M/s Ardee Infrastructure Pvt. Ltd. & Anr vs Mahesh Mathur & Ors on 17 September 2026

JUDGEMENT

PER HON’BLE MR. AJAY TALEGAONKAR, TECHNICAL MEMBER

1. The present Appeal has been filed by M/s Ardee Infrastructure Pvt. Ltd. and M/s Ardee Housing Pvt. Ltd. (“Appellants”) challenging the order dated 11.04.2019 passed by the Haryana Electricity Regulatory Commission (“HERC”/ “State Commission”/ “Respondent No. 3”) in Pro. No. 57/2017. The dispute concerns the levy of an additional 12% amount by the Appellants in the electricity bills raised upon the residents of Ardee City, Sector-52, Gurugram.

Description of the Parties

2. The Appellants are M/s Ardee Infrastructure Pvt. Ltd. and M/s Ardee Housing Pvt. Ltd. which had developed Ardee City in Sector-52, Gurugram. Respondent No. 1, Shri Mahesh Mathur, along with Respondent Nos. 4 to 16, are residents of Ardee City.

3. Respondent No. 2, Dakshin Haryana Bijli Vitran Nigam (“DHBVN” or “Discom”), is a State Government-owned distribution licensee incorporated under the Companies Act, 1956 and is engaged in the business of distribution of electricity in the State of Haryana.

4. Respondent No. 3 is the Haryana Electricity Regulatory Commission (“HERC” or “Commission”).

Factual Matrix of the Case

5. The Appellants had developed the colony, and Flat Buyers Agreements and separate Electricity Agreements had been executed with the residents. The electricity distribution arrangement comprised supply by DHBVN up to a single point with the electrical infrastructure extending thereafter to the individual residential units. The electrical infrastructure within the colony included poles, cables and other distribution facilities. The activities associated with supply to the individual residential units included maintenance and replacement of electrical equipment and parts, meter calibration and testing, meter reading, billing and collection of electricity dues. The infrastructure also included facilities such as transformers and arrangements for electricity used for common purposes. The Appellants charged additional 12% amount as part of the electricity bills raised upon the residents purportedly based on the bilateral agreement.

6. Respondent No. 1, Shri Mahesh Mathur, was authorised by 13 other residents of Ardee City to represent them before HERC. A petition was thereafter filed before HERC under Regulation 5.5 of the Haryana Electricity Regulatory Commission (Single Point Supply to Employers’ Colonies, Group Housing Societies and Residential or Commercial-cum-Residential Complexes of Developers) Regulations, 2013 (“HERC Single Point Supply Regulation, 2013”). The petition also sought refund of the additional 12% amount charged in the electricity bills and action in respect of the alleged levy of amounts over and above the tariff prescribed by HERC.

7. HERC thereafter passed the impugned order dated 11.04.2019 in Pro. No. 57/2017 essentially restraining the Appellants from imposing any additional charge over and above the amount payable as per HERC specified tariff and directing the Apellants to refund the excess amount charged. Aggrieved by the impugned order passed by HERC, the Appellants have preferred the present Appeal.

8. The Appellants have prayed for the following relief before us: “a) the order dated 11.04.2019 in PRO No. 57/2017 passed by Haryana Electricity Regulatory Commission may kindly be pleased to set aside

b) Accept the appeal in the present form

c) Any other order which the Hon'ble Tribunal deems appropriate in the facts of the case may also be passed in favour of the Appellant and against the Respondents.” Submissions of the Appellants

9. The Appellants submitted that the dispute arose from the Electricity Agreements executed with individual residents, which specifically provided under Clauses 14 and 21 that disputes would be referred to arbitration. Sections 49 and 158 of the Electricity Act, 2003 and Clauses 67 and 68 of the HERC Conduct of Business Regulations, 2004 are relied upon in for the support. It is contened that HERC, by adjudicating contractual rights instead of directing the parties to arbitration, exceeded its jurisdiction and disregarded party autonomy and minimal judicial intervention under the Arbitration and Conciliation Act, 1996.

10. The Appellants further submitted that Clause 5.5 of the HERC Single Point Supply Regulations, 2013 was wrongly applied. According to the Appellant, those Regulations principally concern Employer Colonies and Group Housing Societies whereas the Appellant is a private developer which established and maintained its

internal distribution system under contractual arrangements with purchasers. Clause 5.5 only prohibits charging electricity tariff above the Commission- approved tariff and does not prohibit separately agreed infrastructure-related charges or contractual arrangements for operation and maintenance of the internal network.

