Vizag General Cargo Berth PVT LTD (Vgcb) vs. State Of Andhra Pradesh

Held

The High Court disposed of the writ petition in terms of the common order passed by a Division Bench of the same Court in W.P.No.29672 of 2023 & batch dated June 26, 2025. The Division Bench had observed that G.O.Ms.No.7, dated April 8, 2022, was struck down. However, the government was 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 was modified in accordance with law. The exemption granted to agricultural consumers under G.O.Ms.No.82, dated July 7, 2003, was also to remain in force. The Court noted that the amendment to Section 3 of the Andhra Pradesh Electricity Duty Act, by Act 23 of 2024, to the extent of granting power to the government to fix the rate of duty between six paise to one rupee per unit, was upheld. However, amendments 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 remained unaffected. Amendments to Section 7 by Act 23 of 2024 were struck down. G.O.Ms.No.22, dated October 23, 2024, was also struck down, but G.O.Ms.No.277, dated December 9, 1994, remained in force, permitting licensees to recover duty at 6 paise per unit, subject to exemptions.

Facts

The Petitioner, Vizag General Cargo Berth Pvt Ltd (VGCB), filed a writ petition challenging G.O.Ms.No.7, Energy (Power-III) Department, dated April 8, 2022, issued by the State of Andhra Pradesh. This Government Order (G.O.) purportedly increased the electricity duty from Rs. 0.06 per unit to Rs. 1 per unit on energy sales to commercial and industrial consumers. The Petitioner contended that this increase was arbitrary and illegal. The consequential action of the Eastern Power Distribution Company of Andhra Pradesh Limited (EPDCL) in levying electricity duty at the enhanced rate, including in High Tension (HT) bills issued up to July 2023, was also challenged. The Petitioner sought to set aside the G.O. and the enhanced bills, and to direct a refund of excess duty paid.

Key Issues

1. Whether G.O.Ms.No.7, Energy (Power-III) Department, dated April 8, 2022, which exorbitantly increased the levy of electricity duty from Rs. 0.06 per unit to Rs. 1 per unit 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 during FY 2022-2023 passed by the Andhra Pradesh Electricity Regulatory Commission, as argued by the Petitioner. 2. Whether the consequential action of the 2nd Respondent in seeking to levy electricity duty at the enhanced rate is valid, as argued by the Petitioner. 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 various policies and regulatory orders. The Respondent's arguments are not explicitly recorded in the provided text, but their role as the State and the electricity distribution company indicates they would defend the validity of the G.O. and the subsequent levy.