HC strikes down MSEDCL’s ₹2.22-crore supplementary bill to COEP

In a reprieve to the College of Engineering, Pune (CoEP), the Bombay high court (HC) on Friday upheld an order of the Electricity Ombudsman, Mumbai striking down

In a reprieve to the College of Engineering, Pune (CoEP), the Bombay high court (HC) on Friday upheld an order of the Electricity Ombudsman, Mumbai striking down supplementary demand of ₹2.22 crore from the leading government engineering college in Maharashtra.

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Justice Ujjal Bhuyan on Friday dismissed a petition filed by the Maharashtra State Electricity Distribution Company Ltd (MSEDCL) challenging the Ombudsman order.

In accordance with the tariff order passed in August 2012 order by the Maharashtra Electricity Regulatory Commission (MERC), MSEDCL changed the tariff category of CoEP hostel to HT-IX (non-express) on September 5, 2012.

In 2015-16, CAG found mistakes in billing of certain category of MSEDCL consumers after which the electricity supplier carried out inspections and in March 2018 issued a supplementary bill to CoEP of about ₹2.22 crore claiming that the college’s hostel was wrongly categorised as a low tariff HT-IX consumer. MSEDCL also threatened to disconnect power supply to the 11 hostel buildings in case of failure to pay bill in due time.

MSEDCL then moved the high court challenging the Ombudsman order on various grounds.

HC noted that Section 56 (2) of the Electricity Act prohibits recovery of any sum from consumer after a period of two years from the date when such sum became first due, and therefore, it was not open to the electricity supplier to raise demands of differential bill for a period from February 2012 for the first time in March 2018.

Besides, the judge said HT-IX tariff category was applicable to educational institutions and sports club, gymnasium, swimming pool, etc. attached to such institutions situated in the same premises and exclusively meant for the students. “If sports club, gymnasium, swimming pool, etc. attached to such institution and situated in the same premises exclusively meant for the students are covered by the said tariff category, there is no reason to exclude the hostel where the students reside from the ambit of the expression educational institution,” said justice Bhuyan. “Therefore, on this count also, raising of the supplementary bill is highly questionable,” the judge added.

He said the Ombudsman correctly held that MSEDCL was not entitled to demand any differential bill for any period before February 2018, when tariff category of hostels was last changed. In this regard, the Ombudsman had relied on MERC order of February 2003 directing that there shall be no retrospective recovery of arrears on the basis of any abrupt re-classification of consumers, and that in such cases the billing should be prospective as those cannot be construed as cases of escaped billing.