# Shalimar Paper Mills Pvt. Ltd., Muzaffarnagar v. Spl. Judge/E.C. Act, Muzaffarnagar & Ors

- **Citation:** (2023) 5 ILRA 1495
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2023-04-19
- **Case number:** Writ-C No. 41480 of 1999
- **Bench:** Alok Mathur
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/shalimar-paper-mills-pvt-ltd-muzaffarnagar-v-spl-judge-e-c-act-muzaffarnagar-ors-50126
- **Pages:** 5

## Headnote

Civil Laws - Constitution of India, 1950 -
Article - 226 - Electricity Act, 1910 -
Section 26(vi), - Arbitration Act, 1996 -
Section - 34 - writ petition - assailing the
impugned order by which the Special Judge EC
Act, allowing the application preferred u/section
34 of the Arbitration Act, moved by the
respondents
department
-
an
agreement
between the parties for supply of electricity for
a sanctioned load - petitioner challenged the
electricity bills raised by the respondent, citing
section 26(vi) of the EC Act, which required
referral to an Electrical Inspector in case of
defective meters - civil suit pending - Court
finds that, the specific provision u/section 26(6)
of the Electricity Act, 1910 prevails over the
general arbitration clause in the agreement, and
therefore, the matter should be referred to the
Electrical Inspector for resolution - held, the
dispute should be resolved by the Electrical
Inspector as per Section 26(6) of the Electricity
Act, 1910, and directed the petitioner to
withdraw the civil suit and approach the
Electrical Inspector for resolution - direction
issued accordingly, writ petition is disposed of.
(Para - 13, 14, 15, 16)

Writ Petition Disposed of. (E-11)

List of Cases cited:

Belwal Spinning Mills Ltd. & ors. Vs U.P. St.
Electricity Board & anr., 1997 (6) SCC 740.

## Text

5 All. M/s Shalimar Paper Mills Pvt. Ltd., Muzaffarnagar Vs. Spl. Judge/E.C. Act, Muzaffarnagar
 & Ors.
1495
(2023) 5 ILRA 1495
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 19.04.2023

BEFORE

THE HON'BLE ALOK MATHUR, J.

Writ-C No. 41480 of 1999

M/s
Shalimar
Paper
Mills
Pvt.
Ltd.,
Muzaffarnagar ...Petitioner
Versus
Spl. Judge/E.C. Act, Muzaffarnagar & Ors.
 ...Respondents

Counsel for the Petitioner:
Sri Pramod Kumar Jain, Sri B.C. Rai, Sri
Deepak Kumar Pandey

Counsel for the Respondents:
C.S.C., Sri Narendra Kumar Tiwari, Sri
Nipendra Mishra, Sri P.K. Shukla, Sri R.K.
Shukla, Sri Manoj Kumar Dwivedi

Civil Laws - Constitution of India, 1950 -
Article - 226 - Electricity Act, 1910 -
Section 26(vi), - Arbitration Act, 1996 -
Section - 34 - writ petition - assailing the
impugned order by which the Special Judge EC
Act, allowing the application preferred u/section
34 of the Arbitration Act, moved by the
respondents
department
-
an
agreement
between the parties for supply of electricity for
a sanctioned load - petitioner challenged the
electricity bills raised by the respondent, citing
section 26(vi) of the EC Act, which required
referral to an Electrical Inspector in case of
defective meters - civil suit pending - Court
finds that, the specific provision u/section 26(6)
of the Electricity Act, 1910 prevails over the
general arbitration clause in the agreement, and
therefore, the matter should be referred to the
Electrical Inspector for resolution - held, the
dispute should be resolved by the Electrical
Inspector as per Section 26(6) of the Electricity
Act, 1910, and directed the petitioner to
withdraw the civil suit and approach the
Electrical Inspector for resolution - direction
issued accordingly, writ petition is disposed of.
(Para - 13, 14, 15, 16)

Writ Petition Disposed of. (E-11)

List of Cases cited:

Belwal Spinning Mills Ltd. & ors. Vs U.P. St.
Electricity Board & anr., 1997 (6) SCC 740.

(Delivered by Hon'ble Alok Mathur, J.)

1. Heard Sri B.C. Rai along with Sri
Deepak Kumar Pandey, learned counsel for
petitioner as well as Sri Manoj Kumar
Dwivedi, Advocate holding brief of Sri
Narendra Kumar Tiwari, learned counsel
for respondent Nos. 2 to 5.

