Section 45: Power to recover charges

Electricity Act • Official Statutory Text & Practice Guide

Statutory Regulation
Legal Standard
Competent Court / Tribunal
Act 2003

Legal Commentary & Landmark Judgments: Section 45

Section 45 of the Electricity Act, 2003 authorizes distribution licensees to recover charges for electricity supplied in accordance with tariffs determined by the Appropriate Commission, permitting two-part and multi-part tariff structures comprising fixed and variable energy charges.

  • Statutory Authority to Recover Electricity Charges: Empowers the distribution licensee to demand and recover charges for electricity supplied to any consumer strictly in conformity with tariffs determined by the SERC under Section 62.
  • Permissible Multi-Part Tariff Methodologies: Authorizes tariffs structured on fixed demand charges (per kVA/kW), variable energy charges (per kWh/kVAh), maximum demand indicators, load-factor incentives, and time-of-day (ToD) peak/off-peak variations.
  • Absolute Statutory Ceiling on Recoverable Tariffs: Section 45(5) expressly bars the licensee from charging any consumer at rates exceeding the maximum tariff determined by the Appropriate Commission, rendering excess billing illegal.
Key Landmark Precedents:
  • Southern Electricity Supply Co. of Orissa Ltd. (SOUTHCO) v. Sri Seetaram Rice Mill (2012) 2 SCC 108: The Supreme Court held that recovery of electricity charges under Section 45 is a statutory right grounded in regulatory tariffs; consumers drawing power beyond sanctioned contract demand are liable to higher demand charges and regulatory levies.
  • BSES Rajdhani Power Ltd. v. Delhi Electricity Regulatory Commission (2023) 14 SCC 566: The Supreme Court affirmed that distribution licensees can only recover tariffs determined under Section 45 in strict accordance with the Commission's tariff schedules, prohibiting utilities from levying unapproved surcharges under private commercial discretion.
Courtroom Practice & Strategic Litigation Guidance:

When challenging exorbitant electricity bills or back-billing notices before the Electricity Ombudsman or High Court, audit the bill line-by-line against the SERC's notified Section 45 Retail Tariff Order, challenging any unnotified ancillary levy or incorrect slab assessment as ultra vires Section 45(5).