KARNATAKA POWER TRANSMISSION CORPN. & ANR. v. ASHOK IRON WORKS PVT. LTD

Citation: [2009] 1 S.C.R. 1109

Court: Supreme Court of India

Bench: MARKANDEY KATJU, RAJENDRA MAL LODHA

Case summary

KARNATAKA POWER TRANSMISSION CORPN. & ANR. v. ASHOK IRON WORKS PVT. LTD.pdf

Judgment text

[2009] 1 S. C. R. 1109 KARNATAKA POWER TRANSMISSION CORPN. & ANR. - i v. ASHOK IRON WORKS PVT. LTD. (Civil Appeal No 1879 of 2003) FEBRUARY 9, 2009 [MARKANDEY KATJU AND R. M. LODHA, JJ. ] ,. CONSUMER PROTECTION ACT, 1986: ss. 2(1) (d), 2(1)(m), 2(1)(o) and 2(1)(g) - 'consumer', 'person', 'service' 'deficiency' - Complaint by a manufacturing unit claiming damages from Kamataka Power Transmission Corporation for delay in supply of electricity relating to the period prior to amendment of s. 2(1)(d)(ii) by Act 62 of 2002 - Held: Definition of 'person' in s. 2(1)(m) is inclusive and not ..... ~ exhaustive - Company is a person within the meaning of s. 2(1)(d) r/w s.

2(1)(m) - Supply of electricity to a consumer by KPTC is not sale of electricity, but would be covered u/s 2(1)(o) being service and, if the supply is not provided within the time stipulated, there may be a case of deficiency of service as provided uls 2(1)(g)-Therefore, the complaint is maintainable - Interpretation of Statutes. WORDS AND PHRASES : • Expression 'includes' as occurring in s. 2(1 )(m) of Consumer Protection Act, 1986 - Connotation of. The respondent in C. A. No. 1879 of 2003, a Private Limited Company engaged in manufacture of iron products, filed a complaint under the Consumer Protection Act, 1986 before the District Consumer Disputes Redressal Forum claiming damages from the -t " appellant-Karnataka Power Transmission Corporation for delay in supply of electricity. It was stated that the money demanded was deposited on 1. 2. 1991 whereas the supply of power commenced in the month of November, 1992.

The appellant-Corporation raised a preliminary objection as to maintainability of the complaint contending that the complainant was engaged in commercial activity and electricity being 'goods', sale thereof to a commercial consumer for commercial purpose was outside the purview of the Act. The District Forum rejected the complaint as not maintainable. The State Commission and the National Commission having held the complaint maintainable, the Corporation filed the appeal. The appellant in Civil Appeal No. 17784 of 2002, a sole proprietor of a battery charging unit, filed a complaint before the District Forum challenging the demand raised by the Karnataka Power Transmission Corporation. The District Forum held in favour of the appellant. But the . - State Commission and the National Commission having held that the complainant was not a 'consumer' within the meaning of s. 2 (1) (d) of the Act, he filed the appeal.

The questions for consideration before the Court were: (i) "Is a private limited company a 'person' as contemplated under Section 2 (1) (d) of the Consumer Protection Act, 1986? (ii) "Whether the supply of electricity by KPTC to a consumer is sale and purchase of goods within the meaning of Section 2 (1) (d) (i) of the Act, 1986? " and (iii) whether the supply of electricity by KPTC would come within the ambit of s. 2 (1) (o) of the 1986 Act so as to be covered within the purview of subclause (ii) of Clause (d) of s. 2 (1) of the Act? Dismissing Civil Appeal No. 1879 of 2003 and allowing Civil Appeal No. 7784 of 2002, the Court HELD:1. Section 2(1 )(m) of the Consumer Protection Act, 1986. While defining 'person' cannot be held to be restrictive or confined to the four categories enumerated v. ASHOK IRON WORKS PVT. LTD.

therein, namely, (i) a firm whether registered or not; (ii) - "f Hindu undivided family; (iii) a co-operative society; and (iv) every other association of persons whether registered under the Societies Registration Act, 1860 or not. It is not said in terms that 'person' shall mean one or other of the four things enumated, but that it s~all include them. The definition of 'person' in s. 2(1 )(m) is inclusive and not exhaustive. There is no doubt that company is a person . within the meaning of s. 2(1)(d) read with s. 2(1)(m). [para 15 and 18] [1119-E; 1120-B-D] The South Gujarat Roofing Tiles manufacturers Association and Anr. v. The State of Gujarat and Anr. (1976) 4 SCC 601 and Reserve Bank of India v. Peer/ess General Finance and Investment Co. Ltd. and Ors. (1987) 1 SCC 424, referred to _, .. Lord Watson in Dilworth v. Commissioner of Stamps (1899) AC 99, referred to 2. 1. Supply of electricity to a consumer by KPTC is not sale of electricity.

