Rajasthan High Court – Jodhpur
Rajendra Kumar vs The Discom Through Its Chariman … on 6 April, 2026
[2026:RJ-JD:15325-DB]
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
D.B. Civil Writ Petition No. 1151/2023
1. M/s Ultra Tech Cement Ltd., A Company Registered
Under The Companies Act, 1956, Having Its Registered
Office At 'b' Wing, Ahura Centre, 2Nd Floor, Mahakali
Caves Road, Andheri (East), Mumbai - 400093 Through
Its Authorized Signatory Mr. Dilip Kumar Kochar Having
Office At Aditya Cement Works, Adityapuram, Sawa-
Shambhupura Road, Chittorgarh (Raj.)-312622, Plant 1
At Kotputli Cement Works, Tehsil Mohanpura, Kotputli,
Jaipur, Rajasthan, Plant 2 At Unit Aditya Cement Works,
Shambhupura, District Chittorgarh, Rajasthan.
2. Mr. Bhanu Prakash Singh S/o Rajendra Singh, Aged
About 54 Years, Residing At A-Type Bungalow, Staff
Colony Adityapuram, Chittorgarh (Raj.) 312622
----Petitioners
Versus
1. Energy Department, Government Of Rajasthan, Through
Its Secretary, Rvpn It Center, Chambal Power House
Campus, Hawa Sarak, Jaipur 302006
2. Rajasthan Urja Vikas Nigam Limited, Through Its
Chairman, Vidyut Bhawan, Janpath, Jyoti Nagar, Jaipur
302005
3. Jaipur Vidyut Vitran Nigam Limited, Through Chairman
And Managing Director Jaopar - Kishangarh Expy,
Heerapura, Ward No. 18, Jaipur 302020
4. Ajmer Vidyut Vitarnn Nigam Limited, Through Its
Chairman And Managing Director, Bhawan, Panchsheel
Nagar, Makarwali Road, Ajmer 305004
5. Rajasthan Renewable Energy Corporation Limited,
Through Its Chairman, E-166, Yudhister Marg, C
Scheme, Ashok Nagar, Jaipur - 302001
6. Finance Department, Government Of Rajasthan, Through
Its Secretary, 1St Floor, Main Building, Gate 2,
Government Secretariat, Jaipur, Rajasthan 302005
----Respondents
Connected with D.B. Civil Writ Petition Nos - 12531/2021,
13492/2021, 13525/2021, 15565/2021, 13979/2022,
15593/2022. - (Associations)
and
Connected with D.B. Civil Writ Petition Nos - 7298/2022,
9591/2022, 9593/2022, 9621/2022, 9633/2022, 9689/2022,
12614/2022, 13681/2022, 14422/2022, 15097/2022,
15337/2022, 17557/2022, 17691/2022, 19686/2022,
1964/2023, 2423/2023, 2688/2023, 2811/2023, 10590/2023,
10618/2023, 11135/2023, 18783/2023, 19436/2023,
4503/2024.
For Petitioner(s) : Mr. Vikas Balia, Sr. Advocate assisted
by Mr. Mridul Chakravarty
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (2 of 29) [CW-1151/2023]
Mr. Sharad Kothari, Mr. Lakshyajit
Singh Badhwal, Mr. Sachin Saraswat,
Mr. Shridhar Mehta, Mr. Abhishek
Aggarwal for Mr. T.C. Sharma,
Mr. Sunil Joshi, Mr. Kuldeep Bishnoi,
Mr. Ankur Mathur, Mr. Kalpit Shishodia
Mr. Chirag Soni, Mr. Samikrith Rao,
Mr. Kunal Kaul, Mr. Abhishek Howt,
Mr. Dinesh Kumar Bishnoi,
Mr. Priyansh Arora, Mr. Gopal Sandu,
Ms. Varsha Paliwal, Mr. Yashraj Singh
Kanawat, Mr. Lakshya Bagadwat,
Mr. Punit Choudhary, Mr. Manish
Priyadarshi, Mr. Ayush Goyal,
Mr. Vijay Bishnoi, Mr. Sachin Lohia
For Respondent(s) : Mr. Rajendra Prasad, Advocate
General assisted by Mr. Anirudh S.
Shekhawat, Mr. Dheerendra Singh
Sodha, Mr. Anurag Jyani for Mr.
Mahaveer Bishnoi, A.A.G.,
Mr. Harshwardhan Singh Chundawat,
Mr. Arpit Samaria for Mr. Nathu Singh
Rathore, A.A.G., Mr. Manvendra
Singh, Mr. Bhavyadeep Singh
HON'BLE MR. JUSTICE ARUN MONGA
HON’BLE MR. JUSTICE SUNIL BENIWAL
Judgment
Reportable
Judgment Reserved On : 23/03/2026
Pronounced On : 06/04/2026
By the Court (Per: Arun Monga, J)
D.B. Civil Writ Petition No. 1151/2023.
1. The issue raised by petitioner before us is qua the
enforceability of policy assurances made by the State in the
context of renewable energy promotion (solar power), and the
extent to which such assurances can be withdrawn, allegedly to
the detriment of petitioners/investors who have acted upon them.
2. The State of Rajasthan, with a view to promote solar energy,
introduced the Solar Policy, 2019, which, inter alia, assured
exemption from payment of electricity duty for a period of seven
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (3 of 29) [CW-1151/2023]
years from the date of commissioning of solar power plants.
Acting upon such representation, the petitioner made investments
in establishing its captive solar power project.
