Electricity Act

This query is : Resolved 

21 January 2009

My client is an 80 years old man, he has got lot many properties and monies, however his health does not permit him to look after his investments.Therfore, he takes assistance from 2 girls-one as share analyst and one accountant and asks them to invest in Shares for himself only , for which he has got 3pcs at his residence. Here it can be noted that he is using his resience only for residential purpose. But my client received a notice u/s 126(1) of Electricity Act 2003, from BEST(supplier of electricity in mumbai) alleging that electricity is used for commercial purpose and therefore they issued a show cause notice stating their intention to change tariff from residential to commercial.we have replied their notice and explained them above fact that he is using his residence for residential purpose only and not commercial purpose as the investment is done solely of his investments and thereby no commercial activity is carried out.I need a suitable judgement which can support my above contention-pls guide me with the citation.Thanx,BinduAdvocate 

Bindu (Querist)
21 January 2009

Please provide me with suitable judgement


A. A. JOSEOnline (Expert)
21 January 2009

Dear Bindu,

Kindly note that as far as supply of electricity is concerned, there is always an agreement entered into by and between the parties stipulating therein terms and conditions of their relationship under the agreement. Further, after the enactment of the Electricity Act 2003, powers for framing the terms and conditions of supply of electricity, i.e. the Electricity Supply Code, and also for determing the electricity tariff has been exlusively vested in the appropriate Regulatory Commission. Classification of consumers, whether residential/industrial/commercial,etc., are squarely forming part of the tariff orders passed by the respective regulator, based on the nature of and purpose of use of electricity by the consumer. Strictly considering the use of electricity for share business,etc. it is obvious that your client, who has contracted for residential use of electricity with the electricity company, can be said to be violating the contractual terms,i.e. regarding the purpose/use for which the consumer had contracted with the electricity company. Accordingly, it is felt that the electricity company would be justified in booking your client for unauthorised use of electricity under section 126 of the electricity act 2003, and if repeated the same, your client can even be booked for theft of electricity under section 135 of the electricity act 2003. Therefore, electricity, being a "public property", it would be in the public interest and national interest for lawyers to convince clients (especially to those clients like yours who is stated to be very
wealthy), to pay for the actual use/purpose for which electricity is put to use rather than looking from a purely business viewpoint of lawyer-client relationship. You are aware of the fact that there is a total mismatch between demand and supply of electricity in our country and as such the electricity act 2003 has brought about concept of competition in the electricity industry in the country for first time to ensure proper generation, distribution and use of electricity. It is, therefore, imperative that those who use electricity must make payment according to their nature of and purpose of use. I do not think that there is any useful citation available to strengthen your client's case. I am aware of certain judgements of the some HCs/SC decided by the Shops & Establishments Act.,etc., which are not strictly relevant as far as the Electricity Act provisions, regulations and agreements entered into thereunder.

With best wishes,


Bindu (Querist)
21 January 2009


DEFENSE ADVOCATE.-firmaction@g (Expert)
01 February 2009

In this case BEST will have no case.They will have to show lot of evidence to prove that it is used for commercial prupose.

17 February 2009

I do agree with Mr. Shashi Kumar.

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