WEST BENGAL STATE ELECTRICITY DISTRIBUTION COMPANY LTD. & ORS. versus M/S. ORION METAL PVT. LTD. & ANR. on 21 August 2019

WEST BENGAL STATE ELECTRICITY DISTRIBUTIONCOMPANY LTD. & ORS.

v.

M/S. ORION METAL PVT. LTD. & ANR.

(Civil Appeal No. 6547 of 2019)

AUGUST 21, 2019

[R. BANUMATHI AND R. SUBHASH REDDY, JJ.]

Electricity Act, 2003: Object and reasons of enactment –Discussed.

Electricity Act, 2003: s.126(6)(b) – Unauthorized use ofelectricity – Meaning of – Held: Unauthorized use of electricitymeans, the usage of electricity by any artificial means or by a meansnot authorized by the concerned person or authority or licensee;or through a tampered meter; or for the purpose other than forwhich the usage of electricity was authorized; or for the premisesor areas other than those for which the supply of electricity wasauthorized – Thus, use of energy through tampered meter is includedin the definition of unauthorized use of electricity.

Electricity Act, 2003: s.126(1) – Power of authorities to makeassessment under s.126(1) to assess the loss of energy whereelectricity is used through tampered meter – Held: The authoritiesunder the Act are empowered to make a provisional and finalassessment by invoking power under s.126(1) of the Act, even incases where electricity is unauthorisedly used by way of theft.

Electricity Act, 2003: s.126(1) – Criminal complaint of theftof energy – Whether criminal complaint and assessment proceedingsunder s.126(1) can go simultaneously – Held: Whenever there isallegation of theft of energy committed by the consumer, even afterlodging a police complaint for commission of such offence, it isalways open for the authorities to make provisional and finalassessment to recover loss of energy in exercise of power unders.126(1) of the Act.

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AElectricity Act, 2003: s.126 and s.135 – Distinction between– Held: s.126 forms part of the scheme which authorizes electricitysupplier to ascertain loss in terms of revenue caused to it by theconsumer by his act of “unauthorized use of electricity” whereass.135 deals with offence of theft if he is found to have indulgedhimself in the acts mentioned in clauses (a) to (e) of sub-section (1)Bof s.135 of Act.

Electricity Act, 2003: s.126, 135, 154 – Proceedings unders.126(1) and under s.154(5) – Held: Power conferred on authoritiesfor making assessment under s.126(1) of the Act and power todetermine civil liability under s.154(5) of the Act, cannot be said toCbe parallel to each other – In a given case where there is no theft ofenergy, amounting to unauthorized use of energy, in such cases nocomplaint of theft can be lodged as contemplated under s.135 ofthe Act – In such cases for loss of energy, on account ofunauthorized use of energy not amounting to theft, it is always openDfor the authorities to assess the loss of energy by resorting to powerunder s.126(1) of the Act – In cases where allegation is ofunauthorized use of energy amounting to theft, in such cases, apartfrom assessing the proceedings under s.126(1) of the Act, a complaintalso can be lodged alleging theft of energy as defined under s.135(1)of the Act – In such cases, the Special Court is empowered toEdetermine civil liability under s.154(5) of the Act – On suchdetermination of civil liability by the Special Court, the excessamount, if any, deposited by the petitioner, is to be refunded to theconsumer – It is a settled principle that to prove the guilt of theaccused in a criminal proceeding, authorities have to prove theFcase beyond reasonable doubt and the element of mens rea is alsoto be established – On the other hand, such a strict proof is notnecessary for assessing the liability under s.126(1) of the Act.

Electricity Act, 2003: s.154 – Procedure and power ofSpecial Court – The Special Court is empowered to convict theGconsumer and impose a sentence of imprisonment – The SpecialCourt, in cases, where a criminal complaint is lodged, is alsoempowered to determine civil liability under s.154(5) of the Act –As per s. 154(6) of the Act, in case civil liability so determined bythe Special Court is less than the amount deposited by the consumer H

Conclusion

W. B. STATE ELECTRICITY DISTRIBUTION COMPANY LTD.v. M/S. ORION METAL PVT. LTD.

or the person, the excess amount so deposited by the consumer orthe person, shall be refunded by the licensee or the concernedperson, as the case may be – Merely because the Special Court isempowered to determine civil liability under s.154(5) of the Act, incases where a complaint is lodged, it cannot be said that there is nopower conferred on authorities to make provisional assessment/finalassessment under s.126 of the Act.

