Full Judgment Text
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.7319 OF 2021
The State of Maharashtra ..Appellant (S)
Versus
Shri Vile Parle Kelvani Mandal & Ors. ..Respondent (S)
J U D G M E N T
M. R. Shah, J.
1. Feeling aggrieved and dissatisfied with the impugned
judgment and order dated 28.02.2019 passed by the High
Court of Judicature at Bombay in Writ Petition No.2961 of
2018, by which the High Court has allowed the said writ
petition preferred by respondents No.1 to 10 herein
original writ petitioners (hereinafter referred to as original
Signature Not Verified
Digitally signed by R
Natarajan
Date: 2022.01.07
17:49:50 IST
Reason:
writ petitioners – education institutions) and held that the
original writ petitioners are exempted from payment of
1
electricity duty, the State of Maharashtra has preferred the
present appeal.
2. That the original writ petitioners are the education
institutions run and manage by original writ petitioner
No.1 – Shri Vile Parle Kelvani Mandal, a society registered
under the Societies Registration Act, 1860 and also a
public charitable trust registered under the Maharashtra
Public Trusts Act, 1950. That the writ petitioners have
taken electricity connections for power supply to their
education institutions from respective power supply
companies. That prior to 01.09.2016, the charitable
education institutions were exempted from payment of
electricity duty levied on the consumption charges or the
energy consumption for the purposes of or in respect of a
school or college or institution imparting education or
training, students' hostels, hospitals, nursing homes etc.
as per Section 3(2)(iii) of the Maharashtra Electricity Duty
Act, 1958. That in the year 2018, the respective electricity
supply companies levied the electricity duty pursuant to a
letter from the Industries, Energy and Labour Department,
2
Government of Maharashtra stating that as per
Maharashtra Electricity Act, 2016, charitable institutions
registered under the Bombay Public Trusts Act, 1950 (now
known as Maharashtra Public Trusts Act, 1950) for the
purpose of or in respect of school or college imparting
education or training in academic or technical subjects are
not entitled for electricity duty exemption with effect from
1st September, 2016. The respective power supply
companies levied electricity duty at 21% and the bills were
raised accordingly on original writ petitioners and their
education institutions for the period post 01.09.2016.
Aggrieved by the levy of electricity duty on the educational
charitable institutions run by the original writ petitioner
No.1 – respondent No.1 herein, original writ petitioners
preferred the writ petition before the High Court. By the
impugned judgment and order, the Division Bench of the
High Court has allowed the said writ petition and has set
aside the levy of electricity duty on writ petitioners and
consequently has set aside respective electricity bills
levying the electricity duty on consumption of electricity
charge.
3
3. Feeling aggrieved and dissatisfied with the impugned
judgment and order passed by the High Court, the State of
Maharashtra has preferred the present appeal.
4. Shri Sachin Patil, learned counsel appearing on behalf of
the State has vehemently submitted that in the facts and
circumstances of the case, the High Court has committed a
grave error in holding that the original writ petitioners –
charitable education institutions are not liable to pay the
electricity duty.
4.1 It is further submitted that in absence of challenge to the
relevant provisions of the Maharashtra Electricity Act,
2016, the High Court ought not to have allowed the writ
petition and ought not to have set aside the levy of
electricity duty levied from charitable education
institutions like the original writ petitioners.
4.2 It is further submitted by Shri Sachin Patil, learned
counsel appearing on behalf of the State that the High
Court has not properly appreciated and considered the
4
relevant provisions pre and post the Maharashtra
Electricity Act, 2016.
4.3 It is submitted that as per Section 3(2)(a)(iiia) of the
Maharashtra Electricity Duty Act, 1958, the charitable
intuitions registered under the Bombay Public Trusts Act,
for the purpose of, or in respect of, school or college,
imparting education or training in academic or technical
subjects (save in respect of premises used for residential
purposes) were exempted from levy of the electricity duty
on the consumption charges or the units of energy
consumed. It is submitted that however, on enactment of
the Maharashtra Electricity Duty Act, 2016 which repealed
the earlier the Maharashtra Electricity Duty Act, 1958, no
such exemption from levy/payment of electricity duty has
been provided to such charitable education institutions.
