Madras High Court
Shahjahan vs The Superintending Engineer on 28 March, 2012
Equivalent citations: AIR 2012 MADRAS 239, (2012) 4 MAD LJ 763
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 28.03.2012
CORAM
THE HONOURABLE MR. JUSTICE S.NAGAMUTHU
W.P.No.3987 of 2004
and
M.P.No.4702 of 2004
Shahjahan ... Petitioner
Vs.
1. The Superintending Engineer,
Tamil Nadu Electricity Board,
Dharmapuri-5.
2. The Additional Chief Engineer,
Tamil Nadu Electricity Board,
Dharmapuri Electricity Distribution Circle,
Dharmapuri-636 705. ... Respondents
Writ Petition is filed under Article 226 of the Constitution of India for the issuance of a Writ of Declaration declaring that the demand of the 2nd respondent dated 10.01.2001 in his Letter No.0624/Ku Tha Po/VOP/Min/K.R. S/2001 is void and illegal and for a consequential direction, directing the respondents to provide the petitioner new electricity connection to his premises bearing Shed No.17, F.5 in SIDCO Industrial Estate, Kattganapalli Village in Krishnagiri Taluk forthwith.
For Petitioner : Mr.A.Sirajudeen
for M/s.Siraj and Siraj
For Respondents : Mr.G.Vasudevan,
Government Advocate
for TNEB
O R D E R
The petitioner is the owner of the building bearing Shed No.17/F5 at SIDCO Industrial Estate, Krishnagiri Taluk. The shed building was originally owned by one Manivel, the Proprietor of a firm by name "Indian Wire Products". Mr.Manivel had electricity connection for the said shed in his name. It appears that he has fallen in huge arrears towards the electricity consumption charges. Approximately the amount due from Mr.Manivel was around Rs.89,890/-. Since Manivel did not pay the amount as per the provisions of the Tamil Nadu Electricity Act, the service connection was disconnected and the electrical installation was also dismantled in the year 1993 itself. Thereafter, the skeleton building alone remained.
2. Mr.Manivel had also obtained loan from the Tamil Nadu Industrial Investment Corporation (hereinafter referred to as TIIC) by hypothecating the said property. He did not repay the amount. Therefore, as per the provisions of the Tamil Nadu State Financial Corporation Act, TIIC took possession of the said property and put it for public auction. In the auction held on 17.09.1998, one Malathi participated and emerged as the successful bidder. The auction sale was also confirmed in her name. She paid the amount due. Thus, absolute title for the property got transferred in the name of Malathy on the confirmation order passed by the Sale Officer. Thereafter, Malathy sold away the said building to the petitioner by way of a Registered Sale Deed dated 24.11.1999.
3. Subsequently, in February 2000, the petitioner made an application to the 2nd respondent seeking electricity service connection to the said building. The amount required was also paid on 22.07.2000. But the respondents declined to give electricity service connection on the ground that Manivel had left behind him a sum of Rs.89,890/- as due to the Electricity Board. The respondents directed the petitioner to clear off the said amount, that too with interest as a pre-condition for extending fresh electricity service connection to the building. That order of the 2nd respondent dated 10.01.2001 is under challenge in this Writ Petition.
4. In this Writ Petition, it is mainly contended that there was no charge over the property in respect of the dues from Mr.Manivel to the Tamil Nadu Electricity Board. Further, the said amount claimed by the Tamil Nadu Electricity Board is also barred by limitation. It is further contended that when there is no charge over the property, it cannot be enforced against the property. In other words, the said amount cannot be recovered from the petitioner, it is contented. Thus, according to the petitioner, the condition imposed in the impugned order that the petitioner should clear off the dues of Manivel including interest is untenable and the same is against law.
5. Reiterating the above grounds, the learned Counsel for the petitioner made an indebth argument distinguishing between "amount due" and and "a charge over the property". The learned Counsel would rely on a decision of a Division Bench of this Court in W.A.No.646 of 2003 dated 23.02.2007 in The Chairman, Tamil Nadu Electricity Board, Electricity Avenue, Anna Salai, Chennai-2 and another vs. Mrs.S.Nagarathinam wherein in an identical situation, on considering the relevant provisions, the Division Bench in paragraph 6 of the judgment has held as follows:
"6. There is no provision anywhere, which says that the debtor includes the transferor. Similarly, there is no provision which says that the amount payable in a bill or any other proceedings becomes a charge on the property or the purchaser from such person is also personally liable. In the absence of any such specific provision, we are unable to accept the contention of the appellant. Hence, this appeal is dismissed."
