Court Upholds Findings of Lower Courts That Raising Additional Demand Without Following Electricity Supply Code and Principles of Natural Justice Was Unsustainable
Chandigarh: The Punjab & Haryana High Court has dismissed a Regular Second Appeal filed by Dakshin Haryana Bijli Vitran Nigam Limited (DHBVNL) challenging the judgments of the Trial Court and First Appellate Court, which had set aside a disputed electricity demand of ₹5,54,925/- raised against a consumer.
Justice Harsh Bunger, while deciding RSA-1028-2025 (O&M) titled SDP/AGM (OP), Dakshin Haryana Bijli Vitran Nigam and Another vs Shri Ram and Another on 22.09.2026, upheld the concurrent findings of the courts below and held that no interference was warranted in the second appeal.
The High Court observed that before examining the electricity meter in the laboratory and raising a substantial additional demand against the consumer, DHBVNL was required to follow the prescribed procedure, issue notice and provide an opportunity to the consumer. Since the Nigam failed to demonstrate compliance with these requirements, the concurrent findings of the Trial Court and First Appellate Court were upheld.
Dispute Relates to Electricity Bill of ₹5.54 Lakh
The proceedings arose from a civil suit filed by Shri Ram, who challenged an electricity bill issued by DHBVNL. The consumer sought a declaration that the electricity bill dated 30.07.2020 and the corrected/supplementary bill of the same date amounting to ₹46,343/- were illegal, contrary to facts and law, and not binding upon him. The consumer also sought a permanent injunction restraining DHBVNL from recovering the disputed amount and a mandatory injunction directing restoration of the electricity meter to its original position. The dispute primarily related to a much higher demand of ₹5,54,925/- reflected in the electricity bill issued in July 2020.
Consumer’s Case Before Civil Court
The plaintiff stated that he had purchased the premises where electricity connection bearing No. TAID-1113-A was installed. He claimed that he had been regularly using the electricity connection and paying bills issued by DHBVNL. According to the consumer, the electricity bill dated 30.07.2020 showed consumption of 799 units, but unexpectedly reflected huge arrears of approximately ₹15.34 lakh, with final charges payable shown as ₹5,54,923/-. The consumer claimed that the premises were residential in nature and the connection was a 4 KW domestic connection. Upon receiving the bill, he approached DHBVNL officials seeking correction. The consumer stated that although the bill amount was subsequently reduced to ₹46,343/-, even that amount was not according to the actual units consumed. The consumer therefore challenged the demand before the civil court.
DHBVNL’s Defence: Meter Found With Hidden Consumption Reading
DHBVNL contested the suit and stated that the electricity demand was correctly raised. The Nigam’s stand was that the consumer’s meter had remained dead for several years, due to which bills were being issued on a flat-rate basis. DHBVNL claimed that the consumer was aware that once an application was made for meter replacement, actual consumption charges would become payable.
According to DHBVNL, in June 2020 the old meter was replaced and sent to the laboratory for examination. The Nigam stated that during laboratory checking, it was found that only the display screen of the meter was disabled. After connecting a new screen, the meter reflected a reading of 74,493 units, which represented actual consumption by the consumer. Based on this reading, DHBVNL issued the bill for previously unbilled units amounting to ₹5,54,925/-.
Trial Court Sets Aside Demand
After considering evidence produced by both parties, the Trial Court decreed the suit filed by the consumer vide judgment dated 24.07.2023. The Trial Court declared the demand of ₹5,54,925/- shown payable in the July 2020 electricity bill as illegal, null and void and set aside the same. The Court also restrained DHBVNL from adopting coercive recovery measures for the disputed amount and from disconnecting the electricity connection, subject to payment of regular electricity bills.
District Judge Also Upholds Consumer’s Claim
DHBVNL challenged the Trial Court judgment before the District Judge, Rewari. However, the appeal was dismissed vide judgment dated 18.10.2024. The First Appellate Court examined the evidence and found that no prior notice had been issued to the consumer before examining the meter in the laboratory. The Court observed that fairness required the consumer to be informed before such a significant demand was raised. The District Court held that non-issuance of notice before raising a huge electricity demand was against principles of natural justice.
