Judgment on Board

Per Ramesh Sinha , Chief Justice

1. Heard Mr.P.K.Bhaduri, learned Deputy Advocate General for the appellants/State as well as Mr.Ravindra Shrivastava, learned Senior Advocate appearing through video conferencing assisted by Mr.Abhishek Vinod Deshmukh, learned counsel appearing for the respondent on IA No.01/2026, which is an application for condonation of delay of 24 days in filing the present writ appeal.

2. On due consideration, IA No.01/2026 is allowed. Delay of 24 days in filing the writ appeal is hereby condoned.

3. With the consent of learned counsel for the parties, the matter is heard finally.

4. The appellants/State have filed this writ appeal against the order dated 09.12.2025 passed by the learned Single Judge in WPC No.3685/2023, whereby the writ petitions preferred by the respondent / writ petitioner have been allowed by setting aside the demand dated 22.05.2023 raised by the appellants/State towards electricity duty.

5. Brief facts necessary for disposal of the case are that the respondent Company had set up a captive power plant of 270 MW in village Ksaipali which comprises of two units, each of 135 MW. On 5.12.2013 the respondent Company entered into a power purchase agreement with Chhattisgarh State Power Trading Co. Ltd. to meet its power requirement. Appellant No.2 exercising the powers vested in Section 3B and Section 3-C of the Chhattisgarh Electricity Duty Act, 1949 (for short ‘the Act of 1949’) issued a Notification dated 12.8.2016 granting concession in payment of electricity duty to certain producers including captive power generation plants. Consequently, the respondent Company has also been granted exemption/concession in payment of electricity duty and since then the respondent has been paying electricity duty on concessional rates. As per notification dated 12.8.2016, rate of electricity duty applicable on consumption would be 15% of tariff till 31.3.2016 and thereafter 10% of average cost of supply and such exemption to the respondent Company was to start from 1st April 2016 or date of commercial production, whichever is later, till 12 years and thereafter rate of average cost of supply for time being in force. Appellant No.3 issued notice of demand to the respondent demanding arrears of electricity duty mentioned therein for the period from January 2017 to March 2023. The Respondent Company submitted letter dated 17.8.2021 requesting appellant No.3 to recalculate electricity duty and interest amount, but the same failed to evoke any response till date. The State Government vide Notification dated 11.10.2022 revised the electricity duty by making certain changes in slabs. In respect of category of consumers in which the respondent falls, electricity duty is increased to 21% of average cost of supply till 30.9.2022 and thereafter 14% of rate of average cost of supply in the tariff order from 1.10.2022 till 12 years. The respondent Company addressed a letter to appellant No.3 seeking clarification regarding applicability of aforementioned Notification to the consumers who had already granted concession as per Notification dated 12.8.2013 for a period of 12 years etc. Instead of clarifying position in this regard, appellant No.3 issued demand notice in terms of Notification dated 11.10.2022 directing the respondent Company to deposit difference amount of electricity duty for the period from April, 2017 to March 2023 on the basis of tariff revised vide Notification dated 11.10.2022, as also interest amount payable thereon.

6. Being aggrieved by the same, the respondent Company filed writ petitions, which were allowed by learned Single Judge by the impugned order. Hence, this writ appeal.

7. Learned Deputy Advocate General for the appellants/State submits that learned Single Judge has failed to appreciate the scope and ambit of Section 3-B of the Chhattisgarh Electricity Duty Act, 1949 (hereinafter called as “the Act of 1949”). In exercise of powers under Section 3-B of the Act, the S