Madras High Court
M/S.Dcw Limited vs State Of Tamil Nadu on 9 September, 2021
W.P.Nos.26425 of 2014 etc., batch
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 09.09.2021
CORAM
THE HONOURABLE MR.JUSTICE S.M.SUBRAMANIAM
W.P.Nos.26425 & 19666 of 2014, 18502, 18503, 26214,
29418 of 2013, 8115, 8146 & 8947 of 2015
and
M.P.Nos.2 & 2 of 2013, 2 & 3 of 2013, 1 of 2014, 2 & 3 of 2013,
2 & 3 of 2014, 4 to 6 of 2015, 2 to 4 of 2015, 2 to 4 of 2015
and
W.M.P.No.29741 & 29581 of 2019
W.P.No.26425 of 2014 :-
M/s.DCW Limited, Rep by
Senior General Manager, (Electrical)
Caustic Soad and PVC Division,
Sahupuram,
Thoothukudi – 628 229. .. Petitioner
-vs-
1.State of Tamil Nadu,
Rep., by the Secretary to Government,
Energy Department,
Secretariat, Fort St. George, Chennai-600 009.
2.The Director of Electricity Tax,
O/o of the Chief Electrical Inspector to Government,
Thiru-Vi-Ka Industrial Estate,
Chennai – 600 032.
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3.The Electrical Inspector,
Plot No.4, EMS Bhavan,
St.Mary's Road, Perumalpuram,
Tirunelveli – 627 007. .. Respondents
Petition filed under Article 226 of the Constitution of India praying
for issuance of Writ of Certiorari, calling for the records of the impugned
demand notice of 2nd respondent in Letter No.27524/A1/2013 dated
02.09.2014 and quash the same as being violative of the provisions of Tamil
Nadu Tax on Consumption of Sale of Electricity Act and the exemption
notifications in G.O.Ms.No.25 dated 24.03.2008, GO Ms.No.106 dated
04.09.2008, G.O.Ms.No.79 dated 14.09.2009, G.O.Ms.No.44 dated
30.04.2010 and G.O.Ms.No.85 dated 09.09.2010 for the period from
01.03.2008 to 01.05.2008 and for the period from 04.09.2008 till
31.03.2011.
For Petitioner : Mr.Rahul Balaji
(In W.P.Nos.26425 of 2014, 18502 & 18503 of 2013, 26214,
29418 of 2013, 19666 of 2014)
For Petitioner : Mr.T.Balaji
(In W.P.Nos.8115, 8146, 8147 of 2015)
For Respondents : Mr.V.Veluchamy,
(In all W.Ps.) Government Advocate
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W.P.Nos.26425 of 2014 etc., batch
COMMON ORDER
Since the relief sought for in all these writ petitions are identical, the
writ petitions were heard together and are being disposed of by this common
order.
2.These writ petitions are filed, challenging the orders passed under
Section 9 of the Tamil Nadu Tax on Consumption or Sale of Electricity Act,
2003 (hereinafter referred to as “the Act”).
3.Note of demand of tax assessed under Section 9 of the Act was
issued to the petitioners and challenging the said proceedings, the
petitioners are constrained to move these writ petitions.
4.The respective learned counsels appearing on behalf of the writ
petitioners made a submission that the procedures contemplated under the
provisions of the Act had not been followed before passing the impugned
orders. There are several grounds, which all are in favour of the petitioners,
more specifically, regarding exemption on payment of consumption tax.
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The exemption granted and exemption to be granted and the procedures to
be followed for assessment and the statutory exemptions are not even
considered, while passing the impugned orders and therefore, the writ
petitions are filed.
5.This Court is of the considered opinion that it is a notice of demand
of tax assessed under Section 9 of the Act, which is under challenge and
there is provision for appeal under Section 10 of the Act.
6.Let us now consider the scheme of the Act, which was enacted to
consolidate and rationalize the laws relating to levy of tax on consumption
or sale of electricity in the State of Tamil Nadu.
7.Section 2 provides 'definitions'; Section 3 enumerates 'tax on the
consumption or sale of electricity'; Section 8 contemplates 'obligation of
licensees to keep books of account and to submit return'. Accordingly,
every licensee and every person other than a licensee (a) keep books of
account in the prescribed form; and (b) submit returns showing the units of
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electricity supplied and the amount of the electricity tax payable in respect
thereof, to the Director in such form within such time as may be prescribed.
8.Section 9 stipulates 'assessment'. Sub-Section (1) of Section 9
states that “if no return in respect of any period is submitted by a licensee or
a person required to submit return under Section 8 or if the return submitted
by such licensee or person appears to the Director to be incorrect or
incomplete the Director shall, after giving such licensee or person as the
case may be, a reasonable opportunity of being heard, proceed in such
manner as may be prescribed to assess to the best of his judgment the
amount of electricity tax payable under the Act by such licensee or person”.
9.Period of limitation is also contemplated under Section 9(3) of the
Act. Accordingly, no assessment under Section 9(3) shall be made after the
expiry of four years. Thus, the procedures are enumerated for assessment
under Section 9 of the Act.
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10.Section 10 contemplates 'appeal' and sub-Section (1) stipulates
that “any person may in the prescribed manner appeal to the Government
against any order of assessment of Electricity Tax within sixty days or such
further period as may be allowed by the Government for the reasons shown
to their satisfaction from the date of receipt of a notice of demand issued
after such order of assessment”.
