Sri Manikantha Ice Factory vs. The State Of Ap

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. In that common order, the Division Bench held that G.O.Ms.No.7, dated 08.04.2022, is struck down. However, 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 in accordance with law. The exemption granted to agricultural consumers under G.O.Ms.No.82, dated 07.07.2003, remains in force. The amendments to Section 3 by Act 23 of 2024, granting power to the government to fix the rate of duty between six paise to one rupee per unit, were upheld. The amendments to Section 3 by Act 10 of 2021 and Act 23 of 2024, granting power to identify consumer categories for tariff fixing, were set aside. The proviso to Section 3, stipulating a minimum duty of 6 paise per unit in the absence of notified rates, remains unaffected. Amendments to Section 7 by Act 23 of 2024 were struck down. G.O.Ms.No.22, dated 23.10.2024, was also struck down, but G.O.Ms.No.277, dated 09.12.1994, remains in force, permitting licensees to recover duty at 6 paise per unit, subject to exemptions.

Facts

The petitioner, Sri Manikantha Ice Factory, challenged G.O.Ms.No.7 dated 08.04.2022, issued by the State of Andhra Pradesh, which exorbitantly increased the Electricity Duty from Rs.0.06 to Rs.1.00 per unit for commercial and industrial consumers. The petitioner contended this action was arbitrary and illegal, violating their constitutional rights and relevant policies. The consequential action by the 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 writ petition sought to set aside the G.O. and the enhanced electricity bills, and to direct the refund or adjustment of excess duty paid.

Key Issues

1. Whether the action of the first 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. Petitioner's contentions: The petitioner argued that the increase in Electricity Duty was a colourable exercise of power under Section 3(1) of the Andhra Pradesh Electricity Duty Act, 1939. They contended that the enhanced rate was contrary to established policies and prior regulatory orders. The petitioner sought to set aside the G.O. and consequential bills, and sought a refund of excess duty paid. Respondent's contentions: The judgment does not explicitly record arguments from the respondents. However, the context implies they supported the G.O. and the enhanced levy.