1 2025:CGHC:59862 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR Order reserved on 26.11.2025 Order delivered on 09/12/2025 WPC No. 3674 of 2023 1. M/s ACB India Ltd. A Company Incorporated Under Provisions Of The Companies Act Having Registered Office At C-102, L.G.F. Surya Enclave, Multan Nagar, New Delhi - 110056 Having Plant At Village - Chakabura, Tehsil - Katghora, District - Korba, Chhattisgarh, Represented Through Its Authorised Representative, Sh. Ganesan Kumar --- Petitioner versus 1. State of Chhattisgarh Through Its Secretary, Department of Energy, Mahanadi Bhawan, Mantralaya, Nava Raipur, Atal Nagar, Raipur, District - Raipur, Chhattisgarh 2. Special Secretary Department of Energy, Mahanadi Bhawan, Mantralaya, Nava Raipur, Atal Nagar, Raipur, District - Raipur, Chhattisgarh 3. Chief Electrical Inspector Government of Chhattisgarh, B-Block, Second Floor, Indravati Bhawan, Nava Raipur, Atal Nagar, Raipur, District - Raipur, Chhattisgarh --- Respondents WPC No. 3685 of 2023 1. M/s. ACB India Ltd. A Company Incorporated Under Provisions Of The Companies Act Having Registered Office At C-102, L.G.F, Surya Enclave, Multan Nagar, New Delhi SYED ROSHAN ZAMIR ALI Digitally signed by SYED ROSHAN ZAMIR ALI Date: 2025.12.09 19:24:51 +0530 2 110056 Having Plant At Village Kasaipali, Post Jawali, District Korba, Chhattisgarh. Represented Through Its Authorised Representative, Sh. Arbind Kumar Singh. ---Petitione Versus 1. State of Chhattisgarh Through Its Secretary, Department of Energy, Mahanadi Bhawan, Mantralaya, Nava Raipur, Atal Nagar, Raipur, District Raipur, Chhattisgarh. 2. Special Secretary Department Of Energy, Mahanadi Bhawan, Mantralaya, Nava Raipur, Atal Nagar, Raipur, District Raipur, Chhattisgarh. 3. Chief Electrical Inspector Government Of Chhattisgarh, B- Block, Second Floor, Indravati Bhawan, Nava Raipur, Atal Nagar, Raipur, District Raipur, Chhattisgarh. --- Respondents For Petitioner : Mr. Ravindra Shrivastava, Sr. Advocate (through virtual mode) assisted by Mr. Abhishek Vinod Deshmukh, Advocate. For Respondents : Mr. Akhilesh Kumar, Government Advocate SB: Hon’ble Mr. Justice Parth Prateem Sahu C A V Order 1. As the issue for consideration in above two writ petitions is identical, therefore, they were heard together and are being decided by this common order. 2. Challenge in these two writ petitions is to the demand notice issued by respondent No.3 directing the petitioner company to pay the amount as mentioned therein towards electricity duty and interest thereon pertaining to the period mentioned therein. For the sake of convenience, facts narrated in WPC 3 No.3685/2023 have been culled out for the purpose of this order. 3. Facts of the case in brief are that petitioner 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 petitioner company entered into a power purchase agreement with Chhattisgarh State Power Trading Co. Ltd. to meet its power requirement. Respondent 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 (Annexure P-3) granting concession in payment of electricity duty to certain producers including captive power generation plants. Consequently, petitioner company has also been granted exemption/ concession in payment of electricity duty and since then petitioner 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 petitioner 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. Respondent No.3 issued notice of demand to petitioner demanding arrears of electricity duty 4 mentioned therein for the period from January 2017 to March 2023. Petitioner Company submitted letter dated 17.8.2021 requesting respondent 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 petitioner 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. Petitioner company addressed a letter to respondent 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, respondent No.3 issued impugned demand notice in terms of Notification dated 11.10.2022 directing the petitioner 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. 4. Learned Senior Counsel for petitioner Company would submit that the petitioner is engaged in generation of power, they have set-up a 270 MW power plant and supplying power at 5 Energy charges. The State Government vide Notification dated 12.8.2016 had offered concessional rate of tariff and electricity duty to the category of consumers in which petitioner falls for a period of 12 years from 1.4.2016 or date of commercial productions, whichever is later, and since then the petitioner company has been making payment of electricity duty for their units auxiliary consumption and own consumption on concessional rate. The State Government in the year 2022 amended the rates of electricity duty by modified notification and on the basis of which, respondent No.3 issued impugned demand notice directing the petitioner to deposit electricity duty at enhanced rate along with interest thereon. He submits that impugned demand amounts to withdrawal of concession granted for a fixed period vide Notification of 2016, which is not permissible in law. He submits that in the Notification of 2022 there is not a whisper about withdrawal or cancellation of the Notification of 2016. Unless a notification withdrawing/ cancelling the Notification of 2016 granting exemption/concession is issued, which admittedly has not been done in this case as is evident from Notification of 2022, the Notification of 2016 continues to be in force and the Notification of 2022 amending the rate of duty would not be operative against the petitioner nor would it result in automatic withdrawal of benefits conferred upon 6 petitioner under the Notification of 2016. Petitioner is entitled to concession in payment of electricity duty upto 2028 (for a period of 12 years) notwithstanding the revision of rate of electricity duty under the Notification of 2022. 