Exemption notification remains valid unless expressly cancelled or withdrawn by a subsequent like notification.

The respondent, M/s. ACB India Ltd., operates a captive power plant in Chhattisgarh.

Under a Notification dated 12.08.2016 issued pursuant to Section 3-B of the Chhattisgarh Electricity Duty Act, 1949, the respondent was granted an electricity duty exemption/concession for a period of 12 years (until 2028).

However, the State issued a subsequent Notification dated 11.10.2022, revising and increasing the electricity duty rates.

Based on this 2022 Notification, the State issued a demand notice for arrears and differential duty for the period of 2017–2023.

The respondent challenged this demand via writ petition.

The learned Single Judge allowed the petition on 09.12.2025, setting aside the demand because the original exemption notification of 2016 had not been formally cancelled or withdrawn.

The State preferred this writ appeal against the Single Judge’s order.

Whether the State Government can effectively withdraw or modify a specific tax exemption granted by a prior notification without issuing an express notification of cancellation or withdrawal as required under Section 3-B of the Act of 1949.

Whether the amendment to the Schedule of rates via the 2022 Notification automatically supersedes a specific 12-year exemption granted to a class of producers under the 2016 Notification.

Section 3-B of the Chhattisgarh Electricity Duty Act, 1949 empowers the State to exempt persons from duty in the public interest.

Section 3-B(b) of the Chhattisgarh Electricity Duty Act, 1949 mandates that any cancellation of such exemption must be done by a "like notification".

Section 3-C of the Chhattisgarh Electricity Duty Act, 1949.

Section 21 of the General Clauses Act, 1897 stipulates that the power to issue a notification includes the power to rescind or vary it in a similar manner.

The court noted precedents including Yamuna Expressway Industrial Development Authority v. Shakuntla Education and Welfare Society.

The court noted precedents regarding judicial deference to fiscal policy, such as Subhash Photographics v. Union of India.

The Court analyzed the distinction between the State’s power to amend the general schedule of tax rates (Section 3-C) and its power to grant or withdraw specific exemptions (Section 3-B).

While the State argued that the 2022 Notification superseded the 2016 Notification due to fiscal necessity and loss of revenue, the Court observed that the 2016 exemption was specifically granted for a 12-year tenure ending in 2028.

The Court found that under Section 3-B(b), an exemption granted by notification can only be cancelled by an express notification to that effect.

The State failed to produce any document or specific wording in the 2022 Notification that explicitly cancelled or withdrew the 2016 exemption.

Consequently, the general revision of rates in the Schedule did not automatically terminate the specific, time-bound exemption previously granted to the respondent.

The Court held that the Notification dated 12.08.2016 remains in force until August 2028 unless specifically cancelled by a "like notification" as per the statutory scheme.

The demand notice dated 22.05.2023 was quashed, though the State was granted liberty to recalculate outstanding amounts, if any, strictly in accordance with the valid exemptions still in force.

Delay in filing the appeal was condoned.