Himachal Pradesh High Court declared the decision of the state government to levy water cess on power generation, as unconstitutional.
In an order passed on Tuesday a Division Bench of the High Court headed by Justice Trilok Chauhan and Justice Satyen Vaidya held, “The provisions of the Himachal Pradesh Water Cess on Hydropower Electricity Generation Act, 2023, are declared to be beyond the legislative competence of the State Government in terms of Articles 246 and 265 of the Constitution of India and, thus, ultra-vires to the Constitution.”
The court averred, “The notices issued by the state government to power generation companies for recovery of water cess on hydro power generation are declared illegal and are accordingly quashed and set aside .”
Interestingly, the power generation companies in the High Court were represented by senior Supreme Court Lawyer Abhishek Manu Singhvi along with Solicitor General of India Tushar Mehta, against the state government .
Singhvi, a Congress candidate for Rajya Sabha was defeated by BJP candidate Harsh Mahajan in recently held election for a Rajya Sabha seat.
The High Court decision is seen as a setback to the cash strapped state government looking to generate additional revenue by levying water cess.
