Holding

Section 3(2)(iii) of the Maharashtra Electricity Duty Act, 2016 exempts only schools and colleges run by local bodies; charitable education institutions are not covered and therefore are liable to pay electricity duty.

Summary

The State of Maharashtra appealed a Bombay High Court order that had exempted charitable educational institutions, run by Shri Vile Parle Kelvani Mandal, from electricity duty levied after 1 September 2016. The institutions argued that under the earlier Maharashtra Electricity Duty Act, 1958 they were exempt, and contended that the 2016 Act should continue that exemption. The Supreme Court examined the language of Section 3(2)(iii) of the 2016 Act and compared it with the corresponding provision in the 1958 Act, noting that the 2016 Act expressly limits exemption to schools and colleges run by local bodies, excluding charitable trusts. The Court held that the words of the 2016 statute are clear, unambiguous and must be given a literal construction, meaning charitable institutions are not covered by the exemption. Consequently, the High Court’s judgment was set aside and the appeal was allowed, confirming that the charitable institutions must pay electricity duty under the 2016 Act.

Issues considered

Whether charitable education institutions registered under the Maharashtra Public Trusts Act are entitled to exemption from electricity duty under Section 3(2)(iii) of the Maharashtra Electricity Duty Act, 2016.

Legislation cited

Bombay Public Trusts Act, 1950 (now Maharashtra Public Trusts Act, 1950)
Maharashtra Electricity Duty Act, 1958s. 3(2)(ia), s. 3(2)(iiia)
Maharashtra Electricity Duty Act, 2016s. 16, s. 3(2)(iii)
Societies Registration Act, 1860

Subjects

electricity dutyexemptioncharitable institutionMaharashtra Electricity Duty Act 2016statutory interpretationliteral constructiontax laweducationpublic trust

Judgment

160 [2022]REPORTS
SUPREME COURT 1 S.C.R. 160 [2022] 1 S.C.R.

A THE STATE OF MAHARASHTRA
v.
SHRI VILE PARLE KELVANI MANDAL & ORS.
(Civil Appeal No. 7319 of 2021)
B JANUARY 07, 2022
[M. R. SHAH AND SANJIV KHANNA, JJ.]
Maharashtra Electricity Duty Act, 2016: s.3(2)(iii) – Exemption
from electricity duty under – Entitlement of charitable institutions
running the educational institutions – Held: Under 2016 Act,
C
electricity duty on the consumption charges or energy consumed
for the purposes of, or in respect of a school or college or institution
imparting education or training, student’s, hostels run by any local
bodies shall alone be exempted from levy of electricity duty – The
State Government and the Central Government are also specifically
D excluded from payment of electricity duty – However, the public
sector undertakings are not exempted from payment of electricity
Act – Therefore, under s.3(2) of the 2016 Act, the charitable
institutions running the educational institutions are not exempted
from payment of electricity duty, which as such was specifically
exempted under s.3(2)(iiia) of the 1958 Act – The language and
E
words used in s.3(2) are plain and simple and are capable of only
one definite meaning that there is no exemption provided under the
2016 Act from levy of electricity duty so far as the charitable
education institutions are concerned.
Interpretation of statutes: Where the words are clear and
F unambiguous, recourse cannot be had to principles of interpretation
other than the literal view – The exemption provision need to be
interpreted literally and when the language used in exemption
provision is simple, clear and unambiguous, the same has to be
applied rigorously, strictly and literally – Maharashtra Electricity
G Duty Act, 2016 – s.3(2)(iii).
Allowing the appeal, the Court
HELD: 1. As per Section 16 of the 2016 Act, on coming
into force of the 2016 Act, the Maharashtra Electricity Duty Act,
1958 stood repealed subject to the eventualities mentioned in
H
160
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 161
MANDAL

