1961 (10) TMI 76

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.... It generates electricity for the purpose of running its mills and for other purpose connected therewith. It does not sell electrical energy to any person. Under the provisions of the Central Provinces and Berar Electricity Duty Act, 1949 (No. 10 of 1949)as amended by the Madhya Pradesh Taxation Laws Amendment Act, 1956 (Act No. 7 of 1956) the Government of Madhya Pradesh levied upon the appellant electricity duty amounting to Rs. 2,78,417/- for a certain period. The appellant paid it under compulsion and thereafter preferred a writ petition to the High Court of Madhya Pradesh under Art. 226              of the Constitution in which it challenged the validity of the levy on....

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....d by himself or his employees during the preceding month.     Table Rates of Duty     (i) Electrical energy supplied for consumption for lights, fans of any other appliances normally connected to a lighting circuit.     6 nP. per unit of energy.     (ii) Electrical energy supplied for purposes other than those specified in item (i) above.     1 nP. per unit of energy. This is the charging section. It is not disputed by Mr. Sastri that under this provision a producer of electrical energy is made liable to pay duty for the units of electrical energy consumed by himself. He, however, contends that rates of duty have been prescribed in the Table below s....

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....levy of duty upon consumption of electrical energy can be regarded as duty of excise falling within Entry 84 of List I. Under that Entry what is permitted to Parliament is levy of duty of excise on manufacture or production of goods (other than those excepted expressly by that entry). The taxable event with respect to a duty of excise is "manufacture" or "production". Here the taxable event is not production or generation of electrical energy but its consumption. If producer generates electrical energy and stores it up, he would not be required to pay any duty under the Act. It is only when he sells, it or consumes it that he would be rendered liable to pay any duty prescribed by the Act. The Central Provinces and Berar Electricity Act was ....