FOR R1 SRI.C.S.DIAS FOR R1 SRI.AJITH MURALI FOR R1 SRI. C.K. KARUNAKARAN, S.C. GOVT. PLEADER SMT. N. SUDHA DEVI. THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 01/12/2009, THE COURT, ON THE SAME DAY, DELIVERED THE FOLLOWING: PETITIONERS' EXHIBITS: W.P.C.NO. 15931/2005. -------------------------------------------------------------------- EXT.P1 TRUE COPY OF MAHAZAR DT. 24-9-2002. EXT.P2 PENAL BILL DT. 7-10-02. EXT.P3 APPEAL DT. 16-10-02. EXT.P4 PETITION DT. 28-10-02. EXT.P5 COUNTER AFFIDAVIT DT. 27-5-2003. EXT.P6 ORDER DT. 4-8-2004. [TRUE COPY] P.S TO JUDGE. S. Siri Jagan, J. =-=-=-=-=-=-=-=--=-=-=-=-=-=-=-=-=-= W. P (C) No. 15931 of 2005 =-=-=-=-=-=-=-=-=--=-=-=-=-=-=-=-=-= Dated this, the 1st December, 2009. J U D G M E N T The petitioners in this writ petition are the Kerala State Electricity Board and its officers. They are aggrieved by Ext. P6 order of the Chief Electrical Inspector to the Government of Kerala, whereby at the instance of the 1st respondent in respect of an alleged theft of electricity by the 1st respondent, the Electric Inspector has assumed jurisdiction under Section 26(6) of the Indian Electricity Act and directed the 1st respondent to pay for the additional consumption as quantified by the Electrical Inspector in Ext. P6. This writ petition is filed contending that the Electrical Inspector has no jurisdiction under Section 26(6) in view of the specific allegation of theft of electrical energy. The facts necessary for disposal of this case are summarised as under. 2. The officers of the Kerala State Electricity Board conducted an inspection of the premises of the 1st respondent on 24-9-2002 and prepared Ext. P1 mahazar, in which it is stated that the electrical connection to the meter was changed, that the cover of the meter was removed and the meter box was not sealed. Construing this as an act of theft of electrical energy, Ext. P2 bill was issued to the 1st respondent, seeking to recover three times the electricity charges due from the 1st respondent in respect of the energy allegedly stolen by the 1st respondent, which was not recorded in the meter. The 1st respondent filed Ext. P4 petition before the Chief Electrical Inspector invoking his jurisdiction under Section 26(6) of the Indian Electricity Act. The Board filed Ext. P5 counter statement questioning the jurisdiction of the Electrical Inspector in view of the fact that this was a case of theft of electrical energy. However, by Ext. P6 order, the Electrical Inspector considered whether the meter was running correctly and whether the 1st respondent is liable to pay any W.P.C. No. 15931/05 -: 2 :- additional electricity charges. He decided that the average electricity consumed by the 1st respondent was 1123 units per month and the 1st respondent is liable to pay for the quantum of energy contained in the supply for six months' period prior to 24-9-2002 at the rate of 1123 units per month. That order is under challenge before me. 3. As I have already stated, the primary challenge against Ext. P6 is on the ground of want of jurisdiction. According to the petitioners, Section 26(6) can be invoked only in cases where the meter ceases to be correct without intervention by the consumer and where the meter becomes faulty because of fraud or dishonesty on the part of the consumer, the jurisdiction of the Electrical Inspector under Section 26(6) is clearly excluded. They rely on the decisions of the Supreme Court in J.M.D. Alloys Ltd. v. Bihar State Electricity Board and others, (2003) 5 SCC 226 and Bombay Electric Supply and Transport Undertaking v. Laffans (I) Pvt. Ltd., and another, 2005(4) SCC 327 in support of their contention. 4. In answer to the same, the 1st respondent would contend that the Electrical Inspector does have jurisdiction insofar as the petitioners have not been able to prove that there was in fact theft of electrical energy. According to 1st respondent, Ext. P1 itself is a concocted document. He further submits that the very fact that the electricity connection of the 1st respondent was not disconnected invoking power under Clause 43 of the Conditions of Supply of Electrical Energy itself would go to show that Ext. P1 was an after- thought. It is further pointed out that theft of electrical energy has been made a criminal offence under Section 39 of the Indian Electricity Act. According to counsel for the 1st respondent, the fact that the Kerala State Electricity Board has not chosen to initiate prosecution proceedings under Section 39 would also go to show W.P.C. No. 15931/05 -: 3 :- that the allegation of theft of electrical energy is an after-thought to unjustly penalise the 1st respondent. Another circumstance pointed out by the 1st respondent in support of his contention is that Ext. P2 bill is issued under Section 24(1) and not under clause 43 of the Conditions of Supply of Electrical Energy. He would also point out that the remedy by way of appeal as provided under Clause 48 of the Conditions of Supply of Electrical Energy is applicable only to misuse of energy under Clause 42 thereof, whereas theft of energy is dealt with under Clause 43 to which Clause 48 does not apply. He also submits that against Ext. P6 order, the Board has an alternate remedy by way of appeal to the Government under Section 36(2) of the Indian Electricity Act. He also submits that in case this Court is inclined to hold that the Electrical Inspector does not have jurisdiction, the 1st respondent may be given an opportunity to file an appeal under Clause 48 of the Regulations Relating to Conditions of Supply of Electrical Energy. 