Introduction

The case of M/S. Rototex Polyester & Anr. Petitioners v. Administrator, Administration Of Dadra & Nagar Havli (U.T) Electricity Department, Silvassa & Ors. adjudicated by the Bombay High Court on August 20, 2009, centers on the applicability of Section 56(2) of the Electricity Act, 2003. The petitioners, engaged in the manufacturing and supply of polyesters and yarns, contested a revised electricity bill citing a clerical error in the multiplication factor used by the electricity department. The core legal issue revolved around whether the revised billing made four years after the initial due date could be recovered under the said section, which imposes a two-year limitation on such recoveries.

Summary of the Judgment

The Bombay High Court dismissed the writ petition filed by M/S. Rototex Polyester & Anr., thereby upholding the revised electricity bill amounting to Rs. 2,77,34,867.43. The court held that the claim raised by the electricity department was not barred under Section 56(2) because the adjustment was due to a clerical mistake in the multiplication factor, which falls outside the two-year limitation period. The High Court emphasized that such remedial measures by the electricity department, aimed at correcting billing errors, are permissible despite the statutory limitation.

Analysis

Precedents Cited

The judgment extensively references key precedents to substantiate its stance:

• Bharat Barrel & Drum Manufacturing Company Pvt. Ltd. v. Municipal Corporation for Greater Bombay (AIR 1978 Bom. 369): This case addressed the absence of a six-month limitation for claims arising from clerical errors or human mistakes, establishing that such errors can justify extended recovery periods.
• U.A Thadani v. B.E.S.T Undertaking (2000 Vol. 102 (2) Bom.L.R 502): Reinforced the principle that billing errors related to multiplication factors are not constrained by the six-month limitation in Section 26 of the Indian Electricity Act, 1910.
• Brihanmumbai Municipal Corporation v. Yatish Sharma & Ors. (2007 (3) Bom.C.R 659): Highlighted the interpretation of “due” under Section 56(2), emphasizing that amounts become recoverable only after a valid bill has been issued.
• H.D Shourie v. Municipal Corporation Of Delhi & Anr. (AIR 1987 Delhi 219): Explored the meaning of "due" within the context of the Electricity Act, asserting that payments are due post-issuance of a valid bill.

Legal Reasoning

Central to the court’s reasoning was Section 56(2) of the Electricity Act, 2003, which stipulates that:

“Notwithstanding anything contained in any other law for the time being in force, no sum due from any consumer, under this section shall be recoverable after the period of two years from the date when such sum became first due unless such sum has been shown continuously as recoverable as arrears of charges for electricity supplied and the licensee shall not cut off the supply of the electricity.”

The court examined whether the revised billing due to a clerical error falls within the purview of Section 56(2). It concluded that such errors justify an extension beyond the two-year limitation, thereby allowing the electricity department to recover the corrected amounts. The judgment articulated that Section 26(6) of the Indian Electricity Act, 1910, which deals with meter disputes, does not restrict the electricity department from recovering amounts due to multiplication factor errors, as established by prior case law.

Impact

This judgment has significant implications for both electricity consumers and providers:

• For Consumers: It underscores the importance of timely scrutiny of electricity bills and establishes that discrepancies arising from departmental errors are enforceable beyond the standard limitation period.
• For Electricity Departments: Provides judicial backing to rectify billing errors without being hindered by the two-year limitation, ensuring accurate revenue collection.
• Legal Precedent: Reinforces the interpretation of statutory provisions in electricity law, particularly concerning limitation periods and clerical errors.

Complex Concepts Simplified

Section 56(2) of the Electricity Act, 2003

This section limits the recovery of any sum due from consumers to a period of two years from when the amount first became due. Essentially, if the electricity department realizes that they were underbilling, they have two years to correct this mistake and recover the additional amount.

Sub-section (6) of Section 26 of the Indian Electricity Act, 1910

This provision deals with meter disputes, specifically when there's a difference or disagreement regarding the accuracy of a meter. It allows an Electrical Inspector to determine the correctness of a meter and estimate the energy supplied if the meter is found faulty, but generally restricts such adjustments to a six-month period.

Multiplication Factor in Meter Readings

The multiplication factor is used to calculate the actual electricity consumption based on the meter reading. For instance, a multiplication factor of 1000 means the meter reading is multiplied by 1000 to determine the total units consumed.

Conclusion

The Bombay High Court's decision in M/S. Rototex Polyester & Anr. serves as a pivotal reference for the interpretation of Section 56(2) of the Electricity Act, 2003. By distinguishing between clerical errors and other types of billing disputes, the court has clarified that electricity departments retain the authority to rectify and recover amounts beyond the two-year limitation when errors are due to factors like incorrect multiplication factors. This ensures that revenue collection remains accurate while providing a clear legal framework for resolving billing discrepancies. The judgment reinforces the need for both consumers and electricity providers to maintain meticulous billing practices and adhere to statutory provisions when addressing billing disputes.