Allowing the appeal, the Court

HELD : 1.1 Prior to Electricity Act, 2003, generation andsupply of electricity was governed by the provisions under IndianElectricity Act, 1910, the Electricity (Supply) Act, 1948 and theElectricity Regulatory Commissions Act, 1998. With the policyof the Government to encourage private sector participation ingeneration, transmission and distribution of energy and with theobjective of distancing regulatory responsibilities from theGovernment to the Regulatory Commissions, it was felt that thereis a need for harmonizing and rationalizing the provisions of theelectricity by bringing a new legislation. That is how the ElectricityAct, 2003, was enacted and brought into force. In the objects andreasons, a specific reference is made to incorporate provisionsrelating to theft of electricity, to have a revenue focus. A perusalof Sections 135 and 154 shows that after an inspection of anyplace or any premises of any consumer, when Assessing Officercomes to a conclusion that the consumer is indulging inunauthorized use of electricity, the provisional assessment to thebest of his judgment is to be made in accordance with Section126(1) of the Act and such provisional assessment shall be servedupon the person in occupation of the premises. After giving anopportunity to file objections to the provisional assessment, theAssessing Officer is empowered to pass a final order of theassessment assessing the loss of energy, on account ofunauthorized use of energy. The unauthorized use of electricityas defined in Section 126(6)(b) of the Act means, the usage ofelectricity by any artificial means or by a means not authorized bythe concerned person or authority or licensee; or through atampered meter; or for the purpose other than for which the usageof electricity was authorized; or for the premises or areas other AB

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Athan those for which the supply of electricity was authorized.[Paras 9, 11] [395-A-C; 400-D-G]

1.2 Reading of Section 126 (6)(b)(iii) of the Act showsinstances of use of energy through a tampered meter is includedin the definition of unauthorized use of electricity. If that is so,Bthere is no reason, for excluding the power of the authorities formaking assessment under Section 126(1) of the Act to assessthe loss of energy, where electricity is used through a tamperedmeter. All instances of unauthorized use of energy may not amountto theft of electricity within the meaning of Section 135 of theAct, but at the same time, the theft of electricity which is coveredCby Section 135 of the Act, will fall within the definition ofunauthorized use of electricity. As per Section 135(1A) of theAct, without prejudice to the other provisions of the Act, thelicensee or supplier, as the case may be, upon detection of theftof electricity, is empowered to disconnect the power supplyDimmediately. Further, as per the third proviso to Section 135(1A)of the Act, the licensee or supplier, as the case may be, on depositor payment of assessed amount or electricity charges, withoutprejudice to the obligation to lodge a complaint, can restore thepower supply electricity within 48 hours of deposit /payment ofsuch amount. Thus, it is clear that the authorities under the ActEare empowered to make a provisional and final assessment byinvoking power under Section 126(1) of the Act, even in caseswhere electricity is unauthorisedly used by way of theft. When aconsumer deposits the assessed amount, the licensee or thesupplier has to restore the power supply. The assessed amountFreferred to in the aforesaid proviso, relates to assessment whichis contemplated under Section 126(1) of the Act only. There isapparent distinction between Section 126 and Section 135 of theAct. Section 126 forms part of the scheme which authorizeselectricity supplier to ascertain loss in terms of revenue caused to it by the consumer by his act of “unauthorized use of electricity”Gwhereas Section 135 deals with offence of theft if he is found tohave indulged himself in the acts mentioned in clauses (a) to (e)of sub-section (1) of Section 135 of Electricity Act. Further, it isalso clear from Section 154 of the Act, which prescribes procedureand power of Special Court, that the Special Court is empowered H

to convict the consumer and impose a sentence of imprisonment.The Special Court, in cases, where a criminal complaint is lodged,is also empowered to determine civil liability under Section154(5) of the Act. As per Section 154(6) of the Act, in case civilliability so determined by the Special Court is less than the amountdeposited by the consumer or the person, the excess amount sodeposited by the consumer or the person, shall be refunded bythe licensee or the concerned person, as the case may be. Merelybecause the Special Court is empowered to determine civilliability under Section 154(5) of the Act, in cases where a complaintis lodged, it cannot be said that there is no power conferred onauthorities to make provisional assessment/final assessmentunder Section 126 of the Act.[Para 12] [400-H; 401-A-H; 402-A]

