BIHAR STATE ELECTRICITY BOARDversusTHE PATNA ELECTRIC SUPPLY CO. LTD. & ORS.

                    [2011] 12 S.C.R. 393


           BIHAR STATE ELECTRICITY BOARD                         A
                              v.
   THE PATNA ELECTRIC SUPPLY CO. LTD. & ORS.
       (I.A. No. 5. Civil Appeal No. 2630 of 1982)
                  SEPTEMBER 01, 2011
                                                                 B
    [ALTAMAS KABIR, D.K. JAIN AND MARKANDEY
                   KATJU, JJ.)

     SETTLEMENT: Settlement of dues - Respondent no. 1
(PESCO) taken over by appellant (BSEB) - Dispute regarding       C
payment of compensation. to PESCO by BSEB in respect of
the assets of PESCO - Supreme Court directed BSEB to pay
PESCO the purchase price on the basis of book value- Non-
compliance of directions for payment by BSEB - Interlocutory
application - Supreme Court directed that net amount of          o
compensation payable to PESCO worked out to Rs. 135.45
lakhs and out of the said amount, a sum of Rs. 99. 72 lakhs
was already paid by BSEB to PESCO - Under the directions
of the Supreme Court, the balance amount of Rs. 35. 74 lakhs
paid by BSEB to the Bank of India to liquidate the dues of       E
PESCO - A further sum of Rs. 36. 59 lakhs shown as liability
in the accounts of PESCO - The amount of Rs. 36.59 lakhs
paid by PESCO to the Bank of India - Interlocutory application
disposed of with direction that PESCO was entitled to Rs.
36. 59 lakhs if it had made the payment on that account to the   F
Bank - Whether PESCO was entitled to receive from the
BSEB the sum of Rs. 36.59 lacs - Held: PESCO is entitled
to recover the said sum from BSEB, since it has been able
to prove that the amount had been paid by it to the Bank.

    CIVIL APPELLATE JURISDICTION: I.A. No. 5.                    G
                                   IN
    Civil Appeal No. 2630 of 1982.

                             393                                 H
    394      SUPREME COURT REPORTS               [2011] 12 S.C.R.


A       From the Judgment & Order dated 22.07.1981 of the
    Calcutta High Court in appeal from Appellate Order No. 16 of
    1980.
      Gaurab Banerjee, ASG, Navin Prakash, Puneet Jain,
  Sushil Kumar Jain, Bina Gupta, Gopal Prasad, Gopal Singh,
B Chandan Kumar for the appearing parites.
          The following order of the Court was delivered
                                ORDER
        1. After the respondent No.1, Patna Electric Supply
C Company Limited (PESCO), was taken over by the appellant,
   Bihar State Electricity Board (BSEB), certain disputes arose
   regarding payment of compensation by BSEB to PESCO in
   respect of the assets of PESCO. This resulted in litigation and
   ultimately in C.A. No.2630 of 1982 this Court, while granting
D leave, directed that BSEB would pay to PESCO the purchase
 . price on the basis of book-value in accordance with the
   provisions of the Indian Electricity Act, 1910. Since payments
   were not made by BSEB to PESCO in terms of the said
   directions, PESCO filed I.A. No.5 for appropriate directions to
E be given to BSEB in this regard.
       2. On 8.1.2005, after noting· that what was payable by
  BSEB to PESCO was the book-value and not the market value
  of the assets of PESCO, this Court, after taking into
F consideration the submissions of the respective parties, came
  to the conclusion that the net amount of compensation payable
  to PESCO worked out to Rs. 135.45 lakhs. Out of the said
  amount. a sum of Rs. 99.72 lakhs had already been paid by
  BSEB to PESCO, leaving a balance amount of Rs. 35.74
  lakhs payable by BSEB to PESCO. It was also noted that under
G the directions of this Court the balance amount of Rs. 35. 74
  lakhs had been paid by BSEB to the Bank of India to liquidate
  the dues of 'PESCO.
      3. In addition to the above, a further sum of Rs. 36.59 lakhs
H was shown as liability in the accounts of PESCO. It was noted
    BIHAR STATE ELECTRICITY BOARD v. PATNA                   395
        ELECTRIC SUPPLY CO. LTD. & ORS.

that it was not the case of BSEB that the said amount had been      A
paid by it to the-aforesaid Bank. On the other hand, it was noted
that it was PESCO's case that this amount had been paid by
it to the Bank of India and in support thereof a 'No Objection
Certificate' dated 21.3.2001 issued by the Bank in favour of
PESCO had been placed on record. On the basis of the                B
aforesaid calculations and the submissions made on behalf of
the respective parties, I.A. No.5 was disposed of with the
following observations :
    (1) The amount of consumer dues calculated while arriving       c
    at the book value of the assets of PESCO cannot be
    questioned by BSEB at this stage;
    (2) PESCO is entitled to the sum of Rs.36.59 lakhs
    provided it has made the payment on that account to the
    Bank; and                                                       D
     (3) PESCO is entitled to interest in the manner above
     stated on filing requisite material on record along with an
     affidavit showing payment of interest.               -
     4. Thereafter, the matter was taken up on several              E
occasions to enable PESCO to prove that such payment had
actually been made by PESCO to the Bank of India on account
whereof the said amount was shown as a liability in PESCO's
accounts. On 26.3.2009, the Bank of India, Kolkata Main
Branch, was directed to supply the statements relating to the       F
cash credit account maintained by PESCO for the period
commencing from 1973 till the closure of the account. Leave
was given to the appellant to respond to the same once the
statements were made available by the Bank. Ultimately, on
30.9.2010 it was submitted on behalf of the Bank that the           G
information, as was required to be given, had been filed by way
of separate affidavits and leave was also granted to file an
additional affidavit to place on record certain other documents.
    5. The first affidavit affirmed on behalf of the Bank on
31.10.2006 mentions a final settlement arrived at between the       H
    396     SUPREME COURT REPORTS               [2011] 12 S.C.R.
                               '

