Electricity Theft: The electricity company has power to do immediate assessment under Sec 126 and raise bill, in case of theft of electricity; SC.

Supreme Court of India

Justice R. Subhash Reddy and Justice R. Banumathi

The SC { West Bengal State Electricity Distribution Company Ltd. & Ors. v. M/s. Orion Metal Pvt. Ltd. & Anr. } while setting aside the judgment of the HC - by which it was held by the HC that in case of theft, the assessment under Sec 126 of the Electricity Act, 2003 cannot be made by the power distribution company - holds that after inspection team notices unauthorized use of energy by tampering the meter, the authorities can disconnect the power supply immediately and make immediate assessment for loss of energy, by invoking power under Section 126(1) of the Act.

It was held that the term “unauthorized use of energy” is of wide connotation. There may be cases of unauthorized use of energy, not amounting to theft, which are cases viz. exceeding the sanctioned load or using the electricity in the premises where its use is not authorized etc. But at the same time, when there is an allegation of unauthorized use of energy by tampering the meter, such cases of unauthorized use of energy include ‘theft’ as defined under Section 135 of the Act.

It was held that the power conferred on authorities for making assessment under Section 126(1) of the Act and power to determine civil liability under Section 154(5) of the Act, cannot be said to be parallel to each other. It was held by the SC that the High Court has committed an error in recording a finding, that both proceedings cannot operate parallelly.

It was held that in a given case where there is no theft of energy, amounting to unauthorized use of energy, in such cases no complaint of theft can be lodged as contemplated under Section 135 of the Act. In such cases for loss of energy, on account of unauthorized use of energy not amounting to theft, it is always open for the authorities to assess the loss of energy by resorting to power under Section 126(1) of the Act.

It was held that in cases where allegation is of unauthorized use of energy amounting to theft, in such cases, apart from assessing the proceedings under Section 126(1) of the Act, a complaint also can be lodged alleging theft of energy as defined under Section 135(1) of the Act. In such cases, the Special Court is empowered to determine civil liability under Section 154(5) of the Act. On such determination of civil liability by the Special Court, the excess amount, if any, deposited with the petitioner, is to be refunded to the consumer.

It was held that it is a settled principle that to prove the guilt of the accused in a criminal proceeding, authorities have to prove the case beyond reasonable doubt and the element of mens rea is also to be established. On the other hand, such a strict proof is not necessary for assessing the liability under Section 126(1) of the Act. Therefore, it was held by the SC that the finding of HC that Sec 126 of the Act cannot be resorted to for assessment in case of theft of electricity as the Special Court has power to determine civil liability under Sec 154 of the Act was patently illegal and dehors the provisions of the applicable Act. The appeal was allowed and judgment of the High Court was set aside by the SC.