V.K. Barde, J.@mdashThe petitioner is running an industry in the name and style "M/s. Aurangabad Industrial Associates". M/s. K.K. Industries was holding the Plot No. G-25 situated at Chikhalthana, Aurangabad, which is an industrial area, developed by the Maharashtra Industrial Development Corporation. M/s. K.K. Industries had obtained a loan from the Maharashtra State Finance Corporation, to run the industry on the said plot. As M/s. K.K. Industries was in arrears of repayment of loan, the rights of M/s. K.K. Industries on the plant and machinery from the said plot was put up for auction through the Court and the petitioner being the highest bidder, purchased that property in the Court auction so as to start its own industry. The petitioner made an application to the Maharashtra State Electricity Board (hereinafter referred to as "the Board"), for reconnecting the electrical energy to the said premises which was disconnected by the Board, because of failure of payment of electricity charges by M/s. K.K. Industries. On receiving this application from the petitioner, the Board communicated to the petitioner that there were arrears of electricity charges which were not paid by M/s. K.K. Industries and the petitioner was directed that on payment of those arrears, the electricity supply will be reconnected. Taking an exception to this stand of the Board, the petitioner has filed this petition, contending that the petitioner is no way liable to pay the electricity charges, which the Board is demanding on the ground that the previous owner of the property had not paid the electricity charges and the petitioner has prayed that the Board be directed to give him electricity connection without insisting for payment of arrears of electricity charges.
2. Heard Shri S.A. Deshmukh, learned Counsel for the petitioner and Shri N.S. Choudhary, learned A.G.P. for respondent No. 1 and Shri H.T. Joshi, Counsel for the respondent No. 4 Board. So far as the respondent Nos. 2 and 5 are concerned, their names are deleted because the relief claimed against them are not pressed by the petitioner, in this petition.
3. Shri S.A. Deshmukh, learned Counsel for the petitioner, has argued that there was a proclamation for sale of property. As per that proclamation, the property was free from any encumbrance created by the Board. The petitioner, therefore, purchased the property in the Court auction. The petitioner was not at all aware about the arrears of electricity charges which were to be paid by the previous owner, namely M/s. K.K. Industries. The petitioner is a bona fide purchaser for value without notice and, therefore, he is not liable to pay electricity charges.
4. Shri Deshmukh, further, argued that there is no privity of contract between the petitioner and the Board, for the Board to claim electricity charges from the petitioner. He further argued that no charge was created on the property of M/s. K.K. Industries for the electricity charges payable by M/s. K.K. Industries and, therefore, the petitioner who is an auction purchaser, cannot be called upon to pay the arrears.
5. Shri H.T. Joshi, learned Counsel appearing on behalf of the Board, has argued that M/s. K.K. Industries had not paid the electricity charges. The petitioner is the successor of M/s. K.K. Industries and, therefore, before obtaining the reconnection of electricity supply, the petitioner must satisfy the arrears payable by M/s. K.K. Industries. For this proposition, the learned Counsel relied on the Condition No. 23 of the Conditions and Miscellaneous Charges for Supply of Electrical Energy, framed by the Board. The said condition reads as follows :-
"23. ASSIGNMENT OR TRANSFER OF AGREEMENT:
a) The consumer shall not without previous consent in writing of the Board, assign, transfer or part with the benefit of his agreement with the Board nor shall the consumer in any manner part with or create any partial or separate interest thereunder.
b) A consumer who commits breach of condition 23(a) above and neglected to pay to the Board any charges for energy or to deposit with the Board amount of security deposit or compensation and the supply of such consumer is disconnected u/s 24 of the Indian Electricity Act, 1910 or under Condition No. 31(e) of these conditions dies, or transfers, assigns or otherwise dispenses of the undertaking or the premises to which energy was being supplied to the consumer, any person claiming to be heir, legal representative, transferee, assignee or successor of the defaulting consumer with or without consideration in any manner shall be deemed to be liable to pay the arrears of electricity charges, security deposit or compensation due payable by the consumer and it shall be lawful for the Board to refuse to supply or reconnect the supply or to give a new connection to such person claiming to be the heir, legal representative, transferee, assignee or successor of the defaulting consumer of such premises, unless the amount of such charges due and/or the compensation demanded from the defaulting consumer, is as the case may be duly paid to or deposited with the Board."
6. Shri Joshi, also relied upon the ruling reported in AIR 1951 (38) Hyd 93 in the matter of Kashinath v. Phoolchand and others, and has contended that the auction purchaser if purchases the property, he purchases it with all encumbrances on the property.
7. Here at the outset, it must be noted that no encumbrance was created on the property of M/s. K.K. Industries for payment of electricity charges. There was no charge on this property for payment of electricity charges. It was only personal contract between M/s. K.K. Industries and the Board for payment of electricity charges and if there is breach of that personal contract, then the Board is authorised to recover the amount of electricity charges from M/s. K.K. Industries.
8. Another ruling on which Shri Joshi relied upon, is in the matter of Sk. Hussain v. Phoolchand Harichand, reported in AIR 1952 (39) Nag 64; and has contended that on sale by auction, the auction purchaser purchases the right, title and interest of the judgment-debtor or defaulter, as the case may be. If the auction purchaser wants to safeguard his own interest, then auction purchaser''s duty is to investigate the title of the judgment-debtor or the defaulter.
9. It is to be noted that the petitioner, no doubt, is an auction-purchaser and the property was sold through the Court but what he purchased was that property which was mortgaged with the Maharashtra State Finance Corporation. The proclamation, the copy of which is at Exh. A Page 14 of the petition, makes it clear that the proclamation does not include rights of M/s. K.K. Industries under the agreement which M/s. K.K. Industries had with the Board and, therefore, the Board cannot say that the petitioner has purchased this property, subject to any claim of the Board against M/s. K.K. Industries. So both these rulings are not applicable to the facts of the present case.
10. This aspect of the case is also very clear from Condition No. 23 to which a reference is made by the learned Counsel for the respondent No. 4; which clearly indicates that a consumer is not entitled to transfer any way the benefit under the agreement without previous consent in writing of the Board and if there is any such transfer by the consumer to any third person, then such third person is liable to pay the electricity charges which the consumer had not paid. So Condition No. 23 is applicable only when there is voluntary transfer by the consumer to third person the benefits under the agreement. It is pointed out above that the benefits under the agreement between M/s. K.K. Industries and the Board are not transferred by the Court auction. Condition No. 23 is not at all applicable to the present case. It may be added further that this transfer was not voluntary transfer by M/s. K.K. Industries to the petitioner but it was an auction through the Court and from that point of view also, the said condition is not applicable.
11. Section 25 of the Indian Electricity Act, 1910 also makes a provision that the supply lines, meters, fittings etc. fixed on the property not belonging to the licensee are not liable to be taken in execution under the process of the Civil Court or in the proceedings of insolvency against the person in whose possession the same may be. So this section 25 also prohibits sale of all things even by the Court''s sale. So it is very clear that the petitioner who is an auction purchaser had not purchased the benefits under the agreement between M/s. K.K. Industries and the Board and also has not purchased the electricity supply-lines, meters, fittings etc. which are on the premises, which is purchased by him in the Court auction and, therefore, Condition No. 23 is not applicable in his case.
12. Shri Deshmukh, learned Counsel for the petitioner has relied upon the ruling of the Apex Court in the matter of Isha Marbles v. Bihar State Electricity Board and another, reported in 1955(2) S.C.C. 648. In the said matter also the question arose as to whether an auction purchaser was liable to pay the arrears of electricity charges which were payable by the previous owner. Considering the circumstances of this case that no charge was created in favour of the Board for the electricity charges payable by M/s. K.K. Industries on the property which was sanctioned and that it was purely a personal contract between M/s. K.K. Industries and the Board regarding the payment of electricity charges, we find this ruling of the Apex Court fully supports the case of the petitioner. The petitioner is not liable to pay the arrears of electricity charges payable by M/s. K.K. Industries and the Board cannot withhold reconnection of the electric supply to the petitioner on the ground that such arrears are not paid by the petitioner. Hence the Board is directed to supply the electricity to the petitioner without insisting for payment of arrears of electricity charges payable by M/s. K.K. Industries, the previous consumer.
13. Electricity is being supplied to the petitioner as per the interim order passed by this Court on 11th September 1989, on deposit of Rs. 25,000 in this Court. However in view of our order, this amount which was deposited towards the arrears payable by M/s. K.K. Industries, the petitioner is entitled to refund of the amount of Rs. 25,000. It is directed that the petitioner shall make a proper application for reconnection of electricity supply and keeping in mind the direction issued above, the M.S.E.B. to reconnect the electricity supply by following other rules and regulations. The petitioner to make necessary application to the Board within a period of one month from today.
14. With the above direction, writ petition is allowed rule made absolute accordingly.
