Judgment:
ORDER
Tirath Singh Thakur, J.
1. This Writ Petition calls in question an order dated 24th January 1991 whereby the second respondent - Assistant Executive Engineer has determined a sum of Rs. 27,775/- as due and payable by the petitioner on account of the alleged slow recording of the electric energy consumed through the meter installed in the premises. The challenge arises in the following background:
2. The vigilance squad of the respondent - Board visited the hotel premises of the petitioner at Hubli and carried out a check of the meter installed in the premises for recording the electrical energy consumed. The result of the meter calibration carried out by the squad is said to have disclosed that the meter was recording 35.25% less of the energy actually consumed on account of an improper contact in the middle phase of the CT Wire (Current Transfer Wire). The error it is claimed by the Board was rectified, but based on the meter testing report as well as the report of the vigilance squad, a bill for a sum of Rs. 27,775/- raised in terms of Regulation 28 of the Karnataka Electricity Board-Electricity Supply Regulations, 1988. Aggrieved, the petitioner has come up in the present proceedings assailing the demand as indicated earlier.
3. Appearing for the petitioner Mrs. Suman Hegde, Advocate, mounted a two-fold attack on the impugned order. Firstly, it was argued that the respondents had no authority to raise a bill against the petitioner in the light of the provisions contained in Section 26(6) of the Indian Electricity Act, 1910, according to which, in the event of any dispute or difference arising as to the correctness of a meter, the same has to be decided by the Electrical Inspector, who may, if he comes to the conclusion that the meter was not correct, estimate the amount of the energy supplied to the consumer or the electrical quantity contained in the supply, during such period not exceeding six months. It was urged that the allegation made by the respondent suggested that the meter installed in the petitioner's premises was not correct, thereby attracting the provisions of Section 28(6) and making the Electrical Inspector the sole arbiter for determining the said dispute. Reliance was in support, placed upon a judgment of the Supreme Court in MADHYA PRADESH ELECTRICITY BOARD AND ORS. v. SMT. BASANTIBAI, : [1988]1SCR890
4. Secondly, it was argued that the impugned demand notice was issued without providing to the petitioner any opportunity of being heard against the same, hence, violative of the principles of natural justice. It was contended that since the respondents were raising an additional demand against the petitioner and creating a burden which the petitioner was not legally bound to accept, it was obligatory for them to provide a reasonable opportunity of being heard to it before any such determination or demand could be validly raised.
5. I have given my anxious consideration to the submissions made at the bar and purpose to deal with them ad-seriatum.
6. The provisions of Section 26 of the Electricity Act to the extent the same are relevant for the present may be extracted:
'26. Meter: (1) In the absence of an agreement to the contrary, the amount of energy supplied to a consumer or the electrical quantity contained in the supply shall by ascertained , by means of a correct meter, and the licenses shall, if required by the consumer, cause the consumer to be supplied with such a meter.
Provided that the licensee may require the consumer to give him security for the price of a meter and enter into an agreement for the hire thereof, unless the consumer elects to purchase a meter.
(2)xxx xxx xxx xxx
(6) Where any difference or dispute arises as to whether any meter referred to in Sub-section (1) is or is not correct, the matter shall be decided, upon the application of either party, by an Electrical Inspector, and where the meter has, in the opinion of such Inspector, ceased to be correct, such Inspector shall estimate the amount of the energy supplied to the consumer or the electrical quantity contained in the supply, during such time, not exceeding six months, as the meter shall not, in the opinion of such Inspector, have been correct; but save as aforesaid, the register of the meter shall, in the absence of fraud, be conclusive proof of such amount or quantity:
Provided that before either a licensee or a consumer applies to the Electrical Inspector under this sub-section, he shall give to the other party not less than seven days notice of his intention to do so.'
7. A plain reading of these provisions shows that the amount of energy supplied to the consumer or the electrical quantity contained in the supply has to be ascertained by means of a correct meter. The key expression in the provision is ' a correct meter', appearing in Sub-sections (1) and (6) supra. The provision envisages a dispute or difference being referred to the Electrical Inspector only in case the meter installed for recording the amount of energy supplied is not correct. In the instant case however, there is no dispute about the correctness of the meter installed at the premises of the petitioner. Both the petitioner as also the respondents agree that the meter installed was correct and did not suffer from any mechanical or other defect. What is alleged by the respondents is that on account of an improper or defective wiring and in particular, on account of an improper contact in the middle phase of the CT Wire, the meter was not recording the energy correctly. In other words, the defective recording was not because of any defect in the meter, but on account of a defect in the wiring outside the meter. This means that even when the meter may not have been recording the energy consumed correctly, yet the erroneous recording had nothing to do with the correctness of the meter. Stated differently, while an incorrect meter is bound to record the consumption incorrectly, the vise verse is not true, for an incorrect recording by the meter may not be necessarily due to an incorrect meter. Such an incorrect recording is possible as in the instant case due to an incorrect or defective wiring. In any such situation, the defect cannot be attributed to the meter even when the net effect may be an incorrect reading of the energy consumed. It is difficult in such a case to hold that the meter installed at the premises of the petitioner was not correct so as to make a reference to the Electrical Inspector imperative for determination of any such dispute or difference.
