The State of Maharashtra v. Shri Vile Parle Kelvani Mandal & Ors

Case snapshot

Sections / provisions: Section 3 of Maharashtra Electricity Act 2016 and exemption notifications

Questions before the Court / Tribunal

• *The State of Maharashtra Vs Shri Vile Parle Kelvani Mandal & Ors* *Forum-Supreme Court of India* *Date- 7th January 2022* *Sub-Whether a charitable Trust/society in Maharashtra is liable to pay electricity duty under the Maharashtra Electricity Act, 2016 ?* The Supreme Court in this case was called upon to decide whether a charitable society registered under the Bombay Public Trust Act, 1950 imparting education in Maharashtra is liable to pay Electricity duty under the *Maharashtra Electricity Act 2016* which provided for exemption from payment of duty to local bodies as per Section 3 of the said Act. The respondent society/trust argued on several points including i) that the taxing statute has to be construed liberally, ii) doctrine of last antecedent etc.iii )_ taxing statute has to be considered strictly but ambiguity if any has to be decided in favour of the assessee iv) they were…
• Which factual, statutory and procedural conditions controlled the requested relief?
• How did the forum apply the governing provisions to the evidence and procedural history recorded in this case?

Material facts and procedural background

REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.7319 OF 2021 The State of Maharashtra ..Appellant (S) Versus Shri Vile Parle Kelvani Mandal & Ors. .. Respondent (S) J U D G M E N T M. R. Shah, J. 1. Feeling aggrieved and dissatisfied with the impugned judgment and order dated 28.02.2019 passed by the High Court of Judicature at Bombay in Writ Petition No.2961 of 2018, by which the High Court has allowed the said writ petition preferred by respondents No.1 to 10 herein original writ petitioners (hereinafter referred to as original writ petitioners – education institutions) and held that the original writ petitioners are exempted from payment of

electricity duty, the State of Maharashtra has preferred the present appeal. 2. That the original writ petitioners are the education institutions run and manage by original writ petitioner No.1 – Shri Vile Parle Kelvani Mandal, a society registered under the Societies Registration Act, 1860 and also a public charitable trust registered under the Maharashtra Public Trusts Act, 1950. That the writ petitioners have taken electricity connections for power supply to their education institutions from respective power supply companies. That prior to 01.09.2016, the charitable education institutions were exempted from payment of electricity duty levied on the consumption charges or the energy consumption for the purposes of or in respect of a school or college or institution imparting education or training, students' hostels, hospitals, nursing homes etc. as per Section 3(2)(iii) of the Maharashtra Electricity Duty Act, 1958. That in the year 2018, the respective electricity supply companies levied the electricity duty pursuant to a letter from the Industries, Energy and Labour Department,

Government of Maharashtra stating that as per Maharashtra Electricity Act, 2016, charitable institutions registered under the Bombay Public Trusts Act, 1950 (now known as Maharashtra Public Trusts Act, 1950) for the purpose of or in respect of school or college imparting education or training in academic or technical subjects are not entitled for electricity duty exemption with effect from 1st September, 2016. The respective power supply companies levied electricity duty at 21% and the bills were raised accordingly on original writ petitioners and their education institutions for the period post 01.09.2016. Aggrieved by the levy of electricity duty on the educational charitable institutions run by the original writ petitioner No.1 – respondent No.1 herein, original writ petitioners preferred the writ petition before the High Court. By the impugned judgment and order, the Division Bench of the High Court has allowed the said writ petition and has set aside the levy of electricity duty on writ petitioners and consequently has set aside respective electricity bills levying the electricity duty on consumption of electricity charge.

3. Feeling aggrieved and dissatisfied with the impugned judgment and order passed by the High Court, the State of Maharashtra has preferred the present appeal. 4. Shri Sachin Patil, learned counsel appearing on behalf of the State has vehemently submitted that in the facts and circumstances of the case, the High Court has committed a grave error in holding that the original writ petitioners – charitable education institutions are not liable to pay the electricity duty. 4.1 It is further submitted that in absence of challenge to the relevant provisions of the Maharashtra Electricity Act, 2016, the High Court ought not to have allowed the writ petition and ought not to have set aside the levy of electricity duty levied from charitable education institutions like the original writ petitioners. 4.2 It is further submitted by Shri Sachin Patil, learned counsel appearing on behalf of the State that the High Court has not properly appreciated and considered the