4.4 It is submitted that the High Court has failed to consider
there is no provision, similar to the Repealed Act of 1958
(the Maharashtra Electricity Duty Act, 1958) in the new
Act, 2016 (Maharashtra Electricity Duty Act, 2016), and
the charitable education institutions whether registered
5
before or after coming into the new Act of 2016, are not
entitled to the exemption from payment of electricity duty.
4.5 It is further submitted that the High Court has not
properly appreciated or considered that by virtue of the
statutory provisions under the Repealed Act of 1958, the
charitable education institutions were enjoying concession
from payment electricity consumption duty/ electricity
consumption charges and therefore there was no need to
issue a specific order in their favour under the Repealed
Act of 1958. It is submitted that therefore, if any order had
been issued by the department in favour of any institution,
it is neither an order as contemplated under Repealed Act,
1958 nor it is saved from proviso of Section 4 of the
Maharashtra Electricity Duty Act, 2016. It is submitted
that therefore, after commencement of the new Act of 2016,
such order does not confer right upon the charitable
education institutions to claim exemption.
4.6 It is further submitted that as such the language used in
the new Act of 2016 with respect to the exemption/levy of
electricity duty is very clear and unambiguous. It is
6
submitted that the words used are plain and simple and
therefore the same should be read with the intention of the
legislature particularly in favour of revenue. It is submitted
that as per the law laid down by this Court in catena of
decisions a taxing statute is to be construed in favour of
assesse but an exception or an exemption provision from a
taxing statute has to be construed strictly. It is submitted
that even if there is any ambiguity in that regard the issue
must be answered in favour of revenue.
4.7 In support of the above submissions, learned counsel
appearing on behalf of the State has relied on the following
decisions of this Court:
Commr. of Customs Vs. Dilip
Kumar & Co., (2018) 9 SCC 1; Central Public
Information Officer, Supreme Court of India Vs.
(2020) 5 SCC 481;
Subhash Chandra Agarwal, Essar
Steel India Ltd. & Anr. Vs. State of Gujarat & Anr.,
(2017) 8 SCC 357; Star Industries Vs. Commr. of
Customs (Imports), (2016) 2 SCC 362; Giridhar G.
Yadalam Vs. Commissioner of Wealth Tax & Another,
7
(2015) 17 SCC 664; Godrej & Boyce Mfg. Co. Ltd. Vs.
Deputy Commissioner of Income Tax & Anr., (2017) 7
SCC 421.
5. Making the above submissions and relying on the aforesaid
decisions of this Court, it is prayed to allow the present
appeal and quash and set aside the impugned judgment
and order passed by the High Court.
6. The present appeal is vehemently opposed by Shri Shekhar
Naphade, learned Senior Advocate, appearing on behalf of
the original writ petitioners – respondents No.1 to 10
herein.
6.1 It is vehemently submitted by Shri Shekhar Naphade,
learned Senior Advocate appearing on behalf of the original
writ petitioners that in the facts and circumstances of the
case and considering the fact that the original writ
petitioners are charitable education institutions, the High
Court has rightly held that they are exempted from
payment of electricity duty.
8
6.2 It is submitted by Shri Naphade, learned Senior Advocate
appearing on behalf of the original writ petitioners that as
observed by this Court in the case of
C.W.S. (India) Ltd.
Vs. Commissioner of Income Tax, 1994 Supp (2) SCC
296 (para 10), where a literal interpretation leads to absurd
result, the wording of the statute can be modified to accord
with the intention of the legislature and to avoid absurdity.
6.3 It is submitted that if the interpretation canvassed by the
state is accepted then it will lead to absurdity and manifest
injustice as school/colleges etc. run by the local authority
will fall within the purview of Section 3(2)(iii) of 2016 Act,
while those run by the statutory university or charitable
institution registered under Bombay Trusts Act, 1950 (now
known as Maharashtra Public Trusts Act, 1950), would fall
outside the ambit of Section 3(2)(iii). It is submitted that as
such there is no essential difference between
schools/colleges etc. run by the statutory university or
institution registered under the Maharashtra Public Trusts
Act, 1950 and those run by the local authority. It is
9
submitted that such absurdity or injustice cannot be the
intention of the legislature.
