KERALA STATE ELECTRICITY BOARD v BALACHANDRAN & STATE OF KERALA & OTHERS

# **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** # **`PRESENT`** ``` THE HONOURABLE MR.JUSTICE K. BABU ``` ``` MONDAY, THE 29[TH] DAY OF JANUARY 2024 / 9TH MAGHA, 1945 ``` # **`RSA NO. 815 OF 2007`** ``` AGAINST THE JUDGMENT AS 136/2005 OF ADDITIONAL DISTRICT & ``` ``` SESSIONS COURT (ADHOC-I), KOLLAM ``` ``` OS 232/2001 OF ADDITIONAL MUNSIFF’S COURT, KOLLAM ``` ## **`APPELLANTS/APPELLANTS/DEFENDANTS 1 & 2:`** ``` 1KERALA STATE ELECTRICITY BOARD REPRESENTED BY ITS SECRETARY, VYDHYUTHI BHAVAN, PATTOM, THIRUVANANTHAPURAM. ``` - **`2 THE ASSISTANT EXECUTIVE ENGINEER K.S.E.B. ELECTRICAL SUB DIVISION, PERINAD, KOLLAM.`** ``` BY ADVS. SRI.P.SANTHALINGAM SR. SRI.S.SHARAN SC K.S.E.BOARD ``` ``` B.PRAMOD SRI.C.K.KARUNAKARAN, SC FOR KSEB ``` ## **`RESPONDENTS/RESPONDENTS/PLAINTIFF & DEFENDANTS 3 TO 5:`** ``` 1BALACHANDRAN, S/O.BHASKARAN PILLAI ``` ``` PUTHEN MELATHIL HOUSE, KOTTAMKARA, CHANDANATHOPE POST, KOLLAM. ``` ``` 2STATE OF KERALA REPRESENTED BY DISTRICT COLLECTOR, KOLLAM. ``` ``` 3REVENUE RECOVERY TAHSILDAR KOLLAM. ``` R.S.A.No.815 of 2007 2 ``` 4VILLAGE OFFICER ``` ``` KOTTAMKARA VILLAGE, KOLLAM. ``` ``` R2 TO R4 BY GOVERNMENT PLEADER SRI.JAYAN SMT.C.G.PREETHA SMT.P.RANI DIOTHIMA SRI.P.S.SREEDHARAN PILLAI ``` ``` THIS REGULAR SECOND APPEAL HAVING BEEN FINALLY HEARD ON ``` ``` 29.01.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` R.S.A.No.815 of 2007 3 ## **JUDGMENT** This Regular Second Appeal arises from the judgment and decree passed by the District Court, Kollam in A.S.No.136/2005 which arose from O.S.No.232/2001 on the file of the Munsiff’s Court, Kollam. Defendants 1 and 2 are the appellants. The plaintiff and defendants 3 to 5 are the respondents. 2. The Original Suit was instituted for declaration, permanent prohibitory injunction and damages. The plaintiff started a Coconut Oil Mill under the Self Employment Scheme in 1986. A 10 HP three-phase electric connection was taken for the said purpose. While availing the electric connection, the plaintiff had agreed that he would remit minimum charges up to April, 1990. The business could not be materialised due to financial problems. When the plaintiff realised that he could not start the business, he submitted an application before the Assistant Executive Engineer, KSEB (defendant No.2) on 30.4.1990 requesting to disconnect and dismantle the electric supply and to terminate the agreement with the Kerala State Electricity Board (KSEB). R.S.A.No.815 of 2007 4 The electricity connection was cut off and dismantled on 1.5.1990. There are no outstanding dues at the time of disconnection. The plaintiff received a notice from the Village Officer (defendant No.5) on 5.9.2000 demanding a sum of Rs.7,673/-, being the dues to the Electricity Board. The notice was issued as part of the revenue recovery steps at the request of the KSEB. 3. Defendant Nos.1 and 2 resisted the suit. They contended that the meter reading register would show that the plaintiff consumed 78 units in June, 1990. The premise was permanently locked up, and so the connection was dismantled in the month of September, 1990 due to non-payment of electric charges from 4/1990. The service was subsequently dismantled on 15.3.1994. The KSEB thereafter initiated revenue recovery proceedings to realise the arrears due to it from 4/1990. The final reading was not available as the meter was kept inside the locked premises. As per clause 32(k) of the Conditions of Supply of Electrical Energy, the KSEB is empowered to realise the amount by recourse to Revenue Recovery proceedings. 4. The court below proceeded with the trial. On the side of the plaintiff, PW1 was examined and Exts.A1 to A13 were marked. DW1 was examined on the side of the defendants. R.S.A.No.815 of 2007 5 5. The trial Court decreed the suit in favour of the plaintiff as per judgment dated 17.12.2004. 6. Defendants 1 and 2 challenged the decree by filing A.S.No.136/2005 before the District Court, Kollam. As per judgment dated 11.12.2006 the First Appellate Court confirmed the judgment passed by the trial Court. 7. Defendant Nos.1 and 2 are before this Court invoking Section 100 of the Code of Civil Procedure. 8. After hearing both sides, this Court reformulated the substantial question of law as below:- “Have the courts below drawn necessary inferences and presumptions based on the pleadings and evidence.” 