The expression 'supply' is not synonym for 'sale'. Supply does not mean sale. The expression 'but does not include a person who avails of such services for any commercial purpose' inserted in s. 2(1 )(d)(ii) by the Act 62 of 2002 is not applicable in the facts and circumstances of th~ instant case since the • controvetsy relates to the period prior to the amendment. [Para 24] [1124-A-D] CST v. M. P. Electricity Board, Jabalpur 1969 (2) SCR 939; State of Andhra Pradesh v. National Thermal Power Corporation (2002) 5 SCC 203; Indian Aluminium Co. v. State of Kera/a; (1996) 7 SCC 637; Southern Petrochemical Industries Co. Ltd. Vs. Electricity Inspector & ETIO and Ors. (2007) 5 SCC 447 and SOO, Electricity and Anr. Vs. B. S. Lobana (2005) 6 SCC 280, referred to 2. 2. As a matter of fact, the company has brought its 't case to be covered by s.

2(1)(d)(ii) and not 2(1)(d)(i), as the dispute raised by the company is with regard to nonperformance of services for consideration within the time frame. For the purposes of maintainability of the complaint, therefore, what is important to be seen is whether there is deficiency in service within the meaning of s. 2(1)(d)(ii). [Para 22] [1122-H; 1123-A-B] 3. Under s. 2(1)(o) of the 1986 Act, 'service' means service of any description which is made available to potential users and includes the provision of facilities in connection with supply of electrical or other energy. As indicated in the definition of 'service', the provision of facilities in connection with supply of electrical energy is a service. Supply of electricity by the Board or for that matter KPTC to a consumer would be covered u/s 2(1)(o) ~ being 'service' and, if the supply of electrical energy to a consumer is not provided in time as is agreed upon, then u/s (2)(1 )(g), there may be a case for deficiency in service.

[Para 22] (1123-8-E] 4. 1. The complaint made by the appellant company in C. A. No. 1879/2003 before the District Forum is maintainable. The orders passed by National Consumer Disputes Redressal Commission and the State Consumer .. Redressal Commission are affirmed and, accordingly, the complaint stands remitted to the District Forum for its disposal in accordance with law. [Para 25 and 28] [1124- - E; 1125-E] 4. 2. The complaint by the complainant in CA No. 7748/ 2002 is maintainable. The Orders passed by State and the National Commissions are set aside. Appeal No. 168/1994 is restored to the file of the State Commission for its disposal in accordance with law. [Para 27and 28] [1125- C-G] v. ASHOK IRON WORKS PVT. LTD.

Case Law Reference: - -¥ (1976) 4 sec 601 referred to para 11 (1987) 1 sec 424 referred to para 11 (1899) AC 99 referred to para 12 1969 (2) SCR 939 referred to para 19 (2002) s sec 203 referred to para 19 (1996) 1 sec 637 referred to para 19 (2001) s sec 447 referred to Para 20 (2oos) 6 sec 280 referred to para 23 CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1879 of 2003. ... From the Judgment and Order dated 7. 10. 2002 of the National Consumers Disputes Reddressal Commission, New Delhi) in Revision Petition No. 791 of 2000. WITH C. A. No. 7784 of 2002. Vijay Kumar and V. N. Raghupathy for the Appellants. Kiran Suri, K. H. Nobin Singh for the Respondents. • The Judgment of the Court was delivered by ...... R. M. LODHA, J. 1. These two appeals by special leave, involving common questions, were heard together and are being disposed of by this judgment. 2. As the principal arguments have been advanced in Civil Appeal No.

1879/2003, we take up the facts of that appeal which are thus, briefly put. M/s Ashok Iron Works Private Limited (for short, 'the company') is a Private Limited Company and engaged in the activity of manufacture of iron products. The company applied for the supply of electrical energy (2500 'r0IA) to the Karnataka Electricity Board (now Karnataka Power -,. • Transmission Corporation and hereinafter referred to as 'KPTC'). The application made by the Company was cleared by the Single Window agency and supply of electric energy 1500 KVA was sanctioned. The company is said to have deposited an amount of Rs. 8,40,000/- on 1st February, 1991 as per demand. KPTC did not commence supply of electricity as agreed upon and that necessitated the company to approach Karnataka High Court for a direction to KPTC to supply the sanctioned energy.