3. The Petitioner No. 1 company, UltraTech Cement Limited
(“UltraTech”), operates two cement manufacturing plants in
Rajasthan, namely Aditya Cement Works and Kotputli Cement
Works, for which it has established captive solar power generation
facilities after declaration of the State Solar policy.
4. The grievance of the petitioner arises from the subsequent
action of the State, whereby the benefit of exemption was
withdrawn by way of impugned amendment dated 10.05.2022 in
the Solar policy, thereby subjecting such project to electricity duty.
The petitioner’s case, inter alia, is anchored on promissory
estoppel and legitimate expectation. More of it later.
CHRONOLOGY OF FACTS
5. Succinct factual narrative, shorn of unnecessary details,
which, the petitioners state, led to their decision in setting up
Solar power plants in Rajasthan, is as below :-
5.1. On 21.05.1962, the Rajasthan Electricity (Duty) Act, 1962
(“ED Act“) came into force. Section 3 thereof levies a duty on a
consumer consuming electricity generated by itself, at such rate as
may be notified by the State Government. Section 3(3) further
empowers the State Government, where it is of the opinion that it
is necessary or expedient in public interest, to reduce or remit
electricity duty, inter alia, for consumers in the manufacturing
industry or persons generating energy for their own consumption.
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (4 of 29) [CW-1151/2023]
5.2. On 10.06.2003, the Electricity Act, 2003 came into force.
The Act seeks to promote efficient and environmentally benign
policies, as reflected in its Statement of Objects and Reasons, and
incorporates several provisions aimed at encouraging efficient use
of captive as well as renewable energy through various facilitative
measures.
5.3. On 12.02.2005, the Government of India notified the
National Electricity Policy under Section 3 of the Electricity Act.
Clause 5.12 thereof envisages the need to promote electricity
generation from non-conventional (renewable) sources through
appropriate promotional measures.
5.4. On 06.01.2006 (as revised on 28.01.2016), the Government
of India notified the Tariff Policy under Section 3 of the Electricity
Act, which has a statutory force. Clause 6.4 of the said policy
mandates that State Electricity Regulatory Commissions (“SERCs”)
shall endeavour to promote renewable energy by prescribing a
minimum percentage for procurement of power from such
sources.
5.5. On 08.03.2006, the Government of Rajasthan issued a
notification remitting electricity duty on consumption of electricity
by a person generating such electricity for its own use.
5.6. In July 2012, the Government of Rajasthan issued the “Policy
for Promoting Generation of Electricity from Wind, 2012” (“Wind
Policy, 2012”). Clause 9.1 thereof provided that energy consumed
by a power producer for captive use would be exempt from
payment of electricity duty.
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (5 of 29) [CW-1151/2023]
5.7. On 04.03.2014, the Government of Rajasthan issued a
notification amending, inter alia, Clause 9.1 of the Wind Policy,
2012, to restrict the exemption to energy consumed for captive
use within the State of Rajasthan.
5.8. On 18.10.2014, the Government of Rajasthan introduced the
Rajasthan Investment Promotion Scheme, 2014 (“RIPS, 2014”),
which provided, inter alia, that eligible manufacturing enterprises
would be granted exemption from payment of 50% of electricity
duty for a period of seven years (subject to a reduced benefit of
25% for the tourism sector).
5.9. In year 2014 itself, the Government of Rajasthan also
notified the Rajasthan Solar Energy Policy, 2014 (“Solar Policy,
2014”). Clause 13.1 thereof provided that captive solar generators
would be treated as eligible industries under RIPS, 2014. Unlike
wind energy projects which enjoyed full exemption, solar projects
were extended only a 50% exemption.
5.10. On 09.03.2015, the Government of Rajasthan issued a
notification, in supersession of the earlier notification dated
08.03.2006, prescribing electricity duty at the rate of Rs. 0.40 per
unit on consumption of captively generated electricity (other than
from diesel generating plants), with effect from 16.03.2015.
5.11. On 15.12.2016, the Government of Rajasthan issued a
notification (Annexure P-10) granting complete exemption from
payment of electricity duty to captive solar plants up to
31.03.2018.
5.12. On 10.07.2019, the Government of Rajasthan issued a
notification extending the exemption from electricity duty for
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (6 of 29) [CW-1151/2023]
captive solar plants from 01.04.2018 to 31.03.2020. The said
notification also amended the earlier notification dated 09.03.2015
by enhancing the duty rate from Rs. 0.40 per unit to Rs. 1.00 per
unit.
5.13. On 01.08.2019, the Government of Rajasthan issued a
further notification amending the notification dated 09.03.2015 by
revising the electricity duty rate from Rs. 1.00 per unit to Rs. 0.60
per unit.
5.14. In year 2019, the Government of Rajasthan also introduced
the Rajasthan Solar Energy Policy, 2019 (“Solar Policy, 2019”),
which provided for exemption from payment of electricity duty for
a period of seven years from the Commercial Operation Date
(COD) for captive solar plants registered under the policy, subject
to consumption of power within the State.
5.15. In the same year, the Government of Rajasthan also notified
the Wind and Hybrid Energy Policy, 2019, which, under Clause
34.3, granted a blanket exemption from electricity duty to captive
wind and wind-solar hybrid power projects without any sunset
clause or commissioning-based limitation, unlike the conditional
exemption provided to solar projects.
5.16. On 30.06.2021, the Chairman of Ajmer Vidyut Vitran Nigam
Ltd., Jodhpur Vidyut Vitran Nigam Ltd., and Jaipur Vidyut Vitran
Nigam Ltd. (“Rajasthan Discoms”) issued impugned letter
(Annexure P-15) clarifying that electricity duty at the rate of Rs.
