M/S. Sankara Industries vs. The State Of Andhra Pradesh

Held

The High Court disposed of the writ petition in terms of the common order dated June 26, 2025, passed by a Division Bench in W.P. No. 29672 of 2023 & batch. The Division Bench had struck down G.O. Ms. No. 7 dated April 8, 2022. However, it upheld the government's entitlement to collect duty at the rate of 6 paise per unit throughout the period from the date Act 10 of 2021 was published until the rate of duty is modified in accordance with law. The Division Bench also struck down amendments to Section 7 by Act 23 of 2024 and G.O. Ms. No. 22 dated October 23, 2024. The proviso to Section 3, stipulating a minimum duty of 6 paise per unit in the absence of notified rates, remained unaffected. The exemption granted to agricultural consumers under G.O. Ms. No. 82 dated July 7, 2003, was also confirmed to remain in force. The court directed that G.O. Ms. No. 277 dated December 9, 1994, remains in force, permitting licensees to recover duty at 6 paise per unit, subject to exemptions.

Facts

The petitioners, M/s. Sankara Industries and Thotakura Jhansi Lakshmi, filed a writ petition challenging G.O. Ms. No. 7 Energy (Power-II) Department dated April 8, 2022. This Government Order (G.O.) increased the electricity duty from Rs. 0.06 paise to Rs. 1.00 per unit on energy sales to commercial and industrial consumers. The petitioners sought a declaration that this G.O. was illegal and arbitrary. They also requested that the refundable amount be adjusted in future consumption bills and that electricity duty be levied at the rate of Rs. 0.06 paise only on their service connection. An interim application was also filed seeking to restrain the respondents from disconnecting power supply for recovery of electricity duty at the enhanced rate.

Key Issues

1. Whether G.O. Ms. No. 7 Energy (Power-II) Department dated April 8, 2022, which increased electricity duty for commercial and industrial consumers from Rs. 0.06 paise to Rs. 1.00 per unit, is illegal, arbitrary, and contrary to law. Petitioner's arguments: The petitioners contended that the action of the respondents in issuing G.O. Ms. No. 7 was illegal, arbitrary, and contrary to law. They sought a direction to adjust any refundable amounts in future bills and to levy duty only at the rate of Rs. 0.06 paise. They also sought interim relief to prevent power disconnection. Respondent's arguments: The judgment does not record specific arguments made by the respondents. However, it refers to a common order passed by a Division Bench in a batch of writ petitions (W.P. No. 29672 of 2023 & batch) which dealt with similar issues concerning G.O. Ms. No. 7 and related amendments.