(2015) 17 SCC 664; Godrej & Boyce Mfg. Co. Ltd. Vs. Deputy Commissioner of Income Tax & Anr. , (2017) 7 SCC 421. 5. Making the above submissions and relying on the aforesaid decisions of this Court, it is prayed to allow the present appeal and quash and set aside the impugned judgment and order passed by the High Court. 6. The present appeal is vehemently opposed by Shri Shekhar Naphade, learned Senior Advocate, appearing on behalf of the original writ petitioners – respondents No.1 to 10 herein. 6.1 It is vehemently submitted by Shri Shekhar Naphade, learned Senior Advocate appearing on behalf of the original writ petitioners that in the facts and circumstances of the case and considering the fact that the original writ petitioners are charitable education institutions, the High Court has rightly held that they are exempted from payment of electricity duty.

Appellant / petitioner / assessee submissions

educational institutions being run by the original writ petitioner. 6.6 Pointing out the following aspects, it is submitted by Shri Naphade learned Senior Advocate appearing on behalf of the original writ petitioners, that as such there are no radical changes between the Maharashtra Electricity Duty Act, 1958 (1958 Act) and the Maharashtra Electricity Duty Act, 2016 (2016 Act). It is submitted that under Section 3(2) of 1958 Act, no duty could be imposed on the following entities: (a) Government of Maharashtra [Section 3(2)(i)] (b) Local authorities carrying on specified activities [Section 3(2)(ia)] (c) Licensee carrying on specified activities [Section 3(2)(ib)] (d) Tramway company [Section 3(2)(ii)] (e) Entity generating electricity for the purpose of supplying it for the use of vehicles and vessels. [Section 3(2)(iv)]

Revenue / respondent submissions

submitted that the words used are plain and simple and therefore the same should be read with the intention of the legislature particularly in favour of revenue. It is submitted that as per the law laid down by this Court in catena of decisions a taxing statute is to be construed in favour of assesse but an exception or an exemption provision from a taxing statute has to be construed strictly. It is submitted that even if there is any ambiguity in that regard the issue must be answered in favour of revenue. 4.7 In support of the above submissions, learned counsel appearing on behalf of the State has relied on the following decisions of this Court: Commr. of Customs Vs. Dilip Kumar & Co. , (2018) 9 SCC 1; Central Public Information Officer, Supreme Court of India Vs. Subhash Chandra Agarwal , (2020) 5 SCC 481; Essar Steel India Ltd. & Anr. Vs. State of Gujarat & Anr. , (2017) 8 SCC 357; Star Industries Vs. Commr. of Customs (Imports) , (2016) 2 SCC 362; Giridhar G. Yadalam Vs. Commissioner of Wealth Tax & Another ,

Court / Tribunal analysis and reasoning

before or after coming into the new Act of 2016, are not entitled to the exemption from payment of electricity duty. 4.5 It is further submitted that the High Court has not properly appreciated or considered that by virtue of the statutory provisions under the Repealed Act of 1958, the charitable education institutions were enjoying concession from payment electricity consumption duty/ electricity consumption charges and therefore there was no need to issue a specific order in their favour under the Repealed Act of 1958. It is submitted that therefore, if any order had been issued by the department in favour of any institution, it is neither an order as contemplated under Repealed Act, 1958 nor it is saved from proviso of Section 4 of the Maharashtra Electricity Duty Act, 2016. It is submitted that therefore, after commencement of the new Act of 2016, such order does not confer right upon the charitable education institutions to claim exemption. 4.6 It is further submitted that as such the language used in the new Act of 2016 with respect to the exemption/levy of electricity duty is very clear and unambiguous. It is

Reliance is placed on the decision of this Court in the case of B.R. Enterprises Vs. State of U.P. & Ors. , (1999) 9 SCC 700 (para 81). 6.5 It is further submitted that even otherwise there is presumption that legislature does not make radical changes in existing law. Reliance is placed on the decision of this Court in the case of Byram Pestonji Gariwala Vs. Union Bank of India & Ors. , (1992) 1 SCC 31 (para 29 38). It is submitted that it is not in dispute that Section 3(2) (iii a) of 1958 Act clearly provided that the electricity duty shall not be imposed on schools/colleges etc. run by charitable institutions registered under the Maharashtra Public Trusts Act, 1950. It is submitted that there is no dispute that the schools/colleges etc. of the writ petitioners fall within the purview the purview of Section 3(2)(iii a) of 1958 Act. It is submitted that therefore there is nothing in 2016 Act which warrants a conclusion that there is a radical change in law leading to duty being imposed on the