2. From the scheme of the Act, it appears that afterinspection team notices unauthorized use of energy by tamperingthe meter, the authorities can disconnect the power supplyimmediately and make immediate assessment for loss of energy,by invoking power under Section 126(1) of the Act. The term“unauthorized use of energy” is of wide connotation. There maybe cases of unauthorized use of energy, not amounting to theft,which are cases viz. exceeding the sanctioned load or using theelectricity in the premises where its use is not authorized etc.But at the same time, when there is an allegation of unauthorizeduse of energy by tampering the meter, such cases of unauthorizeduse of energy include ‘theft’ as defined under Section 135 of theAct. The power conferred on authorities for making assessmentunder Section 126(1) of the Act and power to determine civilliability under Section 154(5) of the Act, cannot be said to beparallel to each other. The High Court has committed an error inrecording a finding, that both proceedings cannot operateparallelly. In cases where allegation is of unauthorized use ofenergy amounting to theft, in such cases, apart from assessingthe proceedings under Section 126(1) of the Act, a complaint alsocan be lodged alleging theft of energy as defined underSection 135(1) of the Act. In such cases, the Special Court isempowered to determine civil liability under Section 154(5) ofthe Act. [Para 14] [403-B-F]

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AExecutive Engineer Southern Electricity SupplyCompany of Orissa Limited (SOUTHCO) & Another v.Shi. Seetaram Rice Mill (2012) 2 SCC 108 : [2011]15 SCR 211 – relied on.

The Hotel Adityaz Limited v. Madhya Pradesh KshetraBVidyut Vitran Company Limited, Bhopal & others AIR2016 (NOC) 39 (M.P.) – referred to.

Case Law Reference

AIR 2016 (NOC) 39 (M.P.)referred toPara 6C[2011] 15 SCR 211relied onPara 13

relied onPara 13

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6547of 2019.

From the Judgment and Order dated 18.12.2017 / corrected orderdated 7.2.2018 of the High Court at Calcutta in FMA No. 520 of 2017.

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Jaideep Gupta, Sr. Adv., Saurabh Mishra, Abhishek Singh,Ms. Aashna, Advs. for the Appellants.

Gaurav Jain, Ms. Abha Jain, Jaivir Singh, Advs. for theRespondents.

EThe Judgment of the Court was delivered by

R. SUBHASH REDDY, J. 1. Leave granted.

2. This civil appeal is filed by the appellant- West Bengal StateElectricity Distribution Company Limited and others, aggrieved by thejudgment and order dated 18.12.2017 passed by the High Court ofFCalcutta in F.M.A. No.520 of 2017 and the corrected order dated07.02.2018. By the impugned order, the intra Court appeal preferred bythe respondent company was allowed by the Division Bench of HighCourt.

3. Necessary facts, in brief, are as under:G

(a) The 1[st] respondent herein is the consumer of electricity fromthe appellant- West Bengal State Electricity Distribution Company Limited& Ors. There is a supply agreement entered into between the parties on22.12.2004. The officials of the appellant company served a notice dated28.10.2016 upon the 1[st] respondent, in exercise of power under Class H

IV of the West Bengal Electricity Regulatory Commission ElectricitySupply Code, 2007 for conducting an inspection in the metering systemof the respondent. The respondent-company is a centralized bulk highvoltage consumer of electricity in the Hooghly region, with a contractedload of 1450 KVA. After service of notice on the 1[st] respondent on28.10.2016, inspection was made by the Superintending Engineer,Divisional Engineer, Divisional Engineer (Manager), Assistant Engineerof Chandanangore Division, in the premises of the respondent herein.

(b) During the inspection, it was noticed by the inspecting teamthat input current is abnormally high from output current at TTB end inrespect of the R & B Phase of PT secondary wires. The inspectingteam on breaking open the TTB has also found some foreign materialinside. In view of such discrepancies found during the inspection, theinspection team was of the view that there was a theft of energy bytampering the meter by the respondent-company. The three-phase meterand the metering equipment was seized by the inspecting team bypreparing a seizure list. In view of such discrepancies noticed duringinspection, in exercise of power under Section 126(1) of the ElectricityAct, 2003 (for short ‘the Act’), provisional assessment for loss of energyby un-metered consumption was made by one Mr. B. Saha,Superintending Engineer/Assessing Officer of the appellant-company.The provisional assessment was made assessing the value of energywhich was consumed on account of un-metered consumption atRs.13,41,17,482-30 paise (Rupees thirteen crores forty one lakhsseventeen thousand four hundred and eighty two only).

(c) After inspection, a criminal complaint was also lodged beforethe local police by the Superintending Engineer (Commercial), Hooghlyregion, of the appellant company, complaining theft of energy by therespondent. In the complaint made by the appellant, it was alleged thatby inserting a foreign material into the meter, the respondent-companyhas indulged in theft of energy.

(d) On the basis of criminal complaint made by the SuperintendingEngineer (Commercial), a criminal case has been registered against therespondent-company and the police have submitted a charge-sheet inthe criminal case.