8. Reliance by the Learned Counsel upon the judgment of the Supreme Court in Basanti Bai's case is in my opinion, wholly misplaced. A careful reading of the said judgment would in fact show that the same holds the proposition exactly contrary to what is argued by Mrs. Hegde to be correct and has approved the view taken by a Single Bench of the High Court of Madhya Pradesh in MADHYA PRADESH ELECTRICITY BOARD, JABALPUR v. CHHAGANLAL, : AIR1981MP170 . In the said case, the Court was dealing with an almost identical situation as in the present. The consumer had questioned a bill raised against him with an assertion that the meter installed was correct and had been occasionally checked by the officers of the Board. The written statement filed by the Board also asserted that the meter was correct, but was recording slow not on account of any defect in the meter, but because of defective wiring. The question that arose was whether the slow recording in the meter on account of a defective wiring could also be deemed to be a dispute or difference within the meaning of Section 26(6). Relying upon a judgment of this Court in GADAG BETGERI MUNICIPAL BOROUGH v. GOVERNMENT OF MYSORE, AIR 1962 Mysore 209, the Court held that the defective wiring resulting in erroneous recording of the energy consumed by a meter which was otherwise correct, cannot be said to be a defect in the meter itself so as to make the same incorrect and bring any dispute about it within the purview of Section 26(6). In the right of the above pronouncements which are approved by the Apex Court, I have no hesitation in rejecting the submissions made on behalf of the petitioner.
9. That brings me to the alternative argument advanced in support of the petition and touching upon the validity of the impugned demand notice on account of violation of the principles of natural justice. The essential facts in this regard are not in dispute. It is not denied by the respondents that after the inspection conducted by the vigilance squad and the meter testing staff, the petitioner was never issued any show cause notice or given any opportunity of being heard against the proposed action. The result of the calibration and the method of calculation was also never communicated to the petitioner. What is argued by the respondents however, is that the checking of the meter had been carried out in the presence of one Sri K.M. Shanbhag, the representative of the petitioner which according to the respondent, was a sufficient compliance with the principles of natural justice. I find it difficult to uphold this contention, the very fact that the inspection or the calibration was carried out by the staff of the respondent - Board in the presence of the representative of the petitioner would not suffice. As to what was the result of the calibration and what action the respondents proposed to take on that basis was admittedly never communicated to the petitioner so as to give it an opportunity to challenge or represent against the same. In terms of Regulation 28-02 of the Electricity Supply Regulations, if the meter installed in a consumer's premises is found to be slow beyond permissible limits, the consumer is liable to pay the difference at normal rates based on the percentage error for a period of not more than six months prior to the test, due regard being paid to the conditions of working, occupancy, etc, during this period and upto the date of replacement or rectification of the meter. It therefore, follows that detection of a slow recording by the meter was not the end of the matter. Even after such a detection the liability to pay the amount was dependent upon considerations made relevant by Regulation 28.02 such as conditions of working, occupancy etc. In the circumstances, before the respondents could finally determine the amount and fasten any liability upon the petitioner to pay the same, it was obligatory for them to issue a notice to it and consider the objections that it may have filed in response,. In as much as the respondents failed to do so, they committed an error which is sufficient to vitiate their action.
10. Mr. Shetty appearing for the respondents, however, argued that in order to cut short delay in the determination of the whole controversy, the impugned demand notice arid the calculation sheet accompanying the same could itself be treated to be a show-cause notice to the petitioner against which the petitioner could file its objections for the consideration of the respondents before making a fresh order. There is merit in this submission, particularly when the impugned demand notice and the calculation sheet sufficiently conveys to the petitioner the nature and the basis of the demand being raised against him. In the circumstances, therefore, instead of quashing the impugned demand notice, the same can be read down and treated only as a show cause notice to the petitioner calling upon it to submit its objections, if any, to the proposed action of recovering the amount mentioned therein in terms of the Regulation 28.02 of the Supply Regulations.
11. In the result, this petition succeeds and is hereby allowed, the demand notice dated 24th January 1991 shall be treated to be only a show-cause notice to the petitioner, to file its objections which the petitioner may file within six weeks from today. In case the objections are so filed, respondent No. 2 - the Assistant Executive Engineer shall consider the same while passing fresh orders on the subject. In the circumstances, however, the parties shall bear their own costs.