Royal Plywood Industries 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. The Division Bench's order struck down G.O.Ms.No.7, dated 08.04.2022. However, it permitted the government 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, was also confirmed to remain in force. The Division Bench upheld the amendment to Section 3 of the 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, but set aside amendments allowing the government to identify consumer categories for fixing tariff rates. 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, with G.O.Ms.No.277, dated 09.12.1994, remaining in force, permitting recovery of duty at 6 paise per unit.

Facts

The petitioner, Royal Plywood Industries, challenged G.O.Ms.No.7, Energy (Power-III) Department, dated 08.04.2022, 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 contended this action was arbitrary, illegal, and violative of constitutional rights, common order on Tariff for Retail Sale of Electricity, and National Tariff Policy 2016. The petitioner sought to set aside the G.O. and the consequential enhanced Electricity Duty bills issued by the second respondent, Andhra Pradesh Eastern Power Distribution Corporation Limited (APEPDCL), from April 2022 onwards, and sought a refund or adjustment of 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 industrial and commercial consumers, is arbitrary, illegal, and violative of constitutional rights, 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. Petitioner's Contention: The petitioner argued that the G.O. was issued in colorable exercise of powers under Section 3(1) of the Andhra Pradesh Electricity Duty Act, 1939, and was contrary to established policies and orders, leading to excessive and unjustifiable levy of duty. They sought to set aside the G.O. and consequential bills. Revenue/State's Contention: The judgment does not record specific arguments from the respondents. However, it notes that the issue is covered by a common order of the Division Bench.