THE MAHARASHTRA STATE ELECTRICITY DISTRIBUTION COMPANY LTD THROUGH ITS EXECUTIVE ENGINEERversusM/S NAVJEEVAN TYRES PVT LTD THROUGH ITS AUTHORIZED SIGNATORY

2026:BHC-AUG:16430
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                          IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                     BENCH AT AURANGABAD

                                  83 WRIT PETITION NO. 1861 OF 2018

             The Maharashtra State Electricity                                  }
             Distribution Company Ltd,                                          }
             Circle Office, Latur,                                              }
             Through its Executive Engineer                                     }
                                                                            Petitioner
                                                                        (Orig. Respondent)
                                          Versus

             M/s. Navjeevan Tyres Pvt. Ltd.,                                    }
             Plot No.F-8, Kallam Road,                                          }
             MIDC Latur Tq. District Latur-431512,                              }
             Through its Authorized Signatory                                   }
                                                                             Respondent
                                                                      (Orig. Complainant)
                                                   ...
             Advocate for the Petitioner : Mr. A. S. Shelke
             Advocate for Respondent : Mr. J. R. Shah
                                                   ...

                                      CORAM           : SIDDHESHWAR S. THOMBRE, J.
                                      DATE            : 02.04.2026

             JUDGMENT :
             1.       Rule. Rule made returnable forthwith. Heard finally with the
             consent of the parties at the stage of admission.
             2.       The petitioner is aggrieved by the order dated 03.10.2017 passed

             by the Electricity Ombudsman, Nagpur in Representation No. 35 of 2017,

             more particularly to the extent of clauses (c) and (d) of the operative

             order.

             3.       The brief facts of the case:-

             3.1      It is the case of the petitioner that the petitioner is an authority of
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the Maharashtra State Electricity Distribution Company Limited, engaged

in distribution and supply of electricity under the provisions of the

Electricity Act, 2003 (for short, “the Act”). The respondent is a consumer,

carrying on business of tyre re-treading. The respondent obtained

electricity supply on 16th September, 1989. As per Commercial Circular

No.243 dated 3rd July, 2015, the activity of Tyre re-treading falls under

LT-II (Non-Residential / Commercial) category.

3.2   On 23.02.2016, the Flying Squad, Ratnagiri, inspected the premises

of the respondent and, upon verification of the installation, noticed

irregularities. It was observed that the respondent was being billed under

Industrial Tariff instead of Commercial Tariff. Accordingly, the concerned

Sub-Division of the petitioner issued an assessment bill dated 10.03.2016

for an amount of Rs.6,17,870/-. Being aggrieved thereby, the respondent

approached the Internal Grievance Redressal Cell (IGRC) on 21st

September, 2016. After considering the contentions of both sides, the

grievance came to be rejected, holding that categorization of the

consumer was proper in view of Circular Nos.175 and 243. Being further

aggrieved, the respondent approached the Consumer Grievance Redressal

Forum (CGRF), Latur. The CGRF, after hearing both sides, partly allowed

the grievance and directed the petitioner to revise the assessment bill of

Rs.6,17,870/-. It further directed that recovery be restricted to a period of

two years prior to 24.02.2016 i.e. till 24.02.2014 without application of

delayed payment charges (DPC) and interest.
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3.3      Being aggrieved by the said order, the respondent preferred

Representation No.35/2017 before the Electricity Ombudsman, Nagpur.

The petitioner appeared and supported the order of CGRF, Latur. The

Electricity Ombudsman, Nagpur, by the impugned order, directed the

petitioner to charge the differential amount between LT-II (Commercial)

and LT-V (Industrial) tariff only for the period from 24.02.2016 (date of

inspection) to 30.10.2016, without imposing any delayed payment

charges (DPC) or interest. It was further directed to revise the bills

accordingly and refund the excess amount after re-calculation, if any. The

petitioner thereafter filed Review Application No.05/2017 before

Electricity Ombudsman, Nagpur which came to be rejected on

09.02.2018. Being aggrieved by the said order, the present petition is

filed.