Section 16 of the 2016 Act. None of the eventuality mentioned in A
proviso to Section 16 shall be attracted and/or applicable to the
facts of the case on hand in view of the specific provisions
providing for exemption from payment of the electricity duty as
per sub-section (2) of Section 3 of the 2016 Act. Therefore,
for the purpose of exemption from payment of electricity duty
B
on and after 01.09.2016, sub- section (2) of Section 3 of the
2016 Act shall have to be applied and shall be applicable.
[Para 11.1][178-D-E]
2. As per sub-section (2) of Section 3 of the 1958 Act, the
electricity duty was not leviable on the consumption charges or
the units of energy consumed by or in respect of charitable C
institution registered under the Bombay Public Trusts Act, 1950,
for the purpose of, or in respect of, school or college imparting
education or training in academic or technical subjects (save in
respect of premises used for residential purposes) [Section
3(2)(iiia)]. Therefore, under the 1958 Act, the electricity duty D
was not leviable on the consumption charges or the units of energy
consumed by or in respect of charitable institutions for the
purpose; in respect of school or college imparting education or
training in academic or technical subjects. Even as per Section
3(2)(ia), electricity duty shall not be leviable on the consumption
charges or the units of energy consumed by or in a respect of any E
municipal corporation, municipality, municipal committee, town
committee, notified area committee, Cantonment Board, Zilla
Parishad or village panchyat constituted under any law for the
time being in force in the State, for the purpose of, or in respect
of a school or college imparting education or training in academic F
or technical subjects, a hospital, nursing home, dispensary, clinic,
public street lighting, public water works and system of public
sewers or drains (save in respect of premises used for residential
purposes. However, there are material changes under the 2016
Act. As per Section 3(2) of the 2016 Act, even the public
undertakings are liable to pay the electricity duty. As per Section G
3(2)(iii), electricity duty is not leviable on the consumption
charges or energy consumed, for the purposes of, or in respect
of a school or college or institution imparting education or
training, student’s, hostels, hospitals, nursing homes,
H
162 SUPREME COURT REPORTS [2022] 1 S.C.R.

A dispensaries, clinics, public streets lighting, public water works,
sewerage systems, public gardens including zoos, public
museums, administrative offices forming whole or, as the case
may be, a part of system run by any local bodies constituted under
any law for the time being in force in the State of Maharashtra.
Therefore, Section 3(2)(iiia), which was there in 1958 Act, is now
B
conspicuously and deliberately absent in Section 3(2) of the 2016
Act. [Paras 11.2, 11.3][178-E-H; 179-A-D]
3. Where the words are clear and unambiguous, recourse
cannot be had to principles of interpretation other than the literal
view. The exemption provision need to be interpreted literally
C and when the language used in exemption provision is simple,
clear and unambiguous, the same has to be applied rigorously,
strictly and literally. Under the 2016 Act, charitable education
institutions running the schools or colleges are specifically
excluded from the exemption clause/exemption provision –
D Section 3(2). [Para 11.4][179-G-H; 180-A]
4. If the submissions on behalf of the original writ
petitioners is accepted that as per Section 3(2)(iii), with respect
to all the schools/colleges or institutions, imparting education or
training, the electricity duty is not leviable, in that case it would
E lead to absurd result. In that case, even the private hospitals,
nursing homes, dispensaries and clinics, who are profit making
entities shall also claim the exemption from levy of electricity
duty. The intention of the legislature as per Section 3(2) of the
2016 Act, is very clear and unambiguous that the electricity duty
shall not be leviable on the consumption charges or energy
F consumed (i) by the State Government excluding the public sector
undertakings; (ii) by the Central Government excluding public
sector undertakings and (iii) run by the local bodies constituted
under any law for the time being in force in the State of
Maharashtra. Other than the State Government, Central
G Government and the local bodies and the Government hostels,
no exemption from payment of electricity duty has been provided.
[Para 12][180-B-D]
Commr. of Customs v. Dilip Kumar & Co. (2018) 9 SCC
1 : [2018] 7 SCR 1191 – followed.
H
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 163
MANDAL

Essar Steel India Ltd. & Anr. v. State of Gujarat & Anr., A
(2017) 8 SCC 357 : [2017] 4 SCR 767; Novopan India
Ltd. v. CCE and Customs, 1994 Supp (3) SCC 606 :
[1994] 3 Suppl. SCR 549; Hansraj Gordhandas v. H.H.
Dave, Assistant Collector of Central Excise Customs,
Surat & Ors., AIR 1970 SC 755 : [1969] SCR 253;
B
Star Industries v. Commr. of Customs (Imports) (2016)
2 SCC 362 : [2015] 11 SCR 570; Giridhar G. Yadalam
v. Commissioner of Wealth Tax & Another (2015) 17
SCC 664 : [2015] 15 SCR 543; Godrej & Boyce Mfg.
Co. Ltd. v. Deputy Commissioner of Income Tax & Anr.,
(2017) 7 SCC 421:[ 2017] 3 SCR 602 – relied on. C
Central Public Information Officer, Supreme Court of
India v. Subhash Chandra Agarwal, (2020) 5 SCC 481:
[2019] 16 SCR 424; C.W.S. (India) Ltd. v. Commissioner
of Income Tax, 1994 Supp (2) SCC 296 : [1994] 2 SCR
247; B.R. Enterprises v. State of U.P. & Ors. (1999) 9 D
SCC 700 : [1999] 2 SCR 1111; Byram Pestonji Gariwala
v. Union Bank of India & Ors. (1992) 1 SCC 31 : [1991]
1 Suppl. SCR 187; Collector of Central Excise,
Bombay-I & Anr. v. Parle Exports (P) Ltd., (1989) 1
SCC 345 : [1988] 3 Suppl. SCR 933; Union of India
& Ors. v. Wood Papers Ltd. & Anr. (1998) 4 SCC 256 – E
referred to.
Case Law Reference
[2018] 7 SCR 1191 followed Para 4.7
[2019] 16 SCR 424 referred to Para 4.7 F
[2017] 4 SCR 767 relied on Para 4.7
[2015] 11 SCR 570 relied on Para 4.7
[2015] 15 SCR 543 relied on Para 4.7
[2017] 3 SCR 602 relied on Para 4.7 G

