Isabella Mariam

The High Court of Bombay Division Bench of Justice G.S. Kulkarni and Justice Advait M. Sethna dismissed a petition challenging the rejection of an application made under the Mahavitaran Abhay Yojana, 2024 (Amnesty Scheme). The Court held that the petitioner was not entitled to relief under the scheme in the absence of compliance with the applicable conditions, which included payment of theft charges decreed against the previous consumer of the premises. The Bench concluded that the revised terms of the scheme, as notified in MSEDCL’s circular dated 3 December 2024, were binding and lawfully applicable to the petitioner’s application. It further recorded that the previously applicable Regulation 10.5 of the 2005 Supply Code stood repealed and had no bearing on the present claim. The petition was accordingly rejected without any order as to costs.

The petitioner, a private limited company, challenged the rejection of its application under the Mahavitaran Abhay Yojana, 2024 (Amnesty Scheme), a scheme introduced by the Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL) for recovery of dues. The petitioner had purchased an industrial unit located at Plot No. J-79, MIDC Tarapur, through a public auction conducted by a secured creditor under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). The previous consumer of electricity at the said premises was M/s Vishwas Steel Ltd., whose connection had been permanently disconnected on 1 April 2001 due to default in payment.

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Following the purchase, the petitioner applied to MSEDCL for a fresh electricity connection. MSEDCL declined the request, stating that as per applicable policy, the supply could not be restored until the dues of the previous consumer were cleared. The petitioner filed Writ Petition No. 1686 of 2011 seeking directions against this decision. In that proceeding, an interim order dated 15 June 2011 was passed by the High Court permitting MSEDCL to provide electricity connection to the petitioner upon payment of unpaid dues limited to a six-month period prior to disconnection, which was computed as ₹3,35,54,866.94 subject to verification.

Despite the interim relief, the petitioner did not deposit the said amount. Years later, on 11 October 2024, the petitioner sought to withdraw the 2011 writ petition, citing the option to apply under the new Mahavitaran Abhay Yojana, 2024.

The petitioner subsequently submitted an online application under the Amnesty Scheme. When no response was received, it issued letters dated 25 and 28 November 2024 to MSEDCL requesting action on its application. On 3 December 2024, MSEDCL issued Circular No. 07 of 2024, modifying the scheme’s terms to include a provision for theft cases. It stipulated that in cases of permanent disconnection due to theft, 100% of the theft assessment amount must be paid to avail waiver of interest.

On 6 December 2024, MSEDCL issued a letter rejecting the petitioner’s application under the scheme. The letter cited an outstanding theft liability of ₹2,07,24,237.16 assessed against the premises’ previous occupant, M/s Vishwas Steel Ltd. The basis for this claim was a decree passed on 23 September 2003 by the Civil Judge, Senior Division, Thane in Special Civil Suit No. 876 of 1996, in which the earlier consumer was directed to pay the theft dues with interest.

The petitioner contended that the demand was unsustainable for multiple reasons. First, it argued that the revised circular dated 3 December 2024 could not be retrospectively applied to an application already submitted under the original scheme terms. Second, the petitioner claimed that it had no legal liability to pay for the electricity dues of the prior consumer, relying on Regulation 10.5 of the Maharashtra Electricity Regulatory Commission (Electricity Supply Code and Other Conditions of Supply) Regulations, 2005, specifically the proviso that limits such liability to six months’ dues prior to disconnection.

The petitioner also submitted that the decree passed in the civil suit was between MSEDCL and the prior consumer and could not bind the petitioner as a third-party purchaser who had acquired the premises in an auction sale under the SARFAESI Act. It argued that as a bona fide purchaser without notice of liability, no statutory or contractual obligation could be imposed upon it to discharge the previous occupant’s assessed theft dues.

The respondents, including MSEDCL and the State of Maharashtra, opposed the petition. It was submitted on behalf of MSEDCL that the petitioner’s application had not been acted upon before the revised circular came into effect. Consequently, the application was governed by the modified terms of the scheme. It was further submitted that theft charges, unlike general arrears, were adjudicated and confirmed through a decree passed by a competent court. The decree, dated 23 September 2003, remained unsatisfied and constituted a binding liability recoverable against the premises, irrespective of change in ownership.

MSEDCL also argued that the 2005 Regulations, including Regulation 10.5, had been repealed and replaced by the Maharashtra Electricity Regulatory Commission (Electricity Supply Code and Standards of Performance of Distribution Licensees including Power Quality) Regulations, 2021. The 2021 Regulations did not preserve the benefits under the repealed provision. It was thus contended that the petitioner could not rely on a repealed regulation to seek waiver or limitation of liability.

Additionally, it was submitted that the petitioner had long benefited from interim relief in Writ Petition No. 1686 of 2011 without complying with the financial conditions imposed therein, and the withdrawal of that petition precluded revival of arguments based on the same cause of action.

The Court took note of the fact that the theft charges were not merely raised in a supplementary bill but were crystallized through a civil court decree. It also considered that the petitioner had constructive knowledge of the liability attached to the premises and that the decree was not concealed from the petitioner at the time of purchase.