11. The Appellants submitted that HERC erred in directing refund of the alleged excess amount because the billing records referred to in the Impugned Order showed that the Appellant had not recovered the alleged excess amount or derived unjust enrichment. It is also contened that the order also failed to specify the amount to be refunded, relevant billing periods, affected consumers or the methodology for computation, making the direction vague.

12. Further argued that HERC did not maintain parity with its decision in Mukesh Kumar v. Full Marks Facilities Management Pvt. Ltd. & Ors., HERC/PRO-20 of 2015 where a similar issue concerning overcharging under a Single Point Connection system was treated as a billing dispute and the consumer was directed to approach the Electricity Ombudsman under Section 42 of the Electricity Act.

13. The complaint before HERC was instituted in 2018 whereas the Impugned Order directed refund for earlier billing cycles in 4 to 6 billing cycles. The Appellants submitted that HERC did not examine limitation, although claims for recovery/ restitution are governed by Article 113 of the Limitation Act, 1963 prescribing three years in the absence of a special statutory provision. The Electricity Agreements remained valid and binding and no contractual provision had been declared void or unenforceable.

14. The Appellants submitted that HERC exceeded its statutory jurisdiction by directing modification of the Electricity Agreements. Sections 61, 62 and 86 of the Electricity Act, 2003 did not authorise interference with the private contracts. The Agreements contemplated recovery of infrastructure-related expenses, including installation charges, testing charges and meter hire charges which constituted contractual consideration and were distinct from statutory electricity tariff. The Respondents had not sought modification or cancellation of the Agreements, yet HERC granted such relief suo motu.

15. Before the proceedings before HERC, the Ardee City Residents’ Welfare Association had filed Consumer Complaint No. 686 of 2017 before the NCDRC on 09.03.2017 challenging the same billing methodology and alleged overcharging. Shri Mahesh Mathur, the lead Respondent, was the Treasurer of the RWA. Since the parties, cause of action and subject matter substantially overlapped, the Appellants submitted that the HERC proceedings ought to have been stayed under Section 10 CPC to avoid conflicting decisions.

16. HERC directed refund of the alleged excess amount to “all residents of Ardee City”, although the complaint was filed only by a limited number of residents. The Appellants submitted that Section 86(1)(f) of the Electricity Act empowers the Commission to adjudicate disputes between the parties before it and does not permit extension of relief to non-parties without examining their individual claims, billing records or contractual arrangements. The Appellants also submitted that several Respondents were defaulters under the Agreements and that HERC nevertheless granted relief without requiring compliance with contractual obligations.

17. The Appellants further submitted that the billing dispute should have been dealt with through the Internal Grievance Redressal Forum and Electricity Ombudsman rather than being directly entertained by HERC. The permissible 4% or 5% transformation/ LT loss contemplated under Option-2 of Clause 4.1.1 of the HERC Regulations dated 09.01.2013 does not apply. The Appellant’s supply was under Option-1 since DHBVN supplied electricity at a single point to the project and did not install separate connections/ meters for individual consumers. Under Clause 4.1.2, the internal distribution was owned and managed by the Appellant.

18. The Appellants stated that they incurred expenses for installation, maintenance and distribution of power from the sub-station, laying of cables and poles, meter calibration and testing, meter reading, billing and collection of electricity dues up to individual houses. It also maintained and replaced infrastructure, repaired transformers and provided electricity for common uses. In view of the internal distribution system being owned and managed by the Appellants, the Electricity Agreement provided for Service/Administrative Charges. These bilateral agreements were entered into during 2004-2006, before the 2013 Regulations were framed. Any dispute regarding these charges was therefore an arbitrable contractual dispute under Clauses 14 and 21 of the Agreements. The Appellants submitted that they had not charged any amount over and above the tariff approved by HERC.

19. The Appellants also stated that they stopped raising invoices after DHBVN took over distribution and that even while charging the Service/ Administrative Charges, it incurred losses because the difference between electricity consumed at the single-point connection and consumption recorded through individual meters, together with common-service consumption, exceeded the amounts billed.

