IN
THE HIGH COURT OF SINDH AT KARACHI.
Date Order with
signature of Judge
For hearing of CMA 4605/2012.
Date of hearing:
04.06.2012 & 08.06.2012
Mr. Amal Khan Kansi along with Khurram
Ashfaq for the plaintiff.
Mr. Ayan Mustafa Memon for defendant No.1.
None for defendant No.2.
-.-.-
Muhammad
Shafi Siddiqui, J.- By this
order I intend to dispose of application under order XXXIX rule 1 & 2 read
with Section 151 CPC (CMA No.4605 of 2012) whereby the plaintiff has sought
restraining orders against the defendant No.1 from carrying on with its illegal
failure to supply electricity to the plaintiff despite the fact that the
plaintiff has regularly paid all its electricity bills.
2. In
fact a mandatory injunction for restoration of electricity is sought.
3. Learned
counsel for the plaintiff in support of the application has argued that the
plaintiff is one of the largest manufacturers of denim and garments and
pursuant to their business requirement got three electricity connections to
their premises i.e. (i) BL 307, (ii) BL2348 and (iii) BH781. It is submitted by
the learned counsel that the factory units require steady supply of power and
in case of its inconsistent supply, the factory cannot function. Pursuant to
the three aforesaid connections, the contracts were entered into with the
defendant KESC to provide certain amounts of sanctioned load for their
respective premises for its industrial use, which accumulated power the KESC
was obliged to provide. It is submitted
that since the KESC has repeatedly failed to provide steady power supply to the
plaintiffs, they were compelled to set up its own backup electricity generators
in order to enable them to continue its business activities pursuant to the
orders of their various clients. It is submitted that the energy generated
through their Captive Power Plant is not provided to any other party.
4. Highlighting
to the point of non-use it was submitted that the electricity bills are divided
into two portions. The first portion is in relation to the fixed charges
payable regardless of whether or not sanction load is fully utilized whereas
the other portion pertains to usage of the electricity in terms of units
consumed. The cause initiated on 17.02.2012 when the plaintiff received notices
from the defendant KESC which apparently issued under section 20 of the
Electricity Act, 1910 read with Chapter 8 and 14 of the Consumer Service
Manual. Per learned counsel the notices were issued to ascertain whether any
captive power plants were on site and whether the sanctioned load was in fact
being utilized or is kept as standby. It was further claimed in the notices
that if it were discovered that this was the case i.e. kept as standby then
they would be entitled to disconnect the power supply and/or any other supply
of power i.e. captive generators as well.
5. Pursuant
to these notices the plaintiff replied to the KESC through its letter dated
24.2.2012 wherein they submitted that they are paying the bills including the
fixed charges regularly in respect of the sanctioned load. They further
submitted they were coerced and forced to use the captive power plant because
of the KESC’s failure to supply uninterrupted power supply. Learned counsel
further submitted that on 09.03.2012 the plaintiffs also sent a letter to NEPRA
seeking their assistance to rescue them. They urged before the NEPRA that their
contract with KESC did not make it mandatory for the plaintiff to use the
sanctioned load as a primary source. They submitted that before inspection of
all the three units completed, the KESC on 20.03.2012 disconnected the
electricity supply to two units i.e. BL2348 and BH781 whereas third one i.e.
BL307 remained connected until three more notices were issued out of which two
were issued on 19.04.2012 and the third one in respect of BL307 was issued on
20.04.2012. He submitted that it was not until 19.04.2012 that KESC finally
issued a show-cause notice in respect of three units. Hence, it was submitted
that the malafides with regard to issuance of notices are clear from the fact
that sufficient time was not provided to the plaintiff to explain its position
in that regard. It is submitted that
out of three notices two which were issued on 19.04.2012, the date of personal
hearing was fixed as 20.04.2012 whereas for the third meter regarding which the
notice was issued on 20.04.2012 the date of hearing was fixed on
23.04.2012. Thus, per learned counsel
there was no sufficient time provided by the defendant KESC to the plaintiff to
explain their position. It was
submitted that during this time the plaintiffs’ representative was coerced and
pressurized to give an undertaking in favour of KESC for utilizing at least 50%
of the sanction load, hence this coercion and undertaking is out of the
colourable exercise of power that they were enjoying at that time. Learned
counsel, however, submitted that the plaintiff has not given any undertaking by
which they can be compelled to use the KESC as a main or primary source.
