Calcutta High Court (Appellete Side)
West Bengal State Electricity ... vs Sri Uttam Kumar Bhakat & Anr on 15 May, 2015
Author: Patherya
Bench: Patherya
IN THE HIGH COURT AT CALCUTTA
CONSTITUTIONAL WRIT JURISDICTION
APPELLATE SIDE
Present : The Hon'ble Justice Nadira Patherya
W. P. NO. 27601 (W) OF 2012
West Bengal State Electricity Distribution Company Limited
VERSUS
Sri Uttam Kumar Bhakat & Anr.
For the Petitioner (WBSEDCL) :Mr. Srijan Nayek,
Mr. Raja Saha,
Mr. Arindam Mitra.
For the Petitioner :Mr. Shehasis Banerjee.
(In W.P.25683(W) of 2013)
For the Respondent No.1 :Mr. Shehasis Banerjee.
(In W.P.26136(W) of 2013) For the Licensing Company :Mr. Pratik Dhar, Mr. Ritwik Pattanayak.
For the Respondent No.1 : Mr. Subroto Roy Karmakar,
Ms. Sukanya Bhattacharya.
Heard on : 29.10.2014, 10.12.2014 & 13.03.2015
Judgment on : 15th May, 2015.
Patherya J. : In this writ petition, the main issue that arises for consideration is the power of the Ombudsman to grant compensation and impose penalty.
The writ petitioner is the distribution company who is aggrieved by the order of the Ombudsman whereby a direction was given to pay compensation in terms of Regulation 3.3 and Regulation 12(a) of the 2005 Regulations so also 2010 Regulation for delay in grant of electric connection to the consumer's submersible pump.
The case of the petitioner is that the Ombudsman is a creature of Section 42(5) of the 2003 Act and under Section 42(6) any consumer who is aggrieved by non-redressal of his grievance will be entitled to make a representation to an authority known as the Ombudsman to be appointed by the State Commission and under Section 42(7) of the 2003 Act, the grievance of the petitioner has to be settled by the Ombudsman as may be specified by the State Commission.
"Consumer" has been defined under Section 2(15) of the 2003 Act. Therefore, a person to whom supply is connected becomes a consumer and delay in grant of connection to a person who has not been given supply is not a consumer under Section 2(15) of the 2003 Act and will disentitle the Ombudsman from granting any compensation. An application for compensation at the pre-connection stage cannot be entertained by the Ombudsman. Section 43 of the 2003 Act casts a duty on the Distribution Company to supply on request and Section 43(3) of the 2003 Act, imposes a penalty in case of failure to supply within the time specified in Section 43(1) of the 2003 Act. It is only the appropriate Commission which can impose penalty as will be evidenced from Section 57(2) of the 2003 Act. It is under Section 82 of the 2003 Act, that the West Bengal Electricity Regulatory Commission (Commission) has been created and appointed as the appropriate Commission. Therefore, under Sections 143 and 143(2) of the 2003 Act it is the Commission which can impose penalty. Section 97 of the 2003 Act empowers delegation of powers by the appropriate Commission in writing and this delegation was made to the Ombudsman on 7th January, 2014 to adjudicate under Section 143 of the 2003 Act. In the instant case the order was passed on 27th August, 2012 that is before the delegation made in January, 2014. Therefore, the Ombudsman can only consider the grievance of a consumer not related to delay which is a pre-connection situation. Therefore, no compensation or penalty could have been imposed and if any adjudication had to be undertaken it had to be undertaken by the Commission under Section 143(2) of the 2003 Act. The Adjudicating Officer would not be the Ombudsman but the Commission and its Members. Under Section 143(2) of the 2003 Act the Commission would on failure of compliance of Section 43 impose penalty. Similarly under Section 57(2) of the 2003 Act along with penalty compensation could also be imposed. But in both the situations, it would be the Commission