Submissions of the Respondent Nos. 1, 4-16

20. Regulation 6(2) of Haryana Electricity Regulatory Commission (Terms and Conditions for Determination of Wheeling Tariff and Distribution & Retail Supply Tariff) Regulations, 2008 provides that a distribution licensee shall not charge a tariff higher than that determined by the Commission and that any excess amount paid by a consumer shall be recoverable by the person who paid it.

21. Respondent Nos. 1, 4-16 (Consumers/ Residents) submitted that HERC had framed the HERC Single Point Supply Regulation, 2013. Regulation 5.5 thereof mandates that a GHS/employer/developer/RWA shall not charge residents for electricity supplied by the distribution licensee at a tariff higher than the rates approved by the Commission for the Domestic Supply (DS) category. Further submitted that the Appellants had continued to levy excess amounts in contravention of the notifications prescribing the Commission-approved tariff, with the last such Memo being dated 16.08.2016.

22. According to the Residents, the judgment in HERC/PRO-09 of 2014 was squarely applicable to the Appellants.

23. The Residents submitted that Section 175 of the Electricty Act provides that its provisions are in addition to and not in derogation of any other law for the time being in force. At the same time, they submitted that assessments under the Electricity Act, such as those under Section 126 could not be made subject matter of proceedings before a Consumer Court, while Sections 145/ 153 of the Electricity Act bar Civil Courts from entertaining matters falling under Sections 126 and 127. It was submitted that Section 111, under which the present appeal has been

preferred, contains no exclusion of Sections 126 and 61/ 62 read with Regulation 6(2) of the 2008 Regulations and Regulation 5.5 of the 2013 Regulations.

24. The legal issue has been settled in U.P. Power Corporation Ltd. v. Anis Ahmad, (2013) 8 SCC 491 read with Kerala SEB v. Thomas Joseph, (2023) 11 SCC 700. The Residents submitted that the issues arising in the present proceedings concern alleged illegalities and violations of the statutory provisions, regulations and tariffs approved by the competent authorities. Consequently, the statutory authorities empowered under the Electricity Act to act against such violations could not be prevented from exercising their jurisdiction merely because consumer proceedings alleging deficiency in service were pending.

25. According to the Residents, proceedings under the Consumer Protection Act therefore did not create any bar to the present proceedings. HERC possessed the requisite jurisdiction to entertain and adjudicate matters falling within the applicable Regulations and to ensure adherence to the tariff rates prescribed by the competent authorities.

26. It was further submitted that the alleged Bilateral Agreement could not oust HERC’s jurisdiction since an agreement contrary to statutory provisions or Regulations framed under delegated legislative authority cannot prevail over such provisions. The Appellants could not rely upon the Bilateral Agreement to avoid their statutory obligations to adhere to prescribed tariff rates. The Residents disputed the contention that the impugned order amounted to modification of the Bilateral Agreement submitting that the order was based upon Regulations which had not been challenged and which were required to be given effect.

27. The Residents further submitted that HERC had not adjudicated the residents’ maintenance dues as it had no jurisdiction to calculate or determine such dues. The Commission had confined its adjudication to violations of the Regulations. The pendency of proceedings before the Civil Court in CS/4328/2018 was stated to have no bearing on the regulatory violations in question. It was also submitted that the absence of an RWA did not prevent the complaint from being entertained as Regulation 5.5 did not prescribe the existence of an RWA as a condition for filing a complaint.

28. As regards the directions for refund of excess charges, the Residents submitted that such directions could validly be issued in view of the applicable judgments and Regulations. It was contended that the proceedings before HERC did not concern an ordinary billing dispute between a consumer and the competent authority under the Electricity Act, but concerned the Appellants’ charging of amounts from consumers in excess of the prescribed tariff in contravention of the Regulations. HERC was therefore stated to have acted in discharge of its statutory obligation to redress the grievance and enforce the applicable Regulations.

29. The Residents disputed the contention that there was no proof of charging a higher tariff. According to them, the Appellants had admitted that amounts in excess of the prescribed tariff had been charged and had sought to justify such charges by relying upon the Bilateral Agreements. The justification was rejected by HERC. With respect to refund, it was submitted that the impugned order specifically directed that the excess amount was to be returned if it had been charged. The Residents also denied the allegation that HERC had passed inconsistent orders in different cases.

