KERALA STATE ELECTRICITY BOARD LTD. v. KERALA STATE ELECTRICITY APPELLATE AUTHORITY

## **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ## **`THE HONOURABLE MR. JUSTICE AMIT RAWAL`** ## **`FRIDAY, THE 4[TH] DAY OF MARCH 2022 / 13TH PHALGUNA, 1943`** ## **`WP(C) NO. 15793 OF 2016`** ## **`PETITIONER:`** ``` THE ASSISTANT ENGINEER, ELECTRICAL SECTION, KAZHAKUTTAM, KERALA STATE ELECTRICITY BOARD LIMITED, THIRUVANANTHAPURAM. ``` ``` BY ADVS. SRI.RAJU JOSEPH (SR.) SRI.C.JOSEPH ANTONY SRI.GEORGEKUTTY MATHEW, SC, KSEB ``` ## **`RESPONDENTS:`** ``` 1THE KERALA STATE ELECTRICITY APPELLATE AUTHORITY C.C.51/52, NEAR 110 KV SUB STATION, VYTTILA, KOCHI-682 019. ``` ``` 2SRI. K.E.PRAMOD COMMERCIAL MANAGER, THE LEELA SCOTISH LACE PVT. LTD., INFRA INTERNATIONAL APPARAL PARK, ST. XAVIERS COLLEGE.P.O., THIRUVANANTHAPURAM-695 586. ``` ``` BY ADV SRI.K.P.RAJEEVAN ``` ``` ADV.JUSTINE JACOB-SR.GP ``` ``` ADV. GEORGEKUTTY MATHEW -SC ``` ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 11.02.2022, THE COURT ON 04.03.2022 DELIVERED THE FOLLOWING: ``` ``` WP(C) NO. 15793 OF 2016 ``` ``` 2 ``` ## **JUDGMENT** Kerala State Electricity Board (hereinafter called KSEB) has challenged the order of the appellate authority allowing the appeal No.109/2015 preferred against the assessment order on various grounds. 2. The facts in brief are that, on 20.11.2017, the AntiPower Theft Squad (APTS), Thiruvananthapuram unit of KSEB along with officers of electrical section conducted a surprise inspection in the factory premises of 2[nd] respondent. Accordingly, a site mahazar Ext.P1 dated 20.11.2007 was prepared detailing the additional unauthorised load allegedly detected during the inspection. The additional load detected was 215 KW equal to 253 KVA. The sanctioned load was 240 KVA. The inspection details of the unauthorised load was forwarded to Special Officer, Revenue and on that basis, provisional bill demanding an amount of Rs.10,65,732/- was forwarded to the 2[nd] respondent. The 2[nd] respondent submitted an objection which were to be decided within 30 days though it was not decided in ``` WP(C) NO. 15793 OF 2016 ``` ``` 3 ``` 30 days and final assessment order was passed on 30.08.2008 where a partial relief was given to the consumer. The said order was challenged before the Deputy Chief Engineer, which was disposed on 24.05.2010. The 2[nd] respondent also approached the Consumer Grievance Redressal Forum on 08.05.2010 by laying challenge to the provisional bill. The said complaint was rejected by the Redressal Forum by advising the 2[nd] respondent to file a fresh complaint regarding issues related to nonsegregation of the lighting load. The 2[nd] respondent approached the Ombudsman. Ombudsman vide order dated 17.08.2010, as per averment without any jurisdiction, observed that the KSEB shall be free to issue fresh provisional assessment towards penal charges on additional load as well as special fresh assessment towards penal charges on non-segregation of lighting load. In obedience to the direction of the Ombudsman the final order was passed after giving opportunity of hearing to the 2[nd] respondent raising a demand towards the unauthorised additional load of Rs.14,68,275/- by cancelling the demand of Rs.4,23,462.60/- towards non-segregation of lighting load. ``` WP(C) NO. 15793 OF 2016 ``` ``` 4 ``` Against the aforementioned order Ext.P3, 2[nd] respondent preferred an appeal before the appellate authority. 