(a) Specified activities by local authorities [See Section 3(2)(ia) of 1958 Act Section 3(2)(iii) of 2016 Act. (b) Generation of electricity for construction, maintenance and operation of any generating, transmitting and distrusting system by licensee. [See Section 3(2)(ib) of 1958 Act and Section 3(2)(v) of 2016 Act. (c) Generation of electricity for the purpose of supplying for the use of vehicles or vessels [See Section 3(2)(iv) of 1958 Act and Section 3(2) (vii) of 2016 Act. (d) Generation of electricity at a voltage not exceeding 100 volts [See Section 3(2)(v) of the 1958 Act and Section 3(2)(viii) of 2016 Act. 6.11 It is submitted that thus entities who are not subject to imposition of duty have remained the same, both under 1958 Act and 2016 Act and that other activities enumerated herein above have remained same, both under 1958 Act and 2016 Act. It is submitted that therefore, it is difficult to accept that in respect of educational activities a radical change is brought about by 2016 Act by excluding educational institutions run by statutory university or by

charitable institutions. It is submitted that either it is a case of Casus Omissus or a case of bad drafting of 2016 Act. 6.12 It is submitted that 1958 Act clearly indicates that it was the policy of the legislature to exclude the educational activities run by specified entities from imposition of duty. There is nothing in the 2016 Act which would indicate that there is a radical departure in respect of educational activities. Some of the activities which are not subject to imposition of duty both under the 1958 Act and 2016 Act are commercial in nature. It is submitted that therefore if that be so then why the legislature would depart from its earlier policy in respect of educational activities as promotion of education is in public interest. It is submitted that if the commercial activities are not subject to imposition of duty then it would be unreasonable on the part of the legislature to impose duty on noncommercial activity of imparting education. It is submitted that policy of the legislature is presumed to be reasonable so that it

6.14 It is further submitted that Electricity Duty Act is a taxing statute. Therefore, it must be strictly construed and if there is any ambiguity the same must be resolved in favour of the assessee. The legislature is covering all educational activities in one provision contained in Section 3(2)(iii) irrespective of the entity which carries on the activities. While doing so the ambiguity has crept in drafting. It is submitted that the benefit of ambiguity must lean in favour of the assessee rather than the revenue. 6.15 Making the above submissions and relying on the decisions of this Court, it is prayed to dismiss the present appeal. 7. We have heard the learned counsel appearing on behalf of the respective parties at length. 8. The short question which is posed for the consideration of this Court is whether the original writ petitioners being charitable education institutions registered under the provisions of the Public Trusts Act (the Maharashtra Public Trusts Act, 1950) are entitled to the exemption from

9.3 In case of Star Industries , it was held that the eligibility criteria laid down for exemption notification is required to be construed strictly, and once it is found that applicant satisfies the same, the exemption notification should be construed liberally. Reference was made to the decision Novopan India Ltd. vs. CCE and Customs, 1994 Supp (3) SCC 606 and the Constitution Bench decision in Hansraj Gordhandas vs. H.H. Dave, Assistant Collector of Central Excise Customs, Surat & Ors. (supra), which decisions have been noted and elucidated by this Court in Dilip Kumar & Company . Therefore, in the context of exemption notification there is no new room for intendment. Regard must be to the clear meaning of the words. Claim to exemption is governed wholly by the language of the notification, which means by plain terms of the exemption clause. An assessee cannot claim benefit of exemption, on the principle that in case of ambiguity a taxing statue must be construed in his favour, for an exception or exemption provision must be construed strictly.

Operative decision and relief

Court is unsustainable both, on law and on facts and the same deserves to be dismissed. 15. In view of the above and for the reasons stated above, the present Appeal Succeeds. The impugned judgment and order dated 28.02.2019 passed by the High Court in W.P. No.2961 of 2018, is hereby quashed and set aside and it is held that the original writ petitioners – respondents No.1 to 10 herein – charitable education institutions registered under the Societies Registration Act and the Maharashtra Public Trusts Act, are not exempt from levy/payment of electricity duty levied on the consumption charges or the energy consumed even with respect to the properties used by such charitable education institutions for the purpose of or in respect of the school/college imparting education or training in academic or technical subjects. The present Appeal is accordingly allowed. There shall be no order as to costs. …………………………………J. (M. R. SHAH) …………………………………J. (SANJIV KHANNA) New Delhi, January 07, 2022.