2. The petitioner has approached this
Court assailing the judgment and order
dated 30.07.1999 passed by Special Judge,
EC Act, Muzaffarnagar thereby allowing
the application under Section 34 of the
Arbitration Act filed by the respondents for
relegating the dispute to the Arbitrator.

3. The brief conspectus of the facts is
that the petitioner and respondent had
entered into an agreement dated 15.02.1985
for supply of electricity for a sanctioned
load of 470 KVA. The petitioner is a
Papermill which has established its unit at
Muzaffarnagar for manufacturing paper.

4. The dispute pertains to the bills
raised
by
the
respondent-Electricity
Department
dated
05.06.1985
and
07.06.1985 amounting to Rs. 41527.60/-
and Rs 1,07,605.50/-. In the said bills, it
was stated that the meter installed in the
premises was defective and was not
recording the correct supply of the
electricity and hence the said bills were
raised. The petitioner disputed the said bills
and was of the view that in light of Section
1496 INDIAN LAW REPORTS ALLAHABAD SERIES
26 (vi) of the Electricity Act, 1910 in case
the electric meter was defective, the only
remedy as per the Act of 1910 is that the
matter has to be referred to an Electrical
Inspector who is the only authority under
the said Act to return a finding as to
whether the meter is defective and only
thereafter the bills can be raised by the
Electrical Inspector. It was submitted that
without following the procedure prescribed,
the electricity bills could not have been
raised.

5. As the grievance of the petitioner
was not redressed and being aggrieved by
the aforesaid bills, the petitioner filed a
civil suit being Civil Suit No. 288 of 1985
before
the
Special
Judge,
EC
Act,
Muzaffarnagar. Notices were issued to the
respondents who had put in appearance
before the Civil Court and file their written
statements opposing the claim made by the
petitioner.

6. Apart from objecting the claim of
the petitioner, an application under Section
34 of the Arbitration Act was also made for
staying of the proceedings in light of the
fact that agreement entered into between
the petitioner and respondent, there was
specific clause pertaining to deciding of the
disputes arising out of the agreement by
process of arbitration. Clause 20 of the
agreement is as follows:-

"(20) If any question or dispute
or difference arises between the parties to
this agreement as to the interpretation or
effect of any provision or clause herein
contained or the construction thereof or as
to any other matter in any way connected
with or arising out of this agreement of the
operation thereof or the rights, duties or
liabilities of either party in connection
therewith,
such
question
dispute
or
difference
shall
be
referred
to
the
Arbitrator/Chairman, U.P. State Electricity
Board or the person nominated by him and
the award/decision of the said arbitrator
shall be final and binding upon the parties.

Provided that if the question,
disputes or difference relates to or
concerned any dues chargeable to the
consumer in terms of this agreement, no
reference to arbitration shall at the
instance of such consumer be made till the
consumer has either deposited with the
Supplier the amount of dues in dispute of
difference or given a Bank Guarantee of
such amount in favour of the Supplier valid
upto the period on on year form the date in
whcih the award becomes final or the
amount or dues in cleared, whichever is
earlier."

7. The petitioners had objected to the
prayer made by the respondent for referring
the matter to the arbitration and specific
plea was taken, there exists a specific
provision under Electricity Act, 1910
where the dispute which has arisen in the
present case was referable to Section 26
(vi) of Act of 1910 and the same should
have been referred to the Electrical
Inspector rather than invoking the general
power of arbitration under the said
agreement.

8. Learned counsel for petitioner in
support of his submissions, has placed
reliance upon the judgment of the Hon'ble
Supreme Court passed in the case of
Belwal Spinning Mills Ltd. and Others Vs.
U.P. State Electricity Board and another,
1997 (6) SCC 740, where Hon'ble Supreme
Court has held as under:-

