Case Note & Summary
The petitioner, M/s. Namco Industries Pvt. Ltd., filed a writ petition under Article 226 of the Constitution seeking a direction to the Maharashtra State Electricity Distribution Company Limited (MSEDCL) to allow its application for a temporary 100 HP load power supply and to set aside a demand of Rs. 39,57,15,400 raised by the respondent. The petitioner had purchased the premises from the fourth respondent, who had acquired it through an auction sale conducted in execution of a recovery certificate issued by the Debts Recovery Tribunal. The dispute centered on whether the petitioner, as a subsequent transferee, was liable to pay the arrears of electricity charges of the erstwhile owner, Malhotra Steels (Bombay) Limited. The petitioner argued that it was seeking a fresh connection, not restoration of the old one, and thus should not be liable for the previous owner's dues. The respondent relied on Regulation 10.5 of the Maharashtra Electricity Regulatory Commission (Electricity Supply Code and Other Conditions of Supply) Regulations, 2005, which provides that unpaid electricity dues constitute a charge on the property and can be recovered from the transferee, subject to a maximum of six months of unpaid charges. The court analyzed the regulation and held that the petitioner, as a transferee, is liable for the arrears but only to the extent of six months of unpaid charges for electricity supplied. The court allowed the petition in part, directing the respondent to grant the connection upon payment of the limited amount, and set aside the demand for the full arrears.
Headnote
A) Electricity Law - Arrears of Electricity Dues - Liability of Transferee - Regulation 10.5 of Maharashtra Electricity Regulatory Commission (Electricity Supply Code and Other Conditions of Supply) Regulations, 2005 - The court considered whether a transferee of property is liable for unpaid electricity dues of the previous owner. Held that under Regulation 10.5, unpaid dues constitute a charge on the property and can be recovered from the transferee, but only to the extent of six months of unpaid charges for electricity supplied. (Paras 3, 10-12) B) Electricity Law - Fresh Connection vs. Restoration - Distinction - Regulation 10.5 of MERC Regulations, 2005 - The petitioner sought a fresh connection, not restoration of the old one. The court held that the distinction is irrelevant because the regulation applies to any new connection sought by a transferee, and the liability is limited to six months' arrears. (Paras 3, 10-12)
Issue of Consideration
Whether arrears of unpaid electricity charges can be claimed from a subsequent transferee of property, and if so, what is the quantum of those charges to which the transferee is liable.
Final Decision
The court allowed the petition in part, directing the respondent to grant the connection upon payment of six months' unpaid charges as per Regulation 10.5, and set aside the demand for the full arrears.
Law Points
- Electricity dues as charge on property
- liability of transferee for arrears
- interpretation of Regulation 10.5 of MERC (Electricity Supply Code and Other Conditions of Supply) Regulations 2005
- maximum liability limited to six months of unpaid charges