4.       The learned counsel for the petitioner, Mr. Shelke submits that the

impugned order passed by the Electricity Ombudsman is contrary to the

facts on record. He submits that the respondent is carrying on the

business of Tyre re-treading, which is classified under the Commercial

category as per Circular Nos.175 and 243. However, the respondent-

consumer was erroneously billed under the Industrial tariff category since

the year 2012. This irregularity came to be noticed on 23.02.2016 during

inspection carried out by the Flying Squad, Ratnagiri.

5.       Pursuant to the inspection, the petitioner-company issued an

assessment bill towards differential charges for the period from August,
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2012 till 24.02.2016. It was the contention of the petitioner that though

judgments of the this Court and the Hon’ble Apex Court were cited before

the Electricity Ombudsman, the same were not considered. It was

contended that the bar of two years under Section 56(2) of the Electricity

Act, 2003 would not apply to such recovery, even if the period exceeds

two years.

6.        The learned counsel for petitioner further submits that the

Electricity Ombudsman, Nagpur has relied on an order passed by the

Maharashtra Electricity Regulatory Commission dated 11.02.2003 in Case

No.24 of 2001, which was rendered prior to the coming into force of the

Act. He submits that the present assessment has been made under the

provisions of the Act and, therefore, such reliance is misplaced and not

sustainable in law. The learned counsel for the petitioner, therefore,

submits that the impugned order passed by the Electricity Ombudsman

deserves to be quashed and set aside.

7.        In support of his submissions, the learned counsel relies upon the

following judgments:—

     i)       Maharashtra State Electricity Distribution Company Limited v.

              Suhasini D. Naik, AIR Online 2024 BOM 1209.

     ii)      Maharashtra State Electricity Distribution Company Limited v.

              Electricity Ombudsman and ors., 2019 AIR (Bom) 113.

     iii)     Assistant Engineer (D1), Ajmer Vidyut Vitran Nigam Limited and

              Another v. Rahamatullah Khan alias Rahamjulla, 2020 (4) SCC 650.

     iv)      Prem Cottex v. Uttar Haryana Bijli Vitran Nigam Limited, 2021
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               DGLS(SC) 564

      v)       Maharashtra State Electricity Distribution Company Limited v. M/s.

               Jamiya Mohamad Education Society, AIR 2024 Bombay 379.

8.         Per contra, the learned counsel for the respondent, Mr. J. R. Shah,

supports the impugned order passed by the Electricity Ombudsman. He

submits that the respondent is running a Tyre re-treading unit, which is

an industrial undertaking, and has been regularly paying electricity bills

under the Industrial tariff category.

9.         He submits that the primary activity of the respondent falls within

the ambit of industrial activity involving a manufacturing process.

According to him, till the inspection conducted by the Flying Squad on

23.02.2016, the petitioner had consistently billed the respondent under

the Industrial tariff category, which was appropriate and justified.

10.        It is further submitted that the change in tariff category from

Industrial to Commercial, pursuant to the inspection dated 23.02.2016,

and issuance of the assessment bill with retrospective effect from August,

2012, is illegal and unsustainable. The respondent, therefore, approached

the Internal Grievance Redressal Cell contending that the unit is a

manufacturing unit and does not involve any commercial activity.

11.        The learned counsel submits that there was no fault or

misrepresentation on the part of the respondent. The respondent had

been continuously charged under the Industrial tariff category since 1989
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till February, 2016, and only after the inspection by the Flying Squad, the

tariff category came to be changed.

12.    It is further submitted that such reclassification of tariff cannot be

equated with a case of escaped billing or clerical error. Therefore,

recourse to recovery under Section 56 of the Act is not permissible. He

submits that the Electricity Ombudsman has rightly appreciated these

aspects and has correctly directed revision of bills and refund of excess

amount recovered pursuant to the assessment bill. In view of the

aforesaid submissions, the learned counsel for the respondent prays for

dismissal of the writ petition.

13.     Having heard the learned counsel for the parties at length, there is

no dispute that the respondent has been carrying on the business since

1989. Upon considering the nature of activities of the respondent, the

Flying Squad submitted its report and, based thereon, the assessment bill

came to be issued to the respondent on the premise that the respondent’s

classification falls under Commercial use.

