The main legal point established in the judgment is the importance of interpreting the statute by considering the text and context, and the applicability of the enabling provision of section 3(1-A) and the notification dated 24th June, 2016 to the exclusion of certain costs from the construction incurred by an employer.

ORDER SUJOY PAUL, J. – In this petition filed under Article 226 of the Constitution, the petitioners have challenged the legality, validity and propriety of order dated 12-12-2019 passed by the competent authority in exercise of power under section 3(1) of the Building and Other Construction Workers’ Welfare Cess Act, 1996 (for short “Cess Act”).

2. The stand of petitioners is that although The Building and Other Construction Workers (Regulations of Employment and Conditions of Service) Act, 1996 (for short “Building Act”) and Cess Act are applicable to the petitioners establishment, the competent authority has assessed the Cess beyond the scope of charging section. Thus, he not only acted beyond the touch stone of charging section, authority has completely failed to see the legislative changes and provision relating to exclusion while passing the impugned order. The authority was under a solemn obligation to examine the legislative changes and scope of charging section while passing the impugned order. Since he has failed to take into account both the aforesaid aspects, the impugned order can be termed as arbitrary and without jurisdiction.

3. To elaborate, Shri Amit Agrawal, learned Sr. Counsel submits that the petitioner No. 1 is engaged in the business of manufacturing and supplying of various parts of wind mills to its customers including but not limited to blade, tower, transformer, nacelle etc. The petitioner No. 2 company is engaged in the business of procurement of land and development of wind park projects. To the extent, petitioners have undertaken the civil construction work, the petitioners are liable to pay the cess as per the Cess Act and the Rules made thereunder. The petitioners in fact calculated and paid the cess arising out of the construction work. In the impugned order, the competent authority has included the cost of wind turbine, generator and electronic apparatus while calculating/determining the cess. This runs contrary to the provisions of the Cess Act and the Rules.

4. Section 3 of Cess Act permits levy and collection of cess on the cost of construction incurred by an employer. Rule 3 of The Building and other Construction Workers’ Welfare Cess Rules, 1998 (for short “Cess Rules”) provides for the purpose of levy of cess, cost of construction shall include all expenditure incurred by an employer in connection with building or other construction work excluding - (i) cost of land (ii) any compensation paid or payable to a worker or his kin under the Workmen’s Compensation Act, 1923. The Government of Madhya Pradesh introduced the M. P. Labour Laws (Amendment) and Miscellaneous Provisions Act, 2015 by publishing it in the Official Gazette on 27-11-2015. The Cess Act was amended by inserting section 3(1-A). It is strenuously contended that a bare perusal of this enabling provision makes it clear that (i) cost incurred on purchase and transportation of plant and machinery and (ii) such other cost which are specified by notification issued by the State Government shall stand excluded from the cost of construction incurred by an employer. In furtherance of this enabling provision, the State Government by notification dated 24th June, 2016 excluded certain items from the cost of construction which includes - “electric and electronic appliances not covered under the category of furnitures and fixtures”. An explanation is also appended to the entries relating to exclusion of certain items. The bone of contention of learned Sr. Counsel is that in view of Entry (xii) mentioned in the notification dated 24th June, 2016, the authority should have excluded the cost of electric and electronic appliances for the purpose of determining the cess. The authority has acted beyond jurisdiction by ignoring the said notification dated 24th June, 2016 and by including costs of excluded items, therefore, despite availability of statutory alternate remedy, this petition can be entertained.

5. Rule 14(2)(b) of the Rules makes i