Based on the above, the matter was placed for final adjudication on the legality of MSEDCL’s rejection of the application under the revised Amnesty Scheme and the petitioner’s eligibility for relief thereunder.

The Court considered the petitioner’s claim that it was not liable to pay theft dues under the Amnesty Scheme and that the revised circular dated 3 December 2024 could not apply retrospectively. The Bench held that Regulation 10.5 of the Maharashtra Electricity Supply Code, 2005 had been repealed and could not form the basis of any enforceable right:

“Regulation 10.5 of the Maharashtra Electricity Supply Code 2005 having stood repealed, there is no question of the petitioner asserting any right, inasmuch as the provision which is brought into force post-repeal i.e. the 2021 Regulations, do not in any manner contemplate any retrospective applicability of Regulation 10.5.”

To support this, the Court cited the Constitution Bench in Kolhapur Canesugar Works Ltd. v. Union of India:

“In the absence of any such provision in the statute or in the rule, the pending proceedings would lapse on the rule under which the notice was issued or proceedings were initiated being deleted/omitted.”

And further noted: “The effect of a repeal, unless saved expressly or by necessary implication, is to obliterate the former statute as completely as if it had never been passed.”

Regarding the decree dated 23 September 2003 passed in Special Civil Suit No. 876 of 1996, the Court recorded: “The liability to discharge the theft charges being called upon by the MSEDCL to be paid by the petitioner... stood crystallized under the decree of the Court… which was an amount due and payable.”

The petitioner argued that it was not liable under the decree as it was not a party to the suit. The Court rejected this, citing K.C. Ninan v. Kerala State Electricity Board:

“The Supreme Court has held that electricity dues can validly be claimed from a purchaser of premises where supply was disconnected for non-payment, and that the liability is tied to the premises.”

The Bench held that the property was sold on an "as is where is" basis and that the decree was part of the record: “The petitioner cannot be heard to say that it was unaware of the decree passed in the suit… there is no merit in the contention that the demand raised by MSEDCL was arbitrary or illegal.”

As to the revised scheme terms introduced by Circular No. 07 of 2024 on 3 December 2024, the Court held: “The revised Scheme dated 3 December 2024 required payment of 100% of theft charges. MSEDCL's rejection of the application for non-payment was consistent with the terms of that circular.”

The petitioner’s claim of accrued rights under the earlier scheme was rejected: “The petitioner admittedly did not deposit the dues as per the earlier scheme, and by the time its application was being considered, the modified scheme had come into force. Thus, the petitioner has no accrued right under the original scheme.”

On the nature of such schemes, the Bench stated: “There is no vested right in an amnesty scheme, and it can be modified or withdrawn before benefit is granted.”

The Court also addressed the petitioner’s non-compliance with earlier litigation orders: “The petitioner has not deposited the amounts pursuant to the earlier interim order dated 15 June 2011 for almost 14 years. Thereafter, having withdrawn the earlier writ petition, the petitioner cannot now assert rights on the basis of the same.”

Then, in a comprehensive finding rejecting the petitioner’s argument against the 3 December 2024 circular, the Court recorded the following:  “The petitioner cannot take a position that the terms and conditions of the amnesty scheme as notified by the impugned circular dated 3 December 2024 requiring theft charges to be deposited in cases of applicants whose electricity connection has been permanently disconnected, be not applied or that such condition is erroneous and illegal.”

“Certainly such a writ cannot be issued and more so in the present case when the law itself does not provide for recovery of such charges, in the position as the petitioner’s stand, so as to be a condition for a fresh electricity connection to be installed at the petitioner’s premises.”

“Thus, considering the clear position in law, in such context, we do not countenance that there is any alternative or way-out to the petitioner, to stand outside/de hors the terms and conditions of the amnesty scheme.”

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“This would amount to reading something into the amnesty scheme, what is not been explicitly set out and/or avoided to be incorporated.”

“Thus, if the contentions as urged by the petitioner are accepted, it would amount to the Court reading into the provisions of amnesty scheme something which has not been provided for or by a judicial fiat incorporating something alien to the Amnesty Scheme.”

“This is not certainly the jurisdiction of the Court, that by an interpretative process the Court would add a category of applicants in the amnesty scheme, so as to grant a benefit to such applicant which is otherwise directly not provided by the amnesty scheme, and which was not the intention and object of the authority in framing the specific terms and conditions of the Amnesty Scheme.”

“In the light of the above discussion, the petition is devoid of merits. It is accordingly rejected. No costs.”

Advocates Representing the Parties:

For the Petitioners: Mr. Jay Sanklecha a/s Mr. Kunal Damle

For the Respondents: Ms. Deepa Chawan, Senior Advocate a/w Mr. Kiran Gandhi, Ms. Ruchi Patil i/b Little and Company; Mr. M.M. Pabale, AGP for the State

Case Title: Aeon Creations Pvt. Ltd. & Anr. vs. State of Maharashtra & Ors.

Neutral Citation: 2025: BHC-AS:22552-DB

Case Number: Writ Petition No. 2734 of 2025

Bench: Justice G.S. Kulkarni and Justice Advait M. Sethna

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