11.Section 14 provides 'exemption and reduction of tax'.
Accordingly, the Government may, by notification, make an exemption or
reduction in rate in respect of the electricity tax payable under the Act on
energy sold for consumption by or in respect of any (i) institution or class of
persons; (ii) place of public worship, public burial or burning ground or
other place for the disposal of the dead; (iii) premises declared by the State
Government to be used exclusively for purposes of public charity; and (iv)
vessel whether seagoing or inland. Thus, the provision regulates the
submission of return by the licensee or person concerned and procedures for
assessment. If any person is aggrieved from and out of the assessment
made, or in respect of procedural violations, if any, or non-adjudication of
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relevant facts by the original authorities, then an appeal to the Government
lies and the said appellate remedy is to be exhausted before approaching the
High Court under Article 226 of the Constitution of India.
12.The Statutory appellate remedy, at no circumstances, be
undermined by the High Courts. In the present cases, the appeal lies before
the Government and the Government is competent to deal with such appeal,
if any, filed by the aggrieved persons. In the present case, the appellate
authority/Government is the final fact finding authority and a complete
adjudication of facts is paramount important for the purpose of exercise of
judicial review by the High Court under Article 226 of the Constitution of
India. Factual adjudication requires verification and scrutinisation of the
original records and the evidences to be produced by the respective parties.
Such an adjudication can never be entertained by the High Court under
Article 226. Thus, the aggrieved person must be provided with an
opportunity to exhaust the appellate remedy, which would be of greater
assistance for the aggrieved person to redress their grievances in the manner
known to law. For instance, the aggrieved persons, against whom an
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assessment order is passed, will get an opportunity to produce all the
documents, related evidences to establish that they have already been
granted exemption or they are entitled for exemption or the assessment itself
is perverse and not in conformity with the procedures contemplated.
However, such elaborate adjudications cannot be undertaken by the High
Court with reference to the documents and evidences. In such
circumstances, undoubtedly, the aggrieved persons are deprived of their
opportunity to adjudicate all the relevant documents, which all are in their
possession. Thus, the importance of an appellate remedy is to be considered
by the High Court for the purpose of entertaining a writ more specifically,
when the orders-in-original are under challenge in the writ proceedings.
13.The respective learned counsels appearing on behalf of the
petitioners submit that there are factual differences in the writ petitions.
Obviously, the facts cannot be similar. It is about to be dissimilar in view of
the nature of usage of electricity and its consumption by the licensee or the
persons concerned. Thus, all those facts are to be considered and suitable
orders are to be passed by the appellate authority. In the present cases,
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statutory exemptions are claimed. Certain petitions are filed claiming
exemption under Section 14 of the Act. Entitlement of exemption is also a
ground taken. The procedures followed for passing assessment orders are
also questioned. Further, certain assessment orders are passed beyond the
period of limitation as contemplated under Section 9(3) of the Act. This
apart, the scope of exemption under the Act is pending before the Hon'ble
Supreme Court. Under these circumstances, the appellate
authority/Government would be the proper authority for adjudication of all
these issues independently and take a decision and pass orders in
accordance with law.
14.In view of the facts and circumstances, the petitioners are at liberty
to file an appeal under Section 10 of the Act before the competent authority
within the period of six weeks from the date of receipt of a copy of this
order in a prescribed format by complying with the provisions of the Act
and Rules. If any such appeal is received by the appellate authority under
Section 10 of the Act, the said appeal shall be entertained and the delay in
filing the appeal, if any, may be condoned by taking into account the
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pendency of the writ petition before the High Court and accordingly, deal
with the issues and grounds raised on merits and in accordance with law by
affording opportunity to the petitioners and pass orders as expeditiously as
possible. The petitioners are at liberty to raise all the factual as well as the
legal grounds before the appellate authority in the manner known to law.
15.It is brought to the notice of this Court that pursuant to the interim
orders passed by this Court, at the time of admission of some of the
petitions, some of the petitioners have deposited some amount. The said
deposited amount is to be adjusted or refunded based on the final outcome
of the appeal to be dealt with by the competent authority under Section 10
of the Act.
16.It is made clear that the contentions raised in the counter statement
by the respondents shall not be taken into consideration, while deciding the
issues afresh and on merits. In other words, the authorities shall decide the
issues uninfluenced by the statements made in the counter affidavit.
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17. With the above directions, all these writ petitions stand disposed
of. No costs. Consequently, connected miscellaneous petitions are closed.
09.09.2021
Index : Yes
Speaking Order
kak
To
1.The Secretary to Government,
Energy Department,
Secretariat, Fort St. George, Chennai-600 009.
2.The Director of Electricity Tax,
O/o of the Chief Electrical Inspector to Government,
Thiru-Vi-Ka Industrial Estate,
Chennai – 600 032.
3.The Electrical Inspector,
Plot No.4, EMS Bhavan,
St.Mary's Road, Perumalpuram,
Tirunelveli – 627 007.
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W.P.Nos.26425 of 2014 etc., batch
S.M.SUBRAMANIAM, J.
kak
W.P.Nos.26425 of 2014 etc., batch
09.09.2021
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