0.60 per unit is chargeable on consumption of self-generated
energy from captive power plants (other than diesel generating
sets). The letter further clarified that the exemption granted vide
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (7 of 29) [CW-1151/2023]
notification dated 10.07.2019 remained operative only until
31.03.2020, and consequently, electricity duty is leviable on such
consumers with effect from 01.04.2020.
5.17. Acting thus on the basis of the assurances given by the
State of Rajasthan, particularly, as per Solar Policy 2019, the
Petitioner No. 1 has taken various steps for setting up a captive
solar power plant in the State of Rajasthan. In this regard, the
relevant details are as under:-
S.No. Particular Aditya Kotputli
1. Project Registration No S/2019/0127 S/2019/0152
2. Date of application for 27.09.2021 13.01.2022
registration
3. Date of registration 22.11.2021 24.03.2022
4. Date of in-principle 16.03.2022 25.07.2022
clearance
5. Date of final approval 01.04.2022 17.08.2022
6. Date of ordering panel 29.10.2021 29.12.2021
7. Date of starting of 16.10.2021 12.01.2022
construction
8. Date of commissioning 07.05.2022 To be
commissioned.
9. Amount of capital 46.56 Crores 42.54 Crores
expenditure incurred.
5.18. On 10.05.2022, the Government of Rajasthan issued
impugned Notification (Annexure P-18) amending Clause
16.4 of the Solar Policy, 2019 whereby the assurance of
exemption from payment of Electricity Duty for 7 years with
effect from the commercial operations date (COD). The
applications for registration of solar plant by the
petitioner/company, as well as the grant of registration
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (8 of 29) [CW-1151/2023]
thereof, were under the Solar Policy, 2019 (i.e., before the
amendment).
5.19. On 07.06.2022, Aditya Cement Works, a unit of
Petitioner No. 1 wrote to the Chief Electrical Inspector, Jaipur
seeking exemption of Electricity Duty for energy consumed
from the onsite 8 MW captive solar plant. But to no avail, as
thereafter, the following impugned bills (Annexure P/20-
Colly.) were raised on UltraTech’s plants by the Respective
Respondents, the details of which are provided below:
Unit Bill Details qua Electricity Duty Payment Status
Electricity Duty and Levied qua Electricity
Period DutyAditya Bill dated Rs. 12,36,764 Paid
Cement 06.07.2022 issued
Works for June, 2022
[Area of
supply of Bill dated Rs. 9,38,252 Paid
Ajmer 05.08.2022 issued
VVNL] for July, 2022Bill dated Rs. 4,94,338/- Paid
07.09.2022 issued
for August, 2022
6. Hence the instant petition.
Arguments on behalf of the Petitioner
7. Led by Mr. Vikas. Balia, Senior advocate assisted by Mr.
Mridul Chakravarty and other advocates, the learned counsels for
the petitioners seek quashing of the impugned amendment dated
10.05.2022 and all consequential levy of the electricity duty on
the power generation through solar plants. Their arguments, inter
alia, are:-
A. SOLAR POLICY 2019 GIVES A VESTED RIGHT ARISING
OUT OF LEGITIMATE EXPECTATION BOUND BY
PROMISSORY ESTOPPEL(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (9 of 29) [CW-1151/2023]I. The Solar Policy, 2019 dated 18.12.2019, issued under
Article 162, expressly provided under Clauses 10.3 and 16.4 for
exemption from electricity duty for 7 years from commissioning,
thereby constituting a clear sovereign representation to promote
solar energy. Acting upon this representation, the petitioner
(UTCL) altered its position and invested approximately ₹89 crores
in setting up captive solar power plants, thereby fulfilling the
reliance requirement for invoking promissory estoppel.
Consequently, a vested right accrued in favour of the petitioner to
claim exemption for 7 years from Commercial Operation Date
(COD).
II. Elaborating, learned senior would argue that the petitioner’s
case rests on a well-settled public law principle that where the
State, in exercise of its executive policy-making power, makes a
clear and unambiguous representation intended to induce
investment in a priority sector such as renewable energy, and the
investor alters its position acting upon such representation, the
State is bound to honor its assurance. The Solar Policy, 2019, read
with the contemporaneous notifications granting exemption from
electricity duty for a defined period, constitutes a specific and
actionable representation. It is not a vague policy aspiration but a
concrete fiscal incentive designed to attract capital investment in
solar infrastructure, a sector characterized by high upfront costs
and long gestation periods.
III. The petitioner acted upon these assurances by establishing
captive solar generation facilities, thereby making substantial
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (10 of 29) [CW-1151/2023]
capital investments premised on the economic viability assured
through exemption from electricity duty. The doctrine of
promissory estoppel is therefore squarely attracted: the State
cannot, after inducing such investment, resile from its promise in
a manner that prejudicially alters the financial equilibrium of the
project. The withdrawal of exemption by way of the impugned
amendment dated 10.05.2022 operates retrospectively in effect,
as it defeats vested expectations arising from prior
representations and disrupts the petitioner’s settled commercial
position.
IV. Equally, the principle of legitimate expectation reinforces the
petitioner’s claim. The consistent policy framework, spanning the
Electricity Act, National Electricity Policy, Tariff Policy, and
successive State policies, unequivocally emphasized promotion of
renewable energy through fiscal incentives. The petitioner, as a
participant in this regulated sector, was entitled to expect that
such incentives, once granted for a specified duration, would not
be withdrawn arbitrarily or prematurely. The expectation here is
not merely procedural but substantive, grounded in a structured
policy regime and specific assurances extended to a defined class
of investors.