30. The Residents also rejected the Appellants’ contention that the amounts collected from residents had been utilised because the competent authority had not provided the infrastructure inside the colony. It was submitted that the Appellants had failed to justify their continued operation in contravention of the Regulations and the Bilateral Agreements particularly when the infrastructure was required to be handed over to the competent authority after the specified period. The Bilateral Agreements could not be relied upon either to continue such arrangement in violation of the Regulations or to avoid the obligation to hand over maintenance and operation of the electricity infrastructure to the competent authority.

31. The allegation that the residents were defaulters was also denied. The Residents submitted that the residents had paid all legally due amounts and that non-payment of demands which were alleged to be illegal and arbitrary could not render them defaulters. It was reiterated that HERC had jurisdiction to issue directions with retrospective effect particularly since competent authorities had previously issued notices to the Appellants requiring rectification of the billing pattern but the Appellants had failed to rectify it. According to the Residents, these circumstances necessitated the retrospective directions contained in the impugned order.

32. With respect to the proceedings under the Consumer Protection Act, it was submitted that those proceedings were still pending and primarily concerned alleged deficiencies in housekeeping, upkeep and maintenance services provided to the consumers/ residents. The proceedings under the Consumer Protection Act concerning deficiency of service could proceed simultaneously with proceedings under the Electricity Act concerning violation of the applicable Regulations. The Appellants’ alleged financial losses could not justify continued violation of the

Regulations. Reliance on Section 43 of the Electricity Act could not be used to disregard the regulatory requirements.

33. The Appellants had taken inconsistent positions by, on the one hand, contending that they had not charged any excess tariff and on the other hand asserting that they were entitled to levy the additional amounts under the Bilateral Agreements. The Residents therefore denied that HERC had incorrectly applied the judgment in PRO No. 9/2014. They reiterated that the electricity bills were required to conform to the Regulations and the statutory scheme under the Electricity Act, 2003 and that the tariff could not be increased beyond the prescribed levels through a Bilateral Agreement containing terms contrary to the Regulations.

34. Finally, the Residents submitted that any Bilateral Agreement containing clauses contrary to the statutory provisions, Regulations or prescribed tariff rates was liable to be ignored and treated as null, void and unenforceable to that extent. The fact that the residents had agreed to contractual terms providing for charges over and above the tariff prescribed by the competent authorities could not validate such charges.

35. It was further submitted that the Appellants’ contention that the Bilateral Agreements could not be modified or that modification would amount to retrospective alteration of the agreements was misconceived since the agreements were stated to be void to the extent of their inconsistency with the Regulations and the statutory scheme.

36. The Residents also stated that they themselves had not instituted proceedings before the National Consumer Court and therefore the contrary averments of the Appellants were liable to be rejected.

Submissions of the Respondent No. 2- DHBVN

37. DHBVN submitted that its responsibility was limited to supply up to the single point where a single meter had been installed. Apart from electricity dues, the Appellant had for several years been charging an additional 12% amount in the monthly electricity bills initially described as “Admin/Service Charges.” Upon complaints from residents, DHBVN issued Memo No. 8963/64 dated 16.08.2016 directing the Appellant not to charge anything above the Commission-approved tariff.

38. After the above direction, the Appellant allegedly continued charging the additional 12% describing it from July 2016 as “Upkeep Charges of HT Lines, Transmission/ Commercial Losses.” From August 2016, the Appellant further bifurcated the 12% amount into 4% towards AT&C Losses and 8% towards Maintenance of HT/LT Transmission Lines and Common Liability & Facility Consumption.

39. Following another complaint from residents dated 05.05.2017, DHBVN issued Memo No. 5432/33/HC dated 09.05.2017, again directing the Appellant to charge electricity tariff in accordance with the tariff approved by the Commission for FY 2017-18. DHBVN also referred to Regulation 6(1) of the HERC Tariff Regulations, 2008 which provides that no tariff can be charged by a distribution licensee without prior Commission approval.

40. DHBVN further relied upon Regulation 6(2) which prohibits charging tariff in excess of the tariff determined by HERC. Where excess amounts are recovered, the excess is recoverable by the person who paid it along with interest at the bank rate apart from the liability for penalties under Sections 142 and 146 of the Electricity Act, 2003.

