Dismissed

U.H.B.N.L. and Anr. v. Jai Jagdembhey Steel Pvt. Ltd.

Punjab & Haryana HC17 Jan 2012RSA/5004/2011

Case brief

AI extract

What is this about?

In second appeal, the High Court upheld the dismissal of the Nigam's appeal against a trial court judgment. The trial court had held that the penalty demand notice was illegal because it assessed theft for a six-month period despite a prior check establishing a shorter assessment window and ordered separate proceedings for the earlier theft incident.

What did the court decide?

Appeal dismissed; demand notice held unsustainable as it assessed penalty for six months despite only 42 days being the valid period; earlier theft to be dealt with separately.

U.H.B.N.L. and Anr. Vs Jai Jagdembh… — Contract and Commercial Disputes | Punjab & Haryana HC (2012)

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RSA No.5004 of 2011

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

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RSA No.5004 of 2011

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Date of Decision: January 17, 2012

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Utter Haryana Bijli Vitran Nigam Ltd. and another

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.......Appellants

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Versus

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Jai Jagdembhey Steel Pvt.Ltd.

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.......Respondent

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CORAM:- HON'BLE MR.JUSTICE TEJINDER SINGH DHINDSA

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Present: Mr.KS Malik, Advocate for the appellants.

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TEJINDER SINGH DHINDSA, J.

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The Uttar Haryana Bijli Vitran Nigam Limited ( for short 'the Nigam') is in second appeal before this Court.

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The plaintiff-respondent filed a suit for declaration with consequential relief of permanent injunction by impugning the demand notice/memo No.59/CA dated 12.1.2005 issued by the Nigam whereby a penalty of Rs.1,24,71,185/- on account of alleged theft of electricity energy had been served upon the plaintiff-respondent. It was pleaded that the plaintiff-respondent is a consumer of the Nigam and had an electricity connection bearing account No.LS-8 for a sanctioned load of 999.612 K.W. The connection had been released on 12.5.2001. It was pleaded that the plaintiff-respondent had been paying the energy charges regularly and the last bill that had been issued to him for an amount of Rs.4,05,182/- had been duly paid vide receipt No.366 dated 24.10.2004. It is pleaded that the

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RSA No.5004 of 2011

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premises of the plaintiff-respondent had been checked by the staff of the Nigam on 12.1.2005 wherein the checking party had noticed that there had been an alleged theft of electricity. On the basis thereof, the impugned demand notice dated 12.1.2005 had been issued. The plaintiff-respondent firm contended that there had been no theft of energy-electricity as alleged and as such, the impugned demand notice dated 12.1.2005 was illegal, null and void and contrary to the circulars issued by the Nigam itself. 3. Upon notice, the defendants filed a joint written statement taking a plea that the plaintiff-respondent firm was an habitual offender. It was submitted that even on an earlier occasion also, it had been found on 24.1.2004 that the electricity had been consumed by it by virtue of illegal means. At that point of time, a checking report had been prepared and a penalty amount to the tune of Rs.75,28,263/- had been assessed and a notice of assessment, bearing No.151 dated 25.1.2004, had been served upon the plaintiff-respondent to make the payment. The plaintiff had then also not made the payment and rather filed a civil suit against the recovery of the penal amount but the same was dismissed. Upon appeal having been filed, the Additional District Judge, Panipat had passed orders dated 13.2.2004 directing the deposit of an amount of Rs.30 lacs and as yet, the remaining amount is outstanding against the plaintiff-respondent. It was further submitted that the premises of the plaintiff-respondent firm were again found consuming electricity energy by illegal means on 12.1.2005 and accordingly, the impugned demand memo No.59/CA dated 12.1.2005 had been served upon the plaintiff-respondent to make payment of Rs.1,24,71,185/-.

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RSA No.5004 of 2011

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The trial Court decreed the suit in favour of the plaintiff holding the impugned memo dated 12.1.2005 to be bad in law. However, the defendant-Nigam was held entitled to charge the amount towards theft of electricity energy from the plaintiff as per the checking report dated 12.1.2005 for the period with effect from 17.11.2004 till 12.1.2005 in terms of the provisions of the circular issued by the Nigam. Liberty was granted to the Nigam to issue a fresh demand of recovery within a period of 15 days and the plaintiff was granted a further period of seven days to make the payment from the date of receipt of the notice and in the eventuality of the plaintiff depositing such payment, the electricity connection of the plaintiff was to be restored.