who would be entitled to undertake such exercise. The Ombudsman is not a member of the Commission and, therefore, cannot exercise any power under Section 143(2) of the 2003 Act. Section 181(2)(r) and (s) empowers the State Commission to make regulations in respect of Section 42(5) and (7) of the 2003 Act. Under Section 181(2)(t) the State Commission is also entitled to make regulations in respect of Section 43(1) of the 2003 Act. Therefore, the power to make regulations by the State Commission is accepted but the question is whether such regulations have been framed. No evidence was produced wherefrom it will appear that the consumer/complainant suffered loss for which compensation was to be fixed. Section 181(2) (za) empowers the Commission to make regulation in respect of Section 57(1) of the 2003 Act, no regulation can be framed by the Commission under Section 57(2) and, in fact, no regulations have been framed under Section 57(2) of the 2003 Act or Section 143 of the 2003 Act. Regulation 56 was framed by the Commission on 26th August, 2013 (2013 Regulations). Regulations 10.4 and 10.5 are relevant as it empowers the Ombudsman to award compensation and penalty under Section 43(3) of the 2003 Act. Though power has been given to the Ombudsman to fix compensation, the entitlement of a consumer to compensation arises under Section 43(1) of the 2003 Act. Regulation 46 was framed in 2010 (2010 Regulations) and it is only under this Regulation that recourse has been taken by the Ombudsman to direct payment of compensation. The 2010 Regulation delegates powers to the Ombudsman but not under Section 97 of the 2003 Act in fact there has been no delegation under Section 97 of the 2003 Act till 2014. Section 57(1) of the 2003 Act is not to apply and compensation issued can only be considered under Section 57(2) of the 2003 Act and under Section 143 of the 2003 Act. Under Section 59(1) of the 2003 Act information can only be sought by the Commission. Therefore, the 2010 Regulation is also not to apply. The 2005 Rules and in particular Rules 7(2) and Rules 7(3) have no manner of application. Under Rule 7(4) report on standard of performance could be sought but no compensation granted. Therefore, report only on performance could be sought and compensation levied. The grievance emanates from Section 43 of the 2003 Act as Section 43(1) of the 2003 Act postulates supply to be made within one month and for redressal of grievance, if any, consumer can approach the Grievance Redressal Officer and thereafter the Ombudsman. But both the Ombudsman and the Grievance Redressal Officer cannot impose compensation. The penalty postulated under Section 43(3) of the 2003 Act can only be imposed by the State Commission under Section 57(2) of the 2003 Act. Regulation 27 of 2006 (2006 Regulation) is in general terms and Regulation 56 is of August, 2013 under Section 97 but the instant case is of 2012 and is not governed by Regulation 56. As it is only the Commission who could have imposed compensation, levy thereof by the Ombudsman in principle is unjustified and, therefore, the order be set aside.
Counsel for the Commission submits that its power under Section 143 of the 2003 Act to adjudicate arises out of Section 86(f) of the 2003 Act. Section 143 of the 2003 Act is not to apply to individual complaints. Reliance is placed on (2007) 8 SCC 381. By virtue of Regulation 10 of the 2003 Regulations the office of the Ombudsman was created in 2005. Regulation 24 deals with standard of performance and was framed in 2005. By the 2006 Regulations, Regulation 10 of 2003 stood repealed. Neither in Regulation 16 nor 24 was the Ombudsman empowered to grant compensation. Regulation 10 which has been superseded by the 2006 Regulation and 2013 Regulation has identified the powers of the Ombudsman but the 2013 