TaxTMI 
TaxTMI 
2025 (6) TMI 753
X X X X Extracts X X X X
X X X X Extracts X X X X
....10451, 13268, 13317, 13297, 13327, 13341, 18832, 18841, 18840, 19073, 19077, 19075, 19079, 27903, 27906, 27914, 27917, 27924, 27966, 27959, 27921, 27970, 27946, 27951, 27955, 32632, 32638, 32636, 32671, 32681, 32679, 32676, 32674, 34395, 34407, 34403, 34412, 34409, 34622, 34644, 34633, 34629, 34637, 34783, 35055, 35070, 35063, 35085, 35076, 35081, 35863, 35870 & 35867 of 2023; 1565, 1578, 1573, 2057, 2062, 2061, 2059, 2058, 2366, 2663, 2661, 2658, 2655, 2371, 2370, 3308, 3310, 4030, 5390, 5397, 5401, 5404, 5392, 5396, 6224, 6230, 6236, 6797, 6803, 6800, 6798, 8136, 8148, 8152, 8146, 14888, 14893, 14897, 14896, 15793, 15796, 15794, 16337, 16350, 16353, 16348, 16349, 16344, 16345, 16346, 18638, 20895, 20908, 22090, 22094, 22099, 27572, 27577, 29689, 29702, 29696, 29706, 32192, 32197, 32195, 35704, 35710, 38058, 38067 & 38064 of 2024; 571, 578, 574, 674, 682, 679, 714, 719, 730, 722, 8172, 8181, 8177, 8495, 8502, 8499, 13051, 13067, 13061, 13058, 14829, 14835 and 14839 of 2025 and W.M.P.Nos.4989, 4988, 4987, 4996, 4995, 4994, 6955, 6958, 6959, 6964, 6965, 6966, 6967, 7010, 7011, 7012, 6969, 6970, 7223, 7219, 7216, 7230, 7229, 7228, 7225, 7217, 7226, 7333, 7322, 7321, 7332, 7331, 7337,....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., 32288, 32287, 32286, 32281, 32279, 32278, 32276, 32273, 32290, 34324, 34314, 34313, 34312, 34305, 34302, 34301, 34323, 34331, 34330, 34325, 34319, 34318, 34317, 34332, 34588, 34587, 34585, 34594, 34592, 34591, 34590, 34589, 34578, 34577, 34582, 34581, 34593, 34575, 34583, 34770, 34773, 35048, 35026, 35049, 35038, 35028, 35027, 35059, 35058, 35057, 35054, 35053, 35047, 35040, 35041, 35021, 35019, 35018, 35052, 35861, 35859, 35858, 35857, 35863, 35854, 35853 & 35852 of 2023; 1605, 1604, 1603, 1601, 1600, 1599, 1591, 1590, 1589, 2206, 2204, 2207, 2202, 2198, 2197, 2196, 2194, 2193, 2191, 2214, 2213, 2212, 2208, 2201, 2924, 2569, 2568, 2936, 2572, 2933, 2932, 2930, 2927, 2926, 2925, 2558, 2937, 2935, 2562, 2560, 2923, 2922, 2571, 2570, 2567, 3568, 3567, 3566, 3565, 3564, 3563, 4353, 4352, 4354, 6920, 5951, 5943, 5946, 5947, 5950, 5952, 6919, 5928, 5929, 5930, 5933, 5948, 5949, 5935, 5953, 6905, 6907, 6912, 5936, 5940, 5941, 5954, 6903, 6913, 6914, 6918, 7584, 7583, 7579, 7578, 7577, 7576, 7575, 7582, 7581, 7580, 7588, 7587, 9100, 9101, 9086, 9104, 41323, 9095, 9096, 9098, 9091, 9093, 9087, 9088, 9090, 16164, 16163, 16152, 16153, 16166, 16165, 16149, 16162, 16157, 16156, 16155, 16167,....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., 2661, 2658, 2655, 2371, 2370, 3308, 3310, 4030, 5390, 5397, 5401, 5404, 5392, 5396, 6224, 6230, 6236, 6797, 6803, 6800, 6798, 8136, 8148, 8152, 8146, 14888, 14893, 14897, 14896, 15793, 15796, 15794, 16337, 16350, 16353, 16348, 16349, 16344, 16345, 16436, 18638, 20895, 20908, 22090, 22094, 22099, 27572, 27577, 29689, 29702, 29696, 29706, 32192, 32197, 32195, 35704, 35710, 38058, 38067 & 38064 of 2024; 571, 578, 574, 674, 682, 679, 714, 719, 930, 722, 8172, 8181, 8177, 8495, 8502, 8499, 13051, 13067, 13061, 13058, 14829, 14835 and 14839 of 2025 :- For the Petitioner(s) : Mr.R.V.Easwar, Senior Counsel Mr.Joseph Prabhakar, for Mr.S.P.Parthasarathy For the Respondent(s) : Mr.Haja Nazirudeen, Additional Advocate General, Asstd. by Mr.T.N.C.Kaushik, Additional Government Pleader (Taxes) and Mr.L.Jai Venkatesh, Standing Counsel for TANGEDCO W.P.No.9059 of 2022:- For the Petitioner(s) : Mr.D.G.Hariprasath For the Respondent(s) : Mr.Haja Nazirudeen, Additional Advocate General, Asstd. by Mr.T.N.C.Kaushik, Additional Government Pleader (Taxes) and Mr.L.Jai Venkatesh, Standing Counsel for TANGEDCO W.P.Nos.32437 and 32447 of 2022:- For the Petitioner(s) : Mr.L.P.Maurya ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... this tax on such transactions by the department would be cumbersome, and he suggested that TANGEDCO also levy and collect the tax since they already possess the relevant data and revenue particulars. The Chief Electrical Inspector also brought to the Government's attention that TANGEDCO already collected tax on the consumption of electricity from captive generating plants, yet it has omitted to collect in some distribution circles, and he sought direction in this regard. The Government examined the Chief Electrical Inspector's request and entrusted TANGEDCO with the collection of tax and consumption of electricity purchased through open access from IEX or PXIL, in addition to the collection tasks already assigned via the Government Order dated 23.12.2010. The Chief Electrical Inspector is instructed to monitor revenue realization and is authorized to remit the same to the account mentioned therein. Additionally, the Chief Electrical Inspector has been designated as the remitting, reconciling, and controlling authority for revenue receipts under the specified head of account. 5. The second limb of the prayer challenges G.O.Ms.No.121, Energy (B1) Department, dated 23.12.2010.....
