Allahabad High Court
M/S. Shalimar Paper Mills Pvt. Ltd. vs Special Judge/E.C.Act Muzaffarnagar ... on 19 April, 2023
Author: Alok Mathur
Bench: Alok Mathur
HIGH COURT OF JUDICATURE AT ALLAHABAD ?A.F.R. Court No. - 9 Case :- WRIT - C No. - 41480 of 1999 Petitioner :- M/S. Shalimar Paper Mills Pvt. Ltd. Respondent :- Special Judge/E.C.Act Muzaffarnagar And Others Counsel for Petitioner :- Pramod Kumar Jain,B.C. Rai Counsel for Respondent :- C.S.C.,Narendra Kumar Tiwari,Nipendra Mishra,P.K.Shukla,R.K. Shukla Hon'ble Alok Mathur,J.
1. Heard Sri B.C. Rai along with Sri Deepak Kumar Pandey, learned counsel for petitioner as well as Sri Manoj Kumar Dwivedi, Advocate holding brief of Sri Narendra Kumar Tiwari, learned counsel for respondent Nos. 2 to 5.
2. The petitioner has approached this Court assailing the judgment and order dated 30.07.1999 passed by Special Judge, EC Act, Muzaffarnagar thereby allowing the application under Section 34 of the Arbitration Act filed by the respondents for relegating the dispute to the Arbitrator.
3. The brief conspectus of the facts is that the petitioner and respondent had entered into an agreement dated 15.02.1985 for supply of electricity for a sanctioned load of 470 KVA. The petitioner is a Papermill which has established its unit at Muzaffarnagar for manufacturing paper.
4. The dispute pertains to the bills raised by the respondent-Electricity Department dated 05.06.1985 and 07.06.1985 amounting to Rs. 41527.60/- and Rs 1,07,605.50/-. In the said bills, it was stated that the meter installed in the premises was defective and was not recording the correct supply of the electricity and hence the said bills were raised. The petitioner disputed the said bills and was of the view that in light of Section 26 (vi) of the Electricity Act, 1910 in case the electric meter was defective, the only remedy as per the Act of 1910 is that the matter has to be referred to an Electrical Inspector who is the only authority under the said Act to return a finding as to whether the meter is defective and only thereafter the bills can be raised by the Electrical Inspector. It was submitted that without following the procedure prescribed, the electricity bills could not have been raised.
5. As the grievance of the petitioner was not redressed and being aggrieved by the aforesaid bills, the petitioner filed a civil suit being Civil Suit No. 288 of 1985 before the Special Judge, EC Act, Muzaffarnagar. Notices were issued to the respondents who had put in appearance before the Civil Court and file their written statements opposing the claim made by the petitioner.
6. Apart from objecting the claim of the petitioner, an application under Section 34 of the Arbitration Act was also made for staying of the proceedings in light of the fact that agreement entered into between the petitioner and respondent, there was specific clause pertaining to deciding of the disputes arising out of the agreement by process of arbitration. Clause 20 of the agreement is as follows:-
"(20) If any question or dispute or difference arises between the parties to this agreement as to the interpretation or effect of any provision or clause herein contained or the construction thereof or as to any other matter in any way connected with or arising out of this agreement of the operation thereof or the rights, duties or liabilities of either party in connection therewith, such question dispute or difference shall be referred to the Arbitrator/Chairman, U.P. State Electricity Board or the person nominated by him and the award/decision of the said arbitrator shall be final and binding upon the parties.
Provided that if the question, disputes or difference relates to or concerned any dues chargeable to the consumer in terms of this agreement, no reference to arbitration shall at the instance of such consumer be made till the consumer has either deposited with the Supplier the amount of dues in dispute of difference or given a Bank Guarantee of such amount in favour of the Supplier valid upto the period on on year form the date in whcih the award becomes final or the amount or dues in cleared, whichever is earlier."
7. The petitioners had objected to the prayer made by the respondent for referring the matter to the arbitration and specific plea was taken, there exists a specific provision under Electricity Act, 1910 where the dispute which has arisen in the present case was referable to Section 26 (vi) of Act of 1910 and the same should have been referred to the Electrical Inspector rather than invoking the general power of arbitration under the said agreement.