3. Sri. Raju Joseph, learned senior counsel appearing on behalf of the petitioner in support of the present writ petition laying challenge to the order of the appellate authority has raised the following submissions: I) On inspection, no prejudice has been caused in case the provisional assessment was done by special officer as the reports are always sent in respect of HT, EHT consumers to Special Revenue Officer. Thus, the observation that the provisional bill should have been issued by the assessing officer, is wholly cryptic and opaque. Even the defect was also rectified by sending a provisional bill by the assessing authority. ii) It is the conceded position on record that the 2[nd] respondent had connected additional load to the electricity main without approval of the electricity board. iii) If the final assessment order was not passed within 30 days, consequences in the language of Section 126 that the ``` WP(C) NO. 15793 OF 2016 ``` ``` 5 ``` period of 30 days can be only considered as directory. 4. Appellate regulatory authority had erroneously accepted the appeal by observing that the assessing officer should have after the remand by the Ombudsman made a site inspection before passing a final order. The said directions are against the mandate of the judgment of this Court in **Syriach Kurian** v. **Union of India** [2014 (2) KHC 325] wherein it has been held that it is not mandatory that the assessing officer should visit the premises of the consumer before the final orders are passed. Even otherwise the situation as existed at the time of the inspection would not have been there even if the inspection had been conducted, again, before passing of the final order, thus, the impugned proceedings are per se illegal, unsustainable and void ab initio. 5. On the other hand, Sri.K.P.Rajeevan, learned counsel appearing on behalf of the respondent No.2 supported the order of the appellate authority by submitting that 2[nd] respondent was functioning in KINFRA International Apparel Park, ``` WP(C) NO. 15793 OF 2016 ``` ``` 6 ``` Thiruvananthapuram and was engaged in making ready-made garments meant for export. HT (11 KV electric connection) bearing consumer code No.11/3894 had been provided to the premises and the maximum contracted demand was 240 KVA and the aggregate connected load would be 540.49 KW. Assistant Engineer, Electrical Section, Kazhakuttom a designated assessing officer under Section 126 of the Electricity Act, 2003, used to visit the premises every month regularly for meter reading. For the purpose of increasing the production additional phase was required. Kerala State Infrastructure Development Corporation allotted a divisional built up space of 17,500 square feet on 16.08.2007 subject to the terms and conditions as evident from Ext.R2A. Accordingly, an application was submitted for additional load. Electrical inspector, on receipt of the application issued an approval scheme dated 26.09.2007 for erection of electrical installation for 214.866 KW additional load. Statutory notice of commencement of work under Rule 50 of Indian Electricity Rule, 1956 was communicated. The ``` WP(C) NO. 15793 OF 2016 ``` ``` 7 ``` erection work was completed and completion report was submitted to the Electrical Inspector on 17.05.2008. On submission of the completion report Electrical Inspector issued a energisation sanction dated 09.06.2008 for an additional connected load of 162.824 KW Ext.R2D. The aforementioned sanction was required for connecting the installation with KSEB supply system for drawing the power, but during the period between 26.09.2007 to 17.05.2008 when the electrical installation works, erection of machinery, equipments and such related work in progress, Inspection work was conducted on 20.11.2007 and by that time electrical appliances available at the premises were not even connected with KSEB supply system. In fact, the inspection was done barely after two months of the commencement of the work. In mahazar it was alleged that an additional load of 215 KW was connected over and above previous sanction connected load of 540.49 KW and also alleged that a separate meter of 108 KW light load was not provided but the mahazar did not disclose the rating of ``` WP(C) NO. 15793 OF 2016 ``` ``` 8 ``` independent equipment’s and the devices much less the details to arrive at the conclusion of