M/S. Sri Adilakshmi Property Developers (P) LTD. vs. The State Of Andhra Pradesh

Held

The High Court disposed of the writ petition in terms of a common order dated June 26, 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 Andhra Pradesh Electricity Duty Act, 1939, 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 fixing tariff rates, were set aside. The proviso 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 April 8, 2022, was struck down. The government is entitled to collect duty at the rate of 6 paise per unit from the date Act 10 of 2021 was published until the rate is modified lawfully. G.O.Ms.No.22, dated October 23, 2024, was also struck down, but G.O.Ms.No.277, dated December 9, 1994, remains in force, permitting licensees to recover duty at 6 paise per unit, subject to exemptions. The operative direction was to dispose of the writ petition in terms of this common order.

Facts

The petitioner, M/s. Sri Adilakshmi Property Developers (P) Ltd., challenged G.O.Ms.No.7, dated April 8, 2022, issued by the Energy Department of the State of Andhra Pradesh. This Government Order (G.O.) purportedly 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 that this increase was arbitrary and illegal, violating constitutional rights and established policies. The consequential action by the second respondent, Andhra Pradesh Eastern Power Distribution Corporation Limited (APEPDCL), in levying this enhanced duty through High Tension (HT) bills from April 2022 onwards, was also challenged. The petitioner sought to set aside the impugned G.O. and the bills, and to refund or adjust the excess duty paid.

Key Issues

1. Whether the action of the first respondent in issuing G.O.Ms.No.7, dated April 8, 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, the National Tariff Policy 2016, and the common order on Tariff for Retail Sale of Electricity for FY 2022-23 passed by the Andhra Pradesh Electricity Regulatory Commission, turning on Section 3(1) of the Andhra Pradesh Electricity Duty Act, 1939. Petitioner's Contentions: The petitioner argued that the G.O. was issued in colorable exercise of power, was arbitrary, illegal, unjust, unfair, unreasonable, excessive, and violated their fundamental and 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. They sought to set aside the G.O. and consequential bills, and for a refund of excess duty paid. Respondent's Contentions: The judgment does not record specific contentions from the respondents, but implies they were defending the G.O. and the enhanced levy.