6.4 It is further submitted by Shri Naphade, learned Senior
Advocate appearing on behalf of the original writ
petitioners that there is always a presumption that the
legislature does not intend to violate Article 14 of the
Constitution of India. It is submitted that as per the case
on behalf of the State, Section 3(2)(iii) of 2016 Act covers
only schools/colleges etc. of the local authority and those
run by the statutory university or by private institutions
are outside the scope of Section 3(2)(iii) of 2016 Act. It is
submitted that this would lead to discrimination and
arbitrariness. It is submitted that who runs the
educational institution cannot be the intelligible differentia
for the purpose of classification. It is submitted that if such
an interpretation is accepted then Section 3(2)(iii) would be
ultra vires Article 14 of the Constitution. It is submitted
that while interpreting Section 3(2)(iii) of 2016 Act, Article
14 must be considered and interpretation which would
accord with the mandate of Article 14 should be adopted.
10
Reliance is placed on the decision of this Court in the case
of , (1999) 9 SCC
B.R. Enterprises Vs. State of U.P. & Ors.
700 (para 81).
6.5 It is further submitted that even otherwise there is
presumption that legislature does not make radical
changes in existing law. Reliance is placed on the decision
of this Court in the case of Byram Pestonji Gariwala Vs.
Union Bank of India & Ors., (1992) 1 SCC 31 (para 29
38).
It is submitted that it is not in dispute that Section 3(2)
(iii a) of 1958 Act clearly provided that the electricity duty
shall not be imposed on schools/colleges etc. run by
charitable institutions registered under the Maharashtra
Public Trusts Act, 1950. It is submitted that there is no
dispute that the schools/colleges etc. of the writ petitioners
fall within the purview the purview of Section 3(2)(iii a) of
1958 Act. It is submitted that therefore there is nothing in
2016 Act which warrants a conclusion that there is a
radical change in law leading to duty being imposed on the
11
educational institutions being run by the original writ
petitioner.
6.6 Pointing out the following aspects, it is submitted by Shri
Naphade learned Senior Advocate appearing on behalf of
the original writ petitioners, that as such there are no
radical changes between the Maharashtra Electricity Duty
Act, 1958 (1958 Act) and the Maharashtra Electricity Duty
Act, 2016 (2016 Act). It is submitted that under Section
3(2) of 1958 Act, no duty could be imposed on the following
entities:
(a) Government of Maharashtra [Section 3(2)(i)]
(b) Local authorities carrying on specified activities
[Section 3(2)(ia)]
(c) Licensee carrying on specified activities [Section
3(2)(ib)]
(d) Tramway company [Section 3(2)(ii)]
(e) Entity generating electricity for the purpose of
supplying it for the use of vehicles and vessels.
[Section 3(2)(iv)]
12
Note under 1958 Act no duty could be imposed on
the Central Government due to the provisions of
Article 285 of the Constitution.
6.6.1 It is further submitted that under Section 3(2) of 2016 Act
no duty can be imposed on the following entities:
(a) State Government [Section 3(2)(i)]
(b) Central Government [Section 3(2) (ii)]
This is by way abundant caution as no duty can be
imposed on the Central Government due to Article
285 of the Constitution.
(c) Licensee carrying on specified activities. [Section 3(2)
(v)]
(d) Generating Company [Section 3(2)(vi)]
(e) Entity generating electricity for use of vehicles and
vessels [Section 3(2)(vii)]
Note – At present there is Tramway company in the
State of Maharashtra. Thus there is no change in
2016 Act as regards the entities who are not subject
to imposition of duty.
13
6.6.2 Further, under Section 3(2) of the 1958 Act no duty could
be imposed on following activities:
(a) Educational institutions run by local authority or
statutory university, or charitable institution registered
under Bombay Trusts Act, 1950. [Section 3(2)(ia), 3(2)
(iii) and 3(2)(iiia)]
(b) Local authority using electricity for hospital, nursing
home, dispensary, clinic, public street lighting, public
water works, system of public sewers or drains.
[Section 3(2)(ia)]
(c) Use of electricity by licensee for the purpose of
construction, maintenance, or operation of any
generating, transmitting and distributing system.
[Section 3(2)(ib)]
(d) Generation of electricity for the purpose of supplying it
for the use of vehicles or vessels. [Section 3(2)(iv)]
(e) Where the energy is generated at a voltage not
exceeding 100 volts. [Section 3(2)(v)]
6.7 It is submitted that both under the 1958 Act and 2016 Act,
the premises used by entities specified under Section 3(2)
14
for the purpose of residence are subject to imposition of
duty.
6.8 It is submitted that aforesaid analysis clearly shows that
the entities on whom no duty can be imposed have
remained the same subject to the rider that if the premises
are used for residence, duty can be imposed.
