MahaDiscom Has No Right To Recover Arrears of Rs49,663, Resident Receiving Electric Supply Is Consumer, Says NCDRC
Moneylife Digital Team 05 February 2024
Reiterating that a person whose premises are connected to receive electricity with the works of a distribution licencee is a consumer, the national consumer disputes redressal commission (NCDRC) stated that the Maharashtra State Electricity Distribution Co Ltd (MahaDiscom) has no right to recover Rs49,663.33. While upholding the order passed by the Thane district consumer disputes redressal forum, NCDRC also directed MahaDiscom to adjust against future bills, Rs17,000 collected from the consumer towards arrears. 
In an order last month, the NCDRC bench of Dr Inder Jit Singh (presiding member) says, "On merits, after having carefully gone through the orders of district forum, we are of the view that district forum has given a detailed and well-reasoned order, duly keeping in view the evidence before it and after suitably addressing the rival contentions of the parties; state commission went wrong in reversing and setting aside a well-reasoned order of the district forum on merits. Hence, the order of the state commission cannot be sustained, and the same is hereby set aside, and order of district forum is restored."
In 1993, Ulhasnagar-based Shyam Kishanchand Bhatia bought a flat from one Hema Murlidas Nagpal and has been residing there. While the electricity connection is registered under the builder's name, Mr Bhatia is responsible for settling the energy bills issued by the company. Starting from August 2007, he did not receive monthly electricity bills. 
When he inquired with MahaDiscom, he was issued a bill dated 17 December 2007, amounting to Rs47,980, covering the entire year 2007. Subsequently, a second bill of Rs50,590, dated 28 February 2008, was issued to Mr Bhatia by MahaDiscom. 
Despite making partial payments, on 17 November 2008, MahaDiscom disconnected the energy supply of Mr Bhatia's home. Upon seeking information under the Right to Information (RTI) Act, he was informed that the electricity meter, replaced on 4 March 2005, was not recorded and updated in MahaDiscom's computer system until 2007. The bills were then charged based on meter readings after instalment payments. Dissatisfied with this explanation and due to the non-restoration of energy supply, Mr Bhatia filed a complaint before the district forum.
On 30 November 2009, the district forum allowed the complaint. While upholding the contention of Mr Bhatia, it gave directions, including a declaration that "MahaDiscom had no right to recover the amount of Rs49,663.33 and bills dated 17 December 2007 and 28 February 2008 are false bills."  
It says, "The forum cannot believe whether such incident occurred because regarding this aspect there is no clinching evidence and supporting proof, and so Mr Bhatia was sent the bill by MahaDiscom for the year 2005 of arrears of amount the said bill is false. The said bill is given on the basis of assumption and so the bills are without any proof. So MahaDiscom does not have any right to recover the disputed bill amount from Mr Bhatia."
"Disconnecting the electric supply without giving notice is a very serious aspect and totally illegal. Indian Electricity Act is a personal (separate) special act, and MahaDiscom is taking advantage of the Act to recover a huge amount by cheating, deceiving and pressuring the consumers and accordingly, this thing is done by MahaDiscom is proved by Mr Bhatia," it added.
Further, Thane district forum directed MahaDiscom to charge only as per the current bill for each month and adjust in the future bills, the amount of Rs10,000, Rs2,000 and Rs5,000 collected towards arrears, and pay a compensation of Rs2,000 towards mental torture and Rs1,000 towards the costs to Mr Bhatia.
MahaDiscom challenged the district forum order before the Maharashtra state consumer disputes redressal commission. In an order on 12 January 2011, the state commission, while allowing the appeal filed by MahaDiscom, set aside the order passed by the Thane district forum.
Mr Bhatia then approached NCDRC. In his appeal, he stated, "The state commission declared that the petitioner or complainant is not a consumer since the bills are issued in the name of Nandwani Satish Santumal and not in the complainant's name...The state commission failed to consider that there are other residents in the same apartment, and the bills are issued by the MahaDiscom in the name of 'Nandwani Satish Santumal.' This practice is consistent for all residents, with bills bearing the same name but different flat numbers."
