The Supreme Court of India has acquitted a company director in an electricity theft case, overturning a conviction by the Bombay High Court. The Court held that a case for theft of energy cannot be established based on “estimation, presumption, approximation or possibilities.” The judgment, delivered by a bench of Justice Sanjay Karol and Justice Prashant Kumar Mishra, emphasized that the statutory presumption against a consumer under the Indian Electricity Act, 1910, cannot be invoked unless the prosecution first proves that an artificial means was used to dishonestly abstract energy.
The case involved Mahaveer, a director of M/s. Rushi Steels and Alloys Pvt. Ltd., who was acquitted by a trial court in 1997 but later convicted by the High Court in 2010. The Supreme Court restored the acquittal, concluding that the prosecution failed to prove its case beyond a reasonable doubt.
Background of the Case
The matter originated in March 1993, when officials of the Maharashtra State Electricity Board (MSEB) observed a 36.6% mismatch between the electricity units supplied to the appellant’s factory in Jalan and the meter readings. An investigation led to an inspection where senior MSEB officials, in the presence of independent witnesses, found that the meter box at the factory had been tampered with, showing three holes of 4 mm each.
The prosecution alleged that workers of the company used these holes to insert additional wires, interfering with the meter and causing it to run slow. After the officials sealed the holes, a subsequent reading showed the disparity in consumption dropped to around 10%. The MSEB quantified the alleged theft at approximately Rs. 30 lakhs and lodged an FIR on June 25, 1993.
The IIIrd Jt. Judicial Magistrate (FC) at Jalan, after trial, acquitted Mahaveer and another director, Radheshyam, on April 25, 1997. The trial court found that the prosecution had failed to establish the charges under Sections 39 (theft of energy) and 44 (interference with meters) of the Indian Electricity Act, 1910.
High Court’s Reversal and Conviction
On appeal by the state, a single judge of the Bombay High Court at Aurangabad reversed the acquittal on October 15, 2010. The High Court concluded that since electricity consumption increased significantly after the holes in the meter box were sealed, it stood proved that the accused were responsible for the theft. The High Court observed that the appellants made no attempt to prove the extra holes were not caused by them and held that the case fell squarely under Section 44(c) of the Act. The directors were sentenced to one year of rigorous imprisonment and a fine of Rs. 2 lakhs each.
Supreme Court’s Analysis and Findings
The Supreme Court, hearing the appeal against the conviction, framed the central question as whether the acquittal was correctly reversed by the High Court.
The Court first analyzed Section 39 of the Act, which defines “theft of energy.” It noted that the provision contains a presumption against the consumer if it is proved that “any artificial means or means not authorised by the licensee exist for the abstraction, consumption or use of energy.” However, Justice Karol, writing for the bench, clarified, “for the presumption against the consumer to take effect, it must be proved that an artificial means or a means not authorised by the licensee had been used in committing the theft. In other words, the presumption is not of automatic application, and instead, something is required to be established for it to apply.”
The Court then meticulously examined the testimonies of the five prosecution witnesses and found them wanting.
- PW-1, a witness to the panchnama, admitted in cross-examination that he had no knowledge of what had transpired and had only affixed his signature to a document written independently.
- PW-2, a Deputy Executive Engineer with MSEB, conceded that his statements regarding less recording of energy were “based on guesswork and nothing specific.”
- PW-3, the complainant, admitted that the conclusion about theft was “entirely based upon the inference only” and that officials never verified the practical possibility of shortening the current through the holes.
- PW-4 stated that he drew an inference that energy was not consumed properly because “there was possibility due to existing the three holes in question.”
- PW-5, the Superintending Engineer who ordered the investigation, admitted in cross-examination that “the existence of 3 holes at the bottom of the metre box of the accused is be only because for charging the accused for pilferage of energy.”
Based on this evidence, the Supreme Court observed, “It is evident from the above discussion and extracts of the testimonies put forward by the prosecution that none of them have deposed with complete confidence about the alleged theft of electricity and the use of artificial means therein, by the appellant-convict. Most of the testimonies are based on estimation, presumption, approximation or possibilities.” The Court categorized the testimonies as “wholly unreliable.”
Regarding the charge under Section 44, the Court found it to be on “shaky grounds,” as nothing on record showed the meter had been injured or tampered with. No witness saw anyone tampering with the box, and there was no categorical statement that the holes did not exist at the time of installation. The judgment noted, “In other words, there are too many open possibilities for criminal liability to be affixed to any person.”
Decision
Concluding that neither Section 39 nor Section 44 could be established against the appellant, the Supreme Court allowed the appeal. The judgment and order of the Bombay High Court were set aside, and the appellant, Mahaveer, was acquitted of all charges.
