Supreme Court: Refusing to interfere with the decision of the Gujarat High Court directing Essar Steel India Ltd. (ESL) to pay electricity duty amounting to Rs. 562 Crores together with interest totaling Rs. 1038.27 Crores to the State of Gujarat, the bench of Dr. A.K. Sikri and Ashok Bhushan, JJ said that the statutory conditions for grant of exemption as contained in Section 3(2)(vii)(a) of the Bombay Electricity Duty Act, 1958 can neither be tinkered with nor diluted.

ESL holds 42% shares in Essar Power Ltd. (EPL) which is a duly incorporated company under the provisions of Companies Act, 1956, which is a generating company selling/supplying electrical energy. The Court noticed that both ESL and EPL are distinct separate legal entities and merely because ESL might have 42% shares holding in EPL, it cannot be said that ESL is generating electricity jointly with EPL and EPL is generating electricity jointly with ESL for use of electricity by ESL.

It was further stated that even assuming ESL and EPL are jointly generating the energy for the use of   industrial   undertaking   which   are   jointly generating the energy, the Gujarat Electricity Board to whom 300 MW has been allocated cannot be held to be   industrial   undertaking   which   is   jointly generating the energy with appellant. The Statutory scheme   for   grant   of   exemption   has   to   be   strictly construed.   EPL   is   not   jointly generating energy with Gujarat Electricity Board and it is selling the energy to the extent of 300 MW to Gujarat   Electricity   Board.   Hence, the   conditions   of   the statutory provisions of Section 3(2)(vii)(a) of the Act are not fulfilled. [Essar Steel India Ltd. v. State of Gujarat, 2017 SCC OnLine SC 522, decided on 02.05.2017]

Must Watch

maintenance to second wife

bail in false pretext of marriage

right to procreate of convict

Criminology, Penology and Victimology book release

Join the discussion

Leave a Reply

Your email address will not be published. Required fields are marked *