Karnataka HC Reopens BESCOM’s Challenge Over HT Consumer’s Security-Deposit Refund Claim After Its Open-Access Argument Went Unconsidered

Orient Bell, an HT consumer of BESCOM and an open-access consumer, sought refund of excess security deposit, asserting that its electricity consumption from BESCOM had fallen after it began purchasing power through open access.

The Consumer Grievance Redressal Forum rejected the claim; the Electricity Ombudsman set aside that decision and directed BESCOM to process any refund application under the Security Deposit Regulations.

BESCOM challenged the Ombudsman’s order in W.P. No. 8009/2020. Orient Bell did not appear in that writ proceeding, and the High Court allowed BESCOM’s petition on 25 November 2022, principally noting that Orient Bell had not surrendered its contracted power.

Orient Bell sought review, arguing that it had not had an adequate opportunity to contest the writ petition and that its entitlement to a security-deposit adjustment in light of its open-access purchases had not been considered.

The petition invoked Order XLVII Rule 1 of the Code of Civil Procedure, 1908, as the basis for review.

Under Regulations 4 and 5 of the Karnataka Electricity Regulatory Commission (Security Deposit) Regulations, 2007, a consumer is generally required to maintain a security deposit based on the prescribed months of charges and consumption.

Regulation 6 requires an annual review of the deposit against average consumption in the preceding year and provides for recovery of a shortfall or refund of excess deposit, subject to the regulation’s conditions and thresholds.

Section 49 of the Electricity Act, 2003 permits open-access consumption, which is regulated by the Karnataka Electricity Regulatory Commission (Terms and Conditions for Open Access) Regulations, 2004; Regulation 11(xii) addresses a security deposit payable by an open-access consumer.

The Court’s review decision turned on whether the earlier writ order had considered a material contention; it did not finally determine Orient Bell’s entitlement to a refund.

The Court observed that the earlier writ order relied on the fact that Orient Bell had not surrendered its contracted power from BESCOM.

However, Orient Bell’s distinct contention—that its consumption from BESCOM had reduced because it also procured power through open access, affecting the deposit required under Regulations 4 and 5—had been raised before the consumer-forum authorities but was not considered in the writ proceeding.

The Court therefore held that the review petition merited consideration and directed that Orient Bell be allowed to file objections in the writ petition.

It did not decide the merits of the refund claim.

The refund claim remained for determination in the writ proceedings.