Judgment:

MUDHOLKAR, J. : This is an appeal on a certificate of fitness granted by the High Court of Madhya Pradesh under Art. 133(1)(a) of the Constitution.

2. The appellant is a textile mill at Gwalior in Madhya Pradesh. It generates electricity for the purpose of running its mills and for other purposes connected therewith. It does not sell electrical energy to any person.

3. Under the provisions of the Central Provinces and Berar Electricity Duty Act, 1944 (No. X of 1949) as amended by the Madhya Pradesh Taxation Laws Amendment Act, 1956 (Act No. VII of 1956) the Government of Madhya Pradesh levied upon the appellant electricity duty amounting to Rs. 2,78,417 for a certain period. The appellant paid it under compulsion and thereafter preferred a writ petition to the High Court of Madhya Pradesh under Art. 226 of the Constitution in which it challenged the validity of the levy on two grounds. The first ground was that upon a proper construction of S. 3 of the C.P. & Berar Electricity Duty Act, 1949 as amended by the Madhya Pradesh Taxation Laws Amendment Act, 1956 the appellant would not be liable to pay any duty at all. The second ground was that if the Act permitted the levy of duly on electricity consumed by the producer himself it was ultra vires the Constitution because in substance it would be a duty of excise which can be levied only by Parliament under Entry 84 of List I and that even if it was not excise duty it was beyond the competence of the Madhya Pradesh Legislature to levy it in the absence of any appropriate entry in List II. The petition was summarily rejected by the High Court, but upon an application made by the appellant it granted to it certificate of fitness, as already stated.

4. Mr. Viswanatha Sastri has reiterated before us the same grounds which were urged in the High Court.

5. For the purpose of appreciating the first ground it would be useful to reproduce in terms of S. 3 of the Act. The section runs thus:

"Levy of duty on sale or consumption of electrical energy - Subject to the exceptions specified in S. 3-A every distributor of electrical energy and every producer shall pay every month to the State Government at the prescribed time and in the prescribed manner a duty calculated at the rates specified in the Table below on the units of electrical energy sold or supplied to a consumer or consumed by himself or his employees during the preceding month.

Rates of Duty

(i) Electrical energy supplied for consumption for lights, fans or any other appliances normally connected to a lighting circuit 6 no per unit of energy.

(ii) Electrical energy supplied for purposes other than those specified in item (i) above 1 nP per unit of energy.

This is the charging section. It is not disputed by Mr. Sastri that under this provision a producer of electrical energy is made liable to pay duty for the units of electrical energy consumed by himself. He, however, contends that rates of duty have been prescribed in the Table below S. 3 only with respect to electrical energy supplied for consumption" to others and that no rates have been prescribed with respect to electrical energy consumed by the producer himself. Section 2(a) of the Act defines "consumer". The definition, so far as relevant, runs thus :

"Consumer" means any person who consumes electrical energy sold or supplied by a distributor of electrical energy or a producer."

Producer as defined in S.2(d-1) of the Act means a person who generates electrical energy at a voltage exceeding hundred volts for his own consumption or supplying to others." If we read the two definitions together omitting the non-essentials, consumer would include "any person who consumes electrical energy supplied by a person who generates electrical energy for his own consumption." Under S. 3 a person who generates electrical energy over hundred volts for his own consumption is liable to pay duty on the units of electrical energy consumed by himself. A producer consuming the electrical energ