8. Learned counsel for petitioner in support of his submissions, has placed reliance upon the judgment of the Hon'ble Supreme Court passed in the case of Belwal Spinning Mills Ltd. and Others Vs. U.P. State Electricity Board and another, 1997 (6) SCC 740, where Hon'ble Supreme Court has held as under:-
"The expression 'check meter' has no special significance or legal incidence for which there is a bar that check meter cannot be treated as an altered meter if the licensee intends to replace the defective meter by the check meter. It will be open to the Electrical Inspector to ascertain the correctness of the check meter along with the disputed meter when dispute is referred for adjudication by the Electrical Inspector and the licensee found its case with reference to check meter. Prior to the amendment of Section 26(6) of Electricity Act, the Electrical Inspector or the competent person specially appointed by the State Government in this behalf, had a statutory duty to first determine whetehr the meter in question was defective and thereafter to estimate the quantity of the electricity consumed during such time as the meter in the opinion of the Electrical Inspector or the competent person 'shall not have been correct'. After the amendment of sub-section (6) of Section 26, the Electical Inspector is the only statutory authority to decide the dispute about the correctness of the meter, if such dispute is raised by either of the parties. If the Electrical Inspector on a reference comes to the finding that the meter has ceased to be correct, the said Inspector has a statutory duty to estimate the amount of energy supplied to the consumer or electrical energy 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.'"
9. The question which engages the attention in the present case is as to whether the petitioner should be relegated to the remedy for an arbitration under Clause 20 of the agreement or the matter should be referred to the Electrical Inspector in terms ofSection 26 (vi) of the Electricity Act, 1910.
10. To answer the aforesaid question, it is necessary to look into the provisions of the Indian Electricity Act, 1910, Section 26 Sub-Section 6 provides as under:-
"Where any difference or dispute arises as to whether any meter referred 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; 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, register of the meter shall, in the absence of fraud, be conclusive proof of such amount or 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 not less than seven days' notice of his intention so to do."
11. Apart from the aforesaid statutory provisions, it is also noticed that the agreement entered into between the petitioner and the respondent also provide for resolution of disputes in a situation when the electricity meter has been found to be defective. Clause 10 Sub-Clause (c) of the agreement provides that :-
(c) Should the consumer dispute the accuracy of the supplier's meter/meters, he may, upon giving notice paying the prescribed fee, have the same tested by the Supplier or in accordance with sub section (6) of Section 26 of the Act by the Electrical Inspector to the State Government. In the event of the meter begin tested by the Supplier and found to be incorrect beyond the limit of accuracy prescribed by the Indian Electricity Rules, 1956, the cost of testing and all reasonable expenses incidental thereto shall be met by the Supplier, and the amount of the bill shall be adjusted in accordance with the result of test taken with respect of the meter readings of the 3 months prior to the month in which the dispute has arisen due regard being paid to the conditions of working, accuracy etc., during the month under dispute, and during the month under dispute , and during the us three months, meter/meters is/are found to be correct within the limits laid down in the Indian Electricity Rules, 1956 or any other statutory modification thereof for the time being enforce, the fees paid by the consumer shall be forfeited to the supplier."
12. A perusal of the aforesaid clause would indicate that the agreement itself provide for a condition that in case there is a dispute with regard to electricity meter, then the same can be resolved in terms of Section 26 (vi) of Electricity Act, 1910.
13. Considering the fact that a specific provision would prevail over a general provision, there is no doubt that if a particular dispute which has arisen as in the present case, the matter can adequately be resolved after referring the matter to the Electrical Inspector. A bare perusal of Section 26 (vi) would also indicate that a reference has to be made to the Electrical Inspector who shall give his opinion about the electricity meter and also estimate about the amount of electricity supplied to the consumer.
14. Considering the fact that a specific provision for resolution of dispute is existing and it is not disputed by either of the parties that the matter can be referred and resolved by the Electrical Inspector and it also clearly finds mention in the agreement and hence binds both the parties, this Court is of the clear view that dispute can be resolved in terms of Section 26 (vi).
15. Learned counsel appearing on behalf of Electricity Department does not dispute this proposition.
16. In light of the above, the contention of the petitioner has force and accordingly with the consent of the parties, this writ petition is being disposed of in the following terms:
(i) Considering the fact that the matter should be resolved by the Electrical Inspector in terms of Sub-Section 6 of Section 26 of the Electricity Act, 1910, it is provided that the petitioner undertakes to withdraw the civil suit No. 288 of 1985 pending before the Special Judge, EC Act, Muzaffarnagar. Let an application in this regard be moved expeditiously, say, within a period of next one month.
(ii). Subsequent to moving of the application for withdrawal, the petitioner shall move an application before the concerned Electrical Inspector appointed by the State Government raising all his grievances with regard to defective meter No.1418020 as well as bills dated 05.06.1985 and 7.06.1985 within next one month. On receipt of the representation/claim of the petitioner, the Electrical Inspector shall proceed to determine the condition of the meter as well as amount of the electricity consumed during the said period relating to the aforesaid two bills and pass an order in accordance with law within next three months.
(iii). It is provided that till the order is passed by the Electrical Inspector, no recovery shall be made from the petitioner in pursuance of the bills dated 05.06.1985 and 07.06.1985.
(iv). This protection shall be available only till passing of an appropriate order by the Electrical Inspector as directed by this Court.
17. In light of the aforesaid direction, the writ petition is disposed of.
(Alok Mathur, J.) Order Date :- 19.4.2023/Ravi/-