6.9 It is submitted that the only question is whether
educational activities carried on by local authorities,
statutory university or a charitable institution registered
under the Bombay Trusts Act, 1950 are within the purview
of Section 3(2) of the 2016 Act?
6.10 It is submitted that it is not in dispute that under the 1958
Act, the educational institutions carried out by local
authorities, statutory university, or the charitable
institutions were not subject to imposition of duty. The
other activities which are not subject to imposition of
electricity duty, both under the 1958 Act and 2016 Act are
as follows:
15
(a) Specified activities by local authorities [See Section
3(2)(ia) of 1958 Act Section 3(2)(iii) of 2016 Act.
(b) Generation of electricity for construction, maintenance
and operation of any generating, transmitting and
distrusting system by licensee. [See Section 3(2)(ib) of
1958 Act and Section 3(2)(v) of 2016 Act.
(c) Generation of electricity for the purpose of supplying
for the use of vehicles or vessels [See Section 3(2)(iv) of
1958 Act and Section 3(2) (vii) of 2016 Act.
(d) Generation of electricity at a voltage not exceeding 100
volts [See Section 3(2)(v) of the 1958 Act and Section
3(2)(viii) of 2016 Act.
6.11 It is submitted that thus entities who are not subject to
imposition of duty have remained the same, both under
1958 Act and 2016 Act and that other activities
enumerated herein above have remained same, both under
1958 Act and 2016 Act. It is submitted that therefore, it is
difficult to accept that in respect of educational activities a
radical change is brought about by 2016 Act by excluding
educational institutions run by statutory university or by
16
charitable institutions. It is submitted that either it is a
case of Casus Omissus or a case of bad drafting of 2016
Act.
6.12 It is submitted that 1958 Act clearly indicates that it was
the policy of the legislature to exclude the educational
activities run by specified entities from imposition of duty.
There is nothing in the 2016 Act which would indicate that
there is a radical departure in respect of educational
activities. Some of the activities which are not subject to
imposition of duty both under the 1958 Act and 2016 Act
are commercial in nature. It is submitted that therefore if
that be so then why the legislature would depart from its
earlier policy in respect of educational activities as
promotion of education is in public interest. It is submitted
that if the commercial activities are not subject to
imposition of duty then it would be unreasonable on the
part of the legislature to impose duty on noncommercial
activity of imparting education. It is submitted that policy
of the legislature is presumed to be reasonable so that it
17
does not fall foul principle of unreasonableness or
arbitrariness.
6.13 Lastly, it is submitted by Shri Naphade learned Senior
Advocate appearing on behalf of the writ petitioners, that in
the present case the doctrine of last antecedent may also
be applied. It is submitted that first part of Section 3(2)
covers all educational activities irrespective of the entity
which carries on such activities. It is submitted that in the
1958 Act in Section 3(2), the following words used are “for
the purposes of or in respect of school ……. Students
hostel” and in the second part of Section 3(2) deals with
activities carried on by the local authorities. It is submitted
that in the 2016 Act, the expression “Run by any local
bodies……State of Maharashtra” does not qualify the
educational activities but it qualifies activities namely
“Hospitals, nursing homes…….a part of system”. It is
submitted that if the doctrine of Last Antecedent is applied
to the present case, the only possible conclusion is that the
expression “Run by any local bodies” does not qualify
educational activities referred to in first part of Section 3(2)
but qualifies the second part i.e. the other activities.
18
6.14 It is further submitted that Electricity Duty Act is a taxing
statute. Therefore, it must be strictly construed and if there
is any ambiguity the same must be resolved in favour of
the assessee. The legislature is covering all educational
activities in one provision contained in Section 3(2)(iii)
irrespective of the entity which carries on the activities.
While doing so the ambiguity has crept in drafting. It is
submitted that the benefit of ambiguity must lean in favour
of the assessee rather than the revenue.
6.15 Making the above submissions and relying on the decisions
of this Court, it is prayed to dismiss the present appeal.
7. We have heard the learned counsel appearing on behalf of
the respective parties at length.
8. The short question which is posed for the consideration of
this Court is whether the original writ petitioners being
charitable education institutions registered under the
provisions of the Public Trusts Act (the Maharashtra Public
Trusts Act, 1950) are entitled to the exemption from
19
payment of electricity duty post 01.09.2016 i.e. as per the
provisions of the Maharashtra Electricity Duty Act, 2016?