[1994] 2 SCR 247 relied on Para 6.2
[1999] 2 SCR 1111 referred to Para 6.4

H
164 SUPREME COURT REPORTS [2022] 1 S.C.R.

A [1991] 1 Suppl. SCR 187 referred to Para 6.5
[1969] SCR 253 referred to Para 9.1
[1988] 3 Suppl. SCR 933 referred to Para 9.1
(1998) 4 SCC 256 referred to Para 9.1
B [1994] 3 Suppl. SCR 549 relied on Para 9.3
CIVIL APPELLATE JURISDICTION: Civil Appeal No.7319 of
2021.
From the Judgment and Order dated 28.02.2019 of the High Court
of Judicature at Bombay in Writ Petition No.2961 of 2018.
C
Sachin Patil, Rahul Chitnis, Aaditya A. Pande, Geo Joseph, Advs.
for the Appellant.
Shekhar Naphade, Sr. Adv., Gagan Gupta, Mehendra Pratap, Mrs.
Manorma Mohanty, Gaurav Kumar, M/s Khaitan & Co., Advs. for the
D Respondents.
The Judgment of the Court was delivered by
M. R. SHAH, J.
1. Feeling aggrieved and dissatisfied with the impugned judgment
E 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
F 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
G 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
H
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 165
MANDAL [M. R. SHAH, J.]

institution imparting education or training, students’ hostels, hospitals, A
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
B
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 C
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
D
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 E
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 F
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 G
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 relevant provisions pre and post the
Maharashtra Electricity Act, 2016. H
166 SUPREME COURT REPORTS [2022] 1 S.C.R.

A 4.3 It is submitted that as per Section 3(2)(a)(iiia) of the
Maharashtra Electricity Duty Act, 1958, the charitable intuitions registered
under the Bombay Public Trusts Act, for the purpose of, or in respect of,
school or college, imparting education or training in academic or technical
subjects (save in respect of premises used for residential purposes) were
exempted from levy of the electricity duty on the consumption charges
B
or the units of energy consumed. It is submitted that however, on
enactment of the Maharashtra Electricity Duty Act, 2016 which repealed
the earlier the Maharashtra Electricity Duty Act, 1958, no such exemption
from levy/payment of electricity duty has been provided to such charitable
education institutions.
C 4.4 It is submitted that the High Court has failed to consider there
is no provision, similar to the Repealed Act of 1958 (the Maharashtra
Electricity Duty Act, 1958) in the new Act, 2016 (Maharashtra Electricity
Duty Act, 2016), and the charitable education institutions whether
registered before or after coming into the new Act of 2016, are not
D 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
E
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,
F 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 submitted that the words used are
G 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
H answered in favour of revenue.
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 167
MANDAL [M. R. SHAH, J.]

4.7 In support of the above submissions, learned counsel appearing A
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
B
Industries Vs. Commr. of Customs (Imports), (2016) 2 SCC 362;
Giridhar G. Yadalam Vs. Commissioner of Wealth Tax & Another,
(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 C
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. D

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 E
duty.
6.2 It is submitted by Shri Naphade, learned Senior Advocate
appearing on behalf of the original writ petitioners that as observed by
this Court in the case of C.W.S. (India) Ltd. Vs. Commissioner of
Income Tax, 1994 Supp (2) SCC 296 (para 10), where a literal F
interpretation leads to absurd result, the wording of the statute can be
modified to accord with the intention of the legislature and to avoid
absurdity.
6.3 It is submitted that if the interpretation canvassed by the state
is accepted then it will lead to absurdity and manifest injustice as school/ G
colleges etc. run by the local authority will fall within the purview of
Section 3(2)(iii) of 2016 Act, while those run by the statutory university
or charitable institution registered under Bombay Trusts Act, 1950 (now
known as Maharashtra Public Trusts Act, 1950), would fall outside the
ambit of Section 3(2)(iii). It is submitted that as such there is no essential
H
168 SUPREME COURT REPORTS [2022] 1 S.C.R.