Learned counsel further submitted that the plaintiff was using captive power
plant but only occasionally they did not get sufficient supply on account of
insufficient gas which compelled them again to shift to KESC connection and in
case of disconnection of KESC they would have no option but to shutdown their
factory.
6. It
is further submitted by the learned counsel that Section 20 of the Electricity
Act, 1910 is not applicable as has been held by the learned Single Judge in the
order passed in case being Suit No.329/2012. The Consumer Service Manual which
deals with the situation of disconnection is governed by Chapter 7 and 8, more
particularly 7.5 and 8.1. Per learned counsel 7.5 of CSM which deals with the
misuse of the tariff, the licencee i.e. KESC is liable to serve seven days clear
notice to the consumer before causing such disconnection. He further submitted
that Chapter 8 and more particularly 8.1 of CSM is the one which could be used
and considered to apply to the current situation. The disconnection under this rule can be made if (i) the consumer
is a defaulter in making payment of energy consumption charges bills, (ii) if
he is using the electricity connection for a purpose other than for which it
was sanctioned and (iii) if he has extended his load beyond the sanction load
even if after receipt of notice in this respect from the licencee. Hence, per
learned counsel the ground for disconnection pursuant to the power being kept
as standby would not be applicable here and consequently the disconnection, per
learned counsel, was unlawful, even if it is conceded by the plaintiff that
they were using the same as secondary source or standby as it is not the case
where plaintiff was using the sanctioned load for a purpose other than for
which it was sanctioned.
7. In
reply to the above arguments, learned counsel for the defendant KESC submitted
that since the plaintiff has approached this Court after substantial delay thus
they are not entitled to any discretionary relief. He submitted that the
plaintiff earlier was having three electric connections there i.e. BH781, BL307
and BL2348. Per learned counsel the electricity in respect of BL2348 was
disconnected on 09.03.2012, BH781 was disconnected on 28.03.2012 and BL307 was
disconnected on 20.03.2012. However, he added that as far as BL307 was
concerned it was disconnected on 20.03.2012 on plaintiff’s refusal to allow the
inspection pursuant to a notice for inspection.
8. It
is submitted by the learned counsel that the plaintiff was catering their
energy requirements through captive power plant and thus are not entitled for
any equitable relief. He submitted that the loads were sanctioned for
plaintiff’s primary use rather than backup or secondary use. It is submitted by
the learned counsel that the fixed charges are payable regardless of whether
any electricity has been consumed in a cycle month as the fixed charges are
calculated subject to reading of the maximum demand indicator of that cycle
month. Meaning thereby that if no electricity is consumed, no load will be
recorded in its MDI and hence no fixed charges could be charged. These charges
are recoverable if the actual units are consumed by a particular consumer. The
difference between the two is that fixed charges are charged against the
maximum load that a particular industrial consumer utilizes and reached in a
month whereas units consumed shows the actual electricity utilized and the
electricity bills for units consumed is issued pursuant to the electricity
consumed by the consumer. Learned counsel for the defendant denied that the
KESC disconnected electricity without prior inspection as the plaintiff itself
annexed three notices of 17.02.2012 and their replies. The respective
inspections were undertaken by KESC on 24.02.2012 for BL2348 and 29.02.2012 for
BH781 and the electricity to these two units was disconnected on 09.03.2012 and
28.03.2012 respectively after they were found using captive power plant in
these two premises and that the third meter bearing consumer No.BL307 was
attempted to inspection and refused by the plaintiff, it was disconnected on
20.03.2012. The inspection, however, was later on carried out on 24.04.2012
with regard to BL307. Learned counsel, however, pointed out that earlier the
disconnection to the aforesaid meter was on account of the refusal by the plaintiff
for inspection. He further submitted
that notices of 19.04.2012 were issued to the three units of the plaintiff in
compliance of the order of this Court. It was further submitted by the learned
counsel that in terms of the second proviso of 8.1, the plaintiff was found
violating the mandate of the sanctioned load and hence the action was also
taken pursuant to Section 20 of the Electricity Act and Chapter 8 of CSM, which
was the creation of NEPRA Act. He submitted that since it is already conceded by
the learned counsel for the plaintiff that the KESC’s connection was being kept
as standby there was neither any occasion to determine such status nor was
there any other impediment.