9. Heard the learned Standing Counsel appearing for the appellants, the learned counsel appearing for respondent No.1 and the learned Government Pleader. 10. The trial court decreed the suit declaring that the plaintiff is not liable to pay any amount and restraining the defendants from taking any revenue recovery proceedings against the plaintiff and his property. 11. The trial Court essentially recorded the following findings:- 6 R.S.A.No.815 of 2007 - (1) The plaintiff could establish that he was liable to pay the fixed charges only up to 4/1990. - (2) Thereafter, the plaintiff is liable to pay electricity charges only for the actual consumption. - (3) The claim of defendant Nos.1 and 2 is barred by limitation. 12. The learned Standing Counsel for the KSEB contended that as per Regulation 19(4) of the Kerala State Electricity Board Terms and Conditions of Supply, 2005, a charge is created if the amount due to it has been shown continuously as recoverable as arrears of charges for electricity supplied, and therefore, the period of limitation for realising the amount is 12 years by virtue of Article 62 of the Limitation Act, 1963. The learned Standing Counsel further contended that as per Section 79(j) of The Electricity (Supply) Act, 1948 in the case of minimum guarantee agreement, the Board is entitled to realise the minimum agreed amount till the line extension becomes selfremunerative as per the norms fixed by the Board from time to time. The KSEB made a claim for the period from 4/1990 to 3/1999. Admittedly, the electric connection was dismantled in 1994. Under Regulation 19(4) of the Kerala State Electricity Board Terms and Conditions of Supply, 2005, which is made by the Kerala State R.S.A.No.815 of 2007 7 Electricity Board by virtue of the powers conferred on it under Regulation 30 of the Kerala Electricity Supply Code, 2005, a charge is created. As per Section 56 of the Electricity Act, 2003 if the sum has been shown continuously as recoverable as arrears of charges for electricity supplied, the Board is entitled to recover the same. Therefore, when a charge is created under Regulation 19(4) of the Kerala State Electricity Board Terms and Conditions of Supply, 2005, under Article 62 of the Limitation Act, 1963 the period of limitation for realising the dues is 12 years. Regulation 19(4) of the Kerala State Electricity Board Terms and Conditions of Supply, 2005 says that all dues to the Board from a consumer shall be the first charge on the assets of the consumer. This Court in **Jaisy Chacko** v. **Kerala State Electricity Board, Tvm and Others (2021 (3) KHC 19)** has considered this question and held that if the amount due has been shown continuously as recoverable as arrears of charges for electricity supplied, the Board is entitled to recover the same for which the period of limitation is 12 years under Article 62 of the Limitation Act, 1963. Therefore, I am in agreement with the contention of the learned Standing Counsel for the KSEB that the finding of the trial Court that the claim is barred by limitation is not sustainable. R.S.A.No.815 of 2007 8 13. The further contention of the Standing Counsel for the KSEB is that if the electricity connection was given under a minimum guarantee agreement, the consumer is liable to pay the minimum charge agreed upon until the line extension becomes self remunerative as per the norms fixed by the KSEB from time to time. The Conditions of Supply of Electrical Energy deals with Line Extension and Minimum Guarantee Agreement. Clause 20 of the Conditions of Supply of Electrical Energy deals with unremunerative works and minimum guarantee agreement, which says that whenever new works are to be carried out to effect supply to prospective consumers, such works will be taken up only if they will fetch the required minimum return. The intention of executing the minimum guarantee agreement is to ensure that the required minimum revenue return is forthcoming and would be charged only until the line extension becomes self remunerative as per the norms fixed by the Board from time to time. In view of the above provisions, I am in agreement with the submission of the learned Standing Counsel for the KSEB that in the case of minimum guarantee agreement, the consumers are liable to pay charges until the line extension has become self-remunerative as per the norms fixed by the KSEB. R.S.A.No.815 of 2007 9 14. This question was considered by a Division Bench of this Court in **Rajesh** v. **K.S.E.B. (2006 KHC 207)** . In **Rajesh,** the Division Bench held that the object of the execution of the agreement is to ensure that minimum revenue required is forthcoming for unremunerative works under the minimum guarantee agreement, and therefore, power is conferred on the Assistant Executive Engineer to review whether the line has become self remunerative and once it is self remunerative it is also open to the Board to waive the minimum guarantee amount guaranteed in the event of which consumer need only pay for the actual consumption of energy. 