(e) Aggrieved by the provisional assessment and the consequentialdemand, the respondents have filed writ petition in W.P. No.30449(W)

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Aof 2016 before the High Court, questioning the jurisdiction of theAssessing Officer in issuing the provisional assessment and theconsequential demand for a sum of Rs.13,41,17,482-30 paise. In thewrit petition, one of the grounds was that the Assessing Officer, whoprepared the provisional assessment, not being a party to the inspectionteam, had no authority to make the provisional assessment under SectionB126(1) of the Act. In the writ petition, it was alleged that provisionalassessment made was not in accordance with Section 126(1) of the Act,as such, such assessment cannot be given effect to.

(f) Learned single Judge of the High Court, on the ground that theappellant-Distribution Company has not produced any material to showCthat the Assessing Officer was part of the inspection team, has held thatassessment and consequential demand made in the provisional assessmentproceedings was not in accordance with Section 126(1) of the Act andquashed the same. While allowing the writ petition, the learned singleJudge has directed the State Government to appoint any member of theDinspection team as an Assessing Officer to make fresh assessment.

(g) Aggrieved by the order of the learned single Judge dated15.12.2016, the respondent-writ petitioners have filed intra Court appealbefore the High Court. Following the directions, as contained in theorder passed by the learned single Judge, it appears, a Member of theEinspection team was appointed as an Assessing Officer by the StateGovernment and the said officer has provisionally assessed the value ofun-metered consumption of electricity and also made final assessmentafter giving opportunity for filing objections.

(h) The fresh assessment order, which is made in compliance ofFdirections issued by the learned single Judge, is also questioned in thepending appeal by filing an interlocutory application by the respondents.In view of the said interlocutory application, the Division Bench of theHigh Court has allowed such application permitting the respondents tochallenge the fresh assessment made pursuant to directions issued bythe learned single Judge, and passed the impugned order allowing theGappeal preferred by the respondents.

(i) In the intra Court appeal, before the Division Bench, therespondents have raised a ground that two parallel proceedings i.e. thecriminal complaint before the Competent Court and also assessmentproceedings under Section 126(1) of the Act cannot go simultaneously.H

Precisely, it was the case of the respondents that once a complaint isfiled, alleging theft of energy under Section 135(1)(a) of the Act, noassessment is permissible under Section 126(1) of the Act.

(j) Before the High Court, it appears that respondents have alsopleaded that the civil liability, if any, of the respondents can be determinedonly under sub-section (5) of Section 154 of the Act. While consideringthe scope of Sections 154, 135(1)(a) and 126 of the Act, the High Courthas held that when a criminal complaint is lodged alleging theft of energyby the consumer and when supply of electricity is disconnected onaccount of such offence alleged, only in cases where restoration of supplyis sought by the consumer, agreeing to deposit the assessed amount ofun-metered consumption, provisional assessment can be made underSection 126 of the Act. The High Court has drawn a distinction to exercisepower under Section 126(1) of the Act, in cases where consumer seeksrestoration of supply after disconnection and in cases where restorationof supply is not sought for. The High Court has held that only in caseswhere restoration is sought after disconnection, authorities can resort tomake assessment under Section 126(1) of the Act, otherwise, the civilliability can be determined by Special Court only by following theprocedure under sub-section (5) of Section 154 of the Act.

4. We have heard Mr. Jaideep Gupta, learned Senior counselappearing for the appellants and Mr. Gaurav Jain, learned counsel forthe respondents.

5. Having heard the learned counsels on both sides, we haveperused the impugned order and other materials placed on record.

6. The learned Senior counsel appearing for the appellants hassubmitted that the High Court has misconstrued the provisions underSections 126, 135 and 154 of the Act and erroneously allowed the appealand quashed the assessment order made by the appellants under Section126(1) of the Act. It is submitted by learned Senior counsel that, wheneverthere is an allegation of theft of energy by the consumer, even afterlodging a complaint for commission of such offence before the police, itis always open for the appellants to make provisional and final assessmentto recover loss of energy in exercise of power under Section 126(1) ofthe Act. Precisely, it is submitted that in all cases covered by Section135 of the Act, it is open for the authorities to make provisional assessmentunder Section 126 of the Act. It is submitted that the power conferred A

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Aunder Section 126(1) of the Act to make provisional assessment, will notdepend, whether consumer seeks restoration of supply or not, afterdisconnection of supply.