"The expression 'check meter' has
no special significance or legal incidence
5 All. M/s Shalimar Paper Mills Pvt. Ltd., Muzaffarnagar Vs. Spl. Judge/E.C. Act, Muzaffarnagar
 & Ors.
1497
for which there is a bar that check meter
cannot be treated as an altered meter if the
licensee intends to replace the defective
meter by the check meter. It will be open to
the Electrical Inspector to ascertain the
correctness of the check meter along with
the disputed meter when dispute is referred
for adjudication by the Electrical Inspector
and the licensee found its case with
reference to check meter. Prior to the
amendment of Section 26(6) of Electricity
Act, the Electrical Inspector or the
competent person specially appointed by
the State Government in this behalf, had a
statutory duty to first determine whetehr
the meter in question was defective and
thereafter to estimate the quantity of the
electricity consumed during such time as
the meter in the opinion of the Electrical
Inspector or the competent person 'shall
not
have
been
correct'.
After
the
amendment of sub-section (6) of Section
26, the Electical Inspector is the only
statutory authority to decide the dispute
about the correctness of the meter, if such
dispute is raised by either of the parties.
If the Electrical Inspector on a reference
comes to the finding that the meter has
ceased to be correct, the said Inspector
has a statutory duty to estimate the
amount
of
energy
supplied
to
the
consumer or electrical energy contained
in the supply during such time not
exceeding six months as the meter shall
not, in the opinion of such Inspector,
have been correct.'"

9. The question which engages the
attention in the present case is as to
whether the petitioner should be relegated
to the remedy for an arbitration under
Clause 20 of the agreement or the matter
should be referred to the Electrical
Inspector in terms ofSection 26 (vi) of the
Electricity Act, 1910.

10. To answer the aforesaid question,
it is necessary to look into the provisions of
the Indian Electricity Act, 1910, Section 26
Sub-Section 6 provides as under:-

"Where any difference or dispute
arises as to whether any meter referred to
in sub-section (1) is or is not correct, the
matter
shall
be
decided,
upon
the
application of either party, by an Electrical
Inspector; and where the meter has, in the
opinion of such Inspector ceased to be
correct, such Inspector shall estimate the
amount of the energy supplied to the
consumer
or
the
electrical
quantity
contained in the supply, during such time,
not exceeding six months, as the meter
shall not, in the opinion of such Inspector,
have been correct; but save as aforesaid,
register of the meter shall, in the absence of
fraud, be conclusive proof of such amount
or quantity.

Provided that before either a
licensee or a consumer applies to the
Electrical Inspector under this sub-section
he shall give to the other party not less than
seven days' notice of his intention so to do."

11. Apart from the aforesaid statutory
provisions, it is also noticed that the
agreement
entered
into
between
the
petitioner and the respondent also provide
for resolution of disputes in a situation
when the electricity meter has been found
to be defective. Clause 10 Sub-Clause (c)
of the agreement provides that :-

(c) Should the consumer dispute
the accuracy of the supplier's meter/meters,
he may, upon giving notice paying the
prescribed fee, have the same tested by the
Supplier or in accordance with sub section
(6) of Section 26 of the Act by the Electrical
Inspector to the State Government. In the
1498 INDIAN LAW REPORTS ALLAHABAD SERIES
event of the meter begin tested by the
Supplier and found to be incorrect beyond
the limit of accuracy prescribed by the
Indian Electricity Rules, 1956, the cost of
testing
and
all
reasonable
expenses
incidental thereto shall be met by the
Supplier, and the amount of the bill shall be
adjusted in accordance with the result of
test taken with respect of the meter
readings of the 3 months prior to the month
in which the dispute has arisen due regard
being paid to the conditions of working,
accuracy etc., during the month under
dispute, and during the month under
dispute , and during the us three months,
meter/meters is/are found to be correct
within the limits laid down in the Indian
Electricity Rules, 1956 or any other
statutory modification thereof for the time
being enforce, the fees paid by the
consumer
shall
be
forfeited
to
the
supplier."

12. A perusal of the aforesaid clause
would indicate that the agreement itself
provide for a condition that in case there is
a dispute with regard to electricity meter,
then the same can be resolved in terms of
Section 26 (vi) of Electricity Act, 1910.

13. Considering the fact that a specific
provision would prevail over a general
provision, there is no doubt that if a particular
dispute which has arisen as in the present
case, the matter can adequately be resolved
after referring the matter to the Electrical
Inspector. A bare perusal of Section 26 (vi)
would also indicate that a reference has to be
made to the Electrical Inspector who shall
give his opinion about the electricity meter
and also estimate about the amount of
electricity supplied to the consumer.

14. Considering the fact that a
specific provision for resolution of dispute
is existing and it is not disputed by either of
the parties that the matter can be referred
and resolved by the Electrical Inspector and
it also clearly finds mention in the
agreement and hence binds both the parties,
this Court is of the clear view that dispute
can be resolved in terms of Section 26 (vi).