41. DHBVN submitted that despite its directions, the Appellant again levied an excess charge in the June 2017 bill describing it as “Admin charges per Clause No. 4 & 7 of bilateral agreement.” Residents thereafter submitted another written complaint dated 10.07.2017 stating that the earlier directions of DHBVN had failed to stop the alleged overcharging.

42. DHBVN stated that after taking over O&M activities of Ardee City from August 2018, it became responsible only for future billing of the residents. Thereafter, DHBVN started recovering electricity dues strictly in accordance with the Single Point Supply Regulations.

43. DHBVN submitted that under the Single Point Supply Regulations, it was not required to provide distribution facilities to individual flat owners within Ardee City. The Appellant, as the developer, was responsible for providing the entire electrical infrastructure for distribution within the project. Reliance is placed on Regulation 5.1(b), (c) and (d) under which the GHS/ Employer/ Developer /RWA is required to install, operate and maintain the internal distribution infrastructure at its own cost; provide transformers/ substations and metering equipment for single-point supply; and provide individual meters for residents and common facilities. The Developer is also responsible for individual metering, billing and collection of charges from users and payment of the energy bill for the single-point connection to the distribution licensee.

44. DHBVN relied on Regulation 5.5 which provides that the GHS/ Employer/ Developer /RWA cannot charge residents for electricity supplied by the distribution licensee at a tariff higher than the Domestic Supply (DS) tariff approved by the Commission. In case of charging above the approved tariff, aggrieved residents may approach HERC for redressal.

45. According to DHBVN, the regulatory framework makes it clear that DHBVN’s responsibility ends at the single point of supply whereas internal distribution, metering, billing and collection are the responsibility of the Appellant/Developer.

46. DHBVN submitted that the Commission did not exceed its jurisdiction by directing modification of the bilateral agreements. Although the Appellant relies upon Clause 3 of the Electricity Connection Agreement for recovery of operational costs, such contractual provisions cannot be treated as legitimate or enforceable to the extent that they violate the binding Single Point Supply Regulations.

47. DHBVN relied on Section 23 of the Contract Act, submitting that an agreement is void where its consideration or object is unlawful and if permitted, would defeat the provisions of law. Since the bilateral agreement permits charging amounts above the Commission-approved DS tariff, it allegedly directly violates Regulation 5.5 and is therefore void to that extent.

48. DHBVN submitted that HERC’s direction to modify the bilateral agreements was a necessary consequence of finding them inconsistent with the Regulations, was within the Commission’s jurisdiction to protect consumer interests and ensure regulatory compliance and did not amount to impermissible interference with contractual freedom because private contracts cannot be permitted to defeat statutory obligations.

49. In view of the above, DHBVN submitted that the Appeal is misconceived and devoid of merit and therefore deserves to be dismissed.

Our Analysis and Conclusions

50. After hearing the Learned Counsel for the Appellant and the Learned Counsel for the Respondents at length and carefully considering their respective submissions, we have also examined the written pleadings and relevant material on record. Upon due consideration of the arguments advanced and the documents placed before us, we now proceed to analyse the issues arising for our consideration in the present Appeal.

51. Before we proceed to examine rival contentions, it will be worthwhile to peruse relevant provisions of the HERC Single Point Supply Regulations, 2013:

“5.2 Existing GHSs covered under the provisions of Regulation 4.2 which opts for Single Point Supply and existing colonies covered under Regulation 3.2.

(a) …..

(b) …..

(c) In case of GHSs/Colonies where the electrical infrastructure including substations/transformers etc for supply of electricity within the GHS/Colony has been installed at the cost of GHS/Developer/RWA /Employer and the ownership is presently with the distribution licensee, the operation & maintenance of the electrical infrastructure shall be carried out by the GHS/Developer/RWA /Employer at their cost from the date of conversion to Single Point Supply but the ownership of the same will be retained by the distribution licensee. However in certain cases where installation has been done at the cost of the GHS/Developer/RWA /Employer and the ownership is also with them, the operation & maintenance of the electrical infrastructure shall be carried by the GHS/Developer/RWA /Employer from the date of conversion to Single Point Supply, if not already being done, and the ownership of the electrical infrastructure shall also continue to remain with the GHS / Developer / RWA /Employer.