X X X X Extracts X X X X
X X X X Extracts X X X X
.....06.2003. 8. On 13.06.2003, vide G.O.Ms.No.51, Energy (B1) Department, the Government of Tamil Nadu notified the tax rate at Rs. 10 paise per unit for electricity consumed for personal use, applicable to both licensees that are captive generating plants and individuals who are not licensees. The learned Counsel would submit that it is evident the tax rate encompasses electricity sold by licensees who are not captive generating plants under Section 3(1)(a), electricity sold by captive generating plant licensees under Section 3(1)(b), and electricity consumed for personal use by captive generating plants that are licensees, as well as individuals who are not licensees in accordance with Section 3(1)(c) of the Act. 9. On the same date, by G.O.Ms.No.53 Energy (B1) Department, the Chief Electrical Inspector of the Government is appointed as the Director of Electricity Tax according to Section 2(3) of the Act. Furthermore, by G.O.Ms.No.54 Energy (B1) Department, the categories of officials mentioned therein were appointed as the Inspecting Officers of Electricity Tax in exercise of powers under Section 12(1) of the Act 12/2003. By G.O.Ms.No.55 Energy (B1) Department, the Officers d....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s, which are determined by the State Electricity Commission periodically. Thus, the position of receiving electricity solely through the State-owned Electricity Board has been liberalized, and the open access system has further strengthened and facilitated this liberalization. 12. The Indian Energy Exchange, among others, is facilitated by the Central Regulatory Electricity Commission. Indian Energy Exchange Limited (IEX) is India's premier energy trading platform that provides an automated platform for the physical delivery of electricity. The platform enables efficient price discovery and allows participants to trade in a variety of energy products. It is neither a generator of energy nor a trader of energy; rather, it serves as a platform facilitating consumers needing energy to purchase and generators willing to supply energy to engage in trade. It is also not a licensee. Actual users of electricity submit bids for purchase using the platform after paying the applicable charges, including cross subsidy charges and other open access fees. The energy consumed is always treated as an inter-State purchase, and the necessary charges are paid accordingly. 13. The learned Co....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ment, dated 23.12.2010, the learned Counsel for the petitioners submits that the State Act was enacted with the objective of consolidating and rationalizing the taxation on the sale and consumption of electricity in the State. While Section 3 is the charging provision, Sections 5 to 9 provide for the levy, assessment, and recovery of the tax. Rules 3 to 21 of the Rules, 2003 outline the registration, maintenance of books of accounts, assessments, and the time and manner of tax collection/payment, etc. The Act and Rules provide a comprehensive mechanism for assessing the Electricity Tax. Rule 6 specifies the manner of payment of Electricity Tax to the Government for the sale of electricity by the licensee, TANGEDCO, as per Section 3(1)(a) and (b) of the Act 12/2003. TANGEDCO must credit the tax at a rate of 5% of the net charge for the supply of electricity to the consumer into the Government treasury under the designated head. 16. The learned Counsel would take this Court through the Rules. Attention is drawn to Rules 8 and 9. It is stated that Section 6 of the Act provides that the licensee may, with the previous sanction of the Act and subject to such conditions as may be impo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....te of registration. Rule 5 of the Rules also provides the application form for registration in Form A-1, and a fee of Rs. 200/- is prescribed. The certificate of registration shall be in Form A-2 and will be valid for a period of three years. It requires the maintaining of a register of all registered generating plants in Form A-3 by the registering authority. Rule 10 stipulates that every captive generating plant shall install meters to measure the quantity of electricity for its own consumption as well as for the sale of surplus electricity to others. It also provides that the said meter shall be installed to ascertain the amount of tax payable under Section 3 of the Act. 20. The learned Counsel would further submit that the registered captive generating plants shall be required to pay the tax at the rate of Rs. 10 ps per unit within 30 days under the head mentioned therein. Furthermore, vide G.O.Ms.No.55, Energy (B1) Department, dated 13.06.2003, the Government had appointed the Electricity Tax Inspecting Officers holding the post of Electrical Inspectors as the Registration Officers. Section 8 provides for the procedure. It mandates that every licensee or a person other than....
