INDSIL ELECTROSMELTS LIMITED Vs. STATE OF KERALA

JUDGEMENT

(1.) In this writ petition filed under Article 226 of the Constitution of India the petitioner-company has assailed the order passed by the Government of Kerala whereby it was directed to levy royalty and the cost component of controlled release of water to Kuthungal Hydro Electric Project on the water utilized by it and it has been quantified that the royalty shall be collected at the rate of 10% of the energy tariff rate of EHT consumers current from time to time for every unit of energy generated. It was further provided in the impugned order that the company was also liable to pay 1.2 paisa per unit as electricity duty for each unit of electricity generated in accordance with the provision of the Kerala Electricity Duty Act. This order dated 3.7.2004 was passed by the Government of Kerala, Department of Power and has been appended as Ext. P11 to the writ petition. The petitioner seeks issuance of a writ of certiorari for quashing the impugned order, Ext. P11. The petitioner is a company engaged in the manufacture of ferro alloys at a factory situated in Pallatheri at Palakkad. The manufacturing of ferro alloys is power intensive and electricity is virtually a raw material used in the manufacturing process.

(2.) The shortage of power in the State of Kerala, as in other States in India was affecting industrial progress. On 22nd December, 1989, the Government of Kerala through Electricity Department issued a Government Order bearing No. 35/89/PD informing the public that the State of Kerala had in principle decided that private agencies would be allowed to undertake small/mini/micro Hydel Schemes for generation of power and that the terms and conditions to which they would be so allowed to do would be laid down separately.

(3.) The State Government received representations from a few private/public undertakings seeking permission pursuant to the said declaration of policy for the setting up of small/mini/micro Hydel Schemes. Considering the representations and after consulting with the Kerala State Electricity Board, the State Government issued a further government order being G.O. (MS) No. 23/90/PD dated 7th December, 1990 (Ext. P1) laying down the terms and conditions on which permission for setting up such hydro power schemes would be granted.