A difference between schools/colleges etc. run by the statutory university
or institution registered under the Maharashtra Public Trusts Act, 1950
and those run by the local authority. It is submitted that such absurdity or
injustice cannot be the intention of the legislature.
6.4 It is further submitted by Shri Naphade, learned Senior
B Advocate appearing on behalf of the original writ petitioners that there
is always a presumption that the legislature does not intend to violate
Article 14 of the Constitution of India. It is submitted that as per the
case on behalf of the State, Section 3(2)(iii) of 2016 Act covers only
schools/colleges etc. of the local authority and those run by the statutory
university or by private institutions are outside the scope of Section 3(2)(iii)
C of 2016 Act. It is submitted that this would lead to discrimination and
arbitrariness. It is submitted that who runs the educational institution
cannot be the intelligible differentia for the purpose of classification. It is
submitted that if such an interpretation is accepted then Section 3(2)(iii)
would be ultra vires Article 14 of the Constitution. It is submitted that
D while interpreting Section 3(2)(iii) of 2016 Act, Article 14 must be
considered and interpretation which would accord with the mandate of
Article 14 should be adopted. 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).
E 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).

F 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
G 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
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
H writ petitioners, that as such there are no radical changes between the
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 169
MANDAL [M. R. SHAH, J.]

Maharashtra Electricity Duty Act, 1958 (1958 Act) and the Maharashtra A
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)] B

(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)] C
Note- under 1958 Act no duty could be imposed on the Central
Government due to the provisions of Article 285 of the
Constitution.
6.6.1 It is further submitted that under Section 3(2) of 2016 Act
D
no duty can be imposed on the following entities:-
(a) State Government [Section 3(2)(i)]
(b) Central Government [Section 3(2) (ii)]
This is by way abundant caution as no duty can be imposed
on the Central Government due to Article 285 of the E
Constitution.
(c) Licensee carrying on specified activities. [Section 3(2)(v)]
(d) Generating Company [Section 3(2)(vi)]
(e) Entity generating electricity for use of vehicles and vessels F
[Section 3(2)(vii)]
Note- At present there is Tramway company in the State of
Maharashtra. Thus there is no change in 2016 Act as regards
the entities who are not subject to imposition of duty.
6.6.2 Further, under Section 3(2) of the 1958 Act no duty could be G
imposed on following activities:-
(a) Educational institutions run by local authority or statutory
university, or charitable institution registered under Bombay
Trusts Act, 1950. [Section 3(2)(ia), 3(2)(iii) and 3(2)(iiia)]
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170 SUPREME COURT REPORTS [2022] 1 S.C.R.

A (b) Local authority using electricity for hospital, nursing home,
dispensary, clinic, public street lighting, public water works,
system of public sewers or drains. [Section 3(2)(ia)]
(c) Use of electricity by licensee for the purpose of construction,
maintenance, or operation of any generating, transmitting
B and distributing system. [Section 3(2)(ib)]
(d) Generation of electricity for the purpose of supplying it for
the use of vehicles or vessels. [Section 3(2)(iv)]
(e) Where the energy is generated at a voltage not exceeding
100 volts. [Section 3(2)(v)]
C
6.7 It is submitted that both under the 1958 Act and 2016 Act, the
premises used by entities specified under Section 3(2) for the purpose of
residence are subject to imposition of duty.
6.8 It is submitted that aforesaid analysis clearly shows that the
D entities on whom no duty can be imposed have remained the same subject
to the rider that if the premises are used for residence, duty can be
imposed.
6.9 It is submitted that the only question is whether educational
activities carried on by local authorities, statutory university or a charitable
institution registered under the Bombay Trusts Act, 1950 are within the
E
purview of Section 3(2) of the 2016 Act?
6.10 It is submitted that it is not in dispute that under the 1958 Act,
the educational institutions carried out by local authorities, statutory
university, or the charitable institutions were not subject to imposition of
duty. The other activities which are not subject to imposition of electricity
F
duty, both under the 1958 Act and 2016 Act are as follows:-
(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
G 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
H Act and Section 3(2) (vii) of 2016 Act.
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 171
MANDAL [M. R. SHAH, J.]

