Dwarkadhish Sakhar Karkhana Ltd v. The State of Maharashtra

The petitioner no.1 is a company registered under the Companies Act, 1956 and it has a sugar factory at Sheware , Taluka – Baglan, District – Nashik. It entered into a Turn Key Contract with M/s. S.S. Engineers at Pune for erection of its sugar factory at Sheware with 1500 TCD capacity and also a Steam Turbo Generator as well as other machineries. The total value of the contract was Rs.12.21 crores, excluding the cost of land or the factory. The approximate cost of Steam Turbo Generator of 3 MW was Rs.1.25 crores and Diesel Generator Set of 315 KVA was Rs. 15 lakhs. It claims to have started sugarcane harvesting in the year 2000-01. It installed one generator set of 3 MW capacity in the year 2001. On 29/12/2003 it received a letter from respondent no.3 calling upon to pay electricity duty at the rate of 30 paise per unit for the period from April 2001 to September, 2003 and the subsequent letter dated 30/6/2005 for the amount of Rs.58,26,307/-. On 31/5/2008 the Tahsildar, Baglan issued a notice to the petitioner – Karkhana to pay the dues of Rs.1,17,75,483/- within a period of eight days towards the payment of electricity duty and this is how the 3 petitioners approached this court praying for the same reliefs as have been prayed in connected writ petitions i.e. W.P.Nos. 6414/2000, 495/01 and 5207/01 (decided on 5/10/2009) and W.P. Nos.7453/07, 897/08, 1960/07, 1962/07, 2003/07, 2262/07, 2364/07, 5954/07, 2204/07, 2245/07, 2443/07, 5966/07, 4962/07, 8260/07 and Original Side W.P. No. 1508/07 (decided today).

We have held in the common judgments dated 5/10/2009 and 7/11/2009 that the Captive Power Plants (CPPs) are entitled for total exemption in payment of electricity duty for the period from 1/4/200 to 30/4/2005. The petitioners pray for the very same relief and we are not inclined to accept the same for the reasons set out hereinbelow.

We have perused the contract, as relied upon by the petitioners, to set up its factory and we have noted that the Diesel Generator set as well as the Steam Turbo Generator cannot fall within the ambit of a Captive Power Plant and the exemption granted by the State Government from payment of electricity duty, by exercising its power under Section 5A of the Bombay Electricity Duty Act, 1958 vide its GR dated 22/6/1993, is only in respect of the Captive Power Plants. The petitioners’ arrangement for generation of power as stated in the petition is by way of standby arrangement so as to ensure that the electricity supply is available continuously and without any power break down, in as much as, if there is any disruption in power supply by the Maharashtra State Electricity Board (MSEB), the standby arrangement of generating sets to take over and continue to supply power so that the manufacturing activities or 4 any other operations are not brought to a standstill. We have noted in the common judgment pronounced today in Writ Petition No. 897 of 2008 a similar arrangement. However, the petitioner-company therein produced on record its correspondence with the MSEB. We noted more particularly the letter dated 10/4/1996 issued by the Board to the company while granting permission under Section 44 of the Electricity (Supply) Act, 1948. The company was called upon to use the generating sets as CPPs and the Board had recognized the installation of generator sets in that case as a Captive Power Plant. In the instant case, no such evidence has been produced on record by the petitioners so as to show that the MSEB or any of its successor company at any time has recognized the standby arrangement of the petitioners as a Captive Power Plant and unless such a recognition is on record, it cannot be said that the power supply from the generator set as is available in the factory premises of the petitioners is a Captive Power Plant. The exemption given by the State Government is only for the Captive Power Plant from the payment of electricity duty.

Hence, this petition must fail and the same is hereby dismissed, however, without any order as to costs. (SMT. ROSHAN DALVI,J.)

(B.H. MARLAPALLE,J.)