On 16th April, 1992, the High Court directed KPTC to supply electrical energy as per sanction forthwith and subsequently, time for supply of electricity was extended by the High Court upto 21st July, 1992. KPTC raised an additional demand of Rs. 8,38,000/- from the company and further demand in the sum of Rs, 1,34,000/-. The company is said to have deposited the said amount. However, the actual supply of the power commenced in the month of November, 1992. The ~ . such as present one, the Consumer Forum is not an appropriate forum. We are afraid no such absolute proposition as canvassed by the learned counsel is discernible from the said order. The said order is ~onfined to its own facts which is clear from paragraph 3 that reads thus: "The respondent has filed written submissions. We have perused the same.

In the facts and circumstances of the case, we are of the view that instead of moving the District Forum, th~ respondent should have moved an application under section 26(6) of the Electricity Act, 1910 (for short " the Act") for referring the matter to the Electrical Inspector. " 24. Learned counsel urged that the definition 'service' is of limited nature and is limited to the providing facilities in connection with electricity. According to him, the facility is an expression which facilitates the supply of electricity to an installation and the definition of service does not cover supply of electricity. This contention of the learned counsel is founded on erroneous assumption that supply of electricity is a sale of electricity and the use of expression 'supply' is synonym for 'sale'. We have already noticed above, which we need not repreat, that supply of electricity to a consumer by KPTC is not sale of electricity. The expression 'supply' is not synonym for 'sale'.

We reiterate what has been stated by this Court in Southern Petrochemical Industries Co. Ltd. (supra) that supply does not mean sale. The expression 'but does not include a person who avails of such services for any commercial purpose' inserted in Section 2(1 )(d)(ii) by the Act 62 of 2002 is not . . applicable in the facts and circumstances of the present case since the controversy relates to the period prior to amendment. 25. In what we have discussed above, the complaint made by the company before the District Forum cannot be said to be not maintainable and we hold, as we must, that complaint is maintainable. 26. In so far as Civil Appeal No. 7784/2002 is concerned, the complainant (appellant herein) is a sole proprietor ofTechno Batteries which is a battery charging unit. According to the complainant, for the power supplied by Karnataka Electricity Board (now 'KPTC') charges payable are under "Power-Tariff, L. T. -5" but in the Bill dated 6th March, 1990, a sum of Rs. ' 22,628.

40 was demanded as "Audit Short Claim" on the ground that the charges payable for the consumption of electricity by the complainant are under Tariff-Schedule L. T. -3 and not L. T. - 5. The complainant moved the District Forum at Bangalore challenging the demand. The District Forum allowed the complaint vide its order dated 22nd February, 1994. KPTC preferred an appeal before the State Commission. The State Commission by its Order dated 19th June, 1997 allowed the appeal on the ground that the complainant was not a consumer within the meaning of Section 2(1 )(d) of the Act, 1986 and consequently, it set aside the order of the District Forum. Aggrieved by the order of the State Commission, the complainant preferred Revision before the National Commission. The Revision Application came to be dismissed as the complainant was not present and also because the National Commission was satisfied with the order passed by the State Commission.

This appeal arises from the Order dated 1st December, 2000, passed by the National Commission. 27. In view of the discussion already made by us above while dealing with contentions (ii) and (iii) in Civil Appeal No. 1879/2003, it has to be held that the complaint by H. V. Balchandra Rao is covered under Section 2(1}(d)(i)(ii) of the Act, 1986. , ; 28. For the foregoing reasons: (1) Civil Appeal No. 1879/2003 is dismissed; the order dated 7th October, 2002 passed by National Consumer Disputes Redressal Commission and the Order of Karnataka State Consumer Redressal Commission passed on 15th June, 1995 are affirmed and, accordingly, the complaint stands remitted to District Forum for its disposal in accordance with law. (2) Civil Appeal No. 7784/2002 is allowed and the Order dated 1st December, 2000 passed by National Consumer Disputes Redressal Commission and the Order dated 19th June, 1997 passed by Karnataka State Consumer Disputes Redressal Commission are set aside. Appeal No.

168/1994 is restored to the file of Karnataka State Consumer Disputes Redressal Commission for its disposal in accordance with law. (3) The parties shall bear their own costs. R. P. Civil Appeal No. 1879 of 2003 dismissed. and Civil Appeal No. 7784 of 2002 allowed.