Regulation is after the order of the Ombudsman in 2012 and it is the 2006 Regulation and the 2010 Regulation which will be applicable to the instant case. These are the only two Regulations that need to be looked into. Regulation 3 of the 2010 Regulation deals with the procedure for giving new electric connection. Regulation 8 deals with complaint management mechanism. Section 42(8) of the 2003 Act is without prejudice to the powers under the 2010 Regulation. In view of (2003) 8 SCC 40, in case there is no pleading the point cannot be canvassed. The Regulations have not been challenged by the writ petitioner, distribution company. Regulation 2(e) of the 2006 Regulation specifically provides that "Consumer grievance" means a grievance in an appropriate written form by a consumer against a distribution licensee under the 2003 Act. The said should be read along with Section 2(15) of the 2003 Act. Rights is coupled with duties. Section 42 speaks of grievance and does not specify the area of grievance. The Regulations are to compliment the 2003 Act just as the Indian Penal Code compliments the Code of Criminal Procedure. The 2006 Regulation does not specify the area of grievance and for that, one has to go to the 2003 Act and its Sections, in particular Sections 43, 45 and 57. The Regulations have not been challenged and, therefore, in view of (2008) 5 SCC 33 and (2007) 8 SCC 381 the said issue cannot be raised at the time of argument. As held in (2011) SCC 363 without challenging the notification the order passed by virtue of such notification cannot be challenged. This will also be applicable to the instant case where without challenging the Regulation, the order passed on basis thereof cannot be challenged. Section 97 will be rendered, otiose in view of Section 86(k) of the 2003 Act as all delegations by the Commission will be rendered nugatory, this could not have been the intent of the legislature. Reliance is placed on (2006) 12 SCC 586, (1985) 2 SCC 116, (2010) 4 SCC 603 and (1979) 3 SCC 229 for the proposition that subordinate legislation is permitted. In view of the said Regulations the Ombudsman was empowered to levy compensation, therefore, this application merits no order and be dismissed.
Counsel for the petitioner in reply submits that there is no dispute with the Regulations framed by the Commission. The 2006 Regulation was enacted in January 2006 and is accepted. Under the said regulation no delegation has been made to the Ombudsman to grant either compensation or penalty. Therefore, it was not within the powers of the Ombudsman to grant compensation or penalty and it is only for the Commission to decide the said issue and any exercise by the Ombudsman is bad. A special order suo moto was passed by the Commission for the first time on 13th June, 2013. In the event the Commission levies compensation, an appeal will lie under Section 111 of the 2003 Act and, thereafter, to the Supreme Court. Section 86(k) does not permit delegation as will be evident from a reading of Section 97.
2007 (8) SCC 381 is not applicable in the facts of this case as it dealt with an issue under Section 86(1)(f). The 2007 Regulations and specially Regulation 9.2 and 11 deals with the issue of transfer by the Commission of a grievance for consideration by the Ombudsman. 2008 (5) SCC 43 is distinguishable on facts. There is no violation with the parent Act. 2007 (8) SCC 381 is also not applicable as issue decided therein is different from the issue raised in this writ petition. 2011 (3) SCC 363 is distinguishable on facts and not applicable to the facts of the instant case. Similarly, 2006 (12) SCC 583 and 1985 (2) SCC 116 are also not applicable. There is no dispute with the proposition laid down in 1979 (3) SCC 229 and 2010 (4) SCC 603 as the Regulations are not under challenge.
