Section 126 Electricity Notice: The 50 Percent Trap

A section 126 notice under the Electricity Act, 2003 is not a bill for one month. It is an assessment for the entire period of unauthorised use, and an appeal against the final order is not entertained unless half the assessed amount is deposited first.

Start with the calendar, not the law book. People lose this fight on the clock far more often than on the facts.

• Day 0. The order of provisional assessment is served on you. Record the exact date of service.
• Before the final order. File written objections with the assessing officer and keep the stamped acknowledgement. Ask in that letter for a hearing before any final order is passed.
• Within thirty days of that final order. An appeal can be filed, and only if half the assessed amount is already deposited.

Work in that order. Do not wait for the final order to start collecting paper.

Sit with the paper before you argue with anyone, and pull out six things.

• The date of service. Not the date printed on the order, the date it reached you. Every clock runs from service.
• Provisional or final. A provisional assessment is what the assessing officer concluded after an inspection. A final order follows it. Your objections belong on the record before that final order is made, which is why the date of service matters.
• The period assessed. From which date to which date. This one line explains the size of the demand more than anything else on the page.
• The ground alleged. The Act defines unauthorised use of electricity as usage by any artificial means, by a means not authorised by the concerned person or authority or licensee, through a tampered meter, for a purpose other than the one the usage was authorised for, or for premises or areas other than those for which supply was authorised. Find which of those five your notice alleges. If it does not say, put that in writing.
• The officer and his authorisation. An assessing officer is an officer of a State Government or Board or licensee, designated as such by the State Government. Note his name and ask for the designation order.
• The computation. Which units, which period, which category of service. Many notices give a total and nothing else. That gap is your strongest early point.

Do not sign anything on the spot, and never let a verbal settlement replace a written record.

A section 126 demand is not the bill for the month of the inspection. The section says:

If the assessing officer reaches to the conclusion that unauthorised use of electricity has taken place, the assessment shall be made for the entire period during which such unauthorised use of electricity has taken place and if, however, the period during which such unauthorised use of electricity has taken place cannot be ascertained, such period shall be limited to a period of twelve months immediately preceding the date of inspection.

Two rules sit inside that one sentence.

First, the assessment covers the whole stretch of unauthorised use. A stretch the officer believes ran for two years is assessed for two years. That is why a family expecting a few thousand rupees opens an envelope with a figure many times larger.

Second, there is a fallback. Where the period cannot be ascertained, the Act caps it at twelve months immediately before the date of inspection. The period is not open ended, and an assessment reaching back further has to rest on an ascertained period, not a guess.

That gives you one clean question to put in writing: on what material was the period from date A to date B ascertained. If there is no answer, the twelve month cap is your argument. Read the section yourself at the source linked below.

This decides more section 126 matters than any legal argument. Section 127 says:

No appeal against an order of assessment under sub-section (1) shall be entertained unless an amount equal to half of the assessed amount is deposited in cash or by way of bank draft with the licensee and documentary evidence of such deposit has been enclosed along with the appeal.

Four hard conditions, all of which must be met before anyone looks at your case.

• How much. An amount equal to half of the assessed amount. Not a token, not what you think is fair. Half of the figure in the order.
• In what form. In cash or by way of bank draft. Start arranging the draft early.
• To whom. With the licensee, the electricity company itself, not with the appellate authority.
• What you attach. Documentary evidence of the deposit, enclosed along with the appeal. A receipt in your drawer does not count.

Miss any one and the appeal is not entertained. That word matters: you do not lose on merits, you never reach merits. Then the thirty day window closes and the assessment stands. So plan the money on day one, not on day twenty nine.

Two more lines of section 127 are worth knowing. On default in paying the assessed amount, the Act makes you liable, from the expiry of thirty days from the date of the order of assessment, to interest at sixteen per cent per annum compounded every six months. And no appeal lies against a final order made with the consent of the parties. Sign a settlement and you close the appeal door yourself.

An appeal built on the words I did not do it goes nowhere. An appeal built on the licensee's own inspection papers is a different animal. Most electricity distribution licensees are State owned companies, and the RTI Act covers any body owned, controlled or substantially financed by government funds. Where that is true, ask for the file.

