SWAROOP VEGETABLE PRODUCTS INDUSTRIES ETC versus STATE OF U. P. AND OTHERS ETC.

Citation: [1983] 3 S.C.R. 666 · Decided: 19-08-1983 · Supreme Court of India · Bench: S. MURTAZA FAZAL ALI · Disposal: Disposed off

Judgment (excerpt)

A 
B 
c 
D 
E 
F 
G 
H 
666 
SWAROOP VEGETABLE PRODUCTS INDUSTRIES ETC, 
v. 
STATE OF U. P. AND OTHERS ETC. 
August 19, 1983 
[S. MURTAZA FAZAL ALI, A. VARADARAJAN 
AND M.P. THAKKAR, JJ.J 
U. P. Electricity (Duty) Act, 1952-Sec. 3(1) (a), (b) and (c) and sec. 4(1) 
(a), (b) and (c)-Levy and payment of electricity duty-Interpretation of. Person 
consuming ·electrical energy from own source and also purehasing from another 
source is liable to pay duty on energy consumedfrom own source. 
U. P. Electricity (Duty) Act, 1952-Notification dated 17.3.1973 under 
sec. 3(4)-Exemption from payment of duty to persons consuming electrical energy 
from own source of generation installed after 2.1.1973-Validity of. 
The appellants who had their Own source of generation of electrical 
energy (generating machinery having been installed and commissioned before 
2.1.1973) rind were also purchasing electrical energy from another source 
challenged the correctness Of the decision of a Full Bench of the High Court 
reversing the decision of a Division Bench and holding that a user of electricity 
was liable to pay electricity duty on consu111ption of energy from his own 
source of supply regardless of whether or not he also purchased electricity from 
some other source indicated in sec. 3(1) (a) and (b). The appellant contended 
that in view of the user of the expression •another person' in sec. 3(1) (c) and 
sec. 4(1) (c) only those consumers who wholly fell outside the orbit of sec: 3(1) 
(a) and (b) were exigible to electricity duty under sec. 3(1) (c). The appellant 
submitted that under Notification dl.ted March 17, 1973' exemption must be 
granted to all per.:ions having their own source of electricity regardless of the 
date on which the source generation is installed to save it from challenge under 
Art. 14 of the Constitution of India. In Civil Appeal 1312 the State of U.P. 
challenged the correctness of the decision of the Division Bench. 
Allowing the Appeal No. 1312 and dismis5ing other appeals. 
HELD : The duty was Chargeable in respect of energy consumed by a 
personJrom his own· source of generation regardl~ss of the fact that he 'also' 
purchased electricity from other source indicated in sec. 3(1) (a) and sec. 
4(1) (a). [671 G] 
On a plain reading of sec. 3(1) (c) it is evident that duty has been levied 
on the energy consumed by a person fron1 his own source of generation without 
anything more. The fact that the user of electricity from his own source of 
generation purchases electricity from some other source as we11, is an altogether 
irrelevant factor from the stand point of liability imposed by the said pro-
visions. Be it realized that duty is levied on the consumption of energy. The 
SWAROOP VEGETABLE V. U.P. 
667 
taxing event being the consumption of energy, the source from which the 
electricity is acquired would become altogether .irrelevant. Sec. 3(1) as also 
sec. 4(1) has to be read as a whole and has to be interpret.ed in a harmonious 
and meaningful manner. A person having his own source of energy who also 
purchas;.;s energy from another source indicated in sec. 3(1) (a) will be covered 
by- 3(1) (a) to the extent he purchases electricity from such a source, and wilJ 
be equally covered by sec._ 3(1) (c), in so far ·as he consunlCs energy from his 
own source of generation. He will he covered by both the provisions read 
conjointly. The same reasoning applies in the context. of clauses (a) (b) and 
(c) of sec. 4(1). There is no rational basis for exonerating a person from 
payment of duty m·erely because he has his own source of generation and he 
also Purchases electricity from some other source. In fact it will be irrational 
to do so and it .would give rise to an anachronism. Why make him pay 'only' 
if he generates his own energy and why exempt him altogether merely because 
he 'also' purchases from some other source ? . [670 D-H] 
As acute shortage of power was being experienced there was a need to 
encourage the consumers· to acquire their own source of energy with a view to 
reduce or lessen the burden on the existing sources of electricity generation. 
Obviously this Purpose can be achieved only by granting the exemption pros-
pectively to those consumers who install their own sour~ of generation of 
energy pursuant to the concession being granted under the provision for 
exemption. Those who already had their own source of generation of energy 
need no such encouragemement in respect of the so

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