(d) In case of GHSs/Colonies, where the installation of electrical infrastructure including substations/transformers etc. for supply of electricity within the GHS/Colony has been done at the cost of the distribution licensee, the ownership of the electrical infrastructure shall continue to be of the distribution licensee but the operation and maintenance of the same, from the date of conversion to Single Point Supply, shall be the responsibility of the GHS/Developer/RWA /Employer and cost thereof shall be borne by them. Alternately, at the option of the GHS/Developer/RWA /Employer, the operation and maintenance may be done by the distribution licensee but the cost shall be borne by the GHS/Developer/RWA.

(e) ……..”

“5.3 The total consumption and combined maximum demand of GHS/Colony will be recorded by Single Point Supply meter. A rebate of 4% in case of supply at 11 kV and 5% in case of supply at higher voltage in the energy consumption as recorded at Single Point Supply meter will be admissible as an incentive for Single Point Supply under these Regulations and to cover the expenses that may be incurred by the GHS/ Employer/ Developer/RWA in meeting their liabilities/obligations such as individual metering, billing, collection of charges from individual residents/users etc. The energy consumption after allowing the rebate as above and the maximum demand recorded by Single Point Supply meter will be billed at the tariff as applicable to Bulk Supply (Domestic) category. All other terms and conditions as applicable to Bulk Supply (Domestic) category as laid down in the Schedule of Tariff notified and as amended by the Commission from time to time shall be applicable for Single Point Supply under these Regulations unless otherwise provided for in these Regulations. ……………” “5.5 The GHS/Employer /Developer/RWA will not charge the residents for electricity supplied by the Distribution Licensee at a tariff higher than the rates for Domestic Supply (DS) category approved by the Commission from time to time. In case any GHS/Employer/Developer/RWA charges the residents for electricity supplied by the Distribution Licensee at rates higher than the Domestic supply tariff, the aggrieved residents can jointly file a complaint against such GHS/Employer/Developer/RWA with the Commission through a petition for redressal of their grievance. ………..”

52. First, we note that the Appellants have raised a preliminary objection that as per the contractual agreements executed between them and the individual residents, the disputes were to be referred to arbitration and hence HERC has exceeded its jurisdiction.

53. We do not agree with the aforesaid contention of the Appellants. It is a well- settled position in law that statutory and regulatory provisions having binding force would prevail over any inconsistent stipulation contained in an agreement. The Hon’ble Supreme Court, including in PTC India Ltd. v. Central Electricity Regulatory Commission, 2010 4 SCC 603, has recognised the binding and statutory character of regulations framed by the Regulatory Commission in exercise of the powers conferred upon it under the Electricity Act, 2003. Consequently, in the present case, the Regulation 5.5 of HERC Single Point Supply Regulations, 2013, which allows the aggrieved residents to approach the Commission regarding any complaint relating to overcharging, shall supersede the contrary provision of the agreement between the Appellants and the residents.

54. Another objection raised by the Appellants is that the HERC has not maintained parity with their own decision in Mukesh Kumar v. Full Marks Facilities Management Pvt. Ltd. & Ors., HERC/PRO-20 of 2015 where a similar issue concerning overcharging under a Single Point Connection system was treated as a billing dispute and the consumer was directed to approach the Electricity Ombudsman under Section 42 of the Electricity Act.

55. As we have noted earlier, the HERC Single Point Supply Regulations, 2013 has specific provision in 2nd paragraph of Regulation 5.5 that in case of overcharging, the aggrieved residents can file a complaint with the Commission. We are conscious that this provision is not entirely harmonious with the provisions

of the Haryana Electricity Regulatory Commission (Guidelines for Establishment of Forum for Redressal of Grievances of the Consumers) and (Electricity Ombudsman) Regulation, 2004, wherein the definition of “complaint” includes overcharging and such disputes are required to be referred to the CGRF. However, we are of the opinion that HERC Single Point Supply Regulations, 2013 supersede any inconsistent provision of the Haryana Electricity Regulatory Commission (Guidelines for Establishment of Forum for Redressal of Grievances of the Consumers) and (Electricity Ombudsman) Regulation, 2004 in the present case, as the former are not only subsequent in time but also specifically deal with the issue of single point supply.

