SHREE SADUL TEXTILES LTD Vs. STATE OF RAJASTHAN

JUDGEMENT

(1.) MESSRS . Shree Sadul Textiles Ltd., (hereinafter called the Mills) have filed this writ application under Article 226 of the Constitution praying for a writ of certiorari or any other appropriate writ, order or direction to quash the order of the Deputy Commissioner Taxation (Appeals), Bikaner dated 26th March, 1969 asking the Mills to deposit the amount of duty on the electricity consumed for the street and factory lighting in the premises of the Mills at the rate of 5 paisa per unit.

(2.) THE facts giving rise to this writ application are as follows: - - The Rajasthan Electricity Board is the supplier of electricity to the Mills for manufacturing textiles in the town of Sri Ganganagar. Two separate meters were installed in the Mills by the respondents to measure the consumption of electricity viz., one for the residential and commercial purposes and the other for the power consumed in the factory. Two separate bills were prepared by the respondents for the energy consumed as recorded by the two meters and separate bills were prepared at two different rates agreed between the parties. It is said that the Mills regularly paid the amounts of the bills within time as specified in the bills. It is further averred that a sub -meter was installed to separately measure the energy consumed by the Mills for the purposes of lighting in the factory building and on the streets in the premises of the Mills. The purpose for installing a sub -meter was that in case the energy consumed for bona fide factory lighting did not exceed 10% of the total power consumed in the factory, it would be charged at the same rate fixed for the supply of power energy as per the tariff, but if the energy consumed for the purposes of lighting exceeded 10% of the total power consumed for running the machines then in that case the excess energy consumed for lighting purposes was charged under the head 'factory lighting' as given in the tariff. The case of the Mills is that the energy consumed for factory lighting included the energy utilised by the Mills in the office, in the main factory building, stores, time -keeper's office, canteen, library, dispensary, staff welfare centres and factory yard lighting and therefore, the energy consumed in all these places was considered as 'factory lighting consumption.' In the year 1962. The Rajasthan Electricity (Duty) Act, 1962 (Act No. 12 of 1962) (hereinafter called the Act) came into force. A notification under Section 3 of the said Act was issued by the Government of Rajasthan on 26th March, 1962 whereby the Electricity Duty on electric energy supply to certain consumers was exempted. This notification was, however, subsequently suspended and substituted by another notification No. 9 (2) E & T/62/II dated March 26. 1962 (Document No. 2) whereby the State Government was pleased to fix 3 N. P. per unit as the rate at which the electricity duty shall be computed. Another notification No. F. 9 (6) F. D. (E & T)/63 dated March 2, 1963 was issued by the Government superseding the first notification referred to above and modifiying the second notification dated 26th March, 1962 whereby the electricity duty chargeable from the consumers mentioned therein was notified at 1 naya paisa per unit in place of 3 naya paisa. In 1965 the Government of Rajasthan again issued a notification No. F. 16 (15) F. D. RT/64 -Pt. dated 1 -11 -65 (Document No. 4) whereby the remission in the electricity duty was allowed in the following terms: - -

(3.) THE contention of the Mills is that on a proper interpretation and construction of the terms of notification and Section 3 of the Act, the Rajasthan State Electricity Board could not have charged the electricity duty for the total energy consumed by the petitioner on the basis of the meters installed in the factory premises either for running the machinery or for lighting or for any other purposes other than residential and commercial purposes at a rate exceeding 3 naya paisa upto 26 -3 -62, and at a rate not exceeding 1 naya paisa per unit from 2 -3 -63, upto date and the bills of demand dated 7 -3 -1968 under the guise of arrears were absolutely illegal and based on calculated misreading and misinterpretation of sub -section (3) of Section 3 of the Act and the relevant portion of the notification issued by the Government of Rajasthan from time to time. The Mills having felt aggrieved by this demand lodged a protest with the Commercial Taxes Officer, Sri Ganganagar under Rule 13 of the Rajasthan State Electricity Rules, 1962 and characterised this demand as illegal and arbitrary. The Commercial Taxes Officer, Sri Ganganagar, however, rejected the petitioner's representation on the basis that he could not interfere with the order of his predecessor dated 23rd September, 1967. The petitioner then went in appeal to Deputy Commissioner Taxation (Appeals), Bikaner who accepted the appeal of the Mills and remanded the case to the Commercial Taxes Officer, Ganganagar to dispose of the representation of the Mills after hearing it. The learned Commercial Taxes Officer gave a hearing to the Mills but rejected their representation. The petitioner again preferred an appeal before the Deputy Commissioner Taxation (Appeals), Bikaner who by his order dated 26th March, 1969 rejected the appeal and held that the demand of arrears made by the State Electricity Board from the petitioner was quite in order and in consonance with the letter and spirit of the Act and the notification issued thereunder by the State Government. After the petitioner's appeal was rejected by the Deputy Commissioner Taxation (Appeals'), Bikaner, another demand notice was issued to the petitioner whereby the respondent called upon the petitioner to pay Rs. 90156.26 nP. towards the payment of electricity duty within 7 days from the receipt of the said notice. This notice also contained a threat of action under Section 24(1) of the Indian Electricity Act, 1910. It is against the judgment of the Deputy Commissioner Taxation (Appeals) Bikaner dated 26th March, 1969 upholding the demand issued on 9 -4 -69 (Document No. 13) to pay Rs. 90156.26 paise that the petitioner has filed this writ application challenging the demand raised by the respondents inter alia on the ground that in view of Section 3 of the Act and the notification issued from time to time by the State Government, the Rajasthan State .Electricity Board cannot make a demand from the Mills for the payment of the electricity duty on the energy consumed by the Mills for the purposes other than the energy consumed for commercial and residential purposes at the rate of 5 paise per unit.