total connected load of 767.37 KW, except in the matter of lighting load. In fact, it was incumbent upon the electricity department to do the rating of all the electrical equipment’s and therefore it cannot be treated as a plausible truth but only way of assumption load. Inspection team was requested to notice the ongoing works but they refused to accede, though were bound to do so under the Act. In fact, the maximum demand of the consumer for the month of September, 2007 to June 2008 for which final order of assessment was issued was well below 250 KVA. It was next contended that this Court cannot assume the role of appellate authority and re-examine the evidence until and unless certain circumstances warranting interference under Article 226 of the Constitution of India are made out which are conspicuously wanting. 6. I have heard the learned counsel for the parties and appraised the paper book. ``` WP(C) NO. 15793 OF 2016 ``` ``` 9 ``` ## 7. The copy of the translation of the mahazar extracted as under: “Site Mahazar prepared by APTS Assistant Engineer Sri N. Rajeev in regard to the inspection conducted on 20.11.2007 at 11 am in the premises of consumer number 11/3894 (HT consumer) and meter and other accessories in the presence of Sub Engineer of Kazhakootam Electrical Section and APTS Executive Engineer Sri A Rajendran. The consumer is an establishment known as M/s Leela International Ltd, Infra Park. It is situated at Meenamkulam KINFRA, plot number 7. They are carrying on the business of ready-made textile manufacturing. The transformer installed in the premises is having a capacity of 500 KVA and the meter installed is bearing serial No D 20490 3 phase, 3 wire system, volt 11 KV /110 V, class 0.5, Freq. 50 Hz, MF-1, pulse rate 100/unit. On the left side of the meter, there is a security seal of L&T on the terminal meter cover also there is TMR/TMLA seal. On the right side near the terminal cover, there is a security seal of TMR/TMLA. Additionally, there is a security seal on the meter optical port and RST button of TMR and TMLA. There is TMR/TMLA seal for the 3 PT fuse units together. On TTB there are 2 TMR/TMLA seals. The CT ratio of CTPT unit is 20/5A. The doors on both sides of CT/PT units are having TMR/TMLA seals. On the rear side door also, there is TMR/TMLA seal. Meter reading at the time of inspection v1= 105075, A1= 2.508A, V3 = 10546. 1V, A3 = 2.525 A, PrPt: 0.929, C:00446292, C:0046864, C2:00016214, C3:00013155, rl=46.419 KVA, r2 = 11.042 KVA, r3. 1.5277 KVA, r = 46429 ``` WP(C) NO. 15793 OF 2016 ``` ``` 10 ``` KVA, CMD: 00002458, rc: 061: Pr count: 03, A: 00071.07, 20:11:11:23. The data was downloaded from the meter by using CMRI. The following defects are seen on inspecting the connected load of the establishment. Out of the total connected load of 540.49 KW, 465.07 KW is power load and 75.420 KW is light load (Tube 40W * 1272 numbers, Fan 60 W * 409 Numbers. Moreover, unauthorized load (additional load) of 215 KW is seen connected of which 195 KW is power load and 20 KW is light load. (Tube 36 W * 76 numbers, Tube 28W * 404 numbers, fan 96 numbers * 60 W). Apart from this 5.5 ton (ductable split AC) 1 number, 2 ton (ductable split AC) 1 number are seen in the office and for two other cabins 1.5 ton (split AC) 1 number, 1 ton (split AC) 1 number are also seen in the office. Office, Conference Hall, mini-Q-A centre, P. M's cabin also have AC with a cumulative load of 12.37 KW. The total load as described above is 767.37. Out of the same light load including AC is 108 KW. There is no separate meter for the light load. The seal of the APTS is affixed on the meter cabin door and meter optical port which was opened for the purpose of downloading data. The seal of the breaker cabin door was seen broken and therefore the APTS had affixed their seal on the door also. The Administrative Office of the establishment, Sri K.Sathar was present during the inspection.” 