56. The principle objection raised by the Appellants is that HERC Single Point Supply Regulations, 2013 have been wrongly applied by the HERC on two counts-

(i) These regulations govern Employer Colonies and Group Housing Societies whereas the Appellant is a private developer, and (ii) Regulation 5.5 only prohibits charging electricity tariff above the tariff approved by the Commission and does not prohibit separately agreed infrastructure-related charges or contractual arrangements for operation and maintenance of the internal network. The Appellants have also contended that under Option-1 (single point supply), there will be transformation and/or LT loss similar to those recognised in option-2 in Regulation 4.1.1. However, there is no mechanism available to the Appellants to recover the same under the Regulations.

57. It does not require much analysis to conclude that no person can undertake distribution of electricity except in accordance with the provisions of the Electricity Act, 2003 (“the Act”) (Section 12). It is an admitted fact that the Appellant was not a distribution licensee. Further the activity of receiving supply at a single point and supplying it to end-users through its own infrastructure, even within the premises

of the colony, amounts to distribution of electricity, as held by this Tribunal in K. Raheja Corporation Pvt. Ltd. v. MERC, 2011 SCC OnLine APTEL 105.

58. These facts lead to only one conclusion that the HERC Single Point Supply Regulations, 2013, without expressly saying so, recognise the GHS/RWA/developer as an intermediary through whom the distribution licensee supplies electricity to the individual residents.

59. It is clear from Regulation 5.3 that a rebate of 4% or 5% (depending on whether the single point supply is at 11 kV or at a higher voltage) is applicable on the applicable bulk domestic tariff for the entire consumption measured at the single point of supply. Regulation 5.5 makes it abundantly clear that residents cannot be charged a tariff higher than that fixed by the Commission for the applicable domestic category.

60. As regards the purpose of the rebate, Regulation 5.3 of the HERC Single Point Supply Regulation, 2013 clarifies that the rebate is provided as an incentive for Single Point Supply under these Regulations and also covers the expenses that may be incurred by the GHS/Employer/Developer/RWA in meeting their liabilities/obligations, such as individual metering, billing, collection of charges from individual residents/users, etc. We also note that Regulations 5.2(c) and 5.2(d) of these Regulations recognise that there are costs associated with the installation and maintenance of infrastructure after the point of receipt of single point supply and that these costs are required to be borne by the GHS/Developer/RWA/Employer. In addition, there would necessarily be costs associated with transformation and/or LT losses in the internal network after receipt of supply from the Discom at the Single Point, the treatment of which has not been

expressly provided for under Option-1 of the HERC Single Point Supply Regulations, 2013.

61. It is obvious that, in the case of a GHS or RWA, such cost would ultimately have to be borne by the member residents, whether by way of maintenance charges, contributions or otherwise, and would have to be apportioned amongst them on some rational basis. Similarly, in the case of a colony developed by an employer, the employer may recover such cost from the employees’ salaries or treat it as a perk for the employees. Thus, in all such cases, the individual residents may effectively pay slightly more than the applicable domestic tariff determined by the Commission, if the costs associated with transformation and/or LT losses, and installation and maintenance of the infrastructure are also taken into account. However, the Impugned Order effectively restricts developer from recovery of these costs.

62. In the present case, the agreements between the Appellants and the individual residents indicates that the cost of the infrastructure was not included in the cost of the flats or houses. It is also clear that there is no explicit provision in the Regulations on the treatment of transformation and/or LT losses under Single Point Supply arrangement.

63. It would be just and fair that, in case of Single Point Supply, the residents of a colony developed by a Developer bear such cost on a similar basis as the residents living in colonies developed or maintained by a GHS/RWA/Employer. However, by the Impugned Order, the burden of the cost relating to the installation and maintenance of the electrical infrastructure within the colony has been unfairly placed on the Developer.

64. In view of the foregoing analysis, we set aside the Impugned Order to the extent it restricts the Appellants from recovering from individual households any amount in excess of the applicable tariff fixed by the Commission, thereby effectively preventing the Appellants from recovering from the residents costs associated with (a) transformation and/or LT losses, and (b) installation and maintenance of the electrical infrastructure within the colony. However, we are not convinced that the 12% additional charges imposed by the Appellants represent reasonable cost for the aforesaid cost elements. We, therefore, have decided to remand the matter to the HERC to determine, during the period in question, the reasonable cost associated with (a) transformation and/or LT losses, and (b) installation and maintenance of the electrical infrastructure within the colony.

