The Tripura State Electricity Corporation Limited vs. The State Of Tripura

Held

The Court held that the writ petition could be entertained despite the availability of an alternative remedy, as the issues raised involved questions of law, including the jurisdiction of the State legislature to levy duty on inter-State and inter-country sales, and the vires of legislation. The Court found that the assessment order dated 30.11.2020 suffered from illegality and lack of jurisdiction concerning the levy of electricity duty on inter-State sale and sale or export of electricity outside India. This levy was beyond the jurisdiction of the State legislature, as previously held in the case of ONGC Tripura Power Company. Consequently, the assessment order to this extent was set aside. The matter was remanded to the assessing authority to pass a fresh assessment order in accordance with the law. The Court noted that the petitioner had confined its prayer to the issue of levy of electricity duty on inter-State and inter-country sales. Therefore, other issues, including the vires of Section 4(1), (2)(a), 4(3), and 4(a), (b) & (d), were left open to be raised at an appropriate stage. The petitioner was granted liberty to raise other issues on facts and law before the assessing authority. The Assessing Officer was directed to pass a fresh assessment order within twelve weeks from the receipt of the order.

Facts

The petitioner, Tripura State Electricity Corporation Limited (TSECL), a Government of Tripura enterprise, was subjected to an assessment proceeding under the Tripura Electricity Duty Act, 2019, for the financial year 2019-20. The assessment was initiated due to TSECL's failure to submit its annual return in Form TED-06, despite several notices. The Superintendent of Electricity Duty, Charge-I, Agartala, proceeded to assess TSECL's liability based on data provided by TSECL itself, as the annual return was not filed. The assessment calculated electricity duty on inter-State sale (including Bangladesh), intra-State sale to domestic consumers, and intra-State sale to other consumers. The total electricity duty due, including interest and penalty, was calculated at Rs. 94.73 crore, against which Rs. 4.891 crore was deposited, leaving a balance of Rs. 80.279 crore plus interest and a small penalty. The assessment order dated 30.11.2020 is under challenge.

Key Issues

1. Whether the assessment order dated 30.11.2020, which computed electricity duty from the beginning of the financial year (01.04.2019) instead of from the effective date of the Act (01.10.2019), is proper in law? 2. Whether the State Legislature has the competence to levy duty on inter-State sale and export of electricity outside India, given the constitutional bar on taxing inter-State trade and sales? 3. Whether the levy of intra-State cess duty was done mechanically, ignoring consumer categories and exemptions granted by notifications? 4. Whether interest was charged at 18% per annum for the full year instead of 1.5% per month on the unpaid duty, contrary to Section 10 of the Act? 5. Whether electricity duty was illegally imposed on fixed charges in addition to electrical energy consumed? 6. Whether the petitioner's prayer to declare Sections 4(1), (2)(a), 4(3), and 4(a), (b) & (d) of the Act of 2019 as ultra vires the Constitution should be considered. Petitioner's arguments: The Act came into effect from 01.10.2019, but the assessment computed duty from 01.04.2019. Electricity duty was imposed on inter-State sales and exports, which is beyond the State's competence, citing ONGC Tripura Power Company Ltd. v. State of Tripura. Intra-State duty was levied mechanically, ignoring exemptions. Interest was charged incorrectly. Duty was imposed on fixed charges. The annual return was submitted on 31.03.2021, but the assessment order was passed earlier. COVID-19 and TERC orders caused delays. The assessment order has glaring defects, and reassessment was prayed for. The petitioner also sought to challenge the vires of certain sections. Respondent's arguments: Not recorded in the provided text.