The liability to pay cess under the Water (Prevention and Control of Pollution) Cess Act, 1977 is limited to specified industries and local authorities entrusted with the duty of supplying water under the law.

G.C. GARG, J.

1. Challenge herein by the Haryana Tourism Corporation Limited, Chandigarh is to the notices Annexures P-1 and P-4 whereby it was asked to pay cess under the Water (Prevention and Control of Pollution) Cess Act, 1977 (for short the 1977 Act) and in default thereof, to pay a penalty of 100% on the amount due.

2. The case of the petitioner is that the petitioner-Corporation is not covered under the provisions of the 1977 Act and thus, the demand made by the respondents from it is wholly illegal and without jurisdiction.

3. On notice being issued, written statement on behalf of respondent No. 1 has been filed. The broad stand of the respondent is that the petitioner-Corporation is covered by the provisions of sub-s. (2) of S. 3 and therefore, is liable to pay cess, it being a body corporate entrusted with the duty of supplying water under the law as provided in subs. (a) of S. 2 of the 1977 Act in various complexes run by it for satisfying the basic needs of human beings and various visitors visiting the complexes or staying therein.

4. By way of a preliminary objection, it has been pleaded that the petitioner-Corporation having submitted to the jurisdiction of the respondent-authorities, is estopped to challenge the move of recovery of cess. It is further submitted that the Corporation has already accepted that the provisions of the 1977 Act are applicable to it.

5. After hearing learned counsel for the parties, we are of the view that this writ petition deserves to succeed, the provisions of the 1977 Act being not applicable to the petitioner-Corporation. Sec. 3 of the said Act provides for the recovery and collection of cess. It, inter alia, provides that cess under this Act shall be payable by "(a) every person carrying on any specified industry; and (b) every local authority" to be calculated on the basis of the water consumed by such person or local authority for any of the purposes specified in column (1) of Schedule II, at such rate, not exceeding the rate specified in the corresponding entry in column (2) thereof. Clause (a) of Sec. 2 defines the local authority to mean any municipal corporation or a municipal committee or a cantonment board or any other body, entrusted with the duty of supplying water under the law by or under which it is constituted. Specified industry has been defined in clause (c) of Sec. 2 to mean any industry specified in Schedule I. Schedule I contains a list of 15 industries and the petitioner-Corporation does not fall in any of the specified industries. Thus, under clause (a) of Sub-Section (2) of Sec. 3, no cess is payable by the petitioner Corporation as it is not carrying on any of specified industries contained in Schedule I of the 1977 Act. Under no circumstance, the petitioner-Corporation can be said to be carrying on an industry engaged in processing of animal or vegetable products. Faced with this situation, emphasis was laid by the learned counsel for the respondents that the petitioner-Corporation fell within the ambit of local authority being any other body and, therefore, is liable to pay cess as it is supplying water to various visitors visiting or staying in the complexes.

6. The stand of the respondents cannot be accepted. As already noticed, the local authority means a municipal corporation or any other body entrusted with the duty of supplying water under the law by or under which it is constituted. In the present case, the respondents have completely failed to show that the petitioner-Corporation is entrusted with the duty of supplying water under the law. Once that is so, the petitioner-Corporation cannot he said to be liable to pay cess under the 1977 Act. A bare reading of the provisions of the said Act as already noticed, clearly go to show that cess is payable by a local authority such as municipal corporation or cantonment board which supply water to its residents in the local area of their jurisdiction. It does not apply to such persons who draw the