(d) Generation of electricity at a voltage not exceeding 100 A
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 B
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. C

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 D
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 E
be unreasonable on the part of the legislature to impose duty on non-
commercial activity of imparting education. It is submitted that policy of
the legislature is presumed to be reasonable so that it does not fall foul
principle of unreasonableness or arbitrariness.
6.13 Lastly, it is submitted by Shri Naphade learned Senior F
Advocate appearing on behalf of the writ petitioners, that in the present
case the doctrine of last antecedent may also be applied. It is submitted
that first part of Section 3(2) covers all educational activities irrespective
of the entity which carries on such activities. It is submitted that in the
1958 Act in Section 3(2), the following words used are “for the purposes
of or in respect of school ……. Students hostel” and in the second part G
of Section 3(2) deals with activities carried on by the local authorities. It
is submitted that in the 2016 Act, the expression “Run by any local
bodies……State of Maharashtra” does not qualify the educational
activities but it qualifies activities namely “Hospitals, nursing homes…….a
part of system”. It is submitted that if the doctrine of Last Antecedent is H
172 SUPREME COURT REPORTS [2022] 1 S.C.R.

A applied to the present case, the only possible conclusion is that the
expression “Run by any local bodies” does not qualify educational activities
referred to in first part of Section 3(2) but qualifies the second part i.e.
the other activities.
6.14 It is further submitted that Electricity Duty Act is a taxing
B 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
C 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.
D
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
payment of electricity duty post 01.09.2016 i.e. as per the provisions of
E the Maharashtra Electricity Duty Act, 2016?
9. While answering the aforesaid question/issue, law on how to
interpret and/or consider the statutory provisions in the taxing statute
and the exemption notifications is required to be analysed first.
9.1 In the case of Dilip Kumar & Company (supra), five-judge
F bench of this Court has held that in every taxing statute –– the charging,
the computation and exemption provisions at the threshold stage should
be interpreted strictly. In case of ambiguity in case of charging provision,
the benefit necessarily must go into favour of the subject/assessee. This
means that the subject of tax, the person liable to pay tax and the rate at
which the tax is to be levied have to be interpreted and construed strictly.
G
If there is any ambiguity in any of these three components, no tax can be
levied till the ambiguity or defect was removed by the legislature [See
pages 53 to 55 in Dilip Kumar & Company]. However, in case of
exemption notification or clause, same is to be allowed based wholly by
the language of the notification, and exemption cannot be gathered by
H necessary implication, or on a construction different from the words
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 173
MANDAL [M. R. SHAH, J.]

used by reference to the object and purpose of granting exemption [See A
Hansraj Gordhandas Vs. H.H. Dave, Assistant Collector of Central
Excise Customs, Surat & Ors., AIR 1970 SC 755]. Further it’s for
the assessee to show by construction of the exemption clause/notification
that it comes within the purview of exemption. The assessee/citizen
cannot rely on ambiguity or doubt to claim benefit of exemption. The
B
rationale is not to widen the ambit at the stage of applicability. However,
once the hurdle is crossed, the notification is constructed liberally [See
Collector of Central Excise, Bombay-I & Anr. vs. Parle Exports
(P) Ltd., (1989) 1 SCC 345 and Union of India & Ors. vs. Wood
Papers Ltd. & Anr., (1998) 4 SCC 256]. Thus, distinction can be
made between the substantive requirements that require strict compliance C
– non-compliance of which would render the assessee ineligible to claim
exemption, and the procedural or compliance provision which can be
interpreted liberally [See paragraphs 64 to 65 in Dilip Kumar &
Company].
9.2 Essar Steel India Ltd. & Anr. was a case relating to grant D
of exemption under Section 3(2)(vii)(a) from payment of electricity duty
under the 1958 Act. The court relied on several decisions on interpretation
of notification in nature of exemption, to hold that the statutory conditions
for grant of exemption can neither be tinkered with nor diluted. The
exemption notification must be interpreted by their own wordings, and
where the wordings of notification with regard the construction is clear, E
it has to be given effect to. If on the wordings of the notification benefit
is not available, then the court would not grant benefit by stretching the
words of the notification or by adding words to the notification. To interpret
the exemption notification one should go by the clear, unambiguous
wordings thereof. These principles were applied in Essar Steel India F
Ltd. & Anr. to deny benefit of Section 3(2)(vii)(a) of the 1958 Act, as
the condition of generating energy jointly with another undertaking was
not fulfilled.
9.3 In case of Star Industries, it was held that the eligibility
criteria laid down for exemption notification is required to be construed G
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 H
174 SUPREME COURT REPORTS [2022] 1 S.C.R.