(a) It is submitted that to prove theft of energy before the SpecialCourt, case has to be proved beyond reasonable doubt and further theBelement of mens rea is a sine qua non to prove the guilt of the accused.It is submitted that such degree of proof is not required for the purposeof assessing loss of energy under Section 126(1) of the Act. LearnedSenior counsel has also placed reliance on the judgment in the case ofExecutive Engineer Southern Electricity Supply Company ofOrissa Limited (SOUTHCO) & Another v. Shi. Seetaram RiceCMill[1].

7. On the other hand, learned counsel appearing for therespondents, in support of the findings recorded by the High Court, hassubmitted that the unauthorized use of energy and theft of energy aretwo different aspects covered under different provisions of the Act. It isDsubmitted that the power conferred for provisional assessment underSection 126(1) of the Act, is confined to cases where there is an allegationof unauthorized use of energy and the allegation of theft of energy is tobe prosecuted only under Section 135(1)(a) of the Act. It is submittedthat only in cases where authorities prove the guilt of the accused, theESpecial Court is empowered to determine civil liability under sub-section(5) of Section 154 of the Act.

(a) It is further submitted that once power supply is disconnected,where there is a request by the consumer for restoration of power supply,the authorities can make assessment under Section 126(1) of the Act. InFsupport of this plea, the learned counsel brought to our notice a judgmentof the learned single Judge of Madhya Pradesh High Court in the caseof The Hotel Adityaz Limited v. Madhya Pradesh Kshetra VidyutVitran Company Limited, Bhopal & others[2] . In the aforesaidjudgment, learned single Judge of the High Court has held that wherethere is an allegation of theft of energy, such cases will fall only underGSection 135 of the Act and Section 126 of the Act, as no application.

8. Before we proceed further, we have looked into the Objectsand Reasons of the Electricity Act, 2003, and also the relevant provisionsi.e Sections 126, 135(1)(a), 153 and 154 of the Act.

1 (2012) 2 SCC 108H2 AIR 2016 (NOC) 39 (M.P.)

9. Prior to Electricity Act, 2003, generation and supply of electricitywas governed by the provisions under Indian Electricity Act, 2010, theElectricity (Supply) Act, 1948 and the Electricity Regulatory CommissionsAct, 1998. With the policy of the Government to encourage private sectorparticipation in generation, transmission and distribution of energy andwith the objective of distancing regulatory responsibilities from theGovernment to the Regulatory Commissions, it was felt that there is aneed for harmonizing and rationalizing the provisions of the electricity bybringing a new legislation. That is how the Electricity Act, 2003, wasenacted and brought into force. In the objects and reasons, a specificreference is made to incorporate provisions relating to theft of electricity,to have a revenue focus. Part XII of the Act deals with the provisionsrelating to investigation and enforcement and Part XIV of the Act dealswith the provisions relating to offences and penalties. The Constitutionof Special Courts and procedure and powers of the Special Courts arecovered by Part XV of the Act.

10. The relevant sections for the disposal of this appeal reads asunder:

“Section 126. Assessment:- (1) If on an inspection of any placeor premises or after inspection of the equipments, gadgets,machines, devices found connected or used, or after inspection ofrecords maintained by any person, the assessing officer comes tothe conclusion that such person is indulging in unauthorized use ofelectricity, he shall provisionally assess to the best of his judgmentthe electricity charges payable by such person or by any otherperson benefited by such use.

(2) The order of provisional assessment shall be served upon theperson in occupation or possession or in charge of the place orpremises in such manner as may be prescribed.

(3) The person, on whom an order has been served under sub-section (2), shall be entitled to file objections, if any, against theprovisional assessment before the assessing officer, who shall,after affording a reasonable opportunity of hearing to such person,pass a final order of assessment within thirty days from the dateof service of such order of provisional assessment, of the electricitycharges payable by such person.

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(4) Any person served with the order of provisional assessmentmay, accept such assessment and deposit the assessed amountwith the licensee within seven days of service of such provisionalassessment order upon him:

(5) If the assessing officer reaches to the conclusion thatBunauthorised use of electricity has taken place, the assessmentshall be made for the entire period during which such unauthorizeduse of electricity has taken place and if, however, the period duringwhich such unauthorised use of electricity has taken place cannotbe ascertained, such period shall be limited to a period of twelvemonths immediately preceding the date of inspection.

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(6) The assessment under this section shall be made at a rateequal to twice the tariff applicable for the relevant category ofservices specified in sub-section (5).

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(a) “assessing officer” means an officer of a State Governmentor Board or licensee, as the case may be, designated as suchby the State Government; (b) “unauthorised use of electricity” means the usage ofelectricity –

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(i) by any artificial means; or

(ii) by a means not authorised by the concerned person orauthority or licensee; or

(iii) through a tampered meter; or

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(iv) for the purpose other than for which the usage of electricitywas authorised; or

(v) for the premises or areas other than those for which thesupply of electricity was authorized.”

