UNION OF INDIA ETC. ETC. versus NATIONAL HYDROELECTRIC POWER CORPN. LTD. AND ORS. ETC. ETC.

Citation: [2001] SUPP. 1 S.C.R. 14 · Decided: 25-07-2001 · Supreme Court of India · Bench: B.N. KIRPAL, N. SANTOSH HEGDE, K.G. BALAKRISHNAN · Disposal: Dismissed
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Judgment (excerpt)

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UNION OF INDIA ETC. ETC. 
v. 
NA TJONAL HYDROELECTRIC POWER CORPN. LTD. 
AND ORS. ETC. ETC. 
JULY 25, '.LOO I 
[B.N. KIRPAL, N. SANTOSH HEGDE AND K.G. BALAKRISHNAN, JJ.) 
Water (Prevention and Control of Pollution) Cess Act, 1977 : 
S. I 6(2)-Amendment of Schedule I-Units causing pollution--Levy and 
collection of cess from industries specified in Schedule I-Initially hydro-
power generating industry not included in Schedule I-Notification No. GSR 
377(£) dated 16.4.1998 issued imposing cess on hydro-power generating 
industry-Challenged-High Court holding that provisions of Section 16 had 
D not been complied with while purporting to amend Schedule I-Held, High 
Court was right in holding that levy of cess was not in accordance with law--
Though the Notification was laid before the Parliament, steps leading to passing 
of resolution were not even commenced, and as such it cannot be said that 
there was a valid amendment of Schedule I to the Act-Legislation-Amendment 
of an Act-Environmental law. 
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CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2885 of 
2000. 
From the Judgment and Order dated 11.10.99 of the HimachaI Pradesh 
High Court in C.W.P. No. 403 of 1997. 
AND 
C.A. Nos. 4659-4668 of 2000 With C.A. No. 4516/2000 and 4517 I 
2000. 
D.S. Mehra, K.K. Venugopal, Ms. B. Sunita Rao, Ms. Sushma Suri, 
Satish K. Agnihotri, Ms. Yogmaya Agnihotri, Anil K. Pandey, Naresh K. 
Sharma, Dhruv Mehta, N.S. Bawa, N.D. Kalra, Ms. Karan Nehra, Ms. Shobha, 
Anil Nag, Ashok Kumar Gupta, Ajit Pudussery, Sushi! Kr. Ja!n, Ms. Jayshree 
Anand, Jagjit S. Ch'.~ura, V.K. Shailendra, Krishnan Venugopal, R.S. Suri, 
H Mahabir Singh, S.B. Upadhyay and Rajiv Nanda for the appearing parties. 
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U.0.1. v. NATIONAL HYDROELECTRIC POWER CORPN. LTD. 
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The following Order of the Court was delivered : 
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Civil Appeal Nos. 2885/2000 and 4659-4668/2000 
The short question which arises for consideration in these cases is : 
Whether there can be a valid levy under the provisions of the Water (Prevention 
and Control of Pollution) Cess Act, I977 (hereinafter referred to as "the said B 
Act") on the hydro power generating industry? 
The aforesaid Act was promulgated with a view to levy and collect cess 
from the units which were thought to cause pollution and the funds so realised 
were to be entrusted to appropriate authorities, inter a/ia, for remedial 
measures. 
According to Section 3 of the side Act, the cess was payable by every 
person carrying on any specified industry and by every local authority. The 
expression 'specified industry' is defined in Section 2(c) to mean any industry 
specified in Schedule I. 
When the Act was promulgated, hydel power generating industry was 
not included in Schedule I. In order to be able to impose cess on this industry, 
a notification No. GSR 377(E) dated 16th April, 1993 was purported to be 
issued under Section 16 of the Act. 
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D 
The respondent filed writ petitions challenging the imposition of cess E 
on the hydro power generating industry. Amongst other grounds which were 
raised, it was contended on behalf of the respondents that there had' been no 
valid amendment of Schedule I of the Act and, therefore, no cess could be 
imposed. This was one of the contentions which was accepted by the High 
Court which came to the conclusion that the provisions of Section 16 had not F 
been complied with while purporting to amend Schedule I of the Act. 
In these appeals, it has been contended by the learned Additional 
Solicitor General that a notification had been issued as contemplated by 
Section I 6 and the matter had been referred to a Parliamentary Committee 
and this shows that there had been sufficient compliance with the provisions G 
of Section 16 and the amendment should be regarded as having been duly 
incorporated in Schedule I. 
Section 16 reads as follows : 
"16. Power to amend Schedule I. - ( 1) The Central Government H 
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SUPREME COURT REPORTS [2001] SUPP. I S.C.R. 
may, by notification in the Official Gazette add to Schedule I any 
industry having regard to the consumption of water in the carrying on 
of such industry and the consequent discharge thereof resulting in 
pollution of any stream and thereupon Schedule I shall, subject to the 
provisions of sub-section (2), be deemed to be amended accordingly. 
(2) Every such notification shall be laid before each House of 
Parliament, if it is sitting, as soon as may be after the issue of the 
notification, and
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