V. The argument thus is that it is settled position that: (a)
promissory estoppel can compel enforcement of governmental
representations; (b) denial of legitimate expectation violates
Article 14; and (c) estoppel operates even against procedurally
irregular representations.
Judgements relied in support:
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (11 of 29) [CW-1151/2023]a. State of Jharkhand v. Brahmputra Metallics Ltd.1
b. State of Punjab v. Nestle India Ltd.2
c. State of Bihar v. Kalyanpur Cement Ltd.3
d. Manuelsons Hotels Pvt. Ltd. v. State of Kerala.4
e. Motilal Padampat Sugar Mills v. State of U.P.5
B. AMENDMENT IN POLICY IS ARBITRARY
I. Any amendment withdrawing exemption must disclose
cogent reasons; none are provided in the notification dated
10.05.2022. Clause 3.3 of the Policy permits modification only for
valid and germane reasons. [Brahmputra Metallics (supra),
Mohinder Singh Gill v. Chief Election Commissioner. 6] No
overriding public interest justifies withdrawal, particularly when
policy targets remain unmet (30,000 MW target vs. ~15,000 MW
achieved as on 24.05.2023), undermining the very objective of
the Policy.
II. The State’s action further fails the test of reasonableness
under Article 14. The abrupt withdrawal of exemption, without any
overriding public interest justification or transitional mechanism, is
manifestly arbitrary and disproportionate. This is particularly so
when similarly situated sectors, such as wind energy, have
continued to enjoy more favourable or stable exemptions, thereby
resulting in discriminatory treatment within the same class of
renewable energy producers.
1. 2020 SCC OnLine SC 968 (paras 20-54).
2. (2004) 6 SCC 465 (paras 3, 4, 6, 11, 14, 16, 20, 25, 35).
3. (2010) 3 SCC 274 (paras 66-79).
4. (2016) 6 SCC 766 (paras 12, 13, 33).
5. (1979) 2 SCC 409 (paras 18-30).
6. (1978) 1 SCC 405.
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (12 of 29) [CW-1151/2023]
III. In fiscal matters, while the State retains the power to amend
or withdraw exemptions, such power is not unfettered. It is
circumscribed by the doctrines of fairness, non-arbitrariness, and
the obligation to respect induced reliance. The impugned
amendment, in negating accrued benefits and undermining
investor confidence in State assurances, strikes at the Rule of Law
and the credibility of governmental policy. In the absence of any
compelling public interest that outweighs the inequity caused to
the petitioner, the withdrawal of exemption is legally unsustainable
and liable to be set aside.
IV. Under Sections 7 and 9 of the Electricity Act, 2003,
generation is de-licensed (Tata Power v. Reliance Energy.7).
Thus, exemption from electricity duty was a primary incentive
under the Policy. Its withdrawal defeats the very basis of
investment and undermines renewable energy promotion and
climate commitments.S
V. The amendment dated 10.05.2022 is an attempt to
overreach judicial proceedings, having been issued after interim
protection was granted in collateral proceedings instituted by
Rajasthan Solar Association’s writ petition no. 12531/2021 (order
dated 13.09.2021) challenging preferential treatment to the Wind
energy generation, which is still sub judice in this Court.
Judgements in support:
7. (2009) 16 SCC 65, (paras 106-110)
8. 2023 SCC OnLine SC 1137 (paras 36-38).
9. (2018) 6 SCC 363 (paras 24-25).
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (13 of 29) [CW-1151/2023]
C. SUBSEQUENT AMENDMENT DATED 10.05.2022, IF AT
ALL, IS APPLICABLE PROSPECTIVELY
In any event, it is settled law that the amendment can operate
only prospectively. Retrospective levy is impermissible under
Section 3 of the ED Act. Further, in the State’s own pleadings in
the pending writ petition, ibid, filed by RSA at Jaipur, it is
conceded stand of the State that exemptions already granted are
the time-bound and any withdrawal thereof is prospective in
nature.
Judgement in support:
a. Hitendra Vishnu Thakur v. State of Maharashtra.10
D. CONTENTION THAT EXEMPTION ON ELECTRICITY
DUTY CANNOT BE GRANTED IN ABSENCE OF EXTENSION OF
SUCH NOTIFICATION BEYOND 31.03.2020 IS UNTENABLE:
Such contention by respondents is untenable, as similar
arguments were rejected in Nestle India (supra), and it has
been held that the State can be compelled to issue a notification
to give effect to its promise (Brahmputra Metallics, supra).
Past conduct of the State shows consistent extension of
exemptions, even retrospectively (e.g., 2019 notification
extending exemption from 01.04.2018-31.03.2020 despite prior
lapse), thereby reinforcing legitimate expectation of continuity
under the Solar Policy, 2019.
E. THE DISCOM LETTER DATED 30.06.2021 IS LEGALLY
UNTENABLE:
It cannot override the solar policy, 2019 issued under executive
power. The ED Act does not empower Discom authorities to amend
policy; subordinate instruments cannot override statute/policy.
Judgement in support:
10. (1994) 4 SCC 602.
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (14 of 29) [CW-1151/2023]
a. Indian Express Newspapers v. Union of India.11
Arguments/Submissions on behalf of the Respondents
8. Seeking dismissal of the petition, learned Advocate General
Mr. Rajendra Prasad, Senior Advocate, assisted by Mr. Anirudh S.