Be realistic about the exception. A purely private licensee may not be a public authority. Even then the State Electricity Regulatory Commission is a body constituted under the Electricity Act, 2003 and is a public authority, so records held there stay reachable.

File in the first week, while the final order is still being written. Adapt this with the AI RTI Drafter.

To: The Public Information Officer
Subject: Information on the assessment under section 126 of the
Electricity Act, 2003, service connection number ______

In respect of the inspection of my premises at ______ carried out on
______ and provisional assessment order number ______ dated ______,
please supply:

1. Copy of the inspection report prepared on the date of inspection.
2. Copy of the site mahazar or panchnama drawn at the premises, with
   names, addresses and signatures of the witnesses present.
3. Copy of the order designating the inspecting officer as an
   assessing officer.
4. Copy of the meter testing report and laboratory report for the
   meter inspected or removed, with date of testing.
5. Copy of the computation sheet for the assessed amount, showing the
   period, units, category of service and the working used.
6. Copy of the material on which the assessed period from ______ to
   ______ was ascertained.
7. Copies of file notings on the provisional and final assessment.
8. Copies of photographs or video recorded during the inspection.

Fee of Rs 10 is enclosed. I am a citizen of India.

Ask for copies, not opinions. Do not ask why you were assessed, ask for the document that answers it. If the reply is empty or late, run it through the PIO Reply Checker, track dates with the Timeline Tracker, and appeal with the First Appeal Builder. The full method is in The RTI Playbook, and the law itself is at RTI Act, 2005.

This is a made up illustration with round numbers, not a real case. No real consumer, place or amount is described.

Suppose a small shop normally pays about Rs 5,000 a month, and after an inspection the assessing officer concludes unauthorised use ran for two years. Because the assessment covers the entire period, the provisional figure is not Rs 5,000. Say it comes to Rs 2,00,000.

Now apply the gate. Half of that is Rs 1,00,000, to be deposited with the licensee in cash or by bank draft, with proof enclosed. So a shopkeeper budgeting a few thousand rupees is really planning for a one lakh rupee deposit inside a thirty day window, before anyone examines whether the two year period was ascertained at all.

The period drives the amount, and the amount drives the deposit. Attack the period early, in writing, and arrange the money in parallel.

That wastes your best window. Once a final order exists, the deposit gate applies to any appeal against it. Written, acknowledged objections put your version on the record while the assessment is still being made, and they are what an appeal later stands on.

Ask, in writing, on what material the start date was ascertained. Section 126 allows an assessment for the entire period of unauthorised use, but where that period cannot be ascertained it is limited to twelve months immediately preceding the date of inspection. A period fixed by guesswork rather than by evidence is the weak point in the order.

No. The section requires documentary evidence of the deposit to be enclosed along with the appeal. An appeal filed with a promise to pay later is not entertained.

The words used are in cash or by way of bank draft, with the licensee. Do not assume a convenient payment mode will be accepted here. Arrange the draft in advance and collect a receipt naming the assessment order.

On default, from the expiry of thirty days from the date of the order of assessment, the Act makes you liable to interest at sixteen per cent per annum compounded every six months, on top of the assessed amount.

The Act says no appeal lies against a final order made with the consent of the parties. Before signing anything called a compromise or settlement, understand you may be giving up the appeal itself.

• Section 126, The Electricity Act, 2003, full text
• Section 126 sub-section 5, assessment for the entire period
• Section 127, appeal and the deposit condition
• The Right to Information Act, 2005, full text

One distinction before you click through. A section 126 assessment is a separate statutory assessment and appeal track under the Electricity Act, 2003, with its own officer, its own final order and its own deposit condition. An ordinary billing complaint, a meter reading error or a connection delay travels the consumer grievance route these pages describe.

• Inflated electricity bill? Force discom action with RTI
• Wrong electricity meter reading: fix an inflated bill
• How to fight a wrong electricity bill: CGRF and ombudsman
• Electricity complaints: the rules, the forums, the RTI
• Power cut compensation and discom standards of performance