Authority Must Share Adverse Material With Accused Before Passing Orders In Electricity Theft Cases: Punjab & Haryana High Court

The Punjab and Haryana High Court has held that in cases of alleged theft of electricity under Section 135 of the Electricity Act, the assessing authority is duty-bound to confront the consumer with adverse material and grant an opportunity of hearing before passing an assessment order. The Court observed that any determination of civil liability, even under Section 135, must comply with principles of natural justice and cannot be made through a mechanical process.Justice Jagmohan Bansal was hearing a batch of writ petitions where the petitioners challenged checking reports, assessment orders and compounding notices issued by the electricity authorities, alleging theft of electricity. The petitioners, engaged in various commercial activities, contended that the authorities had passed assessment orders without issuing a show cause notice, without disclosing material relied upon, and without granting any opportunity of hearing, thereby rendering the proceedings illegal.The Court examined the scheme of the Electricity Act and distinguished between proceedings under Section 126 and Section 135, noting that while the former deals with unauthorised use of electricity and expressly provides for a hearing, the latter pertains to theft involving dishonest intention and creates criminal liability. The Court held that any assessment which entails civil consequences must necessarily comply with principles of natural justice. It emphasised that the consumer must be confronted with the material relied upon by the authority and must be afforded a reasonable opportunity to contest the allegations before final liability is determined. Passing assessment orders without such safeguards was held to be arbitrary and unsustainable in law.“… Assessing Authority while framing assessment under Section 135 is duty bound to confront the consumer with adverse material and grant an opportunity of hearing. In the absence of supplying adverse material, opportunity of hearing may be a futile exercise and mere formality, thus, Assessing Officer is bound to supply adverse material and grant opportunity of hearing to the affected party,” the Court observed.The Court further held that the Civil Court has no jurisdiction to entertain a suit against an assessment order passed under Section 126 of the 2003 Act; the aggrieved person may prefer an appeal before the Appellate Authority. Any person feeling aggrieved from an assessment order passed under Section 135 may approach the Special Court, and he can neither approach the Appellate Authority nor the Appellate Tribunal. The Court observed that the Order of determination of civil liability under Section 135 cannot be set aside on the ground that prosecution has not been launched; the Special Court is duty bound to determine civil liability where there is an assessment order under Section 135. The Court found that the impugned assessment orders had been passed without issuance of notice or grant of hearing, and without disclosing the basis of the allegations. Such action, the Court held, amounted to a clear violation of natural justice and reflected a mechanical exercise of power by the authorities.Accordingly, the High Court allowed the petitions and quashed the impugned assessment orders.Case Title: Rattan Singh v. State of Haryana & Ors. [CWP-35731-2025 (O&M)]Click Here To Read/Download Order

Authority Must Share Adverse Material With Accused Before Passing Orders In Electricity Theft Cases: Punjab & Haryana High Court

Saksham Vaishya

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