Shekhawat, led the arguments on behalf of the respondents along
with other advocates, which, inter alia, are noted as below:-
A. EXCLUSIVE DOMAIN OF STATE TO LEVY/EXEMPT
ELECTRICITY DUTYI. The petitioner’s contention that Solar Policy, 2019 is
statutory under Section 3 of the Electricity Act, 2003 is
misconceived. Levy of electricity duty falls exclusively within Entry
53, List II (State List), and is governed solely by the Rajasthan
Electricity (Duty) Act, 1962. Section 3 of the Electricity Act, 2003
pertains only to national electricity and tariff policies framed by
the Central Government, and does not empower States to create
binding statutory policies on electricity duty.
II. National Electricity Policy (2005) and Tariff Policy (2005)
expressly state issuance under Section 3 of the 2003 Act, whereas
the Solar Policy, 2019 contains no such statutory basis and is
merely an executive policy. Under Section 3 of the Act of 1962,
the State Government has exclusive authority to levy, exempt,
modify, or withdraw electricity duty through notification in the
Official Gazette, whether prospectively or retrospectively. It is
settled that where a statute prescribes a specific mode (i.e.,
notification), it must be followed strictly; exemption cannot arise
dehors statutory notification and remains discretionary.
B. POLICIES HAVE NO STATUTORY FORCE
11. (1985) 1 SCC 641 (para 78).
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (15 of 29) [CW-1151/2023]
I. Solar and Wind Policies are executive instruments without
statutory force; they are advisory frameworks and cannot override
or supplant statutory provisions. Executive instructions may
supplement but cannot contradict statute; they may be altered,
replaced, or withdrawn at any time. Amendment dated
10.05.2022 aligns the policy with the statutory scheme by
clarifying that exemption shall be governed by notifications under
the Act of 1962.
II. In absence of any amendment to the Act of 1962, policy
cannot create enforceable rights contrary to statute; statutory
provisions prevail over executive policy. The State retains power to
modify or withdraw exemptions in public interest; no estoppel
operates against statute.
Judgements in support:
a. Sales Tax Officer v. Shree Durga Oil Mills.12
b. Kasinka Trading v. Union of India.13
c. Shrijee Sales Corpn. v. Union of India.14
C. POLICY DECISIONS AND LIMITED SCOPE OF JUDICIAL
REVIEWI. The petitioner has failed to demonstrate arbitrariness, mala
fides, or violation of Article 14; hence, no interference is
warranted. Mandamus cannot be issued to compel issuance of a
statutory notification, as it amounts to directing legislation. No
mandamus lies for enforcement of non-statutory guidelines or
policies. Issuance of notification under statute is a legislative
12. (1998) 1 SCC 572 (paras 14-26).
13. (1995) 1 SCC 274.
14. (1997) 3 SCC 398.
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (16 of 29) [CW-1151/2023]
function involving policy considerations; courts cannot compel
such action.
Judgements in support:
a. Mangalam Organics Ltd. v. Union of India.15
b. Census Commr. v. R. Krishnamurthy.16
II. Judicial review of policy decisions is limited; unless arbitrary
or unconstitutional, courts must defer to executive wisdom.
Judgements in support:
a. Narendra Kumar Maheshwari v. Union of India.17
b. Syndicate Bank v. Ramachandran Pillai.18
c. Raghupathy v. State of A.P.19
D. DOCTRINE OF LEGITIMATE EXPECTATION –
INAPPLICABLELegitimate expectation arises only from a legal foundation or
consistent past practice; neither exists here. The petitioner was
aware that exemption under the Act of 1962 is discretionary and
time-bound, with no assurance of continuity. Policies lacking
statutory force cannot create enforceable promises; expectation
cannot override statute or public interest. Change in policy in
public interest negates any claim of legitimate expectation.
Judgements in support:
a. Union of India v. Hindustan Development Corpn.20
b. Kuldeep Singh v. GNCTD.21 (2006) 5 SCC 702 (para 25);
15. (2017) 7 SCC 221 (paras 33, 35, 39-40).
16. (2015) 2 SCC 796 (para 25).
17. 1990 (Supp) SCC 440.
18. (2011) 15 SCC 398.
19. (1988) 4 SCC 364.
20. (1993) 3 SCC 499 (paras 28, 33).
21. (2006) 5 SCC 702 (para 25).
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (17 of 29) [CW-1151/2023]
c. Madras City Wine Merchants Assn. v. State of T.N.22
d. Pine Chemicals Ltd. v. Assessing Authority23
E. NO PARITY BETWEEN WIND AND SOLAR ENERGY
Solar and wind energy are distinct sources with different
infrastructure, economics, and policy considerations; they do not
form a homogeneous class. Differential treatment is justified as
solar energy has matured with significant growth, whereas wind
energy still requires incentives for promotion. Policy differentiation
based on sectoral needs does not violate Article 14. Notification
dated 10.05.2022 harmonizes both policies by subjecting
exemptions to statutory notifications under the Act of 1962; thus,
the claim of blanket exemption to wind energy is unfounded.
F. FINANCIAL CONSTRAINTS JUSTIFY WITHDRAWAL
The State has justified withdrawal of exemption on grounds of
financial constraints and evolving economic considerations, which
constitute valid public interest. Initial incentives were necessary to
promote solar adoption; however, with increased penetration and
reduced costs, continued exemption would unjustifiably burden
public exchequer for private benefit.
DISCUSSION AND ANALYSIS
9. In the aforesaid backdrop, having perused the material on
record and heard the arrival contentions and after going through
the relevant citations relied upon by both sides, we shall now
proceed to record our discussion and based thereupon render our
opinion.
22. (1994) 5 SCC 509. (para 48).
23. (1992) 2 SCC 683 (para 20).