Having considered the submissions of the parties the order under challenge is of the ombudsman whereby and whereunder compensation and penalty was imposed. Section 43 of the 2003 Act casts a duty on the distribution company to supply electricity on request, within one month and in the event supply is effected beyond the time specified, under Section 43(3), the distribution licensee will be liable to pay penalty. Besides penalty the licensee will also be liable to pay compensation under Section 57(2) of the 2003 Act. Section 57 of the 2003 Act deals with the standard of performance of a licensee. Section 57(1) of the 2003 Act empowers the appropriate Commission to specify the standards of performance while Section 57(2) permits determination of compensation on failure to meet standards by the Appropriate Commission. Under Section 143(2) of the 2003 Act the Adjudicating Authority appointed by the Commission under Section 143 (1) will be entitled to make an enquiry of failure to comply with either Section 29, Section 33 or Section 43 of the 2003 Act and on being satisfied that there has been failure of the provisions aforementioned penalty can be imposed. In the instant case, Section 43 is the relevant section and it has been alleged by the consumer complainant that there has been delay in grant of connection. On a plain reading of Section 143(1) and (2) it is the Commission or any person appointed by the Commission who is to hold such enquiry. Section 181(2)(r),(s),(t) so also (za) empowers the Commission to make regulation in respect of Section 42(5), 42(7), 43(1) and 57(1) of the 2003 Act. Under Section 181 (zp) regulation can be made in respect of any other matter to be specified. Regulations have been framed under Sections 42(5) and 42(7). The Regulations which are relevant for the instant case are the 2006 Regulation and 2010 Regulation. The order was passed in 2012. Therefore, these two regulations were holding the field in 2012. The 2006 Regulation was enacted in exercise of powers under Sections 42(5) and 42(7) read with Section 181 (2) (r), (s) and (t). The 2010 Regulation was enacted under Section 57(1) and 59(1) of the 2003 Act. The 2010 Regulation deals with the standard of performance of licensees while the 2006 Regulation lays down the guidelines for establishment of forum for redressal of grievance of consumers. Undoubtedly the ombudsman is a creation of Section 42(5) of the 2003 Act and is entitled to consider all grievances. Section 2(15) of the 2003 Act defines "consumer" to mean a person supplied with electricity and includes any person whose premises is for the time being connected for the purpose of receiving electricity. The 2006 Regulation has defined "Consumer Grievance" to mean a grievance by consumer against a distribution licensee under the 2003 Act.
There is no dispute with the proposition that a grievance under the provision of the Electricity Act, 2003 can be considered by the Ombudsman. But whether a grievance which is to be considered by the Commission can be considered by the Ombudsman in the absence of delegation under Section 97 of the 2003 Act is to be seen. To ascertain delegation by the Commission in favour of the Ombudsman a perusal of the two Regulations namely, the 2010 Regulation and 2006 Regulation is necessary. Both the said Regulations do not contain any delegation and without such delegation the Ombudsman is powerless to proceed to adjudicate the issue of compensation or penalty. Even assuming that by the 2010 Regulation standards of performance of a licensee was being specified by the commission but in case of failure to meet such standards it would be the Commission alone who could determine compensation. Regulation 14 of the 2010 Regulations deals with the enforcement mechanism and permits registration of complaint regarding failure to maintain the standard of performance, with the Grievance Redressal Officer and on its failure to redress the grievance, representation is to be made to the Ombudsman for payment of compensation. This is the procedure to be followed but the power of the Ombudsman to levy compensation will not emanate from the 2010 Regulation as all that has been done by the 2010 Regulation is to lay down the standards of performance of a licensee and the Ombudsman has been identified as the person to whom a written representation is to be made for redressal of grievance. The power of the Ombudsman to levy cannot be said to be covered by the 2010 Regulation, as there has been no delegation under Section 97 of the 2003 Act. This has also been accepted by the Commission as by special order dated 13th June, 2013 powers of the Commission under Section 57(3), 57(2) and 43(3) have been delegated to the Ombudsman under Section 97 of the 2003 Act. Similarly by Regulation 56 of 2013 powers of the Commission has been delegated to the Ombudsman under Section 97 by the Commission to award compensation and penalty. The Commission is aware that without delegation of power under Section 97 to the Ombudsman by it, the Ombudsman will not be empowered to grant compensation or penalty.
This delegation has been made in 2013 and not prior thereto, and in 2012 the Ombudsman was not empowered on the basis of the Regulations prevailing to levy compensation or penalty. The decisions relied on by the Commission are not applicable to the facts of this case. It is true that the Regulations have not been challenged and, therefore, the Regulations have to be relied on by the distribution company, writ petitioner.
There is no dispute with the proposition laid down in 1997 (3) SCC 229 and 2008 (5) SCC 533. The said decisions will aid the petitioner as the delegated legislation was not intended to violate the statute. Similarly, there is no dispute with the proposition laid down in 2010 (4) SCC 603, 1985 (2) SCC 116 and 2011 (3) SCC 363, but the said decisions have no application to the facts in issue, therefore, are distinguishable. 2006 (12) SCC 583 is for the proposition that a case is an authority for what it decides and it is only in the light of this decision that 2007 (8) SCC 381 needs to be considered.
