Case: Belwal Spinning Mills Ltd Vs. U.P.State Electricity Board

On February 7, 1986 U.P. State electricity Board installed a meter bearing No. 5850497 in the factory of the appellant. The Board carried out periodical inspection and tests and had raised the bills on the basis of the said installed meter and the appellant had also paid such bills. On September 7, 1987, the U.p. State Electricity Board issued a notice raising doubt about the correctness of the said meter No. 5850497. On October 25, 1987, the appellant controvert the contents of the said notice of the Electricity Board and asserted that the meter wasreference to the Electrical Inspector was made under Section 26 ofthe Electricity Act, 1910 by the Board. The Board installed a check meter on November 30, 1987. The appellant, however, deposited the testing fee and requested the Electricity Board to check the said test meter. The Board, however, continued to raise the bills on the basis of the said check meter for the period December, 1987 to May, 1988. On April 26, 1988 to November, 1987 could be revised o the basis of check meter and sought information for the purpose of revising of the bills prior to 1987. On May 17, 1987, the Electricity Board raised a demand of Rs.10, 70, 886.82 for the period May, 1987 to November, 1987 on the basis of readings in the check meter and threatene the appellant that the electricity connection would be discontinued if the payment was not made. It was at this stage that the appellant moved a Writ Petition No. 10379 of 1988 challenging the said notice dated April 26, 1988 and the demand dated may 17, 1988. During the pendency of the said Writ Petition, the electricity Board again raised bills for teh mon ths of June, 1988 on the basis of check meter and also thereatened the appellant that disconnection would be restorted to if the payment was not made. The appellant then moved another Writ Petition No. 1672/88 in the Allahabad High Court challenging the said bills for June and July, 1988. By an interim order, the High Court restrained the desconnection of the electric supply subject to the payment of electricity dues by the appellant on the basis of original meter reading and furnishing security and bank guarantee for Rs.1 lakh every month. The Electricity Board raised additional demand of Rs. 5, 54, 963.64 ending July 1988 on the basis of check meter. The appellant moved the third Writ Petition on June 21 1990 being writ petition No. 16325/90 challenging the demand dated June 4, 1990 for the said sum of Rs. 5, 54, 963.64. The High Court passed an interim order staying the operation of the demand and directed the appellant deposit a sum of Rs. 1, 50, 000/-. I t may be stated that on July 9, 1988 the appellant made an application for reference to the Electrical Inspector to check the correctness of the original meter and also the check meter. Between 26th June, 1990 and 28th June, 1990, the work of inspection was carried out and on October 10, 1990 the Electrical Inspector submitted a report containing his decision under Section 26(6) ofthe Electricity Act, 1910. In the said report, the Electrical Inspector held that the original meter as well as the check meter incorrect. The Electrical Inspector made an estimate of the energy supplied to the appellant during the period of six months from December, 1989 to May, 1990 and authorised the Board to raise a deamnd accordingly for a period of six months and the Electrical Inspector also directed that the original meter as well as the check meter should be installed under Section 26(1) of the Electricity Act.As aforesaid, on February 19, 1992, by common judgment the High Court disposed of all the said Writ Petitions by quashing various demand notices issued on the basis of the check meter and directing that the payment be made on the basis of estmate of Electrical Inspector dated October 10, 1990 in respect of the said period of six months and also directed that fresh bills for teh period September 7, 1987 to October 10, 1990 be issued on the basis of new meter. Thereafter, the fourth Writ Petition not numbered as yet was moved by the appellant on March 9, 1992 in respect of bill for January, 1992 in which an interim order was passed on March 10, 1992. Such interim order is also impugned in one of these26(60: Where any difference or dispute arises as to whether any meter refried to in sub-section (1) is or is not correct, the matter shall be decided, upon the application of either party, by an Electrical Inspector, or a competent person specially appointed by the State Government in this behalf, and where the meter has, in the opinion of such Inspector or person, ceased to be correct, such Inspector or person shall estimate the amount of the energy supplied to the consumer or the electrical quantity contained in the supply, during such time as the meter shall not in the opinion of such Inspector or person have been correct, and where the matter has been decided by any person other than the Electrical Inspector, an appeal shall liew to the Inspector, whose decision shall in every case be final; but save as aforesaid, the register of the meter shall, in the absence of frond, be occlusive proof of such amount of quantity:Provided that before either a licensee or a consumer applies to the Electrical Inspector under this sub-section, he shall give to the other party noless than seven days notice of his intention so to do.

