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Showing contexts for: compounding fee in K.Dominic vs The Assistant Executive Engineer on 4 July, 2025Matching Fragments
a) Whether payment of compounding fees by the assessee amounts to admission of guilt?
b) Whether having collected the compounding fee, the authority can fasten civil liability on the assessee under Section 126 of the Electricity Act, 2003 ?
c) Whether an assessee has any scope to contest the proceedings under Section 126 of the Electricity Act after payment of compounding fee ?
9.A learned Judge of this Court in the decision reported in 2013 SCC OnLine Mad 3520 (Fiem Industries Ltd. v. Tamil Nadu Generation and Distribution Corporation Ltd.,) held as follows :
“56. ...Once the consumer decides to compound the offence, there is no question of contending that the compounding of the offence was under protest, because compounding under protest is not recognized in law. An offence cannot be permitted to be compounded under protest. If the https://www.mhc.tn.gov.in/judis ( Uploaded on: 08/08/2025 10:34:44 am ) consumer protests, then it is for the authorised officer to record such protest and lodge a complaint to the police station, having jurisdiction. If the consumer accepts the guilt of offence unequivocally, by compounding, the consumer can avoid prosecution. When there is payment of compounding fee, under protest, law does not restrict the powers of the authorised officer to launch prosecution. In a given case, to avoid prosecution, the consumer may come forward to remit the compounding fee, under protest and there is always a possibility to avoid fine, or imprisonment on conviction, by the Court of competent criminal jurisdiction.
10.However, a Division Bench of this Court in WA No.649 of 2020 dated 15.09.2023 (The Assistant Executive Engineer vs. V.Rajagopalan) had declined to endorse the ratio that an act of compounding cannot be retracted. We also take judicial notice of the fact that in almost all cases, the assessee is under the impression that if he https://www.mhc.tn.gov.in/judis ( Uploaded on: 08/08/2025 10:34:44 am ) pays the compounding fee, the issue will be given a quietus. He may also resort to compounding under threat of immediate arrest. Many a time the person in whose name the service connection stands will not be available on the spot. The manager or occupier signs the mahazar and pays the compounding fee and the service holder is made to hold the baby. That is why, the Hon'ble Division Bench had taken the view that under certain circumstances, the assessee must be allowed to retract. But in such circumstances, the field will be once again be opened. The assessee must be ready to face the consequences of prosecution. We however hold that such a retraction must be made at the earliest opportunity. We answer the first issue by holding that having paid the compounding fee, the assessee cannot plead in the assessment proceedings under Section 126 of the Act that there was no unauthorised use of electricity. To this extent, his defence stands foreclosed.
13.In Southern Electricity Supply Co. of Orissa Ltd. v. Sri Seetaram Rice Mill, the Hon'ble Supreme Court evolved the rule of practical interpretation. An interpretation which upon application of the provisions at the ground reality, would frustrate the very law should not be accepted against the common sense view which will further such https://www.mhc.tn.gov.in/judis ( Uploaded on: 08/08/2025 10:34:44 am ) application. Since compounding is often done under coercive circumstances, Section 152 of the Act must be held to be applicable only where an offence has already been registered. It is only an offence that is and can be compounded. Part XIV of the Electricity Act catalogues the offences punishable under the Act. The authorised officer can file a private complaint before the Special Court. The offences are cognizable and non-bailable. The police have been conferred the power to investigate the offences under the Electricity Act and file final report under Section 173 of Cr.Pc (corresponding to Section 193 of BNSS). Thus, unless under Section 151A of the Electricity Act, an offence is registered, the question of compounding may not arise. Sub-section (2) of Section 152 states that on payment of the compounding fee, the person in custody in connection with that offence shall be set at liberty. This again presupposes registration of a case. More than anything else, sub- section (3) of Section 152 states that once an offence is compounded, it shall be deemed to amount to an acquittal. An acquittal is the culmination of the process whereby the criminal law is set in motion. It is the registration of the offence that sets the criminal law in motion. There is a saying in Tamil that a picture can be drawn only if there is a wall in https://www.mhc.tn.gov.in/judis ( Uploaded on: 08/08/2025 10:34:44 am ) the first place. Likewise, there can be an acquittal only when there is an an offence in the first place. An act or omission that is punishable by law is an offence. It is only the registration of the act or omission that makes it into an offence for the purpose of compounding. We, therefore, hold that the authorised officer may accept compounding fee from the assessee only following the registration of a police case in exercise of their power under Section 151A and 151B or filing of complaint by the authorised officer under Section 151 of the Act.