Sanchayita Lahkar

The High Court of Bombay Single Bench of Justice Amit Borkar has dismissed a consumer’s writ petition seeking interest on the mandatory pre-deposit made for filing an appeal against an assessment for unauthorised use of electricity. The Court held that, even where the appellate authority sets aside the assessment and directs refund or adjustment of the deposit, the consumer has no enforceable statutory entitlement to interest on the sum deposited under Section 127(2) of the Electricity Act, 2003. It found that the deposit is a pre-condition to maintain the statutory appeal and is not a payment towards tariff or consumption charges. In the absence of any express provision imposing a corresponding obligation on the licensee, interest could not be directed on equitable considerations.

The petition arose from an assessment made against a consumer engaged in manufacturing plastic granules, alleging unauthorised use of electricity. Following an inspection of the industrial premises, the electricity distribution licensee concluded that the machinery was operating without corresponding meter readings and treated this as unauthorised use under the Electricity Act, 2003. A provisional assessment was issued and, after considering the material on record, a final assessment order followed.

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The consumer challenged the assessment before the appellate authority under the statute and deposited 50 per cent of the assessed amount as a mandatory pre-condition for maintaining the appeal. The appellate authority allowed the appeal, set aside the assessment, and directed refund or adjustment of the deposited amount but declined to grant interest. The consumer thereafter invoked supervisory jurisdiction seeking interest on the statutory deposit, contending that the absence of interest resulted in unjust retention of money by the licensee and relying on provisions relating to interest and refund under the Act.

The Court noted that the dispute before it was limited, observing that “the only surviving question is whether the petitioner is entitled to interest on the statutory deposit of 50% of the assessed amount made under Section 127(2)”. It recorded that the scope of interference under Article 227 was confined, stating that “this Court does not sit in appeal over the decision of the Appellate Authority” and interference would arise only in cases of jurisdictional error or perversity.

Examining the statutory framework, the Court observed that “the statutory scheme under Sections 126 and 127 of the Electricity Act is clear” and that the deposit under Section 127(2) is “a condition precedent for invoking the appellate remedy”. The Court further stated that such deposit “is not a voluntary payment of consumption charges” but a compulsory pre-deposit.

On the question of interest, the Court recorded that Section 127(6) “fastens liability on the consumer in the event of default in payment of the assessed amount” and “does not speak of any liability of the licensee to pay interest if the assessment is set aside in appeal”. Rejecting the argument of reciprocity, the Court stated that “the Court is required to interpret the statute, not to amend it” and that it could not supply a “casus omissus” where the legislature had chosen silence.

With respect to reliance on tariff provisions, the Court observed that “Section 62(6) does not apply to such a statutory pre-deposit” and extending it would amount to rewriting the provision. The Court also relied on binding precedent, noting that “the ratio of that decision is directly attracted to the present case” and that a coordinate bench was bound to follow it. The Court concluded that equity could not override the express statutory scheme, observing that “once the statute has spoken and the field is occupied by clear provisions, equity cannot run contrary to the statute”.

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The Court held 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.” The refusal of the Appellate Authority to grant interest is neither contrary to the Act nor to any declared legal principle”.

“No case for interference under Article 227 is made out” and that “the writ petition, therefore, fails on merits and stands dismissed”, with “no order as to costs”.

Advocates Representing the Parties

For the Petitioners: Mr. Sachin B. Thorat, Advocate with Mr. Dhananjay K. Bhosale, Advocate
For the Respondents: Mr. Harinder Toor, Advocate with Ms. Shradha Nagaonkar, Advocate, instructed by Mr. Sagar Shetty

Case Title: Illiyas Mangroo Shaikh v. Bombay Electricity Supply and Transport Undertaking & Ors.
Neutral Citation: 2025: BHC-AS:54396
Case Number: Writ Petition No. 8545 of 2015
Bench: Justice Amit Borkar