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Challenge to the validity of Tamil Nadu Act 1 of 1979 regarding Central Excise Surcharge on electricity supply. Analysis: The petitioners sought a writ of Mandamus to restrain the respondents from collecting the Central Excise Surcharge of three paise per unit as per Tamil Nadu Act 1 of 1979, claiming it to be ultra vires and void. The petitioners argued that the retrospective effect given to the Act was invalid as it aimed to recover excise duty from consumers since 1-3-1978. They contended that the Act was unconstitutional under Articles 13, 14, and 19(1)(g) of the Constitution. The petitioners also raised concerns about the lack of guidelines for tariff fixation under the Act and the illegality of collecting three paise per unit when the excise duty was fixed at two paise per unit under the Central Excises and Salt Act. The respondents, on the other hand, justified the enactment of Tamil Nadu Act 1 of 1979 under Entry 53 of List 2 and Entry 38 of List 3 of the Constitution. They argued that the Act was necessary to recover excise duty, cover losses, and meet expenses related to electricity supply. Respondents contended that the retrospective levy was valid and that the State Legislature had the authority to pass such laws. The Court examined the retrospective applicability of the Tariff Act and cited precedents establishing the Legislature's power to enact laws retrospectively. It was held that giving retrospective effect to the Tariff Act was not invalid. The Court also analyzed the guidelines provided in the Act for tariff fixation, emphasizing that the cost of production was a key factor to be considered. Additionally, the Court addressed the issue of collecting three paise per unit when the excise duty was fixed at two paise per unit. The Court noted that the one paise additional charge was intended to cover various expenses incurred by the Electricity Board, which fell within the ambit of the Act. The Court found that the Act allowed for such recovery, even if the terminology used was not precise. Furthermore, the Court rejected the petitioners' argument regarding the availability of provisions in the Sale of Goods Act for recovering excise duty, emphasizing that the State Legislature had the discretion to enact laws as deemed necessary. Ultimately, all writ petitions challenging the validity of Tamil Nadu Act 1 of 1979 were dismissed with costs, highlighting the Court's decision to uphold the legality of the Act and the collection of Central Excise Surcharge on electricity supply.
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