X X X X Extracts X X X X
X X X X Extracts X X X X
....2 of the Act 12/2003. 23. Regarding the captive generating plants, it can be observed that the distribution licensee does not supply energy in any way. Based on the challenged Government Order, TANGEDCO is directly imposing e-tax on the energy consumed by the petitioners from their wind and solar power plants. The learned Counsel will direct the attention of this Court to some of the actions taken by TANGEDCO by referencing the bills in that regard. They will further argue that exemptions are periodically granted by the Government under Section 14(2) for various categories. As a result, due to the circumvention of procedure even for exempted units, TANGEDCO continues to collect tax, compelling the concerned units to ultimately approach this Court for a refund of the taxes levied. Despite the Court's orders, TANGEDCO fails to issue refunds. Thus, the learned Counsel submits that on its face, G.O.Ms.No.121, dated 23.12.2010, directly contradicts the provisions of the Acts and the Rules framed thereunder and is therefore liable to be set aside. 24. Thereafter, turning their attention to the other impugned G.O.Ms.No.55, Energy (D2) Department, dated 20.10.2021, it can be seen....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ribution Companies, Traders, and consumers must first register with the exchange. The trading mechanism operates through an electronic trading platform. This mechanism includes the Day-ahead Market (DAM), Termahead Market (TAM), and Renewable Energy Certificate (REC) trading. DAM allows participants to buy or sell electricity for delivery the next day. TAM enables buying or selling electricity over a term period such as a week, month, or quarter. REC refers to a Tradable Certificate that represents the environmental attributes of renewable energy generation. Consumers willing to procure engage in procurement through the segments DAM or TAM by placing bids based on their consumption requirements and price preferences. 28. The next requirement is grid connectivity. To utilize the energy procured, consumers use the grid facilities provided by the local distribution company or through other means, such as open access arrangements. Depending on the type and scale of energy consumed, various approvals and regulatory compliances must also be secured to consume energy from the IEX. Firstly, large consumers wishing to procure energy directly from the generators through the grid, without ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... suppliers, it contains two categories besides captive generating plants, and only Section 3(1)(c) pertains to non-licensed suppliers, including captive generating plants. However, Section 3(1)(c) specifically uses the phrase 'consumption for its own use' and does not mention the word 'consumer'. In this regard, the definition of 'consumer' under Section 2(5) is referenced. It is submitted that while interpreting the provision, the Court must consider that a term, despite being defined in the statute, is not included in the charging provision. If the legislature intended to cover the petitioners, it would have used the phrases 'actual user of power' or 'any person who is supplied with the electricity on payment of charges or free of cost or otherwise'. Since the phrase is not used, Section 3(1)(c) does not encompass the petitioners. 32. The learned Counsel would also rely on the definition of the term 'licensee' under Section 2(10) and the clarification provided under Section 2(16), stating that the words and expressions used but not defined under the Act shall have the same meaning as those under the Indian Electricity Act, 1910, the Elec....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ognizing the necessity to involve private players again, the general policy shifted towards encouraging private sector participation in various aspects. Accordingly, the Electricity Act of 2003 was introduced, and the earlier Acts were repealed. Thus, in 2003, non-licensed captive power plants were recognized and permitted by the Central Government. The State Act, enacted after the Electricity Act of 2003, levies a tax on electricity consumed by such non-licensed captive generating plants. Therefore, the taxable event came into existence on 10.06.2023, and immediately, the present Act came into force on 16.06.2003. Thus, the plain intention should be understood as solely to tax the captive generating plants and nothing else. 35. The next contention is that when the Act of 2003 was enacted, it was founded solely on the Electricity Act of 1910. Therefore, the framework of open access or the procurement exchanges was not contemplated at all, and the imposition of tax is thus legally flawed. The learned Counsel, considering the effective dates of both Acts, will further guide this Court through Sections 2(10), 2(16), etc., of Act 12 of 2003, pointing out that all the provisions refe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....fication, should favor the assessee in any case of ambiguity. Thus, in the absence of a clear provision under Act 12/2003, the entire attempt to collect tax through the impugned Government Order is illegal. 