5. He further submits that as per Section 3-B of the Act of 1949, the power of State Government to exempt from payment of duty in whole or in part by way of notification and cancel any such notification is inter-twined with the formation of opinion that it is necessary or expedient so to do in public interest. From Notification dated 11.10.2022 (Annexure P-8) it does not reveal that there has been any consideration by the State Government that necessity had arisen in public interest to cancel / withdraw the concession extended vide Notification of 2016 to the category of consumers in which petitioner company falls. Since there has been no formation of opinion by the State Government, which is a condition precedent for exercising the power under Section 3B of the Act of 1949, or in other words, no circumstance existed which rendered it necessary to supersede the Notification of 2016 in public interest, therefore, impugned demand by respondent No.3 pursuant to Notification of 2022 is bad in law. 6. He also contended that provision under Statue clothing the authority with the power to withdraw or cancel the notification earlier issued and exercising that power by issuing notification 7 is two different provision. Section 3B provides for granting exemption / concession and Section 3B(b) is the provision granting power to the State to withdraw the exemption or concession earlier granted. State Government has not exercised the powers as granted under Section 3B(b) of the Act of 1949. 7. Per contra, learned State Counsel opposing submissions of learned Senior Counsel for petitioner, would raise an objection with regard to maintainability of this writ petition on the ground that as per Rule 13 of the Chhattisgarh Electricity Duty Rules, 1949 (for short ‘the Rules of 1949’), petitioner is having efficacious alternate remedy of filing an appeal. He further submitted that petitioner has not challenged the Notification of 2022 issued by the State Government in writ petitions filed by them and therefore, petitioner had no locus standi to file writ petition under Article 226 of the Constitution of India challenging the demand notice. 8. He further submitted that the State Government considering that concession granted under Notification of 2016 has suffered loss of revenue to the tune of Rs.667 Crores to the State ex-chequer; amendment in rate at which electricity duty is being imposed will result in increase in collection of revenue which would ultimately be used for public welfare, formed an opinion that continuation of Notification of 2016 is 8 not desirable in the public interest and accordingly, the State Government, exercising the powers under Section 3B read with Section 3C of the Act of 1949 issued Notification of 2022 amending the Schedule appended to Section 3 levying electricity duty. 9. In the reply it is specifically pleaded that the principle of promissory estoppel would have no application to the case of petitioner so as to entitle them any right to continuation of concessional tariff earlier granted. He further contended that notifications granting exemption/concession of duty only created existing rights and such existing rights can always be withdrawn/cancelled by means of a subsequent Notification and that is exactly what has happened in this case. The State Government is fully within its powers to revoke the exemption/concession granted earlier by means of a subsequent Notification. 10. Heard learned counsel for respective parties and perused the documents available in record of writ petition. 11.Undisputed facts in view of pleadings made by respective parties are that petitioner has established 270 MW (2x135 MW) thermal power plant at village Kasaipali and commenced commercial production since December 2011 and June 2012 respectively. Petitioner thereafter was paying electricity duty as per rate prescribed under the Act of 1949. Vide Notification 9 dated 12.8.2016 the State Government has given concession to generating company, captive generating plant and producers of private/public sector of the State which are supplying power at energy (variable) charges to levy 10% of average cost of supply in tariff order from 1.4.2016 or date of commercial production, whichever is later, till 12 years and thereafter at the rate of average cost of supply for time being in force in place of electricity duty which is 15% of “tariff” provided that in case on 31.3.2016 payment of electricity duty along with interest is not due on these producers, for auxiliary consumption and their own consumption. By the same Notification, in exercise of powers conferred under Section 3- C of the Act of 1949, the State Government has made amendments in the schedule of the Act of 1949 and at Sr. No.22 of Part-C of the Schedule appended following amendment was made: (1) (2) (3) (4) 22. For the electricity consumed by the Generating Company, Captive Generating Plants and Producers of Private/Public Sector of the State, who are supplying power at Energy (Variable) charges to the State, for their auxiliary consumption and their own consumption. On all consumed units 15 percent of ‘Tariff’ till 31st March 2016 and thereafter 10 percent of average cost of supply and such exemption to petitioner company was to start from 1st April 2016 or date of commercial production, whichever is earlier, till 12 years and thereafter rate of average cost of supply for time being in force 10 12. Perusal of Notification, Annexure P-3, would show that it was issued in exercise of powers under Section 3B and 3C of the Act of 1949. Section 3B reads thus:- “3B. Where the State Government is of opinion that,- (i) in order to encourage the establishment of any particular industry or class of industries in the State; or (ii)having regard to the particular circumstances of any industry or class of industries; or (iii)in order to extend facilities to such persons or class of persons and for such purposes as the State Government may, by