5. I have considered the rival contentions in detail. 6. Before considering the contentions, I note that the fact that an inspection was conducted in the premises of the 1st respondent on 24-9-2002 is admitted by the 1st respondent in Ext. P4 petition filed by him before the Chief Electrical Inspector. He also does not dispute the receipt of Ext. P2 bill, wherein electricity charges at the rate of 3 times the normal charges was demanded from the 1st respondent for the electricity allegedly misused by the 1st respondent. In Ext. P4 petition before the Electrical Inspector, no grounds of mala fides have been raised on the part of the officers who conducted the inspection at the premises of the 1st respondent on 24-9-2002 and prepared Ext. P1 mahazar. In Ext. P1 mahazar, it is specifically stated that the connection to the meter was wrongly given and also that the W.P.C. No. 15931/05 -: 4 :- cover of the meter was removed off and the meter box was not sealed. In Ext. P5 counter statement filed by the Board, they have raised a specific contention to the effect that since this is a case where the meter is tampered with and theft of electricity has been committed, the Electrical Inspector has no jurisdiction to interfere with the dispute and the remedy available to the 1st respondent is to file a statutory appeal before the next higher authority under Clause 48(c) of the Conditions of Supply of Electrical Energy . 7. Since the Electrical Inspector has exercised jurisdiction under Section 26(6), I shall extract Section 26(6) here, which reads as follows: “26. Meters:- xx xx xx (6) Where any difference or dispute arises as to whether any meter referred to in sub-section (1) is or not correct, the matter shall be decided, upon the application of either party, by an Electrical Inspector; and where the meter has, in the opinion of such inspector ceased to be correct, such Inspector shall estimate the amount of the energy supplied to the consumer or the electrical quantity contained in the supply, during such time, not exceeding six months, as the meter shall not, in the opinion of such Inspector, have been correct; but save as aforesaid, the register of the meter shall, in the absence of fraud, be conclusive proof of such amount or quantity.” From the very wording used in the said Section, I am of opinion that that Section relates to dispute regarding correctness of a meter when the meter has ceased to be correct, which can only mean ceased to be correct without intervention of the consumer. Further, it is specifically stated therein that the register of the meter shall, in the absence of fraud, be conclusive proof of such amount or quantity. Therefore, the wording used in the Section lend support to the W.P.C. No. 15931/05 -: 5 :- conclusion that Section 26(6) will not have any application in cases where there is allegation of theft of electrical energy. In fact, this position of law has been settled by the decision of the Supreme Court in the two decisions referred to by the counsel for the Board. In J.M.D. Alloys's case (supra), in paragraph 10, the Supreme Court has held thus: “10. The contention that the dispute regarding tampering of the seal of CT/PT terminal unit should have been referred to the Electrical Inspector, has hardly any merit. In M.P. Electricity Board v. Basantibai, (1988) 1 SCC 23, it has been held that a dispute regarding the commission of fraud in tampering with the meter and breaking the body seal is one outside the ambit of Section 26(6) of the Indian Electricity Act and the Electrical Inspector has no jurisdiction to decide such cases of fraud. It was further held that under Section 26(6), the only dispute which can be decided by the Electrical Inspector is as to whether the meter is correct and is accurately recording the reading or there is some fault in the same. Since in the present case it has been found that the seal on the CT/PT terminal box had been tampered with and the natural working of the meter had been affected by taking recourse to external devices, a dispute of this kind cannot be referred to an Electrical Inspector.” Again in Bombay Electric Supply and Transport Undertaking's case (supra), the Supreme Court has held thus in paragraph 6: “6. The abovesaid provisions have been the subject matter of consideration by this Court in three cases which have been brought to our notice. They are M.P. Electricity Board v. Basantibai, (1988) 1 SCC 23, Belwal Spinning Mills Ltd. & Ors. v. U.P. State Electricity Board & Anr, (1997) 6 SCC 740 and J.M.D. Alloys Ltd., v. Bihar State Electricity Board, (2003) 5 SCC 226. The first and the last of the cases are decisions by three learned Judges and the second one is a decision by two learned Judges. We have carefully perused the three decisions and we find ourselves in entire agreement with the view of the law taken in these cases. In particular, in Belwal Spinning Mills's case, this Court has examined the provisions of Section 26, specially sub- section (6) thereof, in very many details, also taking into consideration the legislative intention and the object