37. The next ground of attack is that the impugned Government Order in G.O.Ms.No.55 constitutes a colourable exercise of power. When the State lacks the authority to tax inter-State transactions, and when the charging section itself is inapplicable, the aim that cannot be accomplished directly is sought to be achieved indirectly under the pretense of enabling TANGEDCO to collect the tax. Thus, the Government Order is not an innocuous exercise of power; rather, it is one issued to arrogate a power that is non-existent. Finally, regarding Section 16 of the Act, the learned Counsel submits that the removal of difficulties should first be consistent with the objectives and cannot contradict the express provisions of the Act. The judgment of the Hon'ble Supreme Court of India in Straw Products Ltd. Vs. Income Tax Officer, Bhopal and Ors. [(1968) 68 ITR 227] is relied upon. The attention of this Court is drawn to Sections 7 and 9 of the Act, contending that under the guise of e....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oners are not effecting the sale of electricity; instead, they are procuring electricity from the Indian Energy Exchange for their own consumption. Therefore, when the tax is levied on consumption, and when such consumption is confined within the territory of the State, the jurisdiction under Entry 53 of List - II is very much available. In fact, to source power through inter-State open access, the petitioners are permitted to use the transmission lines or associated facilities on the inter- State transmission system in accordance with the regulations. Imposing tax on electricity is one of the major sources of revenue for the State Government. The levy applies to consumption within the State that is procured from IEX. Thus, there is no necessity even to amend the Act. 40. As a matter of fact, during the year 2019, assessment notices in the Form E-1 were issued to all consumers who procured power from IEX. Only some appeared for personal hearings, while others did not take advantage of the opportunity. Therefore, to proceed further, the Inspector of Electricity obtained procurement details from the State Load Dispatch Centre of the Tamil Nadu Transmission Corporation Limited and ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....irst Amendment) Act did not affect Entry 53 of List - II of the Seventh Schedule of the Constitution of India in any manner. Regarding the sale of electricity, even if such a sale occurs in the course of inter-State trade or commerce, the State can impose a tax on such a sale following consumption. If consumption has occurred as a taxable event within the territory of the State, there exists an adequate territorial nexus to levy tax on consumption under Section 3(1)(c) of the Tamil Nadu Act 12/2003 based on consumption inside the State. The state legislature is fully competent to collect tax based on the available data, as this is not illegal. When data regarding the consumption of electricity is available, it can be utilized for the collection of tax. Although the inter-State movement of electricity occurs pursuant to a contract of sale that qualifies as inter-State sale, the consumption of electricity, being a distinct incidence of the levy of tax under the provisions of Section 3(1)(c), is taxable. A beneficial comparison can be made with Entry 38 of List - II, under which the Electricity Act, 2003 came into force. Moreover, it can be observed that even though electricity can be....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ectricity Act, 2003, which falls under Entry 38 of List - III, does not in any manner take away the right of the State legislature falling under Entry 53 of List - II. The learned Additional Advocate General would rely upon the judgment of the Hon'ble Supreme Court of India, relied upon by the petitioners, in State of A.P. Vs. National Thermal Power Corpn. Ltd. (cited supra) to point out that the said judgment is not applicable to consumption by a person other than a licensee, and in the said case, the parties are the Government and a Central Government undertaking. He would submit that Article 287 of the Constitution of India provides for exemption from taxes on electricity consumed by the Government of India or sold by the Government of India. The learned Additional Advocate General would then rely upon the judgment of the High Court of Karnataka in ACC Limited, Mumbai Vs. State of Karnataka and Ors. [2019 SCC OnLine Kar 3962], wherein the High Court of Karnataka considered the judgment of the Hon'ble Supreme Court of India in National Thermal Power Corpn. Ltd. (cited supra) and held that the exemption cannot be claimed as a matter of right, and the right of the State in ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (1) . . .