14.    This Court in the case of Maharashtra State Electricity Distribution

Company Limited (supra) has held in paragraph nos.8, 9 and 10, which

read thus:-

      “8.     CGRF then has taken into consideration the Judgment of the Hon’ble
      Supreme Court in the case of Prem Cottex (supra) and has held that the
      electricity company can recover electricity bill for bonafide mistake and it is
      further held that the mistake in this case is not bonafide and therefore the
      judgment has no application thereto. With this discussion the grievance
      Case No. 071 of 2022 was partially allowed. Electricity company was
      directed to revise supplementary bill issued in June -2022 considering 793
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units for the month of November- 2020 after adjusting the payment made
by the consumer and the interest was also directed be waived.

9. At this stage, it would be relevant to take note of the Judgment of a three
Judge Bench of Hon’ble Supreme Court in the case of K.C.Ninan Vs. Kerala
State Electricity Board and Others (2023 SCC OnLine SC 663), after taking
into consideration judgment in case of Prem Cottex (Supra) and Assistant
Engineer (D1), Ajmer Vidyut Vitran Nigam Limited and Anr. Vs.
Rahamatullah Khan has passed judgment and it would be fruitful to refer to
the relevant paragraph Nos. 122 to 136 thereof which read thus:
      “122…………….
     129. The second issue pertains to the implication of the period
     of two years provided in Section 56(2) on the civil remedies of
     Utilities to recover electricity dues. Section 56(2), which begins
     with a non obstante clause, provides a limitation of two years for
     recovery of dues by the licensee through the means of
     disconnecting electrical supply. It puts a restriction on the right
     of the licensee to recover any sum due from a consumer under
     Section 56 after a period of two years from the date when such
     sum became first due. If this provision is invoked against a
     consumer after two years, the action will be permissible when
     the sum, which was first due, has been shown continuously as
     recoverable as arrears of charges for electricity supplied. Under
     Section 56, the liability to pay arises on the consumption of
     electricity and the obligation to pay arises when a bill is issued
     by the licensee for the first time. Accordingly, the period of
     limitation of two years starts only after issuance of the bill.
     130. Before we deal with the implication of Section 56(2) on the
     civil remedies available to a licensee, it is important to clarify
     that when the liability incurred by a consumer is prior to the
     period when the 2003 Act came into force, then the bar of
     limitation under Section 56(2) is not applicable. In Kusumam
     Hotels Pvt Ltd v. Kerala State Electricity Board, this Court has
     held that Section 56(2) applies after the 2003 Act came into
     force and the bar of limitation under Section 56(2) would not
     apply to a liability incurred by the consumer prior to the
     enforcement of the Act. In terms of Section 6 of the General
     Clauses Act 1897, the liability incurred under the previous
     enactment would continue and the claim of the licensee to
     recover electricity would be governed by the regulatory
     framework which was in existence prior to the enforcement of
     the 2003 Act.
     131………..”

10.     It is thus clear from this judgment, that it is open for the electricity
company to issue a revised bill if it is found that the previous bill issued is
under bonafide mistake. In the instant case, revised bill has been issued
with specific contention that multiplying factor 1 instead of 20 was applied.
There is no dispute made by the consumer with regard to this fact. If it is
so, it does not stand to any reason or justification to hold that this is not
bonafide mistake of the electricity company, as observed by CGRF. In view
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      of the judgment of the Hon’ble Supreme Court in the case of K. C.
      Ninan(supra), the electricity company is within its right to issue revised bill
      once such bonafide mistake is found out.”