9. In
rebuttal learned counsel for the plaintiff reiterated that in such a situation
where the plaintiff was using the electricity as standby the law does not
support KESC to cause disconnection and in addition he submits that the law
requires a second notice to be issued for disconnection in case they reach to
the conclusion and determine that the electricity is being used as standby.
This submission was without prejudice to the earlier arguments wherein he
stated that in such eventuality where the KESC power was being used as standby,
the defendant does not enjoy this privilege to disconnect the electricity
connection.
10. I
have heard the learned counsel for the parties and have also perused the
record. In order to make up mind
regarding the arguments raised by the learned counsel, it would be advantageous
if the relevant law is reproduced hereunder:-
“20. Power for licensee to enter
premises and to remove fittings or other apparatus of licensee. (1) A licensee
or any person duly authorized by the licensee may, at any reasonable time and
on informing the occupier of his intention, enter the premises to which energy
is or has been, or is to be, supplied by him, for the purpose of:-
(a) examining,
inspecting and testing the electric supply-line, meters, maximum demand
indicators or other measuring apparatus, electric wires, fittings, works and
apparatus for the supply or use of energy, whether belonging to the licensee or
to the consumer; or
(b) ascertaining
the amount of energy supplied or the electric quantity contained in the supply
or the apparatus; or
(c) The
removing, where a supply of energy is no longer required, or where the licensee
is authorized to take away and cut off such supply, any electric supply lines,
meters, maximum demand indicators or other measuring apparatus, fittings, works
or apparatus belonging to the licensee:
Provided
that, where a consumer’s apparatus is involved, no person shall be deemed to
have been so authorized by the licensee unless, at the time of entry into such
premises, he is in possession of a written authorization from the secretary,
manager or any other officer of the licensee not below the rank of Divisional
officer in the Public Works Department.
Provide
further that previous permission of the District Magistrate shall be necessary
for making such entry into the premises of a domestic consumer,
(2) Where
a consumer refuses to allow a licensee or any person authorized as aforesaid to
enter his premises in pursuance of the provisions of sub-section (1) or, when
such licensee or person has so entered, refuses to allow him to perform any act
which he is authorized by that sub-section to perform, or fails to give
reasonable facilities for such entry or performance, the licensee may, after
the expiry of twenty four hours from the service of a notice in writing on the
customer, cut off the supply to the consumer for so long as such refusal or
failure continues, but for no longer.
7.1. Tariff.
Tariff means the rates, charges, terms and
conditions for generation of electric power, transmission, interconnection
distribution services and sales of electric power to consumers by a DISCO.
DISCOs shall charge only such tariff from consumers as is approved by NEPRA and
duly notified by Government of Pakistan from time to time. DISCOs shall apply
to NEPRA for any change of tariff to be charged from different categories of
consumers.
..
7.5. MIS-USE
OF TARIFF
(a) The
consumer shall, in no case use the connection for the purpose other than for
which it was originally sanctioned. In case of violation, the consumer is
liable for disconnection and/or penal action.
