IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 30TH DAY OF OCTOBER, 2019 BEFORE THE HON’BLE MRS.JUSTICE S.SUJATHA W.P.Nos.39155 & 45967/2018 (GM – KEB) BETWEEN :
1 . M/s GOKAK TEXTILES LIMITED GOKAK MILLS DIVISION, A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956 AND HAVING ITS REGISTERED OFFICE AT NO.1, 2ND FLOOR, 12TH CROSS, IDEAL HOMES, RAJARAJESHWARI NAGAR, BENGALURU-560098 REP BY ITS HEAD-HUMAN RESOURCE SRI PRADEEP ANDHARE 2 . M/s GOKAK POWER AND ENERGY LIMITED A SUBSIDIARY OF M/S GOKAK TEXTILES LIMITED, A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956 AND HAVING ITS REGISTERED OFFICE AT NO.1, 2ND FLOOR, 12TH CROSS, IDEAL HOMES, RAJARAJESHWARI NAGAR, BENGALURU-560098 REP BY ITS CEO & MANAGING DIRECTOR SRI RAMESH R. PATIL. ...PETITIONERS (BY SRI M.S.RAGHAVENDRA PRASAD, ADV.) AND :
1 . THE STATE OF KARNATAKA VIDHANA SOUDHA, Dr. AMBEDKAR VEEDHI, BANGALORE-560001.
REP BY ITS ADDITIONAL CHIEF SECRETARY.
2 . DEPARTMENT OF PARLIAMENTARY AFFAIRS AND LEGISLATION, STATE OF KARNATAKA, VIDHANA SOUDHA, Dr. AMBEDKAR VEEDHI, BANGALORE-560001 REP BY ITS SECRETARY.
3 . DEPARTMENT OF ENERGY STATE OF KARNATAKA, VIDHANA SOUDHA, Dr. AMBEDKAR VEEDHI, BANGALORE-560001.
REP BY ITS ADDTIONAL CHIEF SECRETARY.
4 . THE CHEIF ELECTRICAL INSPECTOR TO THE GOVERNMENT NO.32/1, CRESCENT TOWERS, 2ND FLOOR, CRESCENT ROAD, BANGALORE-560001. …RESPONDENTS (BY SMT.NILOUFER AKBAR, AGA.) THESE WRIT PETITIONS ARE FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ANNEXURE-H DATED 29.06.2018 ISSUED BY THE RESPONDENT No.4 TO THE 2ND PETITIONER.
THESE PETITIONS COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING:
O R D E R The petitioners have assailed the order dated 29.6.2018 issued by the respondent No.4 to the 2nd petitioner relating to the period 11.03.2013 to June 2018 inter alia to declare that the petitioners are involved in captive consumption and the respondents to assess the petitioners as per section 3(2) of the Karnataka Electricity (Taxation on Consumption) Act, 1959 (‘Act’ for short) and to refund the money collected along with interest @ 18% p.a.
2. Petitioner No.2 is claiming to be the subsidiary company of the petitioner No.1. It appears, a mutual agreement for transfer of power from 2nd petitioner to the 1st petitioner has been executed and is still in force. The respondent No.4 has issued notices calling upon the petitioner to pay tax under Section 3(1) of the Act on the amount of sale @ 6% per unit to which reply was furnished by the 2nd petitioner. The order impugned has been passed by the 4th respondent confirming the proposals made in the notices calling upon the petitioners to pay the tax under Section 3(1) of the Act. Hence these writ petitions.
3. Learned counsel for the petitioners would submit that the order impugned suffers from arbitrariness and is without jurisdiction. In the earlier round of litigation, M/s Gokak Textiles Limited filed W.P.No.11033/2015 before this Court seeking for a writ of mandamus directing the respondents to refund the electricity tax with interest @ 18% p.a. relating to the period 1.7.1996 to 31.10.2003 based on the Notification dated 18.6.1997 issued under Section 83 of the Act exempting the payment of electricity tax on captive generation. This court has directed the State Government to refund the tax amount with interest @ 6% p.a. However, the respondent authorities have passed the order impugned levying tax under Section 3(1) of the Act. Hence alternative remedy of appeal is no bar to invoke the writ jurisdiction.
4. Learned counsel appearing for the petitioners reiterating the grounds urged in the writ petition contended that the order impugned requires to be quashed.
5. Learned AGA appearing for the respondents supports the order impugned and submitted that no writ petition is maintainable circumventing the alternative and efficacious remedy available under the Act.
6. I have carefully considered the rival submissions of the learned counsel for the parties and perused the material on record.
7. It is the contention of the learned counsel for the petitioners that they can be subjected to levy of tax only under Section 3(2) of the Act and not under Section 3(1). It is significant to note that the order impugned refers to refund of electrical tax erroneously credited by M/s Gokak Textiles Limited. It is the finding of the respondent No.4 – authority that on verification of the documents, no tax has been paid by M/s Gokak Textiles Limited, respondent No.1, whereas it is the specific case of the petitioners that indeed tax was paid by the respondent No.1 but not duly appreciated by the respondent- authorities. These two aspects, viz., applicability of tax whether to be under Section 3(1) or 3(2) and the dispute regarding the payment of tax vis-à-vis refund claimed by the petitioners are purely questions of facts which require to be adjudicated before the Appellate Authority provided under the Act. The petitioner without exhausting the alternative remedy has rushed to this Court which cannot be entertained.
Hence, writ petitions stand disposed of relegating the petitioners to avail the alternative remedy of appeal available under the Act and if such an appeal is preferred within two weeks from the date of receipt of certified copy of the order, the same shall be considered by the competent authority on merits in accordance with law without objecting to the period of limitation. All the rights and contentions of the parties are left open.
Sd/- JUDGE Dvr: