BIHAR STATE ELECTRICITY BOARD & ORS. versus MIS. BHOLA RAM STEEL PVT. LTD. & ORS.

Citation: [2016] 1 S.C.R. 499 · Decided: 28-01-2016 · Supreme Court of India · Bench: M.Y. EQBAL · Disposal: Appeal(s) allowed
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Judgment (excerpt)

[2016] I S.C.R. 499 
BIHAR STATE ELECTRICITY BOARD & ORS. 
v. 
MIS. BHOLA RAM STEEL PVT. LTD. & ORS. 
(Civil Appeal No. 585 of2016) 
JANUARY 28. 2016 
[M.Y. EQBAL AND ARUN MISHRA, JJ.] 
Electricity - Benefit under Industrial Policy I 995 - Of 
exemption from payment of minimum guarantee charges - To the 
industrial units having connected load of 500 KVA - Industrial unit/ 
consumer in question entered into an agreement for a contract 
demcnd of 500 KVA - Entitlement to the exemption - Held: As per 
the readings in Maximum Demand Indicator (MDI) Meter!Trivector 
Meter, the· consumer availed electricity in excess of the contracted 
load which was in contravention of the agreement - Therefore, the 
appellant-Board was well within its right to realize the amozint as 
per tariff Notifications, in view of clause 16.5 of the Notification 
dated 21.06.1993 issued u/s. 49 of Electricity Act, 1948 - The 
consumer is not entitled to benefit of exemption - Electricity Act, 
1948 - s. 49. 
Allowing the appeal, the Court 
HELD: 1. As per the readings recorded by the MDI meter/ 
Trivect< . meter, it is apparent that consumer has availed and 
drawn electricity in excess of the contracted load in contravention 
of th~ ;reement with the Electricity Board. The reading of MDI 
meter 1s indicator of total connected loads, the total load deman.ded 
and availed of during the course of actual consumption of energy. 
In the facts of instant case, it is apparent that for six months in 
the year 1999-2000 the MDI meter has recorded excess load. 
Thus the High Court has erred in the facts of the instant case in 
holding that it has not been established in the instant case that 
the c<mnected load was more than 500 KVA. [Para 14] [504-D-E) 
Orissa State Electricity Board & Am: v. !PI Steel Ltd. & 
Ors. (1995) 4 SCC 320: 1995 (3) SCR 684; Bhilai 
Rerollers & Ors. v. MP. Electricity Board & Ors. (2003) 
7 SCC 185: 2003 (2) Suppl. SCR., 787 .- relied on. 
499 
A 
B 
c 
D 
E 
F 
G 
H 
500 
A 
B 
c 
D 
E 
F 
SUPREME COURT REPORTS 
(2016] I S.C.R. 
2. Merely in an inspection in January, 1999 the connected 
load was found to be of 495 HP when for six months in a subsequent 
period of April, 1999 to March, 2000 maximum demand has 
increased beyond the contracted load of 500 KVA and it is not 
disputed that it was more than 110% of the contract load. Thus 
as per clause 16.5 of the notification dated 21.06.1993 issued 
under the Electricity Supply Act, 1948 the Electricity Board was 
well within its rights to realize the amount as per tariff notification. 
The High Court has erred in holding in the facts of the case that 
there can be no correlation with the maximum demand and the 
connected load. [Para 16] [507-D-F] 
3. The High Court has also proceeded on irrelevant 
consideration while it has observed that entrepreneur has stepped 
up production, which will result in economic development, 
generation of employment and income and higher consnmption 
is better for the State of Bihar. This was not a question to be 
gone into by the High Court. The High Court was required to 
consider the reliability of the MDI meter and frequent violation 
of contract demand and the tariff notification dated 21.6.1993. 
·There is material on record indicating that the connected load 
has been exceeded as reflected in the meter reading. [Para 16] 
[507-F-G] 
4. The plea taken that there was defect in the meter and 
they were changed in January, 2000 and again in March, 2000 
has no legs to stand. However MDI meter readings for earlier 
periods too indicated demand exceeding 500 KVA and in the 
month of November 1999, the meter was found to be in order 
and maximum demand exceeded contract demand. Once 
maximum load drawn had exceeded the contracted load, in the 
fact of the case, it can safely be held that there is violation of the 
permissible connected load. The recording in MDI meter is more 
credible and reliable than the stand of the industry that the meter 
G was faulty, set up just to escape from the liability. [Para 16] [507-
H; 508-A-B] 
Case Law Reference 
1995 (3) SCR 684 
relied on. 
H 2003 (2 ) Suppl. SCR 787 
relied on. 
Para 15 
Para 15 
BIHAR STATE ELECTRICITY BOARD v. M/S. BHOLA RAM 
501 
STEEL PVT. LTD. 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 585 of 
A 
2016 
From the Judgment and Order dated 13.11.2009 of the High Comt 
of Judicature at Patna in LPA No. 1613 of 2000. 
Moh it Kumar Shah for the Appellants. 
S. D. Sanjay, Devashish Bharuka, Abraha
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