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (18 of 29) [CW-1151/2023]
9.1. Before adverting to the merits, first and foremost, reference
may be had to Section 3 (3) of The Rajasthan Electricity (Duty)
Act 1962 which reads as under:
“(3) Electricity duty on energy consumed.-
There shall be levied for, and paid to, the State Government on the
energy consumed by a consumer or by a person other than a supplier
generating energy for his own use or consumption a duty 1 (hereinafter
referred to as the “electricity duty”) computed at such rate [xx] as may
be fixed by the State Government from time to time by notification in the
Official Gazette: Provided that–
x-x-x-x-x-x-x
(3) where the State Government is of the opinion that it is necessary or
expedient in the public interest so to do, it may, by notification in the
Official Gazette, exempt fully or partially, whether prospectively or
retrospectively, from payment of electricity duty payable on energy
consumed by any consumer or class of consumers, without any
condition or with such condition as may be specified in the
notification.”
Section 3(3) of the Rajasthan Electricity (Duty) Act, 1962
thus vests in the State Government a broad enabling power to
grant exemption from electricity duty, either wholly or partially, in
public interest. The statue itself provide that such power of
exemption is exercisable prospectively or retrospectively, for any
one consumer or class of consumers, and either unconditionally or
subject to specified conditions. The provision, however, does not
create any automatic or continuing exemption upon expiry of the
notification.
9.2. In exercise of the aforesaid power, the State Government
issued its first notification dated 15.12.2016 granting exemption
from payment of electricity duty on energy generated and
consumed by captive solar power plants, as well as rooftop and
net-metered solar systems. English translation thereof is as
under:
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (19 of 29) [CW-1151/2023]“15.12.2016 NOTIFICATION
In exercise of the powers conferred by clause (3) of the proviso to
section 3 of the Rajasthan Electricity (Duty) Act, 1962 (Act No. 12 of
1962), the State Government being of the opinion that it is expedient in
the public interest so to do, hereby, with immediate effect, exempts from
payment of electricity duty payable by a person on the consumption of
energy, generated by him within the State from;-
(i) solar power plants set up for his own use, and
(ii) solar power plant set up under the Rajasthan Flectricity Regulatory
Commission (Connectivity and Net-Metering for Rooftop and Small
Solar Grid interactive Systems) Regulations, 2015.
subject to the conditions that the duty collected or charged, if any, shall
be paid to the State Government and that the duty deposited to the State
Government shall not be refunded.
This notification shall remain in force upto 31.03.2018.”
Upon expiry of the above said notification, the State
Government, by a subsequent notification dated 10.07.2019,
retrospectively extended the exemption for the period from
01.04.2018 to 31.03.2020. This retrospective extension effectively
bridged the intervening period and ensured continuity of the
exemption up to the latter date. However, beyond 31.03.2020, no
further notification, either prospective or retrospective, has been
issued by the State Government extending or continuing the
exemption.
9.3. Reference may be had to the relevant clauses of the State
policy on solar power generation, which for ready reference are
extracted hereinbelow:-
Erstwhile Clause 16.4 Impugned Amended Clause 16.4
The electricity consumed by the The exemption/ relaxation from payment of
Power Producer for captive use Electricity Duty for the electricity consumed by the
within the State under Clause Power Producer for captive use within the state
7.1, 10.3.1, 10.3.2, 11.4 and under clause 7.1 (Rooftop Solar Plant), 10.3.1
13(iv) will be exempted from (solar plant for captive use within premises),
payment of Electricity Duty for 7 10.3.2 (solar plant for captive use outside
years from COD” premises), 11.4 (solar plant for storage system &
13(iv) (project for EV charging station) will be
governed as per the Orders/Notifications of the
Government of Rajasthan issued from time to time
under the provisions of the Rajasthan Electricity
(Duty) Act, 1962”
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (20 of 29) [CW-1151/2023]A perusal of the above reveals that the amendment has
withdrawn the fiscal incentive of exemption by making it subject
to applicable government orders and notifications issued from time
to time. As is borne out the exemption on electricity duty which
was earlier granted and extended retrospectively has also not
been extended any further after the amendment in the policy, as
above.
10. In light of the above legal position, reverting now to the case
in hand, the controversy before the Court concerns the
enforceability of policy assurances made by the State in the
domain of renewable energy and the extent to which such
assurances, once acted upon, can be withdrawn. The State of
Rajasthan, in furtherance of its objective to promote solar energy,
introduced the Solar Policy, 2019, which, inter alia, assured
exemption from payment of electricity duty for a period of seven
years from the date of commissioning of solar power plants. This
assurance, from plain language of the policy, was neither vague
nor aspirational. It was a time-bound fiscal representation for
limited period of 7 years intended to induce investment in the
renewable energy sector. Acting upon this representation, it so
appears that the petitioners and/or members of the associations in
various petitions, altered their position to set up solar plants at an
alternative location in other States. The petitioner/Ultratech is
stated to have made substantial capital investments, including
investments to the tune of approximately ₹89 crore in establishing
captive solar power projects.
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (21 of 29) [CW-1151/2023]
11. However, vide the subsequent amendment dated
10.05.2022, the State withdrew the benefit of exemption and
subjected such projects to electricity duty. The dispute, therefore,
transcends a mere question of fiscal concession and enters the
broader realm of State accountability and the integrity of
governmental representations in the sector of renewable energy
involving long-gestation investments.
