*The State of Maharashtra Vs Shri Vile Parle Kelvani Mandal & Ors*
*Forum-Supreme Court of India*
*Date- 7th January 2022*

*Sub-Whether a charitable Trust/society in Maharashtra is liable to pay electricity duty under the Maharashtra Electricity Act, 2016 ?*

The Supreme Court in this case was called upon to decide whether a charitable society registered under the Bombay Public Trust Act, 1950 imparting education in Maharashtra is liable to pay Electricity duty under the *Maharashtra Electricity Act 2016* which provided for exemption from payment of duty to local bodies as per Section 3 of the said Act. The respondent society/trust argued on several points including i) that the taxing statute has to be construed liberally, ii) doctrine of last antecedent etc.iii )_ taxing statute has to be considered strictly but ambiguity if any has to be decided in favour of the assessee iv) they were getting exemption under earlier 1958 Act.

However, the Supreme Court held that though the constitution bench of the court in the case of *Commr. of Customs Vs. Dilip Kumar & Co., (2018) 9 SCC 1(SC) **has held that in every taxing statute –– the charging, the computation and exemption provisions at the threshold stage should be interpreted strictly. In case of ambiguity in case of charging provision, the benefit necessarily must go into favour of the subject/assessee. This means that the subject of tax, the person liable to pay tax and the rate at which the tax is to be levied have to be interpreted and construed strictly. If there is any ambiguity in any of these three components, no tax can be levied till the ambiguity or defect was removed by the legislature. In case there is an ambiguity in the exemption notification, then it is for the assessee to show by construction of the exemption that he comes within the purview of the exemption notification. As there was material change in the 2016 Act where the exemption was only given to schools run by local bodies, the charitable educational institution were not entitled for exemption.

*This judgement will be helpful in all taxation cases where exemption notification is subject matter of interpretation.*

Ramesh Patodia
08-01-2022