Retrospective limitation and issue estoppel: pre-2003 electricity dues remained recoverable, and final liability could not be reopened later.

Section 56(2) of the Electricity Act, 2003 was held not to operate retrospectively to bar recovery of electricity dues that had accrued under the earlier regime before the Act commenced; the limitation applies prospectively to liabilities arising under the 2003 Act. The Court also held that where earlier interim and interlocutory orders had already conclusively upheld liability for minimum guarantee charges and those orders had attained finality, the same liability could not be challenged again in a later writ proceeding. Issue estoppel and res judicata barred re-agitation, so the subsequent challenge was not maintainable and the High Court's decision was set aside.

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Issues: (i) Whether section 56(2) of the Electricity Act, 2003 applied to recover dues that had accrued under the earlier regime before the 2003 Act came into force; (ii) whether the demand raised in the second writ petition could be challenged despite the earlier order that had already upheld liability for minimum guarantee charges.

Issue (i): Whether section 56(2) of the Electricity Act, 2003 applied to recover dues that had accrued under the earlier regime before the 2003 Act came into force.

Analysis: The liability for electricity charges had arisen under the earlier statutory framework. The 2003 Act, read with section 185(5) and section 6 of the General Clauses Act, 1897, does not retrospectively impose the limitation in section 56(2) on liabilities already incurred before its commencement. The earlier decisions relied upon by the Court make clear that the bar of limitation under section 56(2) operates prospectively for liabilities arising under the 2003 Act.

Conclusion: The limitation in section 56(2) did not bar recovery of the pre-2003 liability.

Issue (ii): Whether the demand raised in the second writ petition could be challenged despite the earlier order that had already upheld liability for minimum guarantee charges.

Analysis: The earlier interim and interlocutory orders had conclusively determined the respondent's liability to pay minimum guarantee charges, and those orders were not successfully challenged. The second show cause notice raised the same liability for the same amount. Once the issue had attained finality, the respondent was precluded from reagitating it in a subsequent proceeding. The principles of issue estoppel and res judicata barred a fresh challenge, and the later writ petition ought not to have been entertained.

Conclusion: The second challenge was barred by issue estoppel and the finality of the earlier orders.

Final Conclusion: The impugned judgment could not stand, because the earlier orders had crystallised the liability and the subsequent challenge was not maintainable. The appeal succeeded and the High Court's decision was set aside.

Ratio Decidendi: Limitation under section 56(2) of the Electricity Act, 2003 does not apply retrospectively to liabilities incurred before the Act commenced, and a liability conclusively determined by an earlier final order cannot be reopened in a later proceeding on the same issue.

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