V.P.TYAGI, J. - (1.) MESSRS . Shree Sadul Textiles Ltd., (hereinafter called the Mills) have filed this writ application under Article 226 of the Constitution praying for a writ of certiorari or any other appropriate writ, order or direction to quash the order of the Deputy Commissioner Taxation (Appeals), Bikaner dated 26th March, 1969 asking the Mills to deposit the amount of duty on the electricity consumed for the street and factory lighting in the premises of the Mills at the rate of 5 paisa per unit.
(2.) THE facts giving rise to this writ application are as follows: - - The Rajasthan Electricity Board is the supplier of electricity to the Mills for manufacturing textiles in the town of Sri Ganganagar. Two separate meters were installed in the Mills by the respondents to measure the consumption of electricity viz., one for the residential and commercial purposes and the other for the power consumed in the factory. Two separate bills were prepared by the respondents for the energy consumed as recorded by the two meters and separate bills were prepared at two different rates agreed between the parties. It is said that the Mills regularly paid the amounts of the bills within time as specified in the bills. It is further averred that a sub -meter was installed to separately measure the energy consumed by the Mills for the purposes of lighting in the factory building and on the streets in the premises of the Mills. The purpose for installing a sub -meter was that in case the energy consumed for bona fide factory lighting did not exceed 10% of the total power consumed in the factory, it would be charged at the same rate fixed for the supply of power energy as per the tariff, but if the energy consumed for the purposes of lighting exceeded 10% of the total power consumed for running the machines then in that case the excess energy consumed for lighting purposes was charged under the head 'factory lighting' as given in the tariff. The case of the Mills is that the energy consumed for factory lighting included the energy utilised by the Mills in the office, in the main factory building, stores, time -keeper's office, canteen, library, dispensary, staff welfare centres and factory yard lighting and therefore, the energy consumed in all these places was considered as 'factory lighting consumption.' In the year 1962. The Rajasthan Electricity (Duty) Act, 1962 (Act No. 12 of 1962) (hereinafter called the Act) came into force. A notification under Section 3 of the said Act was issued by the Government of Rajasthan on 26th March, 1962 whereby the Electricity Duty on electric energy supply to certain consumers was exempted. This notification was, however, subsequently suspended and substituted by another notification No. 9 (2) E & T/62/II dated March 26. 1962 (Document No. 2) whereby the State Government was pleased to fix 3 N. P. per unit as the rate at which the electricity duty shall be computed. Another notification No. F. 9 (6) F. D. (E & T)/63 dated March 2, 1963 was issued by the Government superseding the first notification referred to above and modifiying the second notification dated 26th March, 1962 whereby the electricity duty chargeable from the consumers mentioned therein was notified at 1 naya paisa per unit in place of 3 naya paisa. In 1965 the Government of Rajasthan again issued a notification No. F. 16 (15) F. D. RT/64 -Pt. dated 1 -11 -65 (Document No. 4) whereby the remission in the electricity duty was allowed in the following terms: - - 'In exercise of the powers conferred by Section 3 of the Rajasthan Electricity (Duty) Act, 1962 (Rajasthan Act 12 of 1962) and in supersession of Government Notification No F. 9 (2) E and T/62 -II dated the 26th March, 1962, and No. F. 9 (6) FD/RT/63 dated 2nd March, 1963, the State Government being of the opinion that it is expedient in public interest to do so, hereby fixes, with immediate effect, five paise per unit as the rate at which the electricity duty shall be computed and subject to the conditions laid down in the third proviso to the said section. - (a) remits, with immediate effect, the electricity duty on the energy consumed (i) in electro -chemical industries and (it) in electro -furnaces of electro -thermal industries; (b) remits with effect on and from the 1st November, 1964, the electricity duty on energy consumed by or in respect of any municipal Board or Council or Panchayat or Panchayat Samiti or other local authority for the purpose of, or in respect of public street lighting, and (c) reduces with immediate effect such duty on the energy consumed in industries, other than those mentioned in (a) above, in the manufacture, production, proceeding or repair of goods, to one paisa