sought to be achieved by substituting sub-section (6) by Act 32 of 1959 in its present form over the predecessor provision. We would be W.P.C. No. 15931/05 -: 6 :- referring to the relevant findings of law recorded in these cases. However, at the outset and here itself, we would like to mention that the applicability of sub-section (6) of Section 26 is attracted only when the meter is not correct. Section 26(6) will have no applicability (i) if the consumer is found to have committed a fraud with the licensee and thereby illegally extracted the supply of energy preventing or avoiding its recording, or (ii) has resorted to a trick or device whereby also the electricity is consumed by the consumer without being recovered by the meter. In effect the latter class of cases would also be one of fraud. Tampering with the meter or manipulating the supply line or breaking the body seal of the meter resulting in non-registering of the amount of energy supplied to the consumer or the electrical quantity contained in the supply – are the cases which were held to be not covered by Section 26(6) in the case of Basantibai (supra), while the provision was held applicable to any case of meter being faulty due to some defect and not registering the actual consumption of electrical energy. Similar is the view taken in the case of J.M.D. Alloys Ltd. (supra).” The Supreme Court has reiterated this view in State of W.B. & Ors. v. Rupa Ice Factory (P) Ltd. & Ors, (2004) 10 SCC 635 and Sub Divisional Officer (P) UHBVNL v. Dharam Pal, AIR 2007 S.C. 1214. Therefore, the law is well settled to the effect that Section 26 (6) has no application where theft of electrical energy is involved. 8. In the present case, there is certainly an allegation of theft as is clear from Ext. P1 mahazar itself and the 1st respondent has been served with Ext. P2 bill demanding electricity charges at 3 times the normal rate in accordance with Clause 43 of the Conditions of Supply of Electrical Energy dealing with theft of electricity. Therefore, it is more than evident that according to the Electricity Board, this is a clear case of theft of electrical energy. They have stated so in their counter statement before the Chief Electrical Inspector, Ext. P5. 9. The facts that the petitioners have not chosen to disconnect the electricity supply to the 1st respondent as required under Clause 43 of Conditions of Supply of Electrical Energy, that the petitioners have not chosen to initiate prosecution proceedings against the 1st W.P.C. No. 15931/05 -: 7 :- respondent under Section 39 and that Ext. P2 bill has been issued under Section 24(1) of the Indian Electricity Act, do not alter the situation in any manner, insofar as the 1st respondent has not chosen to challenge the action of the petitioners on the ground of mala fides. Strangely, the Chief Electrical Inspector has not even referred to the contention regarding theft in Ext. P6 order. He has merely assumed that this is a dispute regarding the correctness of meter. Counsel for the Kerala State Electricity Board would submit that the Electrical Inspector has not even examined the meter. Whatever that be, the question of jurisdiction has to be decided on the basis of pleadings. Of course, the pleadings cannot be merely to deny jurisdiction, but should be bona fide. In this case, in Ext. P1, which is the first document in respect of the subject matter, there is a very clear allegation of theft of electrical energy. The issue of Ext. P2 bill demanding electricity charges at three times the normal rate as provided under Clause 43 of the Conditions of Supply of Electrical Energy further shows that the Electricity Board has proceeded with the matter bona fide believing the same to be a case of theft of electrical energy. Once it is held that the contention of the Electricity Board is bona fide, the Electrical Inspector has not even the jurisdiction to decide whether there is actually theft of electrical energy. It is very relevant to note here that the petitioner has not chosen to challenge the validity of Ext. P1 mahazar before any authority. Once it is shown that there is bona fide contention regarding theft of electrical energy, going by the Supreme Court decision, the Electrical Inspector ceases to have jurisdiction under Section 26(6) of the Indian Electricity Act. That being so, Ext. P6 is clearly without jurisdiction . Accordingly, the same is quashed. 10. That does not mean that the 1st respondent is without any W.P.C. No. 15931/05 -: 8 :- remedy whatsoever to disprove Ext. P1 and challenge Ext. P2 bill appropriately. As rightly pointed out by the learned counsel for the Kerala State Electricity Board, Clause 48 of the Conditions of Supply of Electrical Energy provides for an appeal on the decisions of the Board's officer taken under the provisions of the Conditions of Supply of Electrical Energy to the next higher authority. The 1st respondent can certainly take recourse to that remedy insofar as the action against him is clearly under Clause 43 of the Conditions of Supply of Electrical Energy. In order to enable the 1st respondent to resort to that remedy, I direct that further coercive proceedings pursuant to Exts.P1 and P2 shall be kept in abeyance for a period of one month from today. The original petition is disposed of as above. S. Siri Jagan, Judge. Tds/