9. While answering the aforesaid question/issue, law on how
to interpret and/or consider the statutory provisions in the
taxing statute and the exemption notifications is required
to be analysed first.
9.1 In the case of Dilip Kumar & Company (supra), fivejudge
bench of this Court has held that in every taxing statute ––
the charging, the computation and exemption provisions at
the threshold stage should be interpreted strictly. In case
of ambiguity in case of charging provision, the benefit
necessarily must go into favour of the subject/assessee.
This means that the subject of tax, the person liable to pay
tax and the rate at which the tax is to be levied have to be
interpreted and construed strictly. If there is any ambiguity
in any of these three components, no tax can be levied till
the ambiguity or defect was removed by the legislature [See
pages 53 to 55 in Dilip Kumar & Company ]. However, in
case of exemption notification or clause, same is to be
allowed based wholly by the language of the notification,
20
and exemption cannot be gathered by necessary
implication, or on a construction different from the words
used by reference to the object and purpose of granting
exemption [See Hansraj Gordhandas Vs. H.H. Dave,
Assistant Collector of Central Excise Customs, Surat &
Ors., AIR 1970 SC 755 ]. Further it’s for the assessee to
show by construction of the exemption clause/notification
that it comes within the purview of exemption. The
assessee/citizen cannot rely on ambiguity or doubt to
claim benefit of exemption. The rationale is not to widen
the ambit at the stage of applicability. However, once the
hurdle is crossed, the notification is constructed liberally
[See Collector of Central Excise, BombayI & Anr. vs.
and
Parle Exports (P) Ltd., (1989) 1 SCC 345 Union of
India & Ors. vs. Wood Papers Ltd. & Anr., (1998) 4 SCC
256 ] . Thus, distinction can be made between the
substantive requirements that require strict compliance –
noncompliance of which would render the assessee
ineligible to claim exemption, and the procedural or
21
compliance provision which can be interpreted liberally
[See paragraphs 64 to 65 in ].
Dilip Kumar & Company
9.2 Essar Steel India Ltd. & Anr. was a case relating to grant
of exemption under Section 3(2)(vii)(a) from payment of
electricity duty under the 1958 Act. The court relied on
several decisions on interpretation of notification in nature
of exemption, to hold that the statutory conditions for
grant of exemption can neither be tinkered with nor
diluted. The exemption notification must be interpreted by
their own wordings, and where the wordings of notification
with regard the construction is clear, it has to be given
effect to. If on the wordings of the notification benefit is not
available, then the court would not grant benefit by
stretching the words of the notification or by adding words
to the notification. To interpret the exemption notification
one should go by the clear, unambiguous wordings thereof.
These principles were applied in Essar Steel India Ltd. &
Anr. to deny benefit of Section 3(2)(vii)(a) of the 1958 Act,
as the condition of generating energy jointly with another
undertaking was not fulfilled.
22
9.3 In case of Star Industries , it was held that the eligibility
criteria laid down for exemption notification is required to
be construed strictly, and once it is found that applicant
satisfies the same, the exemption notification should be
construed liberally. Reference was made to the decision
Novopan India Ltd. vs. CCE and Customs, 1994 Supp
(3) SCC 606 and the Constitution Bench decision in
Hansraj Gordhandas vs. H.H. Dave, Assistant Collector
(supra), which
of Central Excise Customs, Surat & Ors.
decisions have been noted and elucidated by this Court in
Dilip Kumar & Company . Therefore, in the context of
exemption notification there is no new room for
intendment. Regard must be to the clear meaning of the
words. Claim to exemption is governed wholly by the
language of the notification, which means by plain terms of
the exemption clause. An assessee cannot claim benefit of
exemption, on the principle that in case of ambiguity a
taxing statue must be construed in his favour, for an
exception or exemption provision must be construed
strictly.
