Electricity Charges Become Payable Only When Bill Is Issued, Not On Consumption: NCDRC

 

In a pivotal judgment, the National Consumer Disputes Redressal Commission (NCDRC) clarified that electricity charges are payable only upon issuance of a bill, irrespective of when the electricity was consumed. This decision emerged from a dispute between the State Bank of India (SBI) and Jaipur Vidyut Vitran Nigam Limited (JVVNL) over delayed billing of arrears.

 

The Dispute

The controversy began when JVVNL issued a demand notice to SBI in August 2019 for ?25.81 lakh in arrears, citing electricity consumed during 2013–2015. The arrears were attributed to a defective electricity meter, and the demand was reflected in subsequent bills. SBI challenged this, arguing that the demand was time-barred under Section 56(2) of the Indian Electricity Act, 2003, which limits arrear recovery to two years unless previously billed.

 

Legal Proceedings

 

1. District Forum Ruling (2021): The District Consumer Forum sided with SBI, holding that JVVNL's demand was barred by the two-year limitation and directing a revised bill.

 

 

2. State Commission Ruling (2022): The State Commission overturned this, stating the limitation period began only upon issuance of the bill, not when the electricity was consumed.

 

 

3. NCDRC Ruling (2024): SBI's appeal to the NCDRC was dismissed. The NCDRC upheld JVVNL's demand, reaffirming that electricity charges become payable only when a bill is issued, not earlier.

 

 

 

Key Takeaways from the NCDRC Judgment

 

Billing Determines Payability: Relying on Supreme Court precedents, the NCDRC observed that payment obligations arise only after a bill is issued, regardless of prior consumption liability.

 

Limitation Period Clarified: Under Section 56(2) of the Electricity Act, the two-year limitation period for arrear recovery begins from the date of the bill's issuance.

 

 

Final Observations

Presiding Member AVM J. Rajendra (Retd.) emphasized that a consumer cannot be expected to pay until a bill is raised. Delayed billing, if legally justified, does not amount to a deficiency in service. The NCDRC concluded that JVVNL's demand for arrears issued in August 2019 was within the permissible period and legally valid.

 

This ruling reaffirms established legal principles and provides clarity on billing and payment obligations, marking a significant precedent for consumer rights and utility services.