15.    The Hon’ble Apex Court in the case of Prem Cottex (supra),

particularly in paragraph nos.23 to 25, has stated as follows:-

      “23. Coming to the second aspect, namely, the impact of Sub-section (1)
      on Sub-section (2) of Section 56, it is seen that the bottom line of Sub-
      section (1) is the negligence of any person to pay any charge for electricity.
      Sub-section (1) starts with the words “where any person neglects to pay
      any charge for electricity or any some other than a charge for electricity
      due from him.
      24.    Sub-section (2) uses the words “no sum due from any consumer
      under this Section”. Therefore, the bar under Sub-section (2) is relatable to
      the sum due under Section 56. This naturally takes us to Sub-section(1)
      which deals specifically with the negligence on the part of a person to pay
      any charge for electricity or any sum other than a charge for electricity.
      What is covered by section 56, under sub-section (1), is the negligence on
      the part of a person to pay for electricity and not anything else nor any
      negligence on the part of the licensee.
      25.    In other words, the negligence on the part of the licensee which led
      to short billing in the first instance and the rectification of the same after
      the mistake is detected, is not covered by Sub-section (1) of Section 56.
      Consequently, any claim so made by a licensee after the detection of their
      mistake, may not fall within the mischief, namely, “no sum due from any
      consumer under this Section”, appearing in Sub-section (2).”

16.    Considering the issue involved, it is necessary to refer to Section 56

of the Electricity Act, 2003, which reads thus:—

      “56. Disconnection of supply in default of payment.–
      (1)Where any person neglects to pay any charge for electricity or any sum
      other than a charge for electricity due from him to a licensee or the
      generating company in respect of supply, transmission or distribution or
      wheeling of electricity to him, the licensee or the generating company may,
      after giving not less than fifteen clear days’ notice in writing, to such
      person and without prejudice to his rights to recover such charge or other
      sum by suit, cut off the supply of electricity and for that purpose cut or
      disconnect any electric supply line or other works being the property of
      such licensee or the generating company through which electricity may
      have been supplied, transmitted, distributed or wheeled and may
      discontinue the supply until such charge or other sum, together with any
      expenses incurred by him in cutting off and reconnecting the supply, are
      paid, but no longer:Provided that the supply of electricity shall not be cut
      off if such person deposits, under protest,–
         (a)an amount equal to the sum claimed from him, or
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        (b)the electricity charges due from him for each month calculated on
        the basis of average charge for electricity paid by him during the
        preceding six months,whichever is less, pending disposal of any dispute
        between him and the licensee.
      (2)Notwithstanding anything contained in any other law for the time being
      in force, no sum due from any consumer, under this section shall be
      recoverable after the period of two years from the date when such sum
      became first due unless such sum has been shown continuously as
      recoverable as arrear of charges for electricity supplied and the licensee
      shall not cut off the supply of the electricity.”

17.   Upon perusal of Section 56(2) of the Act, it is evident that the bar

contained therein is not only in respect of disconnection of supply but

also operates against recovery of dues beyond the prescribed period,

unless the conditions stipulated therein are satisfied.

18.   In the present case, it is an admitted position that the respondent

obtained electricity supply on 16th September, 1989. As per Commercial

Circular No.175 dated 05th September, 2012 and Commercial Circular

No.243 dated 03rd July, 2015, the activity of Tyre re-treading falls under

LT-II (Non-Residential / Commercial) category.

19.   Merely because the respondent was erroneously billed under the

Industrial tariff due to certain irregularities, the same cannot be a ground

to continue such classification, if in fact the activity falls within the

Commercial category. Once the activity of Tyre re-treading is classified as

Commercial, the respondent is liable to pay charges in accordance with

the applicable Commercial tariff.

20.   It is necessary to note that the petitioner is bound to follow the

regulations and tariff classifications framed by the Maharashtra Electricity
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Regulatory Commission. Once the activity of the respondent is

categorized as Commercial, the billing must necessarily be aligned with

such classification.

21.    In that view of the matter, the assessment bill issued in the year

2016, pursuant to the Flying Squad inspection, for recovery of differential

charges on account of wrong tariff application, cannot be said to be

illegal merely because the respondent was previously billed under the

Industrial category.

22.    In view of the aforesaid discussion, this Court finds that the

Electricity Ombudsman has committed an apparent error while allowing

the representation filed by the respondent. The impugned order,

therefore, warrants interference. Hence, I proceed to pass following

order:-

                                   ORDER

i.     The writ petition is allowed.

ii.    The order dated 03.10.2017 passed by Electricity Ombudsman,

       Nagpur in Representation No.35/2017 is hereby quashed and set

       aside.

iii.      Rule is made absolute in the above terms.

iv.    Pending Civil Applications, if any, stand disposed of.



                                             [ SIDDHESHWAR S. THOMBRE ]
                                                       JUDGE