23
9.4 In the case of (supra), it is observed
Giridhar G. Yadalam
and held that in taxing statute, it is the plain language of
the provision that has to be preferred where language is
plain and is capable of one definite meaning. It is further
observed that the strict interpretation to the exemption
provision is to be accorded. It is observed that the
purposive interpretation can be given only when there is
some ambiguity in the language of the statutory provision
or it leads to absurd results. In paragraph 16, it is
observed and held as under:
“16. We have already pointed out that on the
plain language of the provision in question, the
benefit of the said clause would be applicable
only in respect of the building “which has been
constructed”. The expression “has been
constructed” obviously cannot include within its
sweep a building which is not fully constructed
or in the process of construction. The opening
words of clause ( ii ) also become important in this
behalf, where it is stated that “the land occupied
by any building”. The land cannot be treated to
be occupied by a building where it is still under
construction. If the contention of Mr Jain is
accepted, an assessee would become entitled to
the benefit of the said clause, at that very
moment, the commencement of construction
even with construction the moment one brick is
laid. It would be too farfetched, in such a
situation, to say that the land stands occupied
by a building that has been constructed thereon.
24
Even Mr Jain was candid in accepting that when
the construction of building is still going on and
is not completed, literally speaking, it cannot be
said that the building “has been constructed”. It
is for this reason that he wanted us to give the
benefit of this provision even in such cases by
reading the expression to mean the same as “is
being constructed”. His submission was that the
moment construction starts the urban land is
put to “productive use” and that entitles the land
from exemption of wealth tax. This argument of
giving socalled purposive interpretation has to
be rejected for more than one reasons. These are:
( i ) In taxing statute, it is the plain language of the
provision that has to be preferred where
language is plain and is capable of one definite
meaning.
( ii ) Strict interpretation to the exemption
provision is to be accorded, which is the case at
hand.
( iii ) The purposive interpretation can be given
only when there is some ambiguity in the
language of the statutory provision or it leads to
absurd results. We do not find it to be so in the
present case.”
9.5 In the case of Godrej & Boyce Mfg. Co. Ltd. (supra), it is
observed and held by this Court that where the words of
the statute are clear and unambiguous, recourse cannot be
had to principles of interpretation other than the literal
view. It is further observed that it is the bounden duty and
obligation of the court to interpret the statute as it is. It is
25
further observed that it is contrary to all rules of
construction to read words into a statute which the
legislature in its wisdom has deliberately not incorporated.
10. Applying the law laid down by this Court in the aforesaid
decisions to the facts of the case on hand, it is required to
be considered whether post 01.09.2016 and on coming into
force the 2016 Act, still, the writ petitioners – charitable
education institutions registered under the Public Trusts
Act and or the Societies Registration Act are entitled to the
exemption from payment of electricity duty?
11. For the aforesaid purpose, the charging
sections/exemption provisions under the pre Act of 2016
and post Act of 2016 are required to be referred to. Section
3 of the Maharashtra Electricity Duty Act, 1958, which was
applicable prior to coming into force of the Maharashtra
Electricity Duty Act, 2016, relevant for our purpose reads
as under:
“ 3 . (1) Subject to the provisions of subsection
(2), there shall be levied and paid to the State
Government on the 1[consumption charges or
the] units of energy consumed (excluding losses
of energy sustained in transmission and
26
transformation by a licensee before supply to a
consumer), a duty (hereinafter referred to as"
electricity duty") at the rates specified in the
Schedule to this Act.
(2) (a) Electricity duty shall not be leviable on the
3[consumption charges or the] units of energy
consumed,—
(i) by the Government of Maharashtra (save in
respect of premises used for residential
purposes);
(ia) by or in a respect of any municipal
corporation, municipality, municipal committee,
town committee, notified area committee,
Cantonment Board, Zilla Parishad or village
panchyat constituted under any law for the time
being in force in the State, for the purpose of, or
5
in respect of [ a school or college imparting
education or training in academic or technical
subjects, a hospital, nursing home, dispensary,
clinic, public street lighting, public water works
and system of public sewers or drains (save in
respect of premises used for residential
purposes);
(ib) by any licensee for purposes directly
connected with construction, maintenance or
operation of any generating, transmitting and
distributing system of the licensee;
(ii) by a tramway company, save in respect of
premises used for residential and office
purposes;
(iii) by or in respect of any statutory University
and institutions run by the statutory University
for the purpose of or in respect of education,
research and training (save in respect of
premises used for residential purposes);