6. The learned Counsel for the petitioner would further rely on the decision of the Honourable Supreme Court in Isha Marbles vs. Bihar State Electricity Board reported in (1995) 2 SCC 648.
7. But the learned counsel for the TNEB would submit that as per Clause 6.10 of Terms and Conditions of supply of electricity, the petitioner is liable to pay the dues from Mr.Manivel, if he wants electricity service connection afresh. He would further submit that though the right to enforce is barred by limitation, the right accrued to recover the amount has not vanished by the application of the provisions of the Limitation Act. For this proposition, the learned counsel would rely on a decision of this Court in Asmath Begum vs. The Superintending Engineer, Tamil Nadu Electricity Board, Mattur and others reported in 1997 (III) CTC 527 wherein this Court has extensively gone into the meaning of the word 'due' as employed in the 24 of the Electricity Act. This Court has ultimately held that the word 'due' used in Section 24 would take within its fold the monies owed and payable even though their recovery may be barred by the law of limitation. Thus viewed, the amount indisputably payable could not be avoided to be paid or could not be prevented from being recovered by the Board having recourse to Section 24 of the Act by the Electricity Board.
8. Relying on the said judgment, the learned counsel submits that though the Tamil Nadu Electricity Board cannot recover the amount by instituting any suit against the petitioner since the same is barred by limitation, the right to recover the same by other means, more particularly, by invoking its power under Section 24 of the Act is not barred. For the very same proposition, the learned counsel would rely on a decision of the Honourable Supreme Court in Paschimanchal Vidyur Vitran Nigam Limited and Others reported in (2009) 2 MLJ 755 (SC). That was a case where the subsequent purchaser, when applied for electricity service connection, a condition was imposed upon him to clear off the dues from the erstwhile owner. He paid the amount and got the electricity connection afresh. Thereafter, when he approached the authorities for the refund of the said amount alleging that he was not liable to pay the amount, the Honourable Supreme Court held that the amount cannot be refunded to him. The learned counsel for the respondent would conclude his argument saying that the Writ Petition deserves to be dismissed.
9. I have considered the above submissions and also gone through the judgments relied on by the learned counsel.
10. Before going into the discussion of the judgments upon which reliance has been made, let us look into clause 6.10 of the terms and conditions of supply of electricity which reads as follows:
"The Board will refuse to supply electricity to an intending consumer who has defaulted in payment of dues to the Board in respect of any other service connection held in his name.
In case of services which have been disconnected/dismantled for non-payment of arrears and if the services are to be availed by other parties in the same premises either by purchase or transfer or in auction or on lease basis then in such cases the services will be effected only on clearance of the dues outstanding against such disconnected/dismantled services by the intending consumers..."
Similarly Sections 2 (3) and 2(2) of the Tamil Nadu Electricity Board (Recovery of Dues) Act of 1978 defines the terms Debtor and Dues as follows:
"2(3). 'debtor' means a person by whom any dues are payable;
Dues has been defined in Section 2(2) which reads as follows:
2.(2) "dues" means any sum payable to the Board on account of
(i) Consumption of Electrical energy supplied; or
(ii) any remuneration, rent or other charges for hire, inspection, test, installation, connection repairs, maintenance or removal of any electric meter, electric machinery, control gear, fittings, wires or apparatus for lighting, heating, cooling or motive power or for any other purpose for which electricity can or may be used, or any industrial or agricultural machinery operated by electricity; or
iii) price of any such goods as aforesaid taken on loan but not returned"
A cursory perusal of the above provisions would go a long way to show that "dues" mean any sum payable to the Board. Undoubtedly, debtor means any person by whom any dues are payable to the Board. Admittedly, in the case on hand, the amount was due from Manivel and therefore, he is a debtor. There can be no bar that the board can recover the amount by invoking section 24 of the Act or by filling a suit against the debtor, namely, Mr.Manivel. The petitioner is only the subsequent purchaser in public auction. By such purchase in public auction, the question is whether he will get into the shoes of Mr.Manivel and become the debtor as defined in Section 2(3) of the Act. In my considered opinion, the answer is in an emphatic "no". The reason is very simple. The amount which is due from Manivel is only a personal liability from him. It has got nothing to do with the property. Absolutely, there is nothing to show that a charge is created on the property in respect of such dues. There is no statutory provision creating such charge over the property. If there is any such charge created either by means of a contract or by means of any statutory provision, then, in that event, if the property is transferred, the charge will also be carried along with the property. It will also be transferred to the transferee of the property. In such event, the transferee will be a debtor and so the amount can be recovered from him. If he fails to pay the amount, it can be recovered from the property because there is a charge over the property. The learned counsel for the respondent is not in a position to show any such contract or statutory provision creating charge over the property in respect of the dues from Mr.Manivel. Therefore, on the date, when the property was sold in public auction to Malathy, it was sold free of any encumbrance. In other words, it was sold without there being any charge over the property. Thus, Malathy had become the absolute owner of the property from whom the petitioner has purchased and that the petitioner is the absolute owner of the property free from any encumbrance, including any charge.