(b) DISCO
shall serve seven (7) days clear notice to the consumer who is found misusing
the approval/sanctioned tariff. However, DISCO shall immediately change the
tariff and shall determine the difference of charges of the previous period of
mis-use to be recovered from consumer. However, in the absence of any
documentary proof the maximum period of such charges shall not be more than TWO
billing cycles.
8.1. DISCONNECTION
A premise is liable to be disconnected if
the consumer is a defaulter in making payment of the energy consumption charges
bill(s), or if he is using the electric connection for a purpose other than for
which it was sanctioned, or if he has extended his load beyond the sanctioned
load even after receipt of a notice in this respect from the DISCO.
14.1. Access
to the Consumer’s Premises
A duly authorized employee of the DISCO
shall be entitled at all reasonable times, and on informing the occupier of his
intention (after giving a notice of clear 3 days), to enter the premises to
which energy is or has been, or is to be supplied by the DISCO, for the purpose
of:
a) examining
inspecting and testing the electric supply lines, meters, maximum demand
indicators or other measuring apparatus, electric wires, fittings, works or an
apparatus for the supply or use of energy, whether belonging to the DISCO or to
the Consumer, or
b) ascertaining
the amount of energy supplied or the electrical quantity contained in the
supply or the apparatus, or
c) removing,
where a supply of energy is no longer required, or where the DISCO is
authorized to take away and cut-off supply, any electric supply lines, meters,
maximum demand indicators or other measuring apparatus, fittings, works or
apparatus belonging to the DISCO or
d) along
all other things necessary or incidental to the proper supply or maintaining
such supply to the consumer’s premises.
14.10. Disconnection
of supply for Non-Compliance.
a) DISCO
may disconnect supply to a consumers if,
b) The
consumer has not fulfilled an obligation to comply with this Manual; and
c) The
DISCO has given the consumer 7 business days’ written notice of disconnection
(such notice to be in addition to the notice already given) and
d) The
consumer fails to comply with the notice.”
11. I
am also honoured to go through the order passed by my learned brother Munib
Akhtar, J in Suit No.329 of 2012 which substantially touches the issue involved
in this case. I must admit that my learned brother has not left a single (i) to
be dotted and ‘t’ to be crossed. It is virtually a complete code.
12. The
primary question, which comes out of the pleadings of either side and arguments
advanced, is as to whether the defendant No.1 was well within its right to
disconnect the electricity of the plaintiff in terms of Chapter 8 of Consumer
Service Manual who has kept the sanctioned load of defendant No.1 as a standby
and/or for secondary purposes. The parties however are not at issue as far as
status of sanctioned load is concerned which is admittedly being kept as
standby/secondary source.
13. As
far as the Electricity Act 1910 (Act of 1910) is concerned, it does not provide
any occasion to discontinue or disconnect the electric supply in such eventuality
i.e. standby/secondary use. Section
20(2) ibid provides that where a consumer refuses to allow a licencee or any
person authorized to enter his premises in pursuance of provisions of
subsection (1) or when such licencee or person has so entered, refuses to allow
him to perform any act which he is authorized by that subsection to perform, or
fails to give reasonable facilities for such entry or performance, the licencee
may after the expiration of 24 hours from the service of notice in writing on
the consumer, cut off the supply to the consumer for so long such refusal or
failure continues. Such is not the
situation here except for meter bearing No.BL307 whose inspection was earlier
refused but later on carried out. Therefore, as far as the issue of secondary
source/ standby is concerned, it is not at all covered by the Act of 1910 and I
agree with the observations and findings of my learned brother, as reflected in
the cited order that this could never be the intent of legislature in 1910 nor
could any one remotely think of obtaining a load for the purpose of keeping it
as standby, hence this situation is not covered by Act of 1910 and therefore
the application of Section 20 to such situation is a futile effort.