8. On going through the translation of the mahazar, it is not evident that how much voltage or ampere the A/Cs referred to therein were of. Mahazar also do not disclose the fact that the ``` WP(C) NO. 15793 OF 2016 ``` ``` 11 ``` ## sanction was granted to the 2[nd] respondent vide order dated 09.06.2008, the contents of the same reads as under: “Sanction is hereby accorded under Section 54 of Electricity Act 2003, and Rule 63 (3) of Indian Electricity Rules, 1956 for the energisation of MV Addition of 162,824 KW load (Electrification of new first floor) at the premises of M/s Leela International Itd., Kinfra Apparel Park, Kazhakoottam Thiruvananthapuram covered under the completion report cited as (3) under reference subject to the following conditions. 1. Date of energisation should be informed to this office promptly. 2. No additions/alterations should be made in the existing Installation without obtaining prior sanction from this office.” 3. Any modlification suggested by the Chief Electrical Inspector or during subsequent inspection from this office should be carried out by the consumer. 4. Periodical inspection fee and electricity duty shall be remitted on demand from this office. 9. Before the energization the machinery was not attached. The appellate authority noticing rival contentions of the parties as well as the provisions of Section 126, found that once the order was set aside by the Ombudsman, the ``` WP(C) NO. 15793 OF 2016 ``` ``` 12 ``` respondents were to issue a fresh provisional assessment towards the penal charges of unauthorised load and fresh assessment towards non-segregation of lighting load under the appropriate statutes. Assessing officer issued a provisional assessment for Rs.13,40,475/- on 30.3.2011 for a period from 26.09.2007 to 09.06.2008 and thereafter finalized to Rs.14,68,275/- on 11.07.2011, but did not conduct a site inspection to initiate the proceedings under Section 126 of the Electricity Act, 2003. The only statute by which the assessing officer is empowered to make assessment on unauthorized use of electricity is Section 126 of the Act. Assessment proceedings would commence with inspection of the premises by an assessing officer by recording the finding that such consumer was indulging into an unauthorized use of electricity. 10. Appellate authority found that KSEB had not issued revised assessment on both occasion or provided any opportunity giving plausible reason to the Ombudsman to set aside the payment bill dated 23.11.2007 issued by Special ``` WP(C) NO. 15793 OF 2016 ``` ``` 13 ``` Officer of Revenue. The Division Bench of this Court in _**Kerala State Electricity Board Ltd. and Others**_ v. _**M/S. Alwaye Rubex (P) Ltd. and Others Pvt.Ltd. and Another**_ [2019 KHC 220] held that an actual consumption in excess of contract demand is not necessary for attracting the deterrent provisions of Section 126 as with the use of additional equipment of specified loads found on inspection and admittedly used by the consumers, whereas in the instant case it is disputed, the electricity used was without approval of the Board or not and to form opinion that it was unauthorised. In other words, the load of the equipment additionally connected to the supply lines without the approval of the Board would be an unauthorised use of electricity, but, On perusal of the mahazar report, it is not mentioned that which of the machinery was used for additional load except for the additional load of lights. There is a difference between the actual load used for running the factory and lighting load. There is finding of the appellate authority of having not conducted a fresh assessment in order to find out ``` WP(C) NO. 15793 OF 2016 ``` ``` 14 ``` whether the machinery actually put in use after it is sanctioned in June, 2008 was a new one or old on, thus, the plea of the petitioner that subsequent sanction cannot co-relate to the actual events on the date of inspection is wholly misplaced. 