11. Clause 6.10 of the Terms and Conditions of Supply of electricity Act is sought to be used against the petitioner. In my considered opinion, the said attempt has to necessarily fail. Clause 6.10 can be enforced only against a person, who is a debtor. Suppose the purchaser of the property, either in public auction or at least by private auction also falls within the definition of "debtor" as defined in Section 2(3) of the Act and surely Clause 6.10 will be applicable against him. Clause 6.10 therefore, cannot be read independently. The definition of the term 'debtor' as found in Section 2(3) of the Act should be read into Clause 6.10 as per the terms and conditions of supply of electricity. Clause 6.10 should be understood in such a way that if there is any charge created over the property, then as per this clause, unless the purchaser clears off the arrears, he will not be entitled for service connection. To put it differently, if there had been no charge over the property, since the purchaser is not a debtor as defined in Section 2(2) of the Act, Clause 6.10 of the Terms and Conditions of supply of electricity cannot be applied against him at all.
12. In the Division Bench judgment in W.A.No.646 of 2003 dated 23.02.2007 referred to above, precisely, the Division Bench went into Clause 6.10 of the Terms and Conditions of Supply of Electricity and the definition of the terms 'debtor' and 'dues' extensively and has held in para 6 that in the absence of any specific provision creating charge over the property, the contention of the appellant that the subsequent purchaser should clear off the dues from the erstwhile owner cannot be accepted. As per the said view taken by the Division Bench, I have no doubt that in the case on hand, the petitioner is not a debtor and therefore Clause 6.10 cannot be enforced against him.
13. Now turning to the judgment of the Honourable Supreme Court in Isha's case, cited supra in which, in an identical situations referring to the above provisions, the Supreme Court has held in para 56 as follows:
"From the above, it is clear that the High Court has chosen to construe Section 24 of the Electricity Act correctly. There is no charge over the property. Where that premises comes to be owned or occupied by the auction purchaser, when such purchaser seeks supply of electric energy, he cannot be called upon to clear the past arrears as a condition precedent to supply. What matters is the contract entered into by the erstwhile consumer with the Board. The Board cannot seek the enforcement of contractual liability against the third party. Of course, the bona fides of the sale may not be relevant."
A close reading of the above observations of the Honourable Supreme Court would go to show that in the event of no charge over the property then the property comes to be owned or occupied by the auction purchaser free of any encumbrance and therefore, he cannot be called upon to clear off the past arrears as a condition precedent to give fresh electricity service connection. As has been laid down by the Hon'ble Supreme Court in the said case, there can be no controversy that in the instant case, the condition imposed by the respondents to the petitioner to clear off all the dues from Manivel is untenable and unsustainable. Since there was no charge created over the property, the petitioner is not liable to pay the dues and therefore, he is entitled for service connection without clearing of the dues from Mr.Manivel.
14. Now turning to the judgment in Asmath Begum vs. The Superintending Engineer, Tamil Nadu Electricity Board, Mattur and others relied on by the learned counsel appearing for TNEB reported in 1997 (III) CTC 527 cited supra, in that case, the primary question for consideration before this Court was as to whether the provisions of the Limitation Act could be made applicable in respect of dues to the Tamil Nadu Electricity Board. In the said judgment, this Court has held as follows:
"It is by how well settled that the law of limitation as contained in the Limitation Act is applicable to and governs only actions or causes instituted before a competent civil court or before any other statutory authority to which the Limitation Act is rendered applicable, in processing or adjudicating such claims for being entertained or sustained. It is equally well settled that the law of limitation does not have the effect of destroying the right itself but it only disables the holder of such a right beyond a particular period stipulated in the law of limitation to have recourse to the Courts constituted to enforce or vindicate such right, which as per the law of limitation is said to be barred. In other words, the avenue for enforcement of such right only in foreclosed. So far as the Electricity Board is concerned, the rights secured to them under Section 24 of the Indian Electricity Act cannot be ignored or denied."
