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2025 Supreme(Mad) 3605
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
K.R. SHRIRAM, CJ, V. LAKSHMINARAYANAN, J.
Super Sales India Ltd. - Appellant
Versus
The President, Thappukundu Panchayat - Respondent
W.P. (MD) No. 3789 of 2013, M.P. (MD) No. 1 of 2013
Decided On : 12-02-2025
Advocate Appeared:
For the Appellant : Anirudh Krishnan
For the Respondent: P. Thilak Kumar
Wind mills do not require construction permission under Section 160 of the Tamil Nadu Panchayat Act as they do not employ steam, water, or mechanical power.
Headnote:(A) Tamil Nadu Panchayat Act, 1994 - Sections 160 and 172 - Wind energy generation - Petitioner installed wind mills for energy generation but was served a notice requiring permission for construction as a factory - Court held that Section 160 does not apply to wind mills as they do not employ steam, water, or mechanical power - House tax applicable only to the extent of the shed for monitoring the wind mill - Notice issued by village panchayat quashed as invalid. (Paras 3, 15, 27, 28)
(B) Legal interpretation - The definition of 'factory' under Section 160 requires the use of specific powers, which wind mills do not utilize - The court clarified that a building fit for human occupation is subject to house tax regardless of employment status. (Paras 16, 27)
(C) Professional tax demand was not addressed due to the invalidity of the notice. (Paras 28, 30)
Facts of the case:
The petitioner, engaged in wind energy generation, received a notice from the village panchayat requiring various permissions and taxes for the wind mills installed on their land.
Findings of Court:
The court found that the wind mills do not fall under the definition of a factory requiring permission under Section 160 and that house tax is applicable only to the monitoring shed.
Issues: The main issues were whether the erection of wind mills requires permission under Section 160 and the validity of the notice issued by the village panchayat.
Ratio Decidendi: The court ruled that wind mills do not employ the powers specified in Section 160, thus not requiring permission, and clarified the applicability of house tax.
Result: The notice was quashed and set aside.
ORDER :
1. The petitioner is engaged in the business of manufacture of yarn of various counts and gears for various industries and in the generation of energy from renewal and non-conventional sources such as wind energy. Petitioner decided to, in view of power shortage in State of Tamil Nadu at the relevant point of time, set up wind mills. The State Government also had supported permitting various measures for generation of power through non-conventional sources like wind mills. Petitioner had erected 69 wind mills in various villages in Tamil Nadu. One such mill is within the jurisdiction of 1st respondent village panchayat, namely, Thappukundu Panchayat, Theni District.
2. Petitioner purchased a piece of land admeasuring 2 acres and 22 cents pursuant to a registered sale deed. Petitioner submitted a proposal to Tamil Nadu Electricity Board (hereinafter referred to as 'TNEB') for installation of one number of 1500 KW wind electric generator. TNEB classified wind electric generation as Group II project. TNEB also permitted wind electric generator to be tied with board's 22 KV Grid. Based on the sanction from TNEB, petitioner installed and commissioned a 1500 KW capacity wind electric generator over the said land. Electricity generated has been wheeled through TNEB grid and being sold to TANGEDCO under power purchase agreement.
3. Out of the blue, on 18th July 2012, petitioner was served with a notice, stating that
(a) petitioner has to obtain necessary permission for construction of 'factory', as contemplated under Section 160 of the Tamil Nadu Panchayat Act, 1994 (hereinafter referred to as 'the Act');
(b) building plan sanction has to be obtained as per Tamil Nadu Panchayat Buildings Rules 1997 for installment of wind mill;
(c) building tax has to be paid for wind mills in terms of Section 2(1-A) of the Act; and
(d) payment of professional tax for operating wind mill.
4. On receipt of the notice, petitioner filed a reply on 4th August 2012, showing cause as to how it is not required to get any permission or consent as contended in the notice. Various grounds have been taken by petitioner and in particular, as to how Section 160 of the Act shall not apply at all.
5. Despite this reply, the 1st respondent issued a memorandum on 18th February 2013 by rejecting all contentions raised in the reply and threatening to take appropriate action, if petitioner failed to apply and obtain building sanction plan and pay building tax and professional tax etc. It is this memorandum, that is impugned in this petition.
6. We informed no formal order on admission had been ordered. As counter has been filed and the matter being old, with the consent of Counsel, we decided to hear petition finally. Therefore, issue rule and rule made returnable forthwith.
7. By way of history, we need to note that there was a judgment of Single Judge of this Court in S. Muppidathi Vs. Chief Engineer, Non- Conventional Energy Sources (NCES), Tamil Nadu Electricity Board, Chennai and others, 2012 (3) MLJ 6, in which the Single Judge held that Section 160 of the Act is applicable to a wind mill, which generates electricity and therefore, a factory involved in a manufacturing process. This judgment was delivered on 17th November 2011.
8. On 19th June 2012, another Single Judge of this Court in President of Gangaikondan, Manur Panchayat Union Vs. Chief Engineer, Non-Conventional Energy Sources (NCES), Tamil Nadu Electricity Board, Chennai and others, W.P. (MD) No. 5000 of 2012 (unreported) held that notice itself that was issued in that case was bad in law, because it had been issued by the Village Panchayat. He held only a Panchayat Union Council was the competent authority to grant permission for construction of a factory in terms of Section 160 of the Act. In fact, he had accepted the contention of petitioner, in that matter, that erection of wind mill is to be construed as installation of the machinery as contemplated under Section 160 of the Act.
9. In the Writ Petition th
