Rampex Labs PVT. LTD. vs. 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 held that the amendment to Section 3 of the Duty Act, by Act 23 of 2024, granting power to the government to fix the rate of duty between six paise and one rupee per unit, is upheld. However, 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. 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 according to law. G.O.Ms.No.22 dated 23.10.2024 was also struck down, with G.O.Ms.No.277 dated 09.12.1994 remaining in force, permitting recovery of duty at 6 paise per unit, subject to exemptions. The ratio is that while the government has the power to fix duty rates within a range, specific G.O.s and amendments that exceeded this power or were procedurally flawed were struck down, with a minimum statutory duty rate being maintained.

Facts

The petitioners, RAMPEX LABS PVT. LTD. and VERDANT LIFE SCIENCES PVT. LTD., filed a writ petition challenging G.O.Ms.No.7 Energy (Power-III) Department dated 08.04.2022. This Government Order (G.O.) 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 petitioners sought a declaration that this action was illegal and arbitrary, and requested that the increased duty be adjusted against future bills, with duty levied only at the original rate of Rs.0.06 per unit. Interim applications were also filed seeking to restrain power disconnection for recovery of the enhanced duty and to vacate interim orders. The present writ petition was disposed of in terms of a common order passed by a Division Bench of the High Court in a batch of writ petitions.

Key Issues

1. Whether G.O.Ms.No.7 Energy (Power-III) Department 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 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 and arbitrary. They sought a declaration to this effect and consequential directions for adjustment of refundable amounts and levy of duty at the original rate. Respondent's arguments: The judgment does not record specific arguments from the respondents. However, it notes that the issue was covered by a common order of the Division Bench. The Division Bench's order, which this writ petition followed, dealt with amendments to Section 3 and Section 7 of the Duty Act and the validity of G.O.Ms.No.7 and G.O.Ms.No.22.