12. The principal defence of the State rests primarily on four
contentions viz.:
a). Firstly, that exemption from electricity duty is governed strictly
by the Rajasthan Electricity (Duty) Act, 1962 and can be granted
only by way of a statutory notification/exemption;
b). Secondly, that the Solar Policy, being non-statutory in
character, does not create enforceable rights;
and
c). Thirdly, that the withdrawal of the exemption is justified in
public interest on account of financial constraints and a reduced
necessity for incentives.
d). Fourthly, there can be no estoppel against statute and that
economic policy decisions are amenable to change in public
interest even if such a change causes private detriment.
13. The desirability of solar energy is an aspect that is beyond
dispute and a conceded position by one and all in the
Government. In this backdrop, The Solar Policy, 2019, though,
admittedly executive in nature and not legislative, was a conscious
and unequivocal representation. Clause 16.4 specifically assured
exemption from electricity duty for a defined period. This was not
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (22 of 29) [CW-1151/2023]
a case of a general policy guideline but of a concrete assurance
intended to create legal relations and acted upon by the
petitioners. The essential ingredients of promissory estoppel, i.e.,
a clear representation, intention to induce action, actual reliance,
and resulting detriment, stand satisfied.
14. Pertinently, the doctrines of promissory estoppel and
legitimate expectation are not rooted in any codified statute.
These are products of equitable principles of law and an
administrative law evolution, developed over a period of time by
way of various precedents/judgments rendered by courts to
obviate possibility of any arbitrary State action (Article 14) and
ensure fairness in governance. Promissory estoppel prevents a
party, including even the State, from going back on a clear and
unequivocal promise that has been relied upon by another party to
its detriment. In Motilal Padampat Sugar Mills v. State of
Uttar Pradesh (supra), the Supreme Court held that the
government can be bound by its promises even in the absence of
formal contracts, provided overriding public interest does not
justify withdrawal.
14.1. Legitimate expectation, on the other hand, ensures
procedural and sometimes even the substantive fairness. Once a
public authority, through express representation, creates an
expectation in the mind of a person or an entity, that they will be
treated in a certain way, it ought not to resile there from. It is so
held in Navjyoti Co-op. Group Housing Society v. Union of
India24 and Food Corporation of India v. Kamdhenu Cattle
24. (1992) 4 SCC 477.
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (23 of 29) [CW-1151/2023]
Feed Industries25. No doubt, unlike promissory estoppel,
legitimate expectation does not create an enforceable right, but at
the same time it contributes to ensure that expectations are not
defeated arbitrarily.
15. Such being the position of law, the State’s contention that
exemption could only be granted by a statutory notification does
not, in the peculiar facts of the present case, defeat the
petitioners’ claim. The Rajasthan Electricity Duty Act undoubtedly
governs the mechanism of exemption; however, it also enables
the grant of such exemption. The policy, in effect, represented
that such statutory power would be exercised in favour of eligible
projects. The State cannot now be permitted to rely upon its own
failure to issue a notification as a defence to defeat a promise
consciously made. To accept such a contention would render all
policy assurances illusory, enabling the State to invite investment
on the strength of representations and thereafter avoid
compliance by inaction. Such a position would be fundamentally
inconsistent with the Rule of Law and would reduce the doctrine of
promissory estoppel to a dead letter.
16. Equally untenable is the plea that the Solar Policy lacks
statutory force and is therefore unenforceable. The petitioners
herein do not seek enforcement of the policy as if it were a
Statute; rather, they invoke the equitable doctrine of promissory
estoppel, which operates independently of statutory force. It is
well settled that governmental representations, even if not backed
by statute, are enforceable in equity where they have been acted
25. (1993) 1 SCC 71.
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (24 of 29) [CW-1151/2023]
upon to the detriment of the promisee, unless an overriding public
interest justifies their withdrawal. The State, having induced
investment through a clear assurance, cannot approbate and
reprobate by subsequently resiling from it.
17. Speaking of overriding public interest, the justification of
financial constraint, advanced as argument on behalf of the State,
also fails to withstand scrutiny. A mere bald assertion of fiscal
burden or fiscal policy, in the absence of any substantive material,
cannot suffice to defeat vested rights and legitimate expectations.
On the contrary, the material on record indicates that the
objectives of the Solar Policy, including the targeted solar capacity,
remain unmet. In such circumstances, withdrawal of incentives
appears not only unsupported by compelling necessity but also
counterproductive to the very policy objectives the State seeks to
advance. The invocation of public interest must be real,
demonstrable, and proportionate; it cannot be a generic or post
facto justification.
18. Adverting now to the constitutional dimension of the matter
in hand. Promotion of renewable energy is intrinsically linked to
the right to a clean and healthy environment under Article 21 and
to the broader principles of sustainable development and
management. Incentives such as electricity duty exemptions are
not mere fiscal concessions but instruments through which the
State discharges its constitutional and international commitments
in relation to climate change and environmental protection.
Arbitrary withdrawal of such incentives undermines not only
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (25 of 29) [CW-1151/2023]
investor confidence, but also the constitutional ethos of fairness
and non-arbitrariness.
19. Thus, even when viewed independently of promissory
estoppel, the impugned action seems to be unsustainable on the
touchstone of Article 14. Withdrawal of a specific and
unambiguous assurance, after inducing substantial investment,
without cogent justification, is manifestly arbitrary. Undoubtedly,
the State retains the power to amend or modify its policies;
however, in all fairness, such modification cannot operate
retrospectively so as to divest accrued or vested rights, unless of
course it is a converse case of conferring additional rights
retrospectively. At best, a change in policy can have prospective
operation, preserving the rights of those who have already altered
their position in reliance upon the earlier representation. A balance
has to be thus struck between the need to preserve executive
flexibility in economic policy and the imperative of maintaining the
credibility of State assurances. While it is true that fiscal policy
must take precedence, but it cannot be rendered absolute by
treating the governmental representations as expendable. If such
assurances are permitted to be withdrawn arbitrarily, investor
reliance becomes illusory and the predictability essential to
economic governance is eroded.