14. With
this I would now refer to Consumer Service Manual. Chapter 7 and 8 and 14 of
such Manual deals with the disconnection upon certain eventualities. Clause 7.5 of Chapter 7 deals with misuse of
tariff. It says that the consumer shall in no case use the connection for the
purpose other than for which it was originally sanctioned and in case of
violation he was held liable for disconnection, of course he deserves seven-day
clear notice from the licencee. Even in sub-clause (b) of clause 7.5, the
licencee is not vested with the absolute powers of disconnection as it was
under the obligation to immediately change the tariff and determine the
difference of charges of the previous period when it was being misused to be
recovered from the consumer and in the absence of any proof of such period of misuse,
the maximum period for which the consumer could be charged shall not be more
than two billing cycles. This is certainly not the situation here.
15. Next
I would discuss Chapter 8 of the Consumer Service Manual. As stated, 8.1 has
three phases i.e. electricity of the premises is liable to be disconnected if
(i)
consumer is a
defaulter in making payment of the energy consumption charges bills,
(ii)
if he is
using the electric connection for a purpose other than for which it was
sanctioned and
(iii)
if he has extended
his load beyond the sanctioned load, even after receipt of notice in this
respect from the licencee. Proviso (b) and proviso (c) are important as far as
the case of the plaintiff is concerned and I would like to discuss each of
them.
Proviso (ii) has three important words i.e.
“using”, “purpose” and “sanctioned”.
16. This
does not deal with the change of tariff as it has already been discussed in 7.5
clause earlier, therefore, the legislature has something else in its mind while
re-phrasing Chapter 8 of the Consumer Service Manual which is definitely not
the change of tariff. It is an admitted
fact that the electric power was provided by the licencee to the consumer for
its industrial use. The sanction of electric power or electric load to
the plaintiff has a purpose behind it i.e. its industrial use by the
consumer and it does not and cannot carry any other meaning.
17. I
had the occasion to find the meaning of the word “use” and “purpose” in
different dictionaries and it has been defined as something done positively,
eg. utilization or disposal. Mere non-use is not included in the word
“use”.
18. The
word “use” means to make use of a means or instrument; to imply for a
profitable end. It is inconceivable that the legislature has utilized the
words “use” and “purpose” without the application of mind. If the meaning of
these words are read in conjunction with the arguments of the learned counsel
for the plaintiff, it would render 8.1 as redundant, particularly clause (ii)
of 8.1 as ineffective and purposeless. The intentions of the licencee at the
time when the load was sanctioned without any hesitation was of its use by the
consumer and the word “use” does not and cannot include “non use” or
“non-usage” hence the purpose for which the load was sanctioned was its usage
by the consumer and since the purpose was not observed by the consumer, it can
be said that the consumer is using the electric connection for the purpose
other than for which it was sanctioned.
19. Now
surely the word “use” does not mean that the plaintiff or the consumer should
have used that load at its maximum capacity but when it is seen and observed
that the primary source of electricity by a consumer is not which the defendant
supplies, but it is through captive power plant or self generated source, only
then it can be easily said that it is under utilized or not used or not used as
a primary source and hence the legislature has not made (iv) proviso in 8.1 whereby it could have
been easily said that the electricity of the consumer is liable to be
disconnected on account of under-usage and only the extended load beyond the
sanctioned load was discussed in the (iii) proviso. So, the coercion of 50%
usage or any other percentage is not the intent of the legislature but its use
as main source. As it happened sometimes that the industrial concerns are
without work and load/power is not used to its maximum capacity, so “under
utilized” penalty is not made a ground for disconnection. This is the answer to
the arguments of learned counsel for the plaintiff that only extended load use
was subjected to disconnection. Meaning
thereby that if the consumer is under utilizing the load without keeping the
captive generator was not liable for disconnection but if the sanction load is
not used as because other sources of heavy generation are being used then it is
covered by (ii) proviso and then for this reason that the (iv) occasion i.e. of
no utilization or under utilization is not legislated as the same is covered by
(ii) proviso of 8.1. The word “use” must take its color from the context in
which it is used.