In (2007) 8 SCC 381 a billing dispute had been raised which the Supreme Court held was to be considered under Section 42(5) and 42(6) of the 2003 Act, being a complete machinery for redressal of individual consumer grievance, and empowered the Ombudsman to grant compensation as it would be a grievance of an individual consumer but a look at the Regulations would also be necessary.
The Regulations which held sway in 2012 when the impugned order was passed are the following Regulations :-
(i) Regulation 27 dated 17th January, 2006 (Guidelines for Establishment of Forum for Redressal of Grievances of Consumers and Time and Manner of Dealing with such Grievances by the Ombudsman) Regulations, 2006.
(ii) Regulation 46 dated 31st May, 2010 (Standards of Performance of Licensees Relating to Consumer Services).
The 2006 Regulations superseded the 2003 Regulation and empowered the Ombudsman to consider the grievance of a consumer. It is the consumer who has to lodge his grievance for its settlement to the Grievance Redressal Officer and to the Ombudsman. "Consumer" is a person supplied with electricity by a licensee and does not include an intending consumer. This Regulation only deals with the forum of Grievance Redressal Officer and Ombudsman.
The 2010 Regulation on the contrary deals with the Standards of Performance of licensees Relating to Consumer Services. In Regulation 2(xv) of the said 2010 Regulations "intending consumer" has been defined. Regulation 3 of the said 2010 Regulations lays down the procedure for giving new connection so also extension of load and alteration of service. In case of failure, enforcement mechanism has also been provided in Regulation 14 of the said 2010 Regulations. Regulation 14.3 of the said 2010 Regulations empowers the Ombudsman to receive complaint for payment of compensation while Regulation 15 empowers the Ombudsman to determine compensation.
The said Regulations has been issued under Section 57(1) and 59(1) of the 2003 Act. Section 57(1) reads as follows :-
"57. Standards of performance of licensee.-(1) The Appropriate Commission may, after consultation with the licensees and persons likely to be affected, specify standards of performance of a licensee or a class of licensees."
Section 59(1) of the 2003 Act reads as follows :-
"59. Information with respect to levels of performance.-(1) Every licensee shall, within the period specified by the Appropriate Commission, furnish to the Commission the following information, namely:-
(a) the level of performance achieved under sub-
section (1) of section 57;
(b) the number of cases in which compensation was made under sub-section (2) of section 57 and the aggregate amount of the compensation."
Section 59(1) is not applicable as all it seeks is information of performance which is not a requisite for determining compensation or penalty.
Section 57(2) permits determination of compensation by the Appropriate Commission. Section 97 of the 2003 Act permits delegation but there has been no delegation under Section 97 of the 2003 Act by the Appropriate Commission of its powers under Section 57(2) of the 2003 Act, therefore, determination of compensation by the Ombudsman under the 2010 Regulations is not contemplated. In fact, any determination under the 2010 Regulation would be de hors the procedure of law and this was also known to the Commission as in 2013, Regulations were framed under Section 57(3) for determination of compensation under Section 57(2) and Section 43(3) of the 2003 Act by the Ombudsman and delegation has been made under Section 97 of the 2003 Act. Therefore, if compensation would have been granted under the 2013 Regulation the said would have been valid and in accordance with law but orders for payment of compensation without delegation under Section 97 of the 2003 Act will not validate such orders.
There is no doubt that in view of Section 57(2) of the 2003 Act, it is for the Appropriate Commission to direct compensation unless delegated by it and in the absence of such delegation to the Ombudsman under Section 97 of the 2003 Act the orders directing compensation by the Ombudsman cannot be sustained in the eye of law and is set-aside.
In view of the aforesaid this application succeeds and is disposed off.
(Patherya J.) Later :
Prayer for stay sought by the Commission so also the Consumer is considered and rejected.
(Patherya J.)