M/S. Vijaya Lakshmi Oil Mill vs. The State Of Andhra Pradesh

Held

The Court disposed of the writ petition in terms of the common order dated 26.06.2025 passed by the Division Bench in W.P.No.29672 of 2023 & batch. The Division Bench's order struck down G.O.Ms.No.7, dated 08.04.2022. However, it held that the government is entitled to collect Duty at the rate of 6 paise per unit throughout the period from the date Act 10 of 2021 was published in the Gazette until the rate of duty is modified according to law. The exemption granted to agricultural consumers under G.O.Ms.No.82, dated 07.07.2003, was also held to remain in force. Furthermore, G.O.Ms.No.22, dated 23.10.2024, was struck down, but G.O.Ms.No.277, dated 09.12.1994, was held to remain in force, permitting licensees to recover Duty at 6 paise per unit, subject to exemptions. The amendments to Section 7 of the Electricity Duty Act by Act 23 of 2024 were struck down. The amendment to Section 3, by Act 23 of 2024, granting power to the government to fix duty rates between six paise and one rupee per unit was upheld, but the power to identify consumer categories for fixing tariff rates under amendments by Act 10 of 2021 and Act 23 of 2024 was set aside. The proviso for a minimum duty of 6 paise per unit in the absence of notified rates was unaffected.

Facts

The petitioner, M/s. Vijaya Lakshmi Oil Mill, challenged G.O.Ms.No.7, Energy (Power-III) Department dated 08.04.2022, which levied electricity duty at Rs. 1/- per unit on energy sales to industrial and commercial consumers. The petitioner argued this G.O. was an arbitrary exercise of power, interfered with central government policy and the State Electricity Regulatory Commission's statutory functions, and violated Articles 14 and 19(1)(g) of the Constitution. The petitioner also challenged the consequential action of the respondent APSPDCL in levying and collecting this duty from May 2022 without prior sanction from the State Government under Section 7(1) of the Electricity Duty Act, 1939, and sought to set aside the demands, including a specific HT bill for August 2023. The writ petition was filed under Article 226 of the Constitution.

Key Issues

1. Whether G.O.Ms.No.7, Energy (Power-III) Department dated 08.04.2022, levying electricity duty at Rs. 1/- per unit on industrial and commercial consumers, is vitiated by colorable exercise of power, interference with central government policy and the State Electricity Regulatory Commission's functions, illegality, arbitrariness, irrationality, unreasonableness, hostile discrimination, and violation of Articles 14 and 19(1)(g) of the Constitution. 2. Whether the consequential action of the respondent APSPDCL in levying and collecting electricity duty from May 2022, based on G.O.Ms.No.7, without previous sanction from the State Government under Section 7(1) of the Electricity Duty Act, 1939, is illegal, arbitrary, and unauthorized. Petitioner's Arguments: The petitioner contended that G.O.Ms.No.7 was an illegal and arbitrary exercise of power, interfered with statutory policies and functions, and violated constitutional provisions. They also argued that the collection of duty without proper sanction under Section 7(1) of the Act was unauthorized. Respondent's Arguments: The judgment records that learned counsel appearing on either side submitted that the issue was covered by a common order of the Division Bench in W.P.No.29672 of 2023 & batch.