Smk Ice Factory vs. The State Of Andhra Pradesh

Held

The High Court disposed of the writ petition in terms of a common order dated 26.06.2025 passed by a Division Bench in W.P.No.29672 of 2023 & batch. The Division Bench's order upheld the amendment to Section 3 of the Act by Act 23 of 2024, granting the government power to fix duty rates between six paise and one rupee per unit. However, it set aside amendments by Act 10 of 2021 and Act 23 of 2024 to the extent they granted power to identify consumer categories for tariff fixing. Crucially, G.O.Ms.No.7, dated 08.04.2022, was struck down. The government was permitted to collect duty at the rate of 6 paise per unit from the date Act 10 of 2021 was published until the rate was modified legally. The exemption for agricultural consumers under G.O.Ms.No.82 remained in force. G.O.Ms.No.22 was also struck down, with G.O.Ms.No.277 remaining in force, allowing licensees to recover duty at 6 paise per unit.

Facts

The petitioner, SMK Ice Factory, challenged G.O.Ms.No.7 dated 08.04.2022, issued by the Energy Department of Andhra Pradesh. This Government Order (G.O.) purportedly increased the Electricity Duty from Rs. 0.06 per unit to Rs. 1.00 per unit on energy sales to commercial and industrial consumers. The petitioner argued this was an arbitrary and illegal exercise of power under Section 3(1) of the Andhra Pradesh Electricity Duty Act, 1939, and led to the issuance of inflated electricity bills from April 2022 onwards. The petitioner sought to set aside the G.O. and the consequential bills, and to recover excess duty paid. The writ petition was filed under Article 226 of the Constitution of India.

Key Issues

1. Whether G.O.Ms.No.7, dated 08.04.2022, which increased the Electricity Duty from Rs. 0.06 to Rs. 1.00 per unit for commercial and industrial consumers, is arbitrary, illegal, and violative of constitutional rights, principles of natural justice, the National Tariff Policy 2016, and the common order on Tariff for Retail Sale of Electricity for FY 2022-23, as argued by the petitioner. 2. Whether the consequential action of the respondent in levying Electricity Duty at the enhanced rate and issuing L.T. bills from April 2022 onwards is liable to be set aside and the excess duty paid by the petitioner is liable to be refunded or adjusted, as contended by the petitioner. The petitioner argued that the G.O. was an exorbitant increase, made in colorable exercise of power, and contrary to various policies and regulations. The respondents, represented by APEPDCL and the State, did not appear to have presented separate arguments in this specific judgment, as the matter was disposed of based on a common order from a Division Bench.