(c). In the case of a person other than a licensee, the rate shall be not less than 10 paise and not more than 20 paise per unit of electricity on the consumption for own use as may be notified by the Government." 48. In this regard, it is contended that the consumption is within the State of Tamil Nadu and consumption being the incidence of tax, the State of Tamil Nadu will be well within its power. In this regard, the judgment of the Hon'ble Supreme Court of India in Swaroop Vegetables Products Industries (cited supra) is relied upon by the State. It is true that the Hon'ble Supreme Court of India was considering a similar provision with reference to entities which partially generating energy from their own source and partially purchased electricity. The relevant portion of paragraph No.4 reads as hereunder:- "4....The fact that the user of electricity from his own source of generation purchases electricity from some other source as well, is an altogether irrelevant factor from the stand point of the liability imposed by the said provisions. Be it realized that duty is levied on the consumption of energy. The taxing event....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... energy except that it can be "stored" and to the extent that electric energy can be "stored", the observation must be held to be erroneous or by oversight. Science and technology till this day have not been able to evolve any methodology by which electric energy can be preserved or stored. [Ed. : This is largely true for the scale of operation under discussion in this case. A very small amount of electrical energy, however, can be stored in accumulators which can be retrieved and used by inverters, as commonly called.] 21. Another significant characteristic of electric energy is that its generation or production coincides almost instantaneously with its consumption. To quote from Aiyar's Law Lexicon (2nd Edn., 2000)- "Electricity in physics is 'the name given to the cause of a series of phenomena exhibited by various substances, and also to the phenomena themselves'. Its true nature is not understood. Imperial Dictionary (quoted in Spensley v. Lancashire Ins. Co. [54 Wis 433, 442, 11 NW 894] where the court, quoting from the same authority, said, 'we are totally ignorant of the nature of this cause whether it be a material agent or merely a property of matter....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... in the context of electricity, the word "supply" should be interpreted to include sale or consumption of electricity. Entry 53 should therefore be read as "taxes on the consumption or sale for consumption of electricity"." (Emphasis supplied) 51. Thus, it can be seen that the Constitution Bench agreed on the earlier judgment based on the principle that electrical energy can neither be preserved nor stored, and that generation, sale, supply, and consumption occur simultaneously without any hiatus. Therefore, the consumption and sale of electrical energy cannot be separated, meaning that in the case of an inter-State sale, the State Government cannot impose tax by separating the incidence of consumption from sale. It should be a straightforward case of either consumption alone or a sale with consumption within the State. However, there have been subsequent developments following the aforementioned judgments of the Hon'ble Supreme Court of India. Notably, the Constitution Bench did not consider the consumption of power through an open access system. Additionally, the Indian Electricity Act, 2003 came into force, which, effective from 02.06.2003, introduced the open access s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ther the same dictum of the Constitution Bench-where sale, supply, and consumption occur simultaneously-holds true. In reality, trading-the sale and purchase-takes place on platforms like IEX, where bidding occurs, invoices are raised, and payment is made. The supply is facilitated through the grid, and consumption occurs where the purchaser has grid connectivity. Central and state authorities manage grid stability, ensuring supplies to purchasers upon payment of wheeling and other charges. Consequently, this course of transactions complicates the notion that electrical energy, being a constant flow of electrons within a conductor, is generated, sold, supplied, and consumed instantaneously, though conceptually, the dictum of the Hon'ble Constitution Bench that there cannot be any storage of electricity (except for minimal quantities etc.,) and therefore, the supply and consumption can never be separated. 