DHBVNL Approaches High Court in Regular Second Appeal
After dismissal of its first appeal, DHBVNL approached the Punjab & Haryana High Court through RSA-1028-2025 (O&M). The Nigam argued that the courts below had wrongly appreciated the evidence. DHBVNL maintained that the meter inspection and subsequent bill were based on actual consumption recorded from the meter after restoration of the display. The question before the High Court was whether the concurrent findings of the courts below suffered from any illegality, perversity or substantial error requiring interference in second appeal.
High Court Examines Compliance With Electricity Supply Procedure
The High Court examined the reasoning adopted by the Trial Court and First Appellate Court. Justice Harsh Bunger noted that the consumer’s challenge was regarding the correctness of the supplementary electricity demand and the procedure adopted before raising such demand. The Court specifically observed that before examination/testing of the electricity meter in the laboratory, no notice was issued to the consumer. The Court further observed that DHBVNL failed to demonstrate compliance with its own Circular D-21/2017.
Requirement of Notice Before Additional Demand
The Trial Court had relied upon Clause 6.10.4 of the HERC Electricity Supply Code. The provision requires that where a consumer has been undercharged, a notice should be served upon the consumer enabling him to contest the demand. The licensee is required to consider the consumer’s reply before recovery of additional charges. The Trial Court observed that DHBVNL was required to provide details of the charges and issue proper notice before imposing the disputed amount. The Court also referred to DHBVNL’s own Sales Circular No. 27/96, which required notice to consumers before imposing additional charges.
Violation of Principles of Natural Justice
The High Court agreed with the reasoning of the courts below that the prescribed procedure had not been followed. The Court found that DHBVNL failed to establish:
- Prior notice to the consumer;
- Proper opportunity of hearing;
- Compliance with departmental instructions;
- Procedural safeguards before raising additional demand.
The High Court held that the findings recorded by the Trial Court and First Appellate Court were based on proper appreciation of facts, pleadings and evidence available on record.
Scope of Second Appeal Before High Court
The High Court also discussed the limited scope of interference in a Regular Second Appeal. Relying upon Supreme Court judgments including M/s Shivali Enterprises v. Godawari (Deceased) and Randhir Kaur v. Prithvi Pal Singh, the Court reiterated that second appeal jurisdiction cannot be exercised merely because another view on facts is possible. Interference is warranted only where there is a substantial question of law or serious procedural defect.
The Court found no such circumstance in the present case.
High Court Dismisses DHBVNL Appeal
After considering the entire matter, the High Court concluded that the appeal filed by DHBVNL lacked merit. The Court held that the findings recorded by the courts below did not suffer from any illegality or perversity. Accordingly, the Regular Second Appeal was dismissed.
All pending applications, if any, were also closed.
Counsel Appearing Before High Court
For the appellants/DHBVNL:
Legal Significance of the Judgment
The judgment is significant for electricity distribution companies as it reiterates the importance of procedural compliance before raising additional demands against consumers. While electricity utilities have authority to recover genuine charges arising from actual consumption, such recovery must follow the statutory framework and principles of natural justice.
The judgment reinforces that consumers must be given:
- Proper notice;
- Details of alleged undercharging;
- Opportunity to contest the demand;
- Transparent procedure before recovery.
The decision also highlights that internal departmental procedures and regulatory requirements cannot be ignored while exercising billing and recovery powers.
Conclusion
The Punjab & Haryana High Court’s decision in SDP/AGM (OP), DHBVNL & Another vs Shri Ram & Another provides important guidance regarding supplementary electricity billing disputes. The Court upheld the concurrent findings of the Trial Court and District Court, which had set aside the demand of ₹5,54,925/- raised against the consumer. The High Court found that DHBVNL failed to establish compliance with mandatory procedural requirements before raising the additional demand. In particular, the absence of prior notice before laboratory examination of the meter and raising of the disputed bill was considered a violation of principles of natural justice.
The judgment makes it clear that electricity distribution companies must follow due process while recovering additional amounts from consumers and cannot impose substantial financial liability without providing adequate opportunity to the affected consumer.
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