A 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
B
in his favour, for an exception or exemption provision must be construed
strictly.
9.4 In the case of Giridhar G. Yadalam(supra), it is observed and
held that in taxing statute, it is the plain language of the provision that
has to be preferred where language is plain and is capable of one definite
C meaning. It is further observed that the strict interpretation to the
exemption provision is to be accorded. It is observed that the purposive
interpretation can be given only when there is some ambiguity in the
language of the statutory provision or it leads to absurd results. In
paragraph 16, it is observed and held as under:-
D “16. We have already pointed out that on the plain language of
the provision in question, the benefit of the said clause would be
applicable only in respect of the building “which has been
constructed”. The expression “has been constructed” obviously
cannot include within its sweep a building which is not fully
E constructed or in the process of construction. The opening words
of clause (ii) also become important in this behalf, where it is
stated that “the land occupied by any building”. The land cannot
be treated to be occupied by a building where it is still under
construction. If the contention of Mr Jain is accepted, an assessee
would become entitled to the benefit of the said clause, at that
F very moment, the commencement of construction even with
construction the moment one brick is laid. It would be too far-
fetched, in such a situation, to say that the land stands occupied
by a building that has been constructed thereon. Even Mr Jain
was candid in accepting that when the construction of building is
G still going on and is not completed, literally speaking, it cannot be
said that the building “has been constructed”. It is for this reason
that he wanted us to give the benefit of this provision even in such
cases by reading the expression to mean the same as “is being
constructed”. His submission was that the moment construction
starts the urban land is put to “productive use” and that entitles
H the land from exemption of wealth tax. This argument of giving
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 175
MANDAL [M. R. SHAH, J.]

so-called purposive interpretation has to be rejected for more than A
one reasons. These are:
(i) In taxing statute, it is the plain language of the provision that
has to be preferred where language is plain and is capable of one
definite meaning.
(ii) Strict interpretation to the exemption provision is to be accorded, B
which is the case at hand.
(iii) The purposive interpretation can be given only when there is
some ambiguity in the language of the statutory provision or it
leads to absurd results. We do not find it to be so in the present
case.” C

9.5 In the case of Godrej & Boyce Mfg. Co. Ltd. (supra), it is
observed and held by this Court that where the words of the statute are
clear and unambiguous, recourse cannot be had to principles of
interpretation other than the literal view. It is further observed that it is
the bounden duty and obligation of the court to interpret the statute as it D
is. It is further observed that it is contrary to all rules of construction to
read words into a statute which the legislature in its wisdom has
deliberately not incorporated.
10. Applying the law laid down by this Court in the aforesaid
decisions to the facts of the case on hand, it is required to be considered E
whether post 01.09.2016 and on coming into force the 2016 Act, still, the
writ petitioners – charitable education institutions registered under the
Public Trusts Act and or the Societies Registration Act are entitled to
the exemption from payment of electricity duty?
11. For the aforesaid purpose, the charging sections/exemption F
provisions under the pre Act of 2016 and post Act of 2016 are required
to be referred to. Section 3 of the Maharashtra Electricity Duty Act,
1958, which was applicable prior to coming into force of the Maharashtra
Electricity Duty Act, 2016, relevant for our purpose reads as under:-
“3. (1) Subject to the provisions of sub-section (2), there shall be G
levied and paid to the State Government on the 1[consumption
charges or the] units of energy consumed (excluding losses of
energy sustained in transmission and transformation by a licensee
before supply to a consumer), a duty (hereinafter referred to as”
electricity duty”) at the rates specified in the Schedule to this Act.
H
176 SUPREME COURT REPORTS [2022] 1 S.C.R.