55. Be that as it may, there is one more supervening factor. The Constitution (One Hundred and First Amendment) Act, 2016, by which, Section 269A is added to the Constitution of India. The same is extracted hereunder for ready reference:- "269A. Levy and collection of g....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n of tax on the sale or purchase of goods.- (1) No law of a State shall impose, or authorise the imposition of, a tax on the supply of goods or of services or both, where such supply takes place- (a) outside the State; or (b) in the course of the import of the goods or services or both into, or export of the goods or services or both out of, the territory of India. 3[* * * *] (2) Parliament may by law formulate principles for determining when a supply of goods or of services or both in any of the ways mentioned in clause (1). [(3) * * * *]" 58. Even if one were to interpret the open access system through the grids of the Central and State authorities acting as a buffer and considering that the sale and supply ends at the grid connectivity of the suppliers' place and after payment of the wheeling charges, the purchasers consume inside the State, even then, by virtue of the Article 286 of the Constitution of India, if the supply is outside the State, no law of the State shall authorise imposition of such a tax. As a matter of fact, a perusal of the provisions of the Central Goods and Services Tax, 2024 enacted by the Govern....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... strict/literal rule of tax interpretation, qualified by technological neutrality. Courts will not read in or stretch words; however, if the words fit, the law applies. A useful reference in this regard can be made to (i) Commissioner of Customs v. Dilip Kumar & Co. [(2018) 9 SCC 1 paragraph Nos.21-25]; (ii) State of W.B. Vs. Kesoram Industries [(2004) 10 SCC 201 paragraph No.106]. Tax law is ordinarily technology-neutral and would encompass new or novel forms of transactions or technologies developed after its enactment, provided they fall within the literal meaning, do not contradict the purposes of the act, and there is no ambiguity. 60. As already held in question No.(i), the legislative power resides firmly with the State of Tamil Nadu if the procurement occurs through an intra-State open access system, as it does not constitute inter-State trade, nor is the supply outside the State. However, as of now, the charging Section 3 of the Act does not encompass this. In fact, Section 3(1) serves as the enabling provision for the State of Tamil Nadu to impose tax. Section 3(1)(a) addresses the situation of licensees other than captive generating plants, namely those individuals, s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or his own use or for the use of members and includes the power plants that are permitted to sell the surplus power so generated." 63. The definition of 'consumer' that is contained under Section 2(5) of the Act reads as follows:- "Section 2.Definitions.-- (1).. . . . (5) - "consumer", with its grammatical variations and cognate expression means any person who is supplied with electricity on payment of charges, or free of cost or otherwise by a licensee or by the Government or by any other person engaged in the business of supplying electricity to the public under the Indian Electricity Act, 1910 (Central Act X of 1910) or any other law for the time being in force and includes--- (i) a licensee who consumes electricity whether generated by himself or supplied to him by any other licensee; and (ii) actual user of power or any other person who consumes electricity generated by himself. Explanation I.-- Where a licensee consumes electricity, whether generated by himself or supplied to him, such licensee shall be deemed to be a consumer only in respect of the electricity so consumed. Ex....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... electricity is, or is believed to be supplied, for the purpose of-- (a) verifying the statements made in the books of account kept, and returns submitted, under section 5, (b) testing the reading of meters, (c) verifying the particulars required in connection with the levy of electricity tax; (iii) exercise such powers and perform such other functions as may be necessary for carrying out the purposes of this Act or the rules made thereunder. (2) All searches made under sub-section (1) shall be made in accordance with the provisions of the Code of Criminal Procedure, 1973 (Central Act 2 of 1974)." 67. Therefore, when the government has the power to appoint Electricity Tax Inspecting Officers to inspect the petitioners regarding their returns that show the units of electricity supplied and the amount of electricity tax payable to the Director in the prescribed form and manner, and when the Managing Director of TANGEDCO is appointed as the Director, and when, under Section 13, the Electricity Tax Inspecting Officer exercises necessary powers to carry out the purpose of the Act and the Rules, it cannot be said that the impugned governmen....