Case Note & Summary
The dispute arose between the Orissa State Electricity Board and Orissa Tiles Limited regarding the liability of the consumer to pay minimum charges after the disconnection of electricity supply. The parties entered into an agreement on March 5, 1965, which was valid for five years, mandating the consumer to pay certain minimum charges. The electricity supply was disconnected on April 30, 1968, due to non-payment of dues. The Electricity Board filed a suit for the amount due for electricity consumed until the disconnection and for minimum charges from May 1, 1968, to March 5, 1970. The Trial Court decreed the suit, but the High Court only upheld the claim for the period until disconnection, disallowing the claim for subsequent minimum charges on the grounds that the consumer did not use any energy during that period. The Electricity Board appealed to the Supreme Court, arguing that a precedent set in Bihar State Electricity Board, Patna v. M/s Green Rubber Industries established that consumers are liable for minimum charges even when supply is disconnected. The Supreme Court found that the agreement's clause explicitly required the consumer to pay minimum charges regardless of energy usage. Consequently, the Court restored the Trial Court's decree and set aside the High Court's order, ruling in favor of the Electricity Board.
Headnote
A) Contract Law - Consumer Liability - Obligation to Pay Minimum Charges - Indian Electricity Act, 1910 - The consumer is liable to pay minimum charges even after disconnection of supply for non-payment of dues as per the agreement. The court held that the agreement's clause obligates the consumer to pay minimum charges irrespective of energy usage post-disconnection (Paras 861-863).
Issue of Consideration
Whether the consumer is liable to pay minimum charges for the period subsequent to the disconnection of electricity supply.
Final Decision
The Supreme Court allowed the appeal, restored the Trial Court's decree, and set aside the High Court's order, ruling that the consumer is liable to pay minimum charges despite disconnection.
Law Points
- Minimum charges
- Disconnection of supply
- Consumer liability
- Electricity agreement
- Judicial precedent