notification, specify;it is necessary or expedient so to do in public interest, it may, by notification and subject to such conditions, if any, as it may specify in the notification,- (a) exempt from payment of duty in whole or in part- (i) any distributor of electrical energy or producer in respect of the electrical energy sold or supplied to such industry for the purposes thereof; (ii) where any producer or class of producers runs the industry, in respect of the electrical energy consumed by such producer or class of producers for the purpose of such industry; (iii) any distributor of electrical energy or producer in respect of the electrical energy sold to or used for consumption by person or class of persons and for purposes specified in the notification; (b)cancel any such notification and again subject, by a like notification, the distributor of electrical energy or producer or class of such producers to the payment of such duty in respect of such sale, supply or consumption of electrical energy.” 13. Section 3C of the Act of 1949 is also extracted below for ready reference:- “3-C. Power to amend the Schedule.- (1) the State Government may by notification in the Official Gazette 11 amend the schedule. (2) Every notification issued under sub-section (1) which has the effect of increasing the duty payable by any consumer, shall be laid, as soon as may be after it is made, before the State Legislature while it is in session for a total period of thirty days, which may be comprised in one session or two or more successive sessions, and if, before the expiry of the session or immediately following the session or the successive session aforesaid, the House agrees in making any modification or the House agrees that the notification should not be made, shall thereafter have effect only in such modified form or be of no effect, as the case may be, so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done thereunder.” 14. Perusal of above quoted two provisions would show that Section 3B (iii) (a) of the Act of 1949 grants power to the State Government to exempt from payment of duty in whole or in part to any distributor of electrical energy or producer as mentioned in Section 3-B (iii) (a) (I) (ii) (iii). Section 3C provides power to the State Government to amend the schedule by Notification in official gazette. 15. Aforementioned provisions apply in different fields. Power to amendment the schedule and power to grant exemption / relaxation from payment of duty in whole or part, are two different powers under Statute. Here in this case grievance raised by petitioner is with regard to computation of arrears of duty to be paid by petitioner based on the amended rates as mentioned in the schedule came to be amended vide Chhattisgarh Electricity Duty (Amendment) Act 2022, on the 12 ground that relaxation/exemption granted by the State Government by Notification, Annexure P-3, is still in force and that has not been withdrawn/cancelled and therefore, petitioner is entitled to exemption as granted by the State Government vide Notification, Annexure P-3, which was for 12 years and will come to an end in August 2028. 16. 16. Section 3B (b) of the Act of 1949 further grants power to the State Government to cancel any such notification and again subject, by a like notification, the distributor of electrical energy or producer or class of such producers to the payment of such duty in respect of such sale, supply or consumption of electrical energy. 17. Respondent State submitted reply to writ petition mentioning that Section 3B of the Act of 1949 gives power to the State Government to notify exemptions and if there is a public interest which requires cancellation of such notification and supercession by a like notification. It is also submitted that the State Government can withdraw such notification exercising powers under Section 3B(b) of the Act of 1949. 18. True it is that under the Act of 1949 the power is vested in the State Government to grant exemption from payment of electricity duty in whole or in part and also to cancel any such notification and again subject, by a like notification, the distributor or producer of electrical energy to payment of such 13 duty. However, along with reply, respondent State has not placed on record anything to show that exemption granted to petitioner and other like producers/distributors of electrical energy has been cancelled/withdrawn by notification issued by the Competent Authority. 19. Powers to the authority under the Act of 1949 is not questionable in view of specific provision under Section 3B(iii) (b) of the Act of 1979. Consideration before this Court is whether the authority has exercised that power, in the manner as provided under the Act of 1949. 20. Provisions under Section 3 (B) (iii)(b) of the Act of 1949 in clear terms provides ‘cancel any such notification’. If grant of exemption is by notification, then the cancellation of earlier notification should also be by issuing notification clearly mentioning that earlier notification is withdrawn/cancelled. Intention of the authority of withdrawing/cancelling notification should be clearly worded. 21. In the case at hand, before this Court no document is placed to show that the authority under Section 3(B) of the Act of 1949 has issued any notification withdrawing/cancelling earlier notification dated 12.08.2016 (Annexure P-3), as such the Notification, Annexure P-3, is still in force. 22. For the foregoing discussion, the demand raised by the respondent vide Annexure P-1 towards electricity duty is not 14 sustainable, hence it is quashed. Respondents will be at liberty to recalculate the outstanding, if any, against the petitioner towards electricity duty and can raise fresh demand, in the light of discussion and observation as made above. 23. Accordingly, writ petitions are allowed. Sd/- (Parth Prateem Sahu) Judge roshan/-