20. I
also had occasion to understand the meaning of “purposeful” and “purposeless”
which read as under:-
Purposeful:- having a definite purpose in view,
determine. Purposeless:- having no purpose, having no aim or goal,
aimless, to lead a purposeless existence.
Useless.
21. Now
if we are to give a cumulative effect to the meaning of all these words while
discussing (ii) proviso of 8.1, it evinced legislature’s intent that use of sanctioned
load has a positive meaning and it also reflects that the licensee has provided
the electricity to the consumer for its use. Rendering its use idle would
certainly make the (ii) proviso 8.1 as meaningless and hence it can be easily
said that the consumer who kept the sanctioned load as standby has kept the
electricity for the purpose other than for which it was sanctioned. Since it
was sanctioned for its industrial use therefore its non-usage is violative of
(ii) proviso.
22. Hence
I am of the view that (ii) proviso of 8.1 of CSM is the one which deals with
such situation.
23. New
consumers who have applied for electric connections are in such a situation
that they could neither obtain KESC connection on account of power crises at
one hand and on the other hand they cannot even have the industrial gas
connection since it is also being utilized by same or other industrial
consumers who also have the electric connection to their premises. Hence the
plaintiff and many other like consumers are enjoying both the electricity
connection as well as gas connection and are using their captive power plants
as main source whereas the new applicants and new consumers are being
victimized as they cannot avail any of the two on account of its scarcity and
unavailability.
24. Before
taking steps of disconnection the question of determination of status of
sanctioned load is also very important. Throughout the pleadings and in
documents relied upon by the plaintiff it is their consistent stand that
electricity was being kept a standby/ secondary.
25. Obviously
disconnection of electricity on the ground of it being used as standby requires
determination of status of sanctioned load but only where parties are at issue
as to whether the sanctioned load is being used as main source or secondary
source/standby. As I observed earlier throughout in the pleadings as well as in
response to notices dated 17.2.2012 the stand taken by plaintiff was that it
was being used as standby and not as main source. In their reply dated
24.2.2012 attached as annexures C/4 and C/5 the plaintiff’s stand is as under:
“Our sanctioned load is 270KW and our consumption is
“Zero” as we have been running our project on self generation due to instable
status of your company.”
“Our sanctioned load is 100 KW and our consumption is
“Zero” as we have been running our project on self generation due to instable
status of your company.”
26. Similarly
in para-7 of the plaint the plaintiff has taken a similar stand that they were
forced to use captive power as defendant failed to provide regular and reliable
power supply.
“--It also stated that the only reason it
was forced to use captive power was because KESC failed to provide a regular
and reliable power supply. Furthermore, even when KESC did supply power, that
power was often subject to fluctuations in voltage, which had the potential to
cause massive losses and damage to Soorty’s costly plant and machinery.”
Likewise in para-12 of the plaint, the plaintiff categorically submitted as under:
“---At no point has Soorty ever undertaken
to use KESC as a primary source of power. This is clear from the fact that it
has refused to sign the ‘Undertaking’ offered to it by KESC on numerous
occasions--.”
27. In
my view therefore, when the parties are not at issue the question of its
determination does not arise. The plaintiffs was already put on notice by
notices dated 17.2.2012 and the controversy came to an end on account of such
admission with regard to keeping the load as standby. The distinguishing
features as far as this suit and the Suit No. 329/2012 are concerned is of
course the admitted position with regard to the status of the sanctioned load
when the initial notices dated 17.02.2012 were replied. Since there was no
question of determination and even after the issuance of notices it was
consistent stand of the plaintiff that it was keeping the sanctioned load as
standby, the defendant No.1 was well within their right to disconnect the
electricity as the determination is not required. I thus conclude that the
plaintiff does not have a prima facie case. With current status the balance of
inconvenience does not lie in favour of the plaintiff and they would not suffer
any irreparable loss in case of dismissal of the application as they themselves
claimed that the use of sanctioned load from KESC is causing colossal losses,
hence the application has no merits and the same is accordingly dismissed.
Dated:
JUDGE