GThe procedure for ‘theft of energy’ is covered by Section 135 ofthe Act under Part IX. Section 135 of the Act reads as under:

“Section 135. Theft of Electricity:- (1) Whoever, dishonestly,- (a) taps, makes or causes to be made any connection with overhead,underground or under water lines or cables, or service wires, orHservice facilities of a licensee or supplier, as the case may be; or

(b) tampers a meter, installs or uses a tampered meter, currentreversing transformer, loop connection or any other device ormethod which interferes with accurate or proper registration,calibration or metering of electric current or otherwise results in amanner whereby electricity is stolen or wasted; or A

(c) damages or destroys an electric meter, apparatus, equipment,or wire or causes or allows any of them to be so damaged ordestroyed as to interfere with the proper or accurate metering ofelectricity; or B

(d) uses electricity through a tampered meter; or C

(e) uses electricity for the purpose other than for which the usageof electricity was authorised, so as to abstract or consume or use electricity shall be punishablewith imprisonment for a term which may extend to three years orwith fine or with both:

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Provided that in a case where the load abstracted, consumed,or used or attempted abstraction or attempted consumption orattempted use –

(i) does not exceed 10 kilowatt, the fine imposedon first conviction shall not be less than threeEtimes the financial gain on account of such theftof electricity and in the event of second orsubsequent conviction the fine imposed shall notbe less than six times the financial gain onaccount of such theft of electricity; F

(ii) exceeds 10 kilowatt, the fine imposed on firstconviction shall not be less than three times thefinancial gain on account of such theft ofelectricity and in the event of second orsubsequent conviction, the sentence shall beimprisonment for a term not less than sixGmonths, but which may extend to five years andwith fine not less than six times the financialgain on account of such theft of electricity:

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Provided further that in the event of second and subsequentconviction of a person where the load abstracted, consumed,or used or attempted abstraction or attempted consumption orattempted use exceeds 10 kilowatt, such person shall also bedebarred from getting any supply of electricity for a periodwhich shall not be less than three months but may extend totwo years and shall also be debarred from getting supply ofelectricity for that period from any other source or generatingstation:

Provided also that if it is proved that any artificial means ormeans not authorized by the Board or licensee or supplier, asthe case may be, exist for the abstraction, consumption or useof electricity by the consumer, it shall be presumed, until thecontrary is proved, that any abstraction, consumption or use ofelectricity has been dishonestly caused by such consumer.

(1A) Without prejudice to the provisions of this Act, thelicensee or supplier, as the case may be, may, upon detectionof such theft of electricity, immediately disconnect the supplyof electricity:

Provided that only such officer of the licensee or supplier,as authorized for the purpose by the Appropriate Commissionor any other officer of the licensee or supplier, as the casemay be, of the rank higher than the rank so authorised shalldisconnect the supply line of electricity:

Provided further that such officer of the licensee or supplier,as the case may be, shall lodge a complaint in writing relatingto the commission of such offence in police station havingjurisdiction within twenty four hours from the time of suchdisconnect:

Provided also that the licensee or supplier, as the case maybe, on deposit or payment of the assessed amount or electricitycharges in accordance with the provisions of this Act, shall,without prejudice to the obligation to lodge the complaint asreferred to in the second proviso to this clause, restore thesupply line of electricity within forty-eight hours of such depositor payment;]

(2) Any officer of the licensee or supplier as the case may be,authorized in this behalf by the State Government may –

(a) enter, inspect, break open and search any place or premisesin which he has reason to believe that electricity has been or isbeing, used unauthorisedly; (b) search, seize and remove all such devices, instruments,wires and any other facilitator or article which has been, or isbeing, used for unauthorized use of electricity;

(c) examine or seize any books of account or documents whichin his opinion shall be useful for or relevant to, any proceedings inrespect of the offence under sub-section (1) and allow the personfrom whose custody such books of account or documents areseized to make copies thereof or take extracts therefrom in hispresence.

(3) The occupant of the place of search or any person on hisbehalf shall remain present during the search and a list of all thingsseized in the course of such search shall be prepared and deliveredto such occupant or person who shall sign the list:

Provided that no inspection, search and seizure of any domesticplaces or domestic premises shall be carried out between sunsetand sunrise except in the presence of an adult male memberoccupying such premises.

(4) The provisions of the Code of Criminal Procedure, 1973 (2 of1974), relating to search and seizure shall apply, as far as may be,to searches and seizure under this Act.”