A (2) (a) Electricity duty shall not be leviable on the 3[consumption
charges or the] units of energy consumed,—
(i) by the Government of Maharashtra (save in respect of
premises used for residential purposes);
(ia) by or in a respect of any municipal corporation,
B municipality, municipal committee, town committee, notified
area committee, Cantonment Board, Zilla Parishad or village
panchyat constituted under any law for the time being in
force in the State, for the purpose of, or in respect of 5[ a
school or college imparting education or training in academic
C or technical subjects, a hospital, nursing home, dispensary,
clinic, public street lighting, public water works and system
of public sewers or drains (save in respect of premises used
for residential purposes);
(ib) by any licensee for purposes directly connected with
D construction, maintenance or operation of any generating,
transmitting and distributing system of the licensee;
(ii) by a tramway company, save in respect of premises used
for residential and office purposes;
(iii) by or in respect of any statutory University and institutions
E run by the statutory University for the purpose of or in respect
of education, research and training (save in respect of premises
used for residential purposes);
(iiia) by or in respect of charitable institution registered under
the Bombay Public Trusts Act, 1950, for the purpose of, or
F in respect of, school or college imparting education or
training in academic or technical subjects (save in respect
of premises used for residential purposes);”
That thereafter the Maharashtra Electricity Duty Act, 2016 has
been enacted, which has come into effect from 08.08.2016. Section 3 of
G the 2016 Act, relevant for our purpose reads as under:-
“3. (1) Subject to the provisions of sub-section (2), there shall be
levied and paid to the State Government, on the consumption
charges or the units of energy consumed, a duty (hereinafter
referred to as “Electricity Duty”) at the rates classified as per the
H Tariff Schedule of the Commission, from time to time, on the basis
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 177
MANDAL [M. R. SHAH, J.]

of use of the premises by the consumer on whose name energy is A
supplied by the licensee, or a consumer who is consuming energy
produced from an independent source other than that supplied by
the licensee, for his own use as specified in the Schedules, which
are based on the following classifications :––
(a) the consumption charges where energy is supplied by the B
licensee;
Explanation.–– For the purpose of this sub-section, “use of the
premises by the consumer on whose name energy is supplied”
means the basis of purpose for which the consumer in whose
name supply has been released and measured by the meter C
installed at point of supply by the licensee, on which the
consumption charges are billed as per the tariff, however, in
huge industrial parks, commercial premises or malls where
electricity is supplied at single point or as bulk consumers and
further it is re-distributed as one of the utility service provided
by the owner of the premises to the end users occupying the D
area on lease or rent or otherwise, whose purpose of use of
electricity at the user’s end may vary categorically;
(b) units of energy consumed by a person and energy produced
through the–
E
(i) Captive generation;
(ii) Co-generation;
(iii) Standby generation;
(iv) Renewable Energy; or
(v) Independent Power Producer (IPP); F

(c) units of energy consumed which are not covered under
clauses (a) and (b), that is, open access or other sources.
(2) Electricity duty shall not be levied on the consumption charges
or energy consumed,–– G
(i) by the State Government excluding the public undertakings;
(ii) by the Central Government excluding the public
undertakings;
(iii) for the purposes of, or in respect of a school or college or
institution imparting education or training, student’s, hostels, H
178 SUPREME COURT REPORTS [2022] 1 S.C.R.

A hospitals, nursing homes, dispensaries, clinics, public streets
lighting, public water works, sewerage systems, public gardens
including zoos, public museums, administrative offices forming
whole or, as the case may be, a part of system run by any local
bodies constituted under any law for the time being in force in
the State of Maharashtra;
B
(iv) by the Government hostels;
(v) by any licensee, or by any other person engaged in the
business of supplying electricity to the public under the
Electricity Act, for the purposes directly connected with
C construction, maintenance, operation of any transmitting and
distributing system, including the losses incurred therein;”
11.1 As per Section 16 of the 2016 Act, on coming into force the
2016 Act, the Maharashtra Electricity Duty Act, 1958 stood repealed
subject to the eventualities mentioned in Section 16 of the 2016 Act.
D None of the eventuality mentioned in proviso to Section 16 shall be
attracted and/or applicable to the facts of the case on hand in view of
the specific provisions providing for exemption from payment of the
electricity duty as per sub-section (2) of Section 3 of the 2016 Act.
Therefore, for the purpose of exemption from payment of electricity
duty on and after 01.09.2016, sub-section (2) of Section 3 of the 2016
E Act shall have to be applied and shall be applicable.
11.2 As per sub-section (2) of Section 3 of the 1958 Act, the
electricity duty was not leviable on the consumption charges or the units
of energy consumed…………..by or in respect of charitable institution
registered under the Bombay Public Trusts Act, 1950, for the purpose
F of, or in respect of, school or college imparting education or training in
academic or technical subjects (save in respect of premises used for
residential purposes) [Section 3(2)(iiia)]. Therefore, under the 1958 Act,
the electricity duty was not leviable on the consumption charges or the
units of energy consumed by or in respect of charitable institutions for
G the purpose; in respect of school or college imparting education or training
in academic or technical subjects. Even as per Section 3(2)(ia), electricity
duty shall not be leviable on the consumption charges or the units of
energy consumed by or in a respect of any municipal corporation,
municipality, municipal committee, town committee, notified area
committee, Cantonment Board, Zilla Parishad or village panchyat
H constituted under any law for the time being in force in the State, for the
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 179
MANDAL [M. R. SHAH, J.]

