Wednesday, December 5, 2012

Gujarat High Court says: " Electricity is public property. But the Law is inadequate to enforce liability of previous contracting party against auction purchaser"

Recently The Division Bench of the Hon'ble Gujarat High Court, comprising THE Hon'ble CHIEF JUSTICE MR.BHASKAR BHATTACHARYA AND Hon'ble MR.JUSTICE A.L.DAVE AND Hon'ble MR.JUSTICE V. M. SAHAI dismissed all the three Letter Patent Appeals vide No.2240 to 2242 of 2010, instituted by Torrent Power Ltd. against Abhisar Developers and others after hearing all the aggrieved parties, in respect of the liability of the third party purchasing the properties of the defaulter. While adjudicating all these LPA, The Hon'ble High Court has dealt with this issue thoroughly in detail and finally concluded that " We, propose to follow the views of the two three-judge Bench decisions and find that in the Act of 2003, there being no provision of imposing the liability of a defaulter upon the third party, the amended Regulation relied upon by the appellant herein is not only prospective in operation but also inconsistent with the provisions of the Act and hence, ultra vires." The Hon'ble High Court has also made it clear that "Electricity is public property. Law, in its majesty, benignly protects public property and behoves everyone to respect public property. Hence, the courts must be zealous in this regard. But, the law, as it stands, is inadequate to enforce the liability of the previous contracting party against the auction-purchaser who is a third party and is in no way connected with the previous owner/occupier. It may not be correct to state, if we hold as we have done above, it would permit dishonest consumers transferring their units from one hand to another, from time to time, infinitum without the payment of the dues to the extent of lakhs and lakhs of rupees and each one of them can easily say that he is not liable for the liability of the predecessor in interest. No doubt, dishonest consumers cannot be allowed to play truant with the public property but inadequacy of the law can hardly be a substitute for overzealousness" The Hon'ble Court set aside those supply rules and guidelines for new electricity connection, imposing upon the liability of the previous owner over the subsequently owner purchaser in auction, with such the specific observations therein further that-"No doubt, from the tabulated statement above set out, the auction-purchasers came to purchase the property after disconnection but they cannot be consumer or occupier within the meaning of the above provisions till a contract is entered into. We are clearly of the opinion that there is great reason and justice in holding as above."


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  2. I have recently bought a property in bank e auction at surat there was no electricity in the building due to non payment by the bank's npa account holder,how do i get dgvcl to give me a new account and not hold be liable for the previous owners due as i mentioned before i had bought this property in bank e auction

    1. Mr. Adarsh, you have got a strong ground, if the power supply in the property you have purchased is disconnected on predecessors's default and you have not agreed or stipulated to compensate or pay for that standing liabilities of the old owner... So if there is no such condition to pay the dues of SGVCL by you while you purchased from the court auction, and the property you purchased is free from all encumbrances, then simply apply for a new connection, on the basis of your title papers and if SGVCL fails to provide you new power connection, you can move High Court by a writ petition against SMVCL for obtaining a necessary direction to provide you a new connection, invoking its original jurisdiction.. This is the best and speedy remedy, in my opinion..


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