HON’BLE DR. JUSTICE G. YETHIRAJULU W.P.No. 2898 of 2004 DATE: 12-02-2008 Between: M/s. Anuradha Industries, Par Boiled Rice Mill Pragathi Industries Estate, Gorrekunta Village, Geesugonda mandal, Warangal District a proprietary concern, rep By its Proprietor, Sri Thota Sampath Kumar ……………… Petitioner and 1. The Divisional Engineer, Operation/APNPDCL/Urban Warangal, Warangal District and two others. ………….. Respondents HON’BLE DR. JUSTICE G. YETHIRAJULU W.P.No.2898 of 2004 ORDER: This writ petition is filed by the petitioner mill represented by its Proprietor to declare the proceedings, dated nil-02-2004 in demanding a sum of Rs.1,49,781/- including the sum of Rs.44,993-69 ps towards low power factor surcharge for its service connection as illegal, arbitrary, unfair and unjust and consequently to direct the respondents not to demand the lower power factor surcharge from it. 2. The main contention of the petitioner mill is that though the respondents issued demand for low power factor surcharge, they did not give any notice to him and no opportunity was given to explain the circumstances under which the capacitors could not be fixed. No enquiry was conducted and there is no basis to demand the said amount, therefore, the respondents directly issuing the demands itself is illegal and against the principles of natural justice and the impugned proceedings are liable to be quashed. 3. It is contended that the petitioner mill has obtained various licences from the concerned statutory departments and also electrical supply connections from the erstwhile APSEB and availing the electricity supply from the Northern Power Distribution Company Limited, Warangal. Subsequently, two service connections were clubbed and the connection has been converted into LT-III B category. Since the date of starting the business, the petitioner mill was complying with all the necessary requirements and formalities of various departments and there is no complaint from any department. In the meanwhile, in January, 2004 a bill, dated nil-02-2004 was issued demanding Rs.1,49,781/- including a sum of Rs.44,993-69 ps towards low power factor surcharge. Before issuing the notice, the respondents have neither inspected the petitioner mill or not issued any notice nor conducted any enquiry in ascertaining the lower power factor surcharge. All of a sudden, the impugned proceedings were issued in the form of a bill for the month of January, 2004 for electricity consumption charges including the lower power factor surcharge quantified at Rs.44,993-69 ps. There is no basis for demanding the said amount in the absence of any material before them. The petitioner further submitted that the low power factor is a mechanical problem due to malfunctioning of the capacitors and it is not in his hands. Due to low power factor, there will not be any difference in consumption of electricity by the petitioner and there is no loss of consumption or prejudice to the power corporation. The respondents have not imposed any surcharge on the ground of low power factor surcharge to LT- III B category till date. The capacitors will act as stabilizers and regulate the power supply during the power fluctuations. As such, the act of low power factor is neither intentional nor deliberate on the part of the petitioner. Hence, the respondents are not entitled to demand the surcharge from the petitioner on low power factor. 4. The learned counsel for the respondents submitted that the meter of the petitioner mill was inspected and the power factor readings of the months of May and June, 2003 were noted as 0.73 and 0.74 and in pursuance of that, the second respondent issued a notice on 10-07-2003 intimating the petitioner that he was maintaining low power factor, for which he will be penalized as per the service agreement. The petitioner was also informed to install the capacitor bank at his premises for improving the power factor by next month immediately. 5. The petitioner appeared to have not acceded to the request of the respondents, therefore, the impugned demand has been issued. Condition No.23 of the Revised Terms and Conditions of Supply of Electricity reads as follows: “23.Surcharge for low power factor:- The power factor for the month shall be the ratio of KW hours to the Kilo-Volt Amerpere-Hours supplied to the consumer during the month. The power factor shall be calculated upto two decimal places. The power factor of the consumer’s installation shall not be less than 0.85. If the power factor falls below 0.85 during any month, the consumer shall pay a surcharge of two per cent on the amount of that month’s bill (excluding demand charges and customer charges) for each 0.01 (decimal naught one) fall in the power factor. If the power factor is less than 0.85 continuously for a period of six months, the consumer shall pay surcharge at the rate of three per cent on the bill amounts for the subsequent consecutive months, if any, during which the power factor is below 0.85. Should the power factor drop below 0.75 and so remain for a period 2 consecutive months, it must be brought up within a period of 6 months by methods approved by the Board failing which, without prejudice to right of the Board to collect surcharge and without prejudice to such other rights as have accrued to the Board or any other right of the Board the supply to the consumer may be discontinued.” 6. The learned counsel for the respondents further submitted that minimum power factor as per the terms and conditions is 0.85, whereas in the petitioner’s meter they noted the power factor as 0.73 during May, 2003 and 0.74 during June, 2003. As per the formula provided under the Rules, the respondents calculated the amount after giving opportunity to the petitioner to install capacitors, which can maintain the power factor. Since the petitioner failed to change the capacitors to maintain the power factor, the respondents issued the demand notice. 7. After going through the entire material, I find that sufficient opportunity has been given to the petitioner intimating the costs for low power factor and requested him to change capacitors. The served notice was also produced by the learned counsel for the respondents, which contains the signature of the petitioner’s representative. So, the contention of the petitioner that no opportunity has been given to him is not sustainable. As the low power factor surcharge has been calculated on the basis of the formula as per the tariff order, I do not find any illegality in the order. 8. Hence, the writ petition is dismissed. No order as to costs. ____________________ Dr. G. YETHIRAJULU, J Date:12-02-2008 YCR