A Bank and PESCO, to the tune of Rs. 45.93 lakhs and with the
  interest accrued thereupon the amount became Rs. 48.34
  lakhs. According to the Bank records, the said amount was paid
  by PESCO between 15.1.2001 to 19.12.2001. The second
  affidavit affirmed on behalf of the Bank indicates that the
B balance as was outstanding in the Cash Credit Account of
  PESCO, as on 5.2.1974, was Rs. 37,26,137.77. It was also
  made clear that a sum of Rs. 84,08,363/- had been received
  by the Bank, out of which BSEB had paid Rs. 38.74 lakhs and
  PESCO had paid Rs. 48,34,363/-. It is, therefore, clear that the
c Bank received two amounts, one from BSES and the other from
  PESCO. It is also clear that the amount of Rs. 35.74 lakhs paid
  by BSEB, which was the balance of the book-value of the
  assets of PESCO, was pursuant to the directions given by the
  Court on account of the fact that the said amount had initially
  been paid by PESCO. It is also clear that the other amount of
0
  Rs. 48,34,363/- was paid by PESCO to the Bank and was the
  Cash Credit amount of PESCO's ac::ount with Bank of India,
  and which amount, together with interest, was payable to
  PESCO in;terms of the order passed by this Court on
E 8.11.2005.
       6. This was in effect the substance of the submissions
  made by Mr. Puneet Jain, learned Advocate, appearing for
  PESCO. On the other hand, learned Additional Solicitor
  General, Mr. Gaurav Banerjee, submitted that once the total
F dues of PESCO had been assessed at Rs. 135.46 lakhs and
  the entire amount had been paid, including a sum of Rs. 35.74
  lakhs paid by BSEB to the Bank, nothing further remained
  outstanding to be paid to PESCO.
        7. We have carefully considered the submissions made on
G behalf of the respective parties and it is necessary to put an
  end to the controversy regarding the amount which PESCO is
  entitled to receive from the BSEB on account of its take over
  by the BSEB.
      8. The figure of Rs. 135.46 lakhs was arrived at by this
H Court upon deducting all the liabilities from the book;value of
   BIHAR STATE ELECTRICITY BOARD v. PATNA                 397
       ELECTRIC SUPPLY CO. LTD. & ORS.
the assets of PESCO, after taking into consideration the ad hoc A
payments made by BSEB to PESCO. to the tune of Rs. 99.72
lakhs between 1.4.1974 and 8.2.1980. This Court concluded
that the net amount payable to PESCO was Rs. 35.74 lakhs,
which, in fact, was due from PESCO to the Bank and which
amount was ultimately liquidated by BSEB. The dues in relation B
to the said sum of Rs. 135.46 lakhs, therefore, stood concluded
on such payments being made. Further this Court also took
notice of the sum of Rs. 36.59 lakhs in the liabilities column 7
of PESCO's account and the same was shown against cash
credit with Bank of India. Ultimately, as indicated hereinbefore, c
this Court held that PESCO was also entitled to the sum of Rs.
36.59 lakhs, provided such payment had been paid by PESCO
to the Bank.
     9. One of the affidavits filed on behalf of the Bank, as
referred to hereinabove, clearly indicates that the said sum of D
Rs. 48,34,363/-, had been paid by PESCO to the Bank. The
third affidavit affirmed on behalf of the Bank on 30.9.2010,
contains an annexure being a l~tter addressed to PESCO by
the Bank of India certifying tha(PESCO had paid to the Bank
a sum of Rs. 48,34,363/- between 15.1.2001 to 19.12.2001 E
towards final settlement of dues to the Bank.
      10. Accordingly, in terms of the order dated 8.11.2005,
PESCO is entitled to recover the said sum from BSEB, since
it has been able to prove that the amount had been paid by it
to the Bank. Consequently, the directions given on 5.4.2011 for F
reimbursement of the aforesaid amount to PESCO, together ·
with interest @ 6 per cent per annum, from 19.12.2001 till the
date of the order, in view of what has been discussed
hereinabove, does not require any elaboration. The application
for direction, is therefore, disposed of in terms of the order G
passed by this Court on 15.4.2011. The payment, if not made,
shall be made within one month from the date of communication
of this order.
D.G.                                          I.A. dispose of.
                                                                 H