27
(iiia) by or in respect of charitable institution
registered under the Bombay Public Trusts Act,
1950, for the purpose of, or in respect of, school
or college imparting education or training in
academic or technical subjects (save in respect of
premises used for residential purposes);”
That thereafter the Maharashtra Electricity Duty Act, 2016
has been enacted, which has come into effect from
08.08.2016. Section 3 of the 2016 Act, relevant for our
purpose reads as under:
“3. (1) Subject to the provisions of subsection
(2), there shall be levied and paid to the State
Government, on the consumption charges or the
units of energy consumed, a duty (hereinafter
referred to as “Electricity Duty”) at the rates
classified as per the Tariff Schedule of the
Commission, from time to time, on the basis of
use of the premises by the consumer on whose
name energy is supplied by the licensee, or a
consumer who is consuming energy produced
from an independent source other than that
supplied by the licensee, for his own use as
specified in the Schedules, which are based on
the following classifications :––
(a) the consumption charges where energy is
supplied by the licensee;
Explanation.–– For the purpose of this sub
section, “use of the premises by the consumer
on whose name energy is supplied” means the
basis of purpose for which the consumer in
whose name supply has been released and
measured by the meter installed at point of
supply by the licensee, on which the
consumption charges are billed as per the
28
tariff, however, in huge industrial parks,
commercial premises or malls where electricity
is supplied at single point or as bulk
consumers and further it is redistributed as
one of the utility service provided by the owner
of the premises to the end users occupying the
area on lease or rent or otherwise, whose
purpose of use of electricity at the user’s end
may vary categorically;
(b) units of energy consumed by a person and
energy produced through the–
(i) Captive generation;
(ii) Cogeneration;
(iii) Standby generation;
(iv) Renewable Energy; or
(v) Independent Power Producer (IPP);
(c) units of energy consumed which are not
covered under clauses (a) and (b), that is, open
access or other sources.
(2) Electricity duty shall not be levied on the
consumption charges or energy consumed,––
(i) by the State Government excluding the
public undertakings;
(ii) by the Central Government excluding the
public undertakings;
(iii) for the purposes of, or in respect of a
school or college or institution imparting
education or training, student’s, hostels,
hospitals, nursing homes, dispensaries, clinics,
public streets lighting, public water works,
sewerage systems, public gardens including
zoos, public museums, administrative offices
forming whole or, as the case may be, a part of
system run by any local bodies constituted
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under any law for the time being in force in the
State of Maharashtra;
(iv) by the Government hostels;
(v) by any licensee, or by any other person
engaged in the business of supplying electricity
to the public under the Electricity Act, for the
purposes directly connected with construction,
maintenance, operation of any transmitting
and distributing system, including the losses
incurred therein;”
11.1 As per Section 16 of the 2016 Act, on coming into force the
2016 Act, the Maharashtra Electricity Duty Act, 1958 stood
repealed subject to the eventualities mentioned in Section
16 of the 2016 Act. None of the eventuality mentioned in
proviso to Section 16 shall be attracted and/or applicable
to the facts of the case on hand in view of the specific
provisions providing for exemption from payment of the
electricity duty as per subsection (2) of Section 3 of the
2016 Act. Therefore, for the purpose of exemption from
payment of electricity duty on and after 01.09.2016, sub
section (2) of Section 3 of the 2016 Act shall have to be
applied and shall be applicable.
11.2 As per subsection (2) of Section 3 of the 1958 Act, the
electricity duty was not leviable on the consumption
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charges or the units of energy consumed…………..by or in
respect of charitable institution registered under the
Bombay Public Trusts Act, 1950, for the purpose of, or in
respect of, school or college imparting education or training
in academic or technical subjects (save in respect of
premises used for residential purposes) [Section 3(2)(iiia)].
Therefore, under the 1958 Act, the electricity duty was not
leviable on the consumption charges or the units of energy
consumed by or in respect of charitable institutions for the
purpose; in respect of school or college imparting education
or training in academic or technical subjects. Even as per
Section 3(2)(ia), electricity duty shall not be leviable on the
consumption charges or the units of energy consumed by
or in a respect of any municipal corporation, municipality,
municipal committee, town committee, notified area
committee, Cantonment Board, Zilla Parishad or village
panchyat constituted under any law for the time being in
force in the State, for the purpose of, or in respect of a
school or college imparting education or training in
academic or technical subjects, a hospital, nursing home,
dispensary, clinic, public street lighting, public water
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works and system of public sewers or drains (save in
respect of premises used for residential purposes.