15. Now, I shall consider the facts in the present case based on the legal questions answered above. Admittedly, the claim of the KSEB is for the period from 4/1990 to 3/1999. The plaintiff pleaded that as per the agreement executed between himself and the KSEB he was bound to pay the fixed charges only up to 4/1990 and that he paid the amount due to the KSEB till 4/1990. 16. The plaintiff further pleaded that as he could not start the business, he requested the KSEB to dismantle the connection. The electric connection was dismantled on 1.5.1990 at his request. The plaintiff gave oral evidence in support of his claim. The agreement R.S.A.No.815 of 2007 10 between the plaintiff and defendants 1 and 2 has not been produced by the KSEB. The KSEB has not given any evidence to resist the pleading set up by the plaintiff that he was bound to pay the fixed charges only up to 4/1990, and the connection was dismantled on 1.5.1990. The trial Court held that the plaintiff discharged the initial burden in support of his pleadings when defendants 1 and 2 failed to produce the document in their possession to prove the contrary and adverse inference could be drawn against them. As per Section 114 of the Evidence Act, the Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case. As per illustration (g) of Section 114 of the Evidence Act, the Court may presume that evidence which could be and is not produced would, if produced, be unfavourable to the person who withholds it. In the present case, as the trial Court held that the plaintiff discharged his initial burden in support of his pleadings, which could be rebutted by the KSEB with the production of the evidence in their possession, which they failed to produce, I am of the view that the trial Court has drawn necessary inferences in recording the finding that the plaintiff established that he R.S.A.No.815 of 2007 11 was bound to pay the minimum fixed charges only up to 4/1990, and the electricity connection was dismantled on 1.5.1990. 17. Now, the question to be considered is whether the KSEB is entitled to realise any amount from the plaintiff after 4/1990 on the ground that there was a minimum guarantee agreement. Since defendant Nos.1 and 2 failed to establish that there was an agreement to pay the fixed charges beyond 4/1990, KSEB is not entitled to realise the amount claimed from the plaintiff. 18. The finding of fact on the question as to whether the plaintiff was bound to pay fixed charges after 4/1990, and that the electricity connection was dismantled on 1.5.1990 has become final with the dismissal of A.S.No.136/2005. Admittedly, the claim is for the period from 4/1990 to 3/1999. If the electricity connection was dismantled at the request of the plaintiff on 1.5.1990, the necessary conclusion is that no electricity was supplied to the plaintiff or he has not consumed any electricity from 4/1990 to 3/1999. As per Regulation 19(4) of the Kerala State Electricity Board Terms and Conditions of Supply, 2005, a charge is created for the amount due and the KSEB is entitled to realise it within 12 years under Article 62 of the Limitation Act, 1963. As per Section 56 of the Electricity Act, 2003, if the sum has R.S.A.No.815 of 2007 12 been shown continuously as recoverable as arrears of charges for electricity supplied, the Board is entitled to recover the same. In the present case, no electricity has been supplied from 1.5.1990 to the plaintiff and therefore, no amount is due to the KSEB from the plaintiff. Therefore, the finding of the court below that the plaintiff is not entitled to pay Rs.7673/- as demanded as per notice No.D4/1607/1995 dated 1.9.2000 requires no interference. The substantial question of law is therefore answered against the appellants/defendants 1 and 2. The Regular Second Appeal stands dismissed. Sd/- **K.BABU Judge** TKS