M/S. Meenakshi Ice Plant vs. The State Of Andhra Pradesh

Held

The High Court disposed of the writ petition in terms of the common order dated 26.06.2025 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 08.04.2022. 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 in the Gazette until the rate of duty was modified in accordance with law. The exemption granted to agricultural consumers under G.O.Ms.No.82, dated 07.07.2003, was also confirmed to remain in force. The Division Bench also struck down G.O.Ms.No.22, dated 23.10.2024, but held that G.O.Ms.No.277, dated 09.12.1994, remained in force, permitting licensees to recover Duty at the rate of 6 paise per unit, subject to exemptions. The ratio is that while the enhanced rate in G.O.Ms.No.7 was struck down, the underlying power to levy duty at a certain rate, and the prior established rates, were considered.

Facts

The petitioner, M/s. Meenakshi Ice Plant, challenged G.O.Ms.No.7 dated 08.04.2022, issued by the Energy Department of the State of Andhra Pradesh, which exorbitantly increased the levy of Electricity Duty from Rs.0.06 per unit to Rs.1.00 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. The consequential action by the second respondent, Andhra Pradesh Eastern Power Distribution Corporation Limited (APEPDCL), in levying Electricity Duty at the enhanced rate through L.T. bills from April 2022 onwards, was also challenged. The petitioner sought to set aside the G.O. and the bills, and sought a refund or adjustment of excess duty paid.

Key Issues

1. Whether the action of the 1st respondent in issuing G.O.Ms.No.7, dated 08.04.2022, by exorbitantly increasing the levy of Electricity Duty from Rs.0.06 per unit to Rs.1.00 on energy sales to commercial and industrial consumers, is arbitrary, illegal, unjust, unfair, unreasonable, excessive, and violative of Fundamental and Constitutional Rights, Principles of Natural Justice, National Tariff Policy 2016, and the common order on Tariff for Retail Sale of Electricity for FY 2022-23 by the Andhra Pradesh Electricity Regulatory Commission, under Section 3(1) of the Andhra Pradesh Electricity Duty Act, 1939? Petitioner's Contention: The petitioner argued that the G.O. was issued in colorable exercise of power, was contrary to established policies and regulatory orders, and imposed an excessive and unreasonable burden. Respondent's Contention: The judgment does not record specific arguments from the respondents regarding the validity of G.O.Ms.No.7. However, the respondents are the State and the power distribution corporation, whose actions are being challenged.