The procedure to be followed by the Special Court constitutedunder Section 153 of the Act is prescribed under Section 154 of theAct.

Sub-sections (5) and (6) of Section 154 of the Act read as under:

“(5) The Special Court shall determine the civil liability against aconsumer or a person in terms of money for theft of energy whichshall not be less than an amount equivalent to two times of thetariff rate applicable for a period of twelve months preceding thedate of detection of theft of energy or the exact period of theft if A

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determined whichever is less and the amount of civil liability sodetermined shall be recovered as if it were a decree of civil court.

(6) In case the civil liability so determined finally by the SpecialCourt is less than the amount deposited by the consumer or theperson, the excess amount so deposited by the consumer or theBperson, to the Board or licensee or the concerned person, as thecase may be, shall be refunded by the Board or licensee or theconcerned person, as the case may be, within a fortnight from thedate of communication of the order of the Special Court togetherwith interest at the prevailing Reserve Bank of India prime lendingrate for the period from the date of such deposit till the date ofCpayment.

Explanation.- For the purposes of this section, “civil liability”means loss or damage incurred by the Board or licensee or theconcerned person, as the case may be, due to the commission ofan offence referred to in sections 135 to 140 and section 150.”

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11. A perusal of the aforesaid provisions and on giving a conjointreading of the same, it appears to us that after an inspection of any placeor any premises of any consumer, when Assessing Officer comes to aconclusion that the consumer is indulging in unauthorized use of electricity,the provisional assessment to the best of his judgment is to be made inEaccordance with Section 126(1) of the Act and such provisionalassessment shall be served upon the person in occupation of the premises.After giving an opportunity to file objections to the provisional assessment,the Assessing Officer is empowered to pass a final order of theassessment assessing the loss of energy, on account of unauthorized useFof energy. The unauthorized use of electricity is defined under Section126(6)(b) of the Act. It is clear from the aforesaid definition thatunauthorized use of electricity means, the usage of electricity by anyartificial means or by a means not authorized by the concerned personor authority or licensee; or through a tampered meter; or for the purposeother than for which the usage of electricity was authorized; or for theGpremises or areas other than those for which the supply of electricitywas authorized.

12. It is clear from the reading of Section 126 (6)(b)(iii) of the Actthat instances of use of energy through a tampered meter is included in H

the definition of unauthorized use of electricity. If that is so, there is noreason, for excluding the power of the authorities for making assessmentunder Section 126(1) of the Act to assess the loss of energy, whereelectricity is used through a tampered meter. All instances of unauthorizeduse of energy may not amount to theft of electricity within the meaningof Section 135 of the Act, but at the same time, the theft of electricitywhich is covered by Section 135 of the Act, will fall within the definitionof unauthorized use of electricity. As per Section 135(1A) of the Act,without prejudice to the other provisions of the Act, the licensee orsupplier, as the case may be, upon detection of theft of electricity, isempowered to disconnect the power supply immediately. Further, as perthe third proviso to Section 135(1A) of the Act, the licensee or supplier,as the case may be, on deposit or payment of assessed amount orelectricity charges, without prejudice to the obligation to lodge a complaint,can restore the power supply electricity within forty-eight(48) hours ofdeposit /payment of such amount. Thus, it is clear that the authoritiesunder the Act are empowered to make a provisional and final assessmentby invoking power under Section 126(1) of the Act, even in cases whereelectricity is unauthorisedly used by way of theft. When a consumerdeposits the assessed amount, the licensee or the supplier has to restorethe power supply. The assessed amount referred to in the aforesaidproviso, relates to assessment which is contemplated under Section 126(1)of the Act only. There is apparent distinction between Section 126 andSection 135 of the Act. Section 126 forms part of the scheme whichauthorizes electricity supplier to ascertain loss in terms of revenue causedto it by the consumer by his act of “unauthorized use of electricity”whereas Section 135 deals with offence of theft if he is found to haveindulged himself in the acts mentioned in clauses (a) to (e) of sub-section(1) of Section 135 of Electricity Act. Further, it is also clear from Section154 of the Act, which prescribes procedure and power of Special Court,that the Special Court is empowered to convict the consumer and imposea sentence of imprisonment. The Special Court, in cases, where a criminalcomplaint is lodged, is also empowered to determine civil liability underSection 154(5) of the Act. As per Section 154(6) of the Act, in case civilliability so determined by the Special Court is less than the amountdeposited by the consumer or the person, the excess amount so depositedby the consumer or the person, shall be refunded by the licensee or theconcerned person, as the case may be. Merely because the Special AB

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ACourt is empowered to determine civil liability under Section 154(5) ofthe Act, in cases where a complaint is lodged, it cannot be said that thereis no power conferred on authorities to make provisional assessment/final assessment under Section 126 of the Act.

