SHRI ILIYAS MANGROO SHAIKH v. BOMBAY ELECTRICITY SUPPLY AND TRANSPORT UNDERTAKING AND ORS
Entitlement to Interest on Statutory Deposit Under Section 127(2) of the Electricity Act, 2003; No Reciprocal Right for Consumer When Assessment is Set Aside.
Court: Bombay High Court
Citation: 2025:BHC-AS:54396
Decision Date: 11-12-2025
List of Laws
Article 227 of the Constitution of India; The Electricity Act, 2003; Section 126 of the Electricity Act, 2003; Section 127 of the Electricity Act, 2003; Section 62(6) of the Electricity Act, 2003
- Facts: The petitioner, a manufacturer of plastic granules, was assessed for unauthorized use of electricity. During an inspection, officials found the petitioner's machinery running, but the meter showed no corresponding load. A provisional assessment was issued, and the petitioner deposited 50% of the assessed amount as required for appeal under Section 127 of the Electricity Act, 2003. The Appellate Authority set aside the final assessment, finding that the Assessing Officer had not followed the correct procedure. However, the Appellate Authority declined to grant interest on the statutory deposit.
- Procedural Posture: The petitioner filed a writ petition under Article 227 of the Constitution of India, challenging the order of the Appellate Authority that denied interest on the statutory deposit.
- Issue: Is the petitioner entitled to interest on the statutory deposit made under Section 127(2) of the Electricity Act, 2003, after the appellate authority set aside the assessment for unauthorized use of electricity?
- Holding: No, the petitioner is not entitled to interest on the statutory deposit.
- Reasoning: The Court reasoned that Section 127(6) of the Electricity Act, 2003, only provides for interest payable by the consumer in case of default in payment of the assessed amount and does not create a reciprocal right for the consumer to claim interest when the assessment is set aside in appeal. The Court cannot introduce such a right when the legislature has consciously not provided for it. The Court distinguished Section 62(6) of the Act, which deals with excess recovery of tariff, stating that the statutory deposit under Section 127(2) is not a tariff or consumption charge but a pre-condition for filing an appeal. The Court relied on a previous decision, Executive Engineer, Maharashtra State Electricity Distribution Co. Ltd. v. Pioneer Estate Corporation, which held that interest payable by a defaulting consumer cannot be invoked to grant interest to a consumer whose appeal is allowed. The Court stated that "the petitioner has no enforceable right to claim interest on the statutory deposit made under Section 127(2) of the Electricity Act, 2003, once the deposit has been refunded or adjusted pursuant to the appellate order."
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