The counsel for Mr Bhatia further contended that the state commission made an error in its decision by not considering and overlooking section 43 of the Electricity Act. "This section recognises and designates any occupier or owner of premises as a consumer for electricity consumption." 
Referring to Section 43 of the Electricity Act, the counsel emphasised that the distribution licencee is obligated to provide electricity supply to premises upon application by the owner or occupier. "The state commission failed to consider that the bills were indeed paid by Mr Bhatia, and this is evident from the receipts issued by MahDiscom as proof of payment. The fulfilment of payment obligations should establish their status as a consumer under the Electricity Act."
The counsel for MahaDiscom asserted that Mr Bhatia is not a consumer because the electricity bill was issued in the name of Nandwani Satish Santumal. "As there is no relationship between a consumer and service provider, the complaint is not maintainable under the Consumer Protection Act... Mr Bhatia was irregular in paying dues, and proper bills were issued in 2007. He received extracts on CPL (consumer personal ledger), indicating charges for December as Rs47,980, including the amount for actual consumption."
Regarding a bill dated 28 February 2008 for Rs50,590, the counsel for MahaDiscom contended that it was correct based on actual consumption; Mr Bhatia did not pay the amount, resulting in the disconnection of the electric supply. Mr Bhatia paid Rs10,000 on 18 March 2008, and instalment options were granted, but he failed to pay the remaining arrears.
The counsel further argued that there was no error in the bill, and the question of rectification did not arise. He says, "Mr Bhatia paid Rs2,000 on 21 April 2008, Rs2,360 on 28 August 2008, but failed to pay the remaining arrears. The supply was disconnected, and the meter was removed on 17 November 2008, as it is the legal right (of MahaDiscom) to disconnect supply for defaulters."
After going through the orders of the state commission, district forum, other relevant records and rival contentions of the parties, NCDRC observed that in certain situations like multi-storey apartments, especially in the initial stages after allotment of flats, sometimes the electric connection is obtained in the name of the builder or landowners and, many a time, the allottees of such flats continue with the electric connection remaining in the name of the builder or landowners, but they pay the electric bills. Similarly, in cases where houses or flats are rented out, though the tenant pays the electricity bills, the electric connection continues to be in the name of the landlord, it added.
The bench also referred to the Electricity (Rights of Consumers) Rules, 2020, framed by the Union ministry of power. These statutory rules define 'consumer' as:- "consumer" means any person who is supplied with electricity for his own use by a distribution licensee or the government or by any other person engaged in the business of supplying electricity to the public under this Act or any other law for the time being in force and includes any person whose premises are for the time being connected for the purpose of receiving electricity with the works of a distribution licensee, the Government or such other person, as the case may be;" 
"The above definition of a consumer clearly states that it includes a person whose premises are connected for the purpose of receiving electricity with the works of a distribution licensee. Hence, in the present case, considering that Mr Bhatia is the owner of the flat in question, has been paying the electricity bills to the electricity distribution company, and the same have been accepted by MahaDiscom for a very long time, we are of the considered view that the complainant is a consumer of the electricity company under the provisions of the Consumer Protection Act notwithstanding that the electricity connection is not in his name, but in the name of one Nandwani Satish Santumal," NCDRC says.
The bench of Dr Singh also criticised the Maharashtra state commission for proceeding with the case on merits after observing that there exists no inter se relationship between Mr Bhatia and MahaDiscom as a 'consumer' and service-provider. 
"State commission's observation 'looking from any angle since the complainant is not a consumer within the meaning of Consumer Protection Act and since even if he is a consumer,…' shows the state commission has not given a categorical finding whether the complainant is a consumer or not, as in the situation of a categorical finding on complainant not being a consumer, state commission ought not to have gone further into the case on merits," the bench says.
"State Commission went wrong in concluding that complainant is not a consumer," NCDRC stated while setting aside the state commission's order and restoring the order passed by the district forum. It asked MahaDiscom to implement the order within 30 days. 
(Revision Petition No2692 of 2011  Date: 24 January 2024)
Free Helpline
Legal Credit