11. The pith and substance of the order of the authority is not on the point that on receipt of the objections by the consumer assessing authority was required to pass the order within a period of 30 days otherwise the fact would be nullified, but yet, it has been harsh on behalf of the electricity board. As per Ext.P3 final order of assessment the maximum demand of consumer during the month of September, 2007 to June 2008 was well below 240 KVA. Mahazar report cannot be accepted as a sermon if it is being disputed by the consumer and particularly when it has been categorically pointed out in the counter that the officers refused to include the grounds regarding the fact that no piece of equipment or machinery was connected with the existing supply as it could have been only done after completion of the entire work and energisation approval. ``` WP(C) NO. 15793 OF 2016 ``` ``` 15 ``` While exercising the power under Article 226 of the Constitution of India this Court cannot sit in the arm chair of the appellate authority to appeal and examine the veracity of the order of the appellate authority consisting of experts to deal with the matter until unless very glaring illegality, opaqueness or repugnancy is found out which except for vague ground are conspicuously wanting. I do not intend to interfere with the findings arrived at by the appropriate authority. The writ petition sans merit and accordingly, dismissed. **Sd/-** **AMIT RAWAL JUDGE** nak ``` WP(C) NO. 15793 OF 2016 ``` ``` 16 ``` ## **`APPENDIX OF WP(C) 15793/2016`** ``` PETITIONER EXHIBITS ``` ``` EXHIBIT P1TRUE COPY OF THE SITE MAHAZAR DATED 20.11.2007. EXHIBIT P2TRUE COPY OF THE ORDER PASSED BY THE OMBUDSMAN IN REPRESENTATION NO.P-125/10 DATED 17.08.2010. EXHIBIT P3TRUE COPY OF THE FINAL ORDER PASSED BY THE ASSESSING OFFICER DATED 11.07.2011. ``` - `EXHIBIT P4 TRUE COPY OF THE ORDER OF THE 1ST RESPONDENT IN APPEAL NO.109/2015 DATED 12.11.2015.` ``` RESPONDENTS EXHIBITS ``` ``` EXHIBIT R2ATRUE COPY OF THE INTIMATION LETTER FROM KINFRA DATED 16.08.2007. ``` - `EXHIBIT R2B TRUE COPY OF SCHEME APPROVAL DATED 26.09.2007 ISSUED BY THE ELECTRICAL INSPECTOR THIRUVANANTHAPURAM` - `EXHIBIT R2C TRUE COPY OF THE NOTICE DATED 30.09.2007 OF COMMENCEMENT OF ELECTRICAL INSTALLATION WORKS.` - `EXHIBIT R2D TRUE COPY ORDER DATED 9.6.2008 FOR ENERGISATION ISSUED BY THE ELECTRICAL INSPECTOR, THIRUVANANTHAPURAM.` - `EXHIBIT R2E TRUE COPY OF MAHASAR DATED 20.11.2007.` ``` EXHIBIT R2FTRUE COPY OF DEMAND CUM DISCONNECTION NOTICE DATED 23.11.2007. ``` ``` WP(C) NO. 15793 OF 2016 ``` ``` 17 ``` |`EXHIBIT R2G`|`TRUE COPY OF LETTER DATED 31.1.2008`| |---|---| ||`ISSUED TO THE 2ND RESPONDENT.`| |`EXHIBIT R2H`|`TRUE COPY OF THE NOTICE IS DATED`| ||`25.3.2008.`| |`EXHIBIT R2I`|`TRUE COPIES OF THE CHEQUE DATED 9.4.2008`| ||`FOR Rs.5,32,866/- WITH COVERING LETTER`| ||`DATED 10.04.2008.`| |`EXHIBIT R2J`|`TRUE COPY OF ORDER DATED 30.08.2008`| ||`ISSUED BY THE ASSISTANT ENGINEER,`| ||`ELECTRICAL SECTION, KAZHAKKOOTTAM.`| |`EXHIBIT R2K`|`TRUE COPY OF THE ORDER OF THE DEPUTY`| ||`CHIEF ENGINEER, ELECTRICAL CIRCLE (URBAN)`| ||`DATED 27.5.2010.`| |`EXHIBIT R2L`|`TRUE COPY OF THE ORDER OF THE STATE`| ||`ELECTRICITY OMBUDSMAN DATED 17.8.2010 IN`| ||`P125/2010.`| |`EXHIBIT R2M`|`TRUE COPY OF THE PROVISIONAL ASSESSMENT`| ||`ORDER DATED 30.3.2011.`| |`EXHIBIT R2N`|`TRUE COPY OF THE FINAL ORDER OF`| ||`ASSESSMENT DATED 11.7.2011.`| |`EXHIBIT R2O`|`TRUE COPIES OF THE MONTHLY BILLS FOR THE`| ||`MONTHS FROM OCTOBER-2007 TO JULY-2008.`| |`EXHIBIT R2P`|`TRUE COPY OF FORWARDING LETTER WITH`| ||`CHEQUE DATED 24.8.2011.`| |`EXHIBIT R2Q`|`TRUE COPY OF JUDGMENT DATED 2.2.2015 IN`| ||`WP(C) NO.21872 OF 2011.`| |`EXHIBIT R2R`|`TRUE COPY OF THE ORDER IN APPEAL`| ||`NO.109/2015 DATED 12-11-2015 OF THE`| ||`KERALA STATE ELECTRICITY APPELLATE`| ||`AUTHORITY.`|