purpose of, or in respect of a school or college imparting education or A
training in academic or technical subjects, a hospital, nursing home,
dispensary, clinic, public street lighting, public water works and system
of public sewers or drains (save in respect of premises used for residential
purposes.
11.3 However, there are material changes under the 2016 Act. B
As per Section 3(2) of the 2016 Act, even the public undertakings are
liable to pay the electricity duty. As per Section 3(2)(iii), electricity duty
is not leviable on the consumption charges or energy consumed, for the
purposes of, or in respect of a school or college or institution imparting
education or training, student’s, hostels, hospitals, nursing homes,
C
dispensaries, clinics, public streets lighting, public water works, sewerage
systems, public gardens including zoos, public museums, administrative
offices forming whole or, as the case may be, a part of system run by
any local bodies constituted under any law for the time being in force in
the State of Maharashtra. Therefore, Section 3(2)(iiia), which was there
in 1958 Act, is now conspicuously and deliberately absent in Section D
3(2) of the 2016 Act.
11.4 On true interpretation of Section 3(2)(iii), under 2016 Act,
electricity duty on the consumption of charges or energy consumed for
the purposes of, or in respect of a school or college or institution imparting
education or training, student’s, hostels………….run by any local bodies E
shall alone be exempted from levy of electricity duty and the State
Government and Central Government are also specifically excluded from
payment of electricity duty. However, the public sector undertakings are
not exempted from payment of electricity Act. Therefore, under Section
3(2) of the 2016 Act, the charitable institutions running the educational
F
institutions are not exempted from payment of electricity duty, which as
such was specifically exempted under Section 3(2)(iiia) of the 1958 Act.
The language and words used in Section 3(2) are plain and simple and
are capable of only one definite meaning that there is no exemption
provided under the 2016 Act from levy of electricity duty so far as the
charitable education institutions are concerned. As observed herein above, G
where the words are clear and unambiguous, recourse cannot be had to
principles of interpretation other than the literal view. As observed
hereinabove, the exemption provision need to be interpreted literally and
when the language used in exemption provision is simple, clear and
unambiguous, the same has to be applied rigorously, strictly and literally.
H
180 SUPREME COURT REPORTS [2022] 1 S.C.R.

A Under the 2016 Act, charitable education institutions running the schools
or colleges are specifically excluded from the exemption clause/
exemption provision – Section 3(2).
12. If the submissions on behalf of the original writ petitioners is
accepted that as per Section 3(2)(iii), with respect to all the schools/
B colleges or institutions, imparting education or training, the electricity
duty is not leviable, in that case it would lead to absurd result. In that
case, even the private hospitals, nursing homes, dispensaries and clinics,
who are profit making entities shall also claim the exemption from levy
of electricity duty. The intention of the legislature as per Section 3(2) of
the 2016 Act, is very clear and unambiguous that the electricity duty
C shall not be leviable on the consumption charges or energy consumed (i)
by the State Government excluding the public sector undertakings; (ii)
by the Central Government excluding public sector undertakings and
(iii) ……. run by the local bodies constituted under any law for the time
being in force in the State of Maharashtra. Other than the State
D Government, Central Government and the local bodies and the
Government hostels, no exemption from payment of electricity duty has
been provided.
13. In view of the above findings recorded hereinabove, there is
no question of applying the doctrine of Last Antecedents as canvassed
E by Shri Naphade, learned Senior Advocate, appearing on behalf of the
original writ petitioners.
14. In that view of the above the original writ petitioners – charitable
education institutions registered under the provisions of the Societies
Registration Act and/or under the Maharashtra Public Trusts Act, are
F not entitled to any exemption from levy/payment of the electricity duty
on or after 08.08.2016 i.e. from the date on which the Maharashtra
Electricity Duty Act, 2016 came into effect. Therefore, the High Court
has committed a grave error in setting aside the levy of electricity duty
levied on the original writ petitioners – respondents No.1 to 10 herein.
The impugned judgment and order passed by the High Court is
G unsustainable both, on law and on facts and the same deserves to be
dismissed.
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
H and set aside and it is held that the original writ petitioners – respondents
THE STATE OF MAHARASHTRA v. SHRI VILE PARLE KELVANI 181
MANDAL [M. R. SHAH, J.]

No.1 to 10 herein – charitable education institutions registered under the A
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
B
or technical subjects. The present Appeal is accordingly allowed. There
shall be no order as to costs.

Devika Gujral Appeal allowed.

C

D

E

F

G

H