13. In the case of Executive Engineer Southern ElectricityBSupply Company of Orissa Limited (SOUTHCO) & Another v.Shi. Seetaram Rice Mill, reported in (2012)2 SCC 108, this Court hasconsidered the scope of Explanation to Section 126(b)(iv) of 2003 Act.In the aforesaid case, as there was no allegation of theft, this Court hasheld consumption in excess of sanctioned/contracted load, comes withinthe meaning of unauthorized use of electricity as per Explanation (b)(iv)Cof Section 126 of Electricity Act, 2003. Drawing a distinction betweenSection 126 to that of Section 135 of the Act, paragraphs 29 and 61 ofthe aforesaid judgment read as under:-

“29. Thus, it would be clear that the expression “unauthorizeduse of electricity” under Section 126 of the 2003 Act deals withDcases of unauthorized use, even in the absence of intention. Thesecases would certainly be different from cases where there isdishonest abstraction of electricity by any of the methods enlistedunder Section 135 of the 2003 Act. A clear example would be,where a consumer has used excessive load as against the installedEload simpliciter and there is violation of the terms and conditionsof supply, then, the case would fall under Section 126 of the 2003Act. On the other hand, where a consumer, by any of the meansand methods as specified under Sections 135(a) to 135(e) of the2003 Act, has abstracted energy with dishonest intention andwithout authorization, like providing for a direct connection byFpassing the installed meter, the case would fall under Section 135of the Act.

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61. Unauthorized use of electricity cannot be restricted to thestated clauses under the Explanation but has to be given a widermeaning so as to cover cases of violation of the terms and conditionsof supply and the Regulations and provisions of the 2003 Actgoverning such supply. “Unauthorized use of electricity” itself isan expression which would, on its plain reading, take within itsscope all the misuse of the electricity or even malpractices adopted G

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while using electricity. It is difficult to restrict this expression andlimit its application by the categories stated in the explanation. Itis indisputable that the electricity supply to a consumer is restrictedand controlled by the terms and conditions of supply, theRegulations framed and the provisions of the 2003 Act.”

14. We also do not find any valid reason for making a distinctionas made by the High Court in applying Section 126 of the Act. From thescheme of the Act, it appears that after inspection team noticesunauthorized use of energy by tampering the meter, the authorities candisconnect the power supply immediately and make immediate assessmentfor loss of energy, by invoking power under Section 126(1) of the Act.The term “unauthorized use of energy” is of wide connotation. Theremay be cases of unauthorized use of energy, not amounting to theft,which are cases viz. exceeding the sanctioned load or using the electricityin the premises where its use is not authorized etc. But at the same time,when there is an allegation of unauthorized use of energy by tamperingthe meter, such cases of unauthorized use of energy include ‘theft’ asdefined under Section 135 of the Act. The power conferred on authoritiesfor making assessment under Section 126(1) of the Act and power todetermine civil liability under Section 154(5) of the Act, cannot be said tobe parallel to each other. In this regard, we are of the view that the HighCourt has committed an error in recording a finding, that both proceedingscannot operate parallelly. In a given case where there is no theft ofenergy, amounting to unauthorized use of energy, in such cases nocomplaint of theft can be lodged as contemplated under Section 135 ofthe Act. In such cases for loss of energy, on account of unauthorizeduse of energy not amounting to theft, it is always open for the authoritiesto assess the loss of energy by resorting to power under Section 126(1)of the Act. In cases where allegation is of unauthorized use of energyamounting to theft, in such cases, apart from assessing the proceedingsunder Section 126(1) of the Act, a complaint also can be lodged allegingtheft of energy as defined under Section 135(1) of the Act. In suchcases, the Special Court is empowered to determine civil liability underSection 154(5) of the Act. On such determination of civil liability by theSpecial Court, the excess amount, if any, deposited by the petitioner, is tobe refunded to the consumer. It is a settled principle that to prove theguilt of the accused in a criminal proceeding, authorities have to provethe case beyond reasonable doubt and the element of mens rea is also to A

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Abe established. On the other hand, such a strict proof is not necessaryfor assessing the liability under Section 126(1) of the Act.

15. For the aforesaid reasons, this civil appeal is allowed and thejudgment and order dated 18.12.2017 passed by the High Court ofCalcutta in F.M.A. No.520 of 2017 and the corrected order datedB07.02.2018, are set aside. No order as to costs.

Devika Gujral

Appeal allowed.

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