Reasoning:
In appreciating the intention of the legislature, the provision for treating the recording of the disputed meter to be the conclusive proof of the amount of quantity supplied to the consumer in the absence of fraud where a dispute is raised by either of the party about the functioning of the meter, cannot be overlooked. Sub section (6) has been amended and the legislature has introduced a conscious departure by deleting the requirement of assessing the quantity of electricity consumed for the entire period during which the Electrical Inspector or the competent authority was of the opinion that the meter had ceased to be correct. In our view, by limiting the period for estimation to be made by the Electrical Inspector by the amendment of sub-section (6) and further providing that for the anterior period, in the absence of fraud, the register of the meter shall be conclusive proof of the supply of the electricity it is quite evident that even if it transpires that the installed meter ceased to be correct, then for the period anterior to the statutory period for which the estimation is not to be mae by the Electrical Inspector, the register of teh meter about the consumption of the electricity supplied to the consumer shall be binding between the parties by treating such recording as conclusive proof of the consumption in the absence of any fraud practised by the consumer. By the amendment of sub-section (6) the Electrical Inspector has been purposely obsolved from the duty to determine as to from which point of time beyond the said statutory period, the meter had cease to function so taht for such entire entire period, the estimation of the supply of electricity need not be made. Such amendment of sub-section (60, n our view, only means that beyond the statutory period, in the event of dispute between the parties as to the proper functioning of the meter and other electrical apparatus, the consumer has liability to pay the estimated amount indicated by the Electrical Inspector limiting the estimate upto the statutory period and not beyond that but for the other anterior period the consumer is required to pay according to the consumption of electricity registered in the disputed meter provided there is no fraud practised by the consumer because dispute of such anterior period remains unresolved by the change introduced by the amendment.Such legislative change by the amendment of sub-section 6 of Section 26, in our view, has be en introduced to set at rest any dispute between the licensee and the consumer about the actual consumption of the quantity of electricity by the consumer where no fraud has been practised by the consumer for all other period anterior to statory period for estimation. There is good reason for such legislative change because is may not be possible to precisely determine exactly from which point of time the meter ceased to be correct. The scheme under Electricity Act clearly reveals that a correct meter is to be installed and such correct meter is to be maintained by the licensee in the premises of the consumer so that consumption of electricity is computed on the basis of reading in the meter. The scheme also reveals that unilateral decision of either of the parties about the correct status of the meter is not be accepted by the other party if the other party raises objection as to the status of the meter. Whenever both parties do not accept a meter to be correct and the dispute is raised, such dispute is got to be resolved by referring to a statutory authority under Section 26(6), namely, the Electrical Inspectr. Within the integrated scheme under Section 26 of the Electricity Act, it is not possible that even though dispute is raised about the mal functioning of the meter such dispute will be treated as statutorily resolved for a limited period in accordance with the amended sub-section (6)of Section 26 but for other period anterior to the same, the dispute will remain unresolved and claim of the licensee be open to be challenged. Therefore, simply on the finding that mere had ceased to be correct by the Electrical Inspector on entering the reference a licensee may not be justified in contending that a particular meter had ceased to be correct from a particular point of time even though the licensee, despite its statutory duty to maintain the correct meter by repairing or rectifying the defective meter and by re placing it if necessary has failed to take appropriateour view, by the amendment of sub-section (6) of Section 26, the Legistature has intended to put an end of such contest between the licensee and the consumer and has set at rest of any dispute relating to any period anterior to the statutory period of estimation by providing that in a casee of dispute as to functioning of meter, the reading in the meter for the period beyond the period of statutory estimation, will be final.As in none of these appeals, there is any alloegation that the concerned consumer had paractised fraud or had tampered with the emter or other electrical appartus provided for recording the supply of electricity to the consumer, the consumer will be entitled t o the statutory protection of correctness of the recording of the consumption or supply of electricity consumed in the meter/check meter as conclusive proof of such amount of quantity of electricity consumed for all the period anterior to statutory period of estuation under Section 26(6) of the Act because admittedly there is dispute as to the proper functioning of the meter and check meter installed at the premises of the consumer.