15. Learned counsel appearing on
behalf of Electricity Department does not
dispute this proposition.

16. In light of the above, the
contention of the petitioner has force and
accordingly with the consent of the parties,
this writ petition is being disposed of in the
following terms:

(i) Considering the fact that the
matter should be resolved by the Electrical
Inspector in terms of Sub-Section 6 of
Section 26 of the Electricity Act, 1910, it is
provided that the petitioner undertakes to
withdraw the civil suit No. 288 of 1985
pending before the Special Judge, EC Act,
Muzaffarnagar. Let an application in this
regard be moved expeditiously, say, within
a period of next one month.

(ii). Subsequent to moving of the
application for withdrawal, the petitioner
shall move an application before the
concerned Electrical Inspector appointed by
the State Government raising all his
grievances with regard to defective meter
No.1418020 as well as bills dated 05.06.1985
and 7.06.1985 within next one month. On
receipt of the representation/claim of the
petitioner, the Electrical Inspector shall
proceed to determine the condition of the
meter as well as amount of the electricity
consumed during the said period relating to
the aforesaid two bills and pass an order in
accordance with law within next three
months.
5 All. Anil Kumar Gupta @ Rajendra Gupta & Ors. Vs. State of U.P. & Ors.
1499

(iii). It is provided that till the
order is passed by the Electrical Inspector,
no recovery shall be made from the
petitioner in pursuance of the bills dated
05.06.1985 and 07.06.1985.

(iv). This protection shall be
available only till passing of an appropriate
order by the Electrical Inspector as directed
by this Court.

17. In light of the aforesaid direction,
the writ petition is disposed of.
----------
(2023) 5 ILRA 1499
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 20.04.2023

BEFORE

THE HON'BLE ALOK MATHUR, J.

Writ-C No. 45294 of 2010

Anil Kumar Gupta @ Rajendra Gupta &
Ors. ...Petitioners
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioners:
Sri R.K. Gupta

Counsel for the Respondents:
C.S.C.

Civil Laws - Constitution of India, 1950 -
Article - 226 - Stamp Act, 1899 - Sections
47, 47-A, 47(a)(3), 47-A/33, 48-A, 56(1A) & 56(2) - UP Stamp Valuation of
Property Rules, 1997- Rule 7, 7(2)(c),
7(3)(C) - Sale deed of an agricultural land -
notice for deficiency in Stamp duty while
accepting a complaint that, agricultural plot was
purchased but with two storied house, valuation
of which was not included - recovery citation -
Appeal - with a specific plea that no any
independent
inquiry
or
inspection
was
conducted before issuing impugned recovery
order - appeal rejected - writ petition -
undoubtedly,
as
recorded
in
order
of
Commissioner himself such a request was made
by the petitioner in appeal preferred by him -
When such a request is made then, it is
mandatory
upon
authorities
concerned
to
exercise powers conferred under Section 7(3)(c)
of Rules and inspect property after giving due
notice to parties and only then proceed with
matter - in case aforesaid exercise has not been
conducted valuable right vested in person who
is put under notice is lost and valuable right
cannot be exercised by him and procedure as
prescribed is required to be followed in letter
and spirit - and not inspecting property even
after application made by petitioner is clearly
arbitrary and illegal - hence, mater is remitted
back to the Additional District Magistrate who
shall proceed in the matter afresh in accordance
with law - direction issued - accordingly, writ
petition is allowed. (Para - 13, 15, 16)

Writ Petition Dismissed. (E-11)

List of Cases cited:

1. Wasi Ur Rehman & anr. Vs Commissioner
Moradabad Division & ors., (writ - C No. 47533
of 2010 decide don dated 26.2.2015),

2. Chiranji Lal (Dr.) Vs Hari Das (2005) 10 SCC
746,

3.
Ramesh
Chand
Bansal
Vs
District
Magistrate/Collector, 4(1999) 5 SCC 62,

4. Agra City Real St. Development Organisation,
Agra Vs St. of U.P & ors.) 2003 (2) SAC 361,

5. Vijay Kumar & anr. Vs Commissioner, 2008(3)
AWC 299 All.,

6. Ratna Shankar Dwivedi Vs St. of U.P., AIR
2012 ALL 100,

(Delivered by Hon'ble Alok Mathur, J.)

1. Heard Sri R. K. Gupta, learned
counsel for the petitioners as well as
learned Standing counsel for respondent
No.s 1 to 4.