Statutory electricity supply conditions upheld: anti-pilferage procedures, provisional assessment and disconnection clauses were found valid.

Terms and conditions of supply framed by an Electricity Board under section 49 of the Electricity (Supply) Act, 1948 were held to be statutory in character because they were issued under statutory power and applied uniformly, while individual consumer agreements merely recorded acceptance. Clause 39, dealing with malpractice, pilferage, provisional assessment, disconnection and appeal, was upheld as not ultra vires the 1948 Act or the Indian Electricity Act, 1910, since fraud and pilferage were outside the Electrical Inspector's confined jurisdiction. The clause also did not offend Article 14 because it provided inspection, notice, representation, adjudication, appeal and judicial review, and the regulatory measures were treated as reasonable safeguards against theft of electricity.

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Issues: (i) Whether the terms and conditions of supply framed by the Electricity Board were statutory in character or purely contractual; (ii) Whether Clause 39 of the terms and conditions was ultra vires the Electricity (Supply) Act, 1948 and the Indian Electricity Act, 1910; (iii) Whether Clause 39 offended Article 14 of the Constitution of India.

Issue (i): Whether the terms and conditions of supply framed by the Electricity Board were statutory in character or purely contractual.

Analysis: Section 49 of the Electricity (Supply) Act, 1948 empowered the Board to supply electricity on such terms and conditions as it thought fit. The conditions were notified in exercise of that statutory power and applied uniformly to consumers. Execution of individual agreements did not convert them into purely private contracts, because the agreement was only a mode of recording acceptance of statutory conditions.

Conclusion: The terms and conditions of supply were statutory in character, not purely contractual.

Issue (ii): Whether Clause 39 of the terms and conditions was ultra vires the Electricity (Supply) Act, 1948 and the Indian Electricity Act, 1910.

Analysis: Clause 39 dealt with malpractice, pilferage, provisional assessment, disconnection, and appeal. Section 49 of the Electricity (Supply) Act, 1948 authorised the Board to fix terms and conditions, subject only to the Act. The clause was held to be necessary for preventing unauthorised use and recovering loss, and it did not conflict with the scheme of the supply legislation. Under the Indian Electricity Act, 1910, the provisions relied upon concerning Electrical Inspector jurisdiction were confined to disputes about meters, defects in works, or other matters specifically assigned to the Inspector. Fraud, pilferage, and malpractice by a consumer were outside that jurisdiction. The clause therefore did not trench upon the statutory field occupied by the earlier Act.

Conclusion: Clause 39 was not ultra vires either Act.

Issue (iii): Whether Clause 39 offended Article 14 of the Constitution of India.

Analysis: The clause provided for inspection, provisional assessment, opportunity to represent, adjudication, appeal, and further scrutiny. Immediate disconnection on prima facie suspicion of pilferage and provisional payment requirements were upheld as safeguards against theft of electricity and as reasonable regulatory measures. The Board officials were not treated as disqualified merely because they acted under the clause, since they had no personal interest in the dispute. Judicial review remained available despite finality language in the clause.

Conclusion: Clause 39 did not violate Article 14.

Final Conclusion: The Board's power to frame and enforce the impugned conditions of supply, including the procedure for dealing with pilferage and malpractice, was upheld, and the contrary view of the Full Bench was set aside.

Ratio Decidendi: Conditions of supply framed under Section 49 of the Electricity (Supply) Act, 1948 are statutory and valid if they do not conflict with the governing Acts, and a special procedure for detecting and penalising pilferage or malpractice is permissible where the statutory scheme does not reserve that subject to the Electrical Inspector.

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