Court-sanctioned amalgamation does not justify enhanced electricity security deposit where sanctioned load remains unchanged.

A court-sanctioned amalgamation vests the transferor company's rights and liabilities in the amalgamated entity by operation of law, so it is not a voluntary transfer of an electricity connection or undertaking. On that basis, where the sanctioned load remains unchanged and there is no additional electricity demand, the electricity board cannot treat the amalgamated company as a transferee for the purpose of imposing a fresh or enhanced security deposit. The board must recognise the amalgamated company as the consumer and accept the existing security deposit as sufficient.

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Issues: Whether, on amalgamation of a consumer-company with another company, the electricity board could insist on an enhanced security deposit and treat the amalgamated entity as having effected a transfer of the electricity connection.

Analysis: The governing supply conditions empowered the Board to require security deposit and to demand enhancement during the currency of the contract, and to transfer the contract only with the Board's consent. The dispute, however, arose from a court-ordered amalgamation, not from a voluntary transfer of the undertaking. The sanctioned load remained unchanged, no additional demand of electricity was made, and the rights and liabilities of the transferor company vested in the amalgamated company by operation of the amalgamation order. On these facts, the situation could not be equated with a transfer attracting a fresh or enhanced security demand on the basis of recent tariff.

Conclusion: The demand for additional security deposit was unjustified, and the Board was bound to recognize the amalgamated company as the consumer without insisting on further security.

Final Conclusion: The application succeeded, and the electricity board was required to enter the applicant-company's name as consumer for the connection while treating the existing security deposit as sufficient.

Ratio Decidendi: A court-sanctioned amalgamation operates as vesting by law, not as a voluntary transfer of the electricity connection or undertaking, and in the absence of any increase in sanctioned load the board cannot insist on enhanced security deposit merely by treating the amalgamated entity as a transferee.

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