11.3 However, there are material changes under the 2016 Act.
As per Section 3(2) of the 2016 Act, even the public
undertakings are liable to pay the electricity duty. As per
Section 3(2)(iii), electricity duty is not leviable on the
consumption charges or energy consumed, for the
purposes of, or in respect of a school or college or
institution imparting education or training, student’s,
hostels, hospitals, nursing homes, dispensaries, clinics,
public streets lighting, public water works, sewerage
systems, public gardens including zoos, public museums,
administrative offices forming whole or, as the case may
be, a part of system run by any local bodies constituted
under any law for the time being in force in the State of
Maharashtra. Therefore, Section 3(2)(iiia), which was there
in 1958 Act, is now conspicuously and deliberately absent
in Section 3(2) of the 2016 Act.
11.4 On true interpretation of Section 3(2)(iii), under 2016 Act,
electricity duty on the consumption of charges or energy
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consumed for the purposes of, or in respect of a school or
college or institution imparting education or training,
student’s, hostels………….run by any local bodies shall
alone be exempted from levy of electricity duty and the
State Government and Central Government are also
specifically excluded from payment of electricity duty.
However, the public sector undertakings are not exempted
from payment of electricity Act. Therefore, under Section
3(2) of the 2016 Act, the charitable institutions running the
educational institutions are not exempted from payment of
electricity duty, which as such was specifically exempted
under Section 3(2)(iiia) of the 1958 Act. The language and
words used in Section 3(2) are plain and simple and are
capable of only one definite meaning that there is no
exemption provided under the 2016 Act from levy of
electricity duty so far as the charitable education
institutions are concerned. As observed herein above,
where the words are clear and unambiguous, recourse
cannot be had to principles of interpretation other than the
literal view. As observed hereinabove, the exemption
provision need to be interpreted literally and when the
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language used in exemption provision is simple, clear and
unambiguous, the same has to be applied rigorously,
strictly and literally. Under the 2016 Act, charitable
education institutions running the schools or colleges are
specifically excluded from the exemption clause/exemption
provision – Section 3(2).
12. If the submissions on behalf of the original writ petitioners
is accepted that as per Section 3(2)(iii), with respect to all
the schools/colleges or institutions, imparting education or
training, the electricity duty is not leviable, in that case it
would lead to absurd result. In that case, even the private
hospitals, nursing homes, dispensaries and clinics, who
are profit making entities shall also claim the exemption
from levy of electricity duty. The intention of the legislature
as per Section 3(2) of the 2016 Act, is very clear and
unambiguous that the electricity duty shall not be leviable
on the consumption charges or energy consumed (i) by the
State Government excluding the public sector
undertakings; (ii) by the Central Government excluding
public sector undertakings and (iii) ……. run by the local
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bodies constituted under any law for the time being in
force in the State of Maharashtra. Other than the State
Government, Central Government and the local bodies and
the Government hostels, no exemption from payment of
electricity duty has been provided.
13. In view of the above findings recorded hereinabove, there is
no question of applying the doctrine of Last Antecedents as
canvassed by Shri Naphade, learned Senior Advocate,
appearing on behalf of the original writ petitioners.
14. In that view of the above the original writ petitioners –
charitable education institutions registered under the
provisions of the Societies Registration Act and/or under
the Maharashtra Public Trusts Act, are not entitled to any
exemption from levy/payment of the electricity duty on or
after 08.08.2016 i.e. from the date on which the
Maharashtra Electricity Duty Act, 2016 came into effect.
Therefore, the High Court has committed a grave error in
setting aside the levy of electricity duty levied on the
original writ petitioners – respondents No.1 to 10 herein.
The impugned judgment and order passed by the High
35
Court is unsustainable both, on law and on facts and the
same deserves to be dismissed.
15. In view of the above and for the reasons stated above, the
present Appeal Succeeds. The impugned judgment and
order dated 28.02.2019 passed by the High Court in W.P.
No.2961 of 2018, is hereby quashed and set aside and it is
held that the original writ petitioners – respondents No.1 to
10 herein – charitable education institutions registered
under the Societies Registration Act and the Maharashtra
Public Trusts Act, are not exempt from levy/payment of
electricity duty levied on the consumption charges or the
energy consumed even with respect to the properties used
by such charitable education institutions for the purpose of
or in respect of the school/college imparting education or
training in academic or technical subjects. The present
Appeal is accordingly allowed. There shall be no order as to
costs.
…………………………………J.
(M. R. SHAH)
…………………………………J.
(SANJIV KHANNA)
New Delhi,
January 07, 2022.
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