65. The Hon’ble Supreme Court, in A.P. Power Coordination Committee v. Lanco Kondapalli Power Ltd., (2016) 3 SCC 468, has held that although the Limitation Act, 1963, as such, is not directly applicable to proceedings before the Electricity Commission, the principles underlying the law of limitation apply to claims adjudicated by the Commission under Section 86(1)(f) of the Electricity Act, 2003. Consequently, a claim which is barred by limitation in an ordinary civil suit cannot be entertained or allowed by the Commission.

66. There is no doubt that the proceedings in the present case were adjudicatory in nature, albeit under the HERC Single Point Supply Regulations, 2013. We are, therefore, in agreement with the contention of the Appellants and accordingly conclude that, in the remand proceedings, the HERC shall restrict its findings to the period commencing three years prior to the date of filing of the complaint before the HERC and ending on the date on which the supply was taken over by the Discom.

67. We are consciously taking the date of filing of the complaint before the HERC as the reference date, and not the date of filing of the complaint before the Discom, since the Regulations require the residents to approach the HERC and not the Discom.

68. The Appellants have submitted that the consumer complaint was filed before NCDRC by the RWA and therefore the proceedings before HERC were liable to be stayed under Section 10 of the CPC. We are not inclined to consider this contention since the Impugned Order does not show that this issue was raised in the original proceedings before HERC. However, the issue of multiplicity of litigation and forum hunting was raised by the Appellant-Respondent before the HERC and has also been raised in the present proceedings. However, we are not impressed by this argument in view of Section 175 of the Act, which stipulates that the provisions of the Act are in addition to, and not in derogation of any other law for the time being in force. Further, the proceedings before the NCDRC were instituted by the RWA, whereas the present proceedings have been instituted by the individual residents in their capacity as consumers under the HERC Single Point Supply Regulations, 2013. The mere fact that the two proceedings arise from the same underlying dispute, therefore, cannot by itself amount to forum hunting.

69. The Appellants have also raised an objection that in an adjudicatory proceeding on complaint field by a limited number of residents, the HERC directed refund of the alleged excess amount to “all residents of Ardee City”. We do not find merit in the above objection. In our view, the HERC was well within its jurisdiction to grant relief not only to the Respondent-Petitioners but also to all similarly placed consumers. The adjudication was founded upon the HERC Single Point Supply Regulations, 2013, which expressly permits consumers to approach the Commission directly for redressal of grievances pertaining to overcharging.

Although the Impugned Order arose out of an adjudicatory proceeding, the determination therein involved interpretation and application of provisions of the Regulations having general application. In such circumstances, extending the consequential relief to all similarly situated consumers is consistent with the principles of uniformity, non-discrimination and equal treatment embodied in the Electricity Act, 2003 and the Regulations framed thereunder.

70. We have also noted the contention of the Appellants that some residents are defaulters and therefore the direction of HERC to refund the excess amount without even determining the amount, is not correct. However, we are of the opinion that if any individual resident has outstanding dues towards charges other than those relating to electricity, such dues cannot be set off against the amount determined as refundable towards excess electricity charges in the present proceedings. The Appellants shall be at liberty to pursue such dues by adopting such other legal remedy as may be available to them in law.

ORDER

In view of the forging analysis, we set aside the Impugned Order of the Commission to the extent that it restricts the Appellants from recovering from individual households any amount in excess of the applicable tariff fixed by the Commission, thereby effectively preventing the Appellants from recovering from the residents costs associated with (a) transformation and/or LT losses, and (b) installation and maintenance of the electrical infrastructure within the colony. Further, we remand the matter to the HERC for fresh determination in accordance with the findings and directions contained herein. In the remand proceedings, the HERC shall:

(i) determine the reasonable cost associated with the above mentioned cost elements, and

(ii) consequently amount, if any, payable by the Appellants to the residents towards excess charges for electricity, in accordance with our findings hereinabove, and

(iii) issue appropriate directions for refund/adjustment of such amount to the residents of the Ardee City.

The Captioned Appeal and pending IAs, if any, are disposed of in the above terms.

PRONOUNCED IN THE OPEN COURT ON THIS 17th DAY OF SEPTEMBER, 2026.

(Ajay Talegaonkar) Technical Member (Virender Bhat) Judicial Member

REPORTABLE / NON-REPORTABLE kns/mg/mkj/kks