per unit.' The case of the Mills is that in accordance with the aforementioned notification, the respondents charged electricity duty from the petitioner from March 26, 1962 to March 2, 1963 at the rate of 3 paise per unit, whereas after March 2,1963 upto September 30, 1967 the electricity duty was charged from the Mills at 1 paisa per unit in respect of the energy consumed in the factory premises. It i9 however not disputed that the electricity duty was charged at 5 paisa per unit in respect of the energy consumed by the petitioner for residential and commercial purposes. The petitioner paid all the bills in full as and when they were presented to the Mills from March 26, 1962 to September 30, 1967. The grievance of the petitioner Mills is that on 7 -3 -68 the Mills were served with a bill showing arrear of Rs. 41,923.2 P. and the Mills were directed to deposit this amount on or before 23rd March, 1968 failing which a threat was given that the supply of electricity to the Mills would be discontinued under Section 24(1) of the Indian Electricity Act, 1910. The details as given in the bills showed that the Rajasthan Electricity Board claimed the aforesaid amount as being in arrears for the period, specified therein on account of the electricity duty on factory lighting, which was erroneously charged at 1 naya paisa per unit but should have been billed at the rate of 5 naya paisa per unit and 3 naya paisa per unit. This bill was issued by the Assistant Engineer, respondent No. 3 tinder a covering letter No. AIN/SGNR/ IX/D3912/F (Document No. 8).
(3.) THE contention of the Mills is that on a proper interpretation and construction of the terms of notification and Section 3 of the Act, the Rajasthan State Electricity Board could not have charged the electricity duty for the total energy consumed by the petitioner on the basis of the meters installed in the factory premises either for running the machinery or for lighting or for any other purposes other than residential and commercial purposes at a rate exceeding 3 naya paisa upto 26 -3 -62, and at a rate not exceeding 1 naya paisa per unit from 2 -3 -63, upto date and the bills of demand dated 7 -3 -1968 under the guise of arrears were absolutely illegal and based on calculated misreading and misinterpretation of sub -section (3) of Section 3 of the Act and the relevant portion of the notification issued by the Government of Rajasthan from time to time. The Mills having felt aggrieved by this demand lodged a protest with the Commercial Taxes Officer, Sri Ganganagar under Rule 13 of the Rajasthan State Electricity Rules, 1962 and characterised this demand as illegal and arbitrary. The Commercial Taxes Officer, Sri Ganganagar, however, rejected the petitioner's representation on the basis that he could not interfere with the order of his predecessor dated 23rd September, 1967. The petitioner then went in appeal to Deputy Commissioner Taxation (Appeals), Bikaner who accepted the appeal of the Mills and remanded the case to the Commercial Taxes Officer, Ganganagar to dispose of the representation of the Mills after hearing it. The learned Commercial Taxes Officer gave a hearing to the Mills but rejected their representation. The petitioner again preferred an appeal before the Deputy Commissioner Taxation (Appeals), Bikaner who by his order dated 26th March, 1969 rejected the appeal and held that the demand of arrears made by the State Electricity Board from the petitioner was quite in order and in consonance with the letter and spirit of the Act and the notification issued thereunder by the State Government. After the petitioner's appeal was rejected by the Deputy Commissioner Taxation (Appeals'), Bikaner, another demand notice was issued to the petitioner whereby the respondent called upon the petitioner to pay Rs. 90156.26 nP. towards the payment of electricity duty within 7 days from the receipt of the said notice. This notice also contained a threat of action under Section 24(1) of the Indian Electricity Act, 1910. It is against the judgment of the Deputy Commissioner Taxation (Appeals) Bikaner dated 26th March, 1969 upholding the demand issued on 9 -4 -69 (Document No. 13) to pay Rs. 90156.26 paise that the petitioner has filed this writ application challenging the demand raised by the respondents inter alia on the ground that in view of Section 3 of the Act and the notification issued from time to time by the State Government, the Rajasthan State .Electricity Board cannot make a demand from the Mills for the payment of the electricity duty on the energy consumed by the Mills for the purposes other than the energy consumed for commercial and residential purposes at the rate of 5 paise per unit.;