Regarding this legal proposition, there can be no doubt at all. Admittedly, the amount cannot be recovered by taking recourse to the Courts even from Manivel in the instance case because it is barred by limitation. At the same time, it can be recovered by taking recourse to Section 24 of the Indian Electricity Act from Manivel because such recovery from Manivel under Section 24 of the I.E.Act is not barred by limitation since, the provisions of the limitation Act are not applicable to Section 24 of the Act. But the question is as to whether by taking recourse to Section 24 of the Act, the amount can be recovered from the petitioner. As I have already stated, since there is no charge over the property and since the liability is personal in character, the same cannot be enforced against the petitioner. To put it precisely, the amount cannot be recovered either through court of law or by taking recourse to Section 24 of the I.E. Act from the petitioner because the petitioner is not a debtor at all as the amount is not due from him. As I have already stated, the amount is due only from Mr.Manivel. It is his personal liability and therefore, he alone is the debtor. When the petitioner purchased the property, he did so, free of encumbrance. Therefore, the amount due from Manivel cannot be recovered from the petitioner either by taking recourse to court or to Section 24 of the I.E. Act. Thus the judgment relied on by the learned counsel for TNEB does not help the respondents in any manner.
15. Now coming to the next decision of the Supreme Court in Paschimanchal Vidyut Vitram Nigam Limited and others vs. DVS Steels and Alloys Private Limited and others reported in (2009) 2 MLJ 755 (SC), much reliance has been placed by the learned Government Advocate upon the Judgement. As I have already stated, that was a case where the amount was already paid by the purchaser. When refund was sought for, the Honourable Supreme Court formulated a question as to whether the Electricity Board was liable to refund the payment made by the consumer. In that case, the amount was paid by the consumer voluntarily. Having so paid voluntarily, the question was as to whether he could demand for refund. The Honourable Supreme Court answered it in the negative in the following words:
"...The first respondent having paid the said amount in pursuance of its undertaking as a condition for obtaining fresh connection, is estopped from claiming the amount back, except in accordance with the terms subject to which the payment was made. The amount deposited by the first respondent will however have to be refunded by the appellant, with appropriate interest, if the third respondent is ultimately found to be not liable in respect of the demand under the supplementary bills, or if third respondent, actually clears the dues."
Two things are understandable from the above judgment. First of all, the amount was paid voluntarily and having paid the same so voluntarily, according to the Electricity Board, he was estopped from demanding refund. Thus applying the doctrine of estoppel, the Honourable Supreme Court held that refund cannot be ordered. Incidentally, the Honourable Supreme Court took note of the proceedings pending before the Electricity Regulatory Commission. That is the reason why in the rider clause, the Honourable Supreme Court held that in the event, if it is found that the respondent therein was found to be not liable then the amount will be refundable. Thus, the Honourable Supreme Court has not at all laid down that there was charge created in respect of the dues from the erstwhile owner and therefore, the subsequent purchaser is liable to pay the dues. As I have already narrated in Isha's case, the Honourable Supreme Court has laid down the law thereby declaring that there is no charge created over the property in respect of the dues to the Board from the erstwhile owner of the property and therefore, the subsequent purchaser who has purchased the property free from encumbrance is not a debtor and he is not liable to pay the amount.
16. In view of the said clear law laid down by the Honourable Supreme Court, I am of the view that the impugned orders passed by the respondents in this Writ Petition are liable to be set aside. The petitioner is entitled for service connection afresh provided he satisfies the other requirements. It is made clear that the Tamil Nadu Electricity Board shall not demand the amount due from Mr.Manivel as a condition precedent for giving electricity service connection.
17. In the result, the Writ Petition is allowed and the impugned orders are set aside with a further direction to the respondents to provide electricity service connection to the petitioner to the premises-in-question, provided, he satisfies the other requirements as indicated above. The said exercise shall be completed within a period of two months from the date of receipt of a copy of this Order. Consequently, connected Miscellaneous Petition is closed. No costs.
tsi To
1. The Superintending Engineer, Tamil Nadu Electricity Board, Dharmapuri-5.
2. The Additional Chief Engineer, Tamil Nadu Electricity Board, Dharmapuri Electricity Distribution Circle Dharmapuri 636 705