Ratio and legal principle

The narrow proposition associated with The State of Maharashtra v. Shri Vile Parle Kelvani Mandal & Ors concerns *the state of maharashtra vs shri vile parle kelvani mandal & ors* *forum-supreme court of india* *date- 7th january 2022* *sub-whether a charitable trust/society in maharashtra is liable to pay electricity duty under the maharashtra electricity act, 2016 ?* the supreme court in this case was called upon to decide whether a charitable society registered under the bombay public trust act, 1950 imparting education in maharashtra is liable to pay electricity duty under the *maharashtra electricity act 2016* which provided for exemption from payment of duty to local bodies as per section 3 of the said act. the respondent society/trust argued on several points including i) that the taxing statute has to be construed liberally, ii) doctrine of last antecedent etc.iii )_ taxing statute has to be considered strictly but ambiguity if any has to be decided in favour of the assessee iv) they were… The proposition cannot be separated from the judgment’s facts, the governing statutory version, the forum’s jurisdiction, and the exact relief recorded in CIVIL APPEAL NO.7319 OF 2021.

For working-paper purposes, the decision should be cited only after matching the material facts and reading the passages under the judgment-grounded record above. The editorial outcome label “Quashed / set aside” is a navigation aid; it does not replace the operative order or explain every issue in a multi-issue case.

Why this judgment matters

This decision is relevant when a file raises the same central question identified in the source headnote: *The State of Maharashtra Vs Shri Vile Parle Kelvani Mandal & Ors* *Forum-Supreme Court of India* *Date- 7th January 2022* *Sub-Whether a charitable Trust/society in Maharashtra is liable to pay electricity duty under the Maharashtra Electricity Act, 2016 ?* The Supreme Court in this case was called upon to decide whether a charitable society registered under the Bombay Public Trust Act, 1950 imparting education in Maharashtra is liable to pay Electricity duty under the *Maharashtra Electricity Act 2016* which provided for exemption from payment of duty to local bodies as per Section 3 of the said Act. The respondent society/trust argued on several points including i) that the taxing statute has to be construed liberally, ii) doctrine of last antecedent etc.iii )_ taxing statute has to be considered strictly but ambiguity if any has to be decided in favour of the assessee iv) they were… Its practical value lies in the way the Supreme Court of India connected the governing provisions—Section 3 of Maharashtra Electricity Act 2016 and exemption notifications—to the procedural posture and evidence before it.

The authority level is Supreme Court. That affects persuasive or binding weight, but authority level alone is never enough. Territorial jurisdiction, statutory period, the identity of the challenged order, and later appellate treatment must all be checked before the case is used in advice, a submission, or litigation strategy.

Practitioner action points

• Begin with the complete judgment and mark the paragraphs supporting the exact proposition relied upon.
• Match the statutory version of Section 3 of Maharashtra Electricity Act 2016 and exemption notifications and the decision date 2022-01-07; do not assume the current text is identical.
• Compare the notice, assessment, appeal or other procedural sequence with the chronology recorded in this case.
• Verify the stated later-history status and any review, appeal, SLP, curative or rectification proceedings before citation.
• Record why the client’s evidence is materially similar, and also record any fact capable of distinguishing the result.

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Detailed reliance and distinction analysis

Identity check. Confirm that the cited cause title is The State of Maharashtra v. Shri Vile Parle Kelvani Mandal & Ors, the proceeding is CIVIL APPEAL NO.7319 OF 2021, and the decision is dated 2022-01-07. These fields are taken from the judgment record and should appear exactly in the citation note.

Bench check. The judgment identifies the coram as M. R. Shah, J. (authoring judge identified in judgment). A later order by another bench, a larger bench, or a higher forum may alter the weight or interpretation of the proposition.

Provision check. The source associates the dispute with Section 3 of Maharashtra Electricity Act 2016 and exemption notifications. The practitioner should place the historical statutory text next to the current text and identify every amendment, proviso, explanation, rule or notification that could change the analysis.

Fact check. The source issue is not a free-standing abstract rule. It arises from the concrete record summarized above. A reliable application note should list the common facts, the different facts, and whether each difference affects jurisdiction, admissibility, limitation, burden, computation or relief.

Remedy check. The recorded result is Quashed / set aside. Where a matter is remanded, set aside, partly allowed, or disposed with directions, the exact operative language is more important than a binary winner/loser label.

History check. The current closure state is REVIEW_CURATIVE_DOCKET_CHECK_PENDING. If that state is pending, the page does not assert that no later case exists. It means the check remains open and must be completed at the point of professional reliance.

Section / provision impact

• Section 3 of Maharashtra Electricity Act 2016 and exemption notifications — apply the exact version considered in the judgment.

Case network

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