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The Nigam preferred a civil appeal against the judgment and decree passed by the trial Court and vide impugned judgment dated 30.7.2011, the Additional District Judge, Panipat has dismissed the appeal. The Nigam is in second appeal before this Court.

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I have heard Mr.KS Malik, learned counsel for the appellant at length.

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A consumer found indulging in theft of electricity is not entitled to any leniency. Be that as it may, the penalty to be imposed for such theft allegedly committed by a consumer has to be in terms of settled instructions/circulars issued by the Nigam and not at its sole discretion. Circular, Exhibit P9, governs the field of imposition of penalty and assessment thereof to be levied on a consumer found indulging in theft of electricity. The same reads as under:

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“Assessing Officer:- The following officers are authorized for

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RSA No.5004 of 2011

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making assessment for the cases of theft of electricity as per Haryana Government Gazette Notification No.1/12/2003-1 Power dated 9^th December, 2003.

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xxxxxxxx

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III) Assessment for Theft of Electricity:

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On an inspection of any place or premises or after inspection of the equipments, gadget, machines devices found connected or used, or after inspection of records maintained by any person the assessing officer comes to the conclusion that such person is indulging in theft of electricity, he shall assess the electricity charges payable by such consumer or occupier of the premises.

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(a) Period of Assessment:- The period of assessment shall be taken as a period of 12 months immediately preceding the date of inspection or from the date of release of connection or date of last checking by M&P wing which ever is less or entire period of theft, if it is determined.

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(b) Computation of Assessed amount:- The assessment of quantity in units for the theft of electricity made under clause (iii)(d) and for the period under clause (iii)(a) shall be charged at a rate equal to two times tariff applicable or the relevant category of consumers, after deducting the consumption recorded by the meter during such period of assessment. (c) If a person is found indulging in all or more than one act of theft of electricity, the assessment in respect of each such act shall be separately made for every such theft of electricity.

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(d) Method for assessment of quantity in units for theft of electricity:- Quantity of units consumed per month (except AP supply) shall be worked out as under:For LT Supply:- KW x LF x H x D

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For HT Supply:- MD x LF x H x D”

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Clause (a) of the circular, Exhibit P9, makes it clear that the

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RSA No.5004 of 2011

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period of assessment for purposes of theft of electricity shall be taken as a period of 12 months immediately preceding the date of inspection or from the date of release of connection or date of last checking by the Nigam officials, whichever is less, or the entire period of theft if the same was to be determined. Furthermore, clause (c) stipulates that any consumer found indulging in more than one act of theft of electricity, the assessment in respect of each such act would be dealt with separately.

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Both the Courts below have noticed that the admitted position of fact being that the premises of the plaintiff-respondent was also checked on 17.11.2004 whereupon no theft of electricity/energy had been noticed. Thereafter, the checking took place on 12.1.2005 whereupon the alleged theft had been detected and as such, in terms of circular, Exhibit P9, the assessment for purposes of penalty for such alleged theft could have been only with effect from the last checking i.e. 17.11.2004 till 12.1.2005 i.e. the period of 42 days. The impugned demand notice dated 12.1.2005, on the other hand, had been issued on the basis of an assessment for a six month's period. It is on such basis that the impugned notice has been held to be unsustainable being against the circular, Exhibit P9, issued by the Nigam itself.

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As regards the previous alleged theft pertaining to the checking of the plaintiff-respondent firm on 24.1.2004, suffice it to say, that in terms of clause (c) of the circular, each act of theft of electricity and the assessment in respect thereof, would have to be dealt with separately. The proceedings in relation to the previous act of theft if at all are pending, would be taken to the logical end in accordance with law.

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RSA No.5004 of 2011

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In the light of the discussion above, it is clear that the assessment for purposes of imposition of penalty in pursuance to the detection of alleged theft dated 12.1.2005 has to be dealt with in accordance with clause (a) of the circular, Exhibit P9. The conclusion and findings of both the Courts below are perfectly tenable in law.

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There is no perversity in the findings recorded by the trial Court and as affirmed by the first Appellate Court.

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No question of law, much less substantial question of law, arises for determination in the present second appeal.

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The present appeal is wholly devoid of merit and deserves to be dismissed.

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15. Appeal dismissed.

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( TEJINDER SINGH DHINDSA ) JANUARY 17, 2012 JUDGE SRM

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Note: Whether to be referred to Reporter? Yes/No

U.H.B.N.L. and Anr. v. Jai Jagdembhey Steel Pvt. Ltd.

Case brief

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U.H.B.N.L. and Anr. v. Jai Jagdembhey Steel Pvt. Ltd.

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