20. As an upshot, we are satisfied that, no doubt, while the State
can alter/amend/withdraw its policy in the larger public interest
and/or fiscal requirements, but cannot take away accrued rights.
Thus, the petitioners herein are entitled to the limited benefit of
the exemption promised under the Solar Policy, 2019, only in
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (26 of 29) [CW-1151/2023]
respect of those projects which have already been commissioned
prior to the impugned amendment. The said amendment cannot
operate retrospectively to divest accrued rights and can only have
prospective effect.
21. With these observations, the writ petition is accordingly
disposed of with liberty to verify exact commercial operations date
of each of the two solar projects set up by the petitioner i.e. as to
whether the same are prior to amendment in the policy and,
thereafter, pass independent orders qua each claim of seeking
exemption from the electricity duty by granting benefit for the
limited period of seven years w.e.f. the commercial operations
date (COD).
22. All pending applications stand disposed of.
D.B. Civil Writ Petition Nos – 12531/2021, 13492/2021,
13525/2021, 15565/2021, 13979/2022, 15593/2022.
23. Petitioners herein are different associations engaged in the
promotion of the solar power industry, seeking issuance of an
appropriate direction, order, or writ against Respondent No. 1 to
grant the benefit of complete exemption from payment of
electricity duty to all captive solar power plants operating in the
State of Rajasthan for a period of seven years commencing from
the date of issuance of the Rajasthan Solar Policy, 2019, without
linking such benefit to the respective commercial operation dates
of the captive solar power plants.
24. Upon perusal of the petitions, it is borne out that the
petitioner associations comprises various members. However, the
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (27 of 29) [CW-1151/2023]
petitions are conspicuously deficient in material particulars.
Specifically, it fails to disclose the Commercial Operation Dates
(COD) of the individual members’ projects. Same is an essential
and determinative criterion for assessing eligibility under the Solar
Policy, 2019.
25. A mere bald assertion of deprivation of benefits does not
suffice sufficient information.
26. Clause 32 (Savings Clause) of the Solar Policy, 2019 reads as
under:-
“Clause 32: Savings Clause
The Power Plants already approved and/or commissioned before
commencement of this Policy will continue to be governed by the
policy/regulations prevailing at the relevant time.”
The above provision, not under challenge before us,
unequivocally stipulates that projects commissioned prior to the
policy shall continue to be governed by the earlier regime. This
necessarily requires precise disclosure of COD to determine the
applicable legal framework.
27. The petitioners have further failed to plead, even in broad
terms, how many of its members are actually impacted by the
impugned amendment to the Solar Policy, 2019.
28. In these circumstances, these petitions are disposed of with
liberty to the individual members of the association to submit
separate representations. Such representations shall be
considered in accordance with the judgment referred to above.
29. The competent authority shall examine each representation
independently by verifying the exact commercial operations date
of each solar project, including whether such date precedes the
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (28 of 29) [CW-1151/2023]
policy amendment. Upon such verification, reasoned and
independent orders shall be passed in respect of each claim
seeking exemption from electricity duty, limited to a period of
seven years from the respective Commercial Operation Date
(COD).
30. Disposed of accordingly, with liberty as aforesaid. Pending
application(s), if any, also stand(s) disposed of.
D.B. Civil Writ Petition Nos – 7298/2022, 9591/2022,
9593/2022, 9621/2022, 9633/2022, 9689/2022,
12614/2022, 13681/2022, 14422/2022, 15097/2022,
15337/2022, 17557/2022, 17691/2022, 19686/2022,
1151/2023, 1964/2023, 2423/2023, 2811/2023,
10590/2023, 10618/2023, 11135/2023, 18783/2023,
19436/2023, 4503/2024.
31. Petitioners herein seek quashing of an order dated
30.06.2021 issued by Chairman, Discoms, whereby it has been
stipulated that electricity duty shall be levied at the rate of Rs.
0.60 per kWh on the consumption of solar-generated energy for
any purpose. The petitioners further seek the issuance of an
appropriate direction, order, or writ against Respondent No. 1 for
granting complete exemption from the payment of electricity duty.
32. It is the case of the petitioners pleaded in affirmation that
they have set up the rooftop solar energy system. However, a
mere bald assertion of deprivation of benefits does not suffice
sufficient information in the absence of their date of
commissioning.
33. In the premise, the instant petitions are disposed of with the
liberty to the petitioners to file their individual representations
before the competent authority who will look into the same and in
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
[2026:RJ-JD:15325-DB] (29 of 29) [CW-1151/2023]
case their case is found to be covered by the judgement ibid,
appropriate order shall be passed.
34. The competent authority shall examine each representation
independently by verifying the precise date on which the rooftop
PV solar plant of each project became operational, including
whether such date precedes the policy amendment. Upon such
verification, reasoned and independent orders shall be passed in
respect of each claim seeking exemption from electricity duty, with
such exemption limited to a period of seven years from the exact
date on which the respective rooftop PV solar plant became
operational.
35. Disposed of accordingly, with liberty as aforesaid. Pending
application(s), if any, also stand(s) disposed of.
(SUNIL BENIWAL),J (ARUN MONGA),J
213-243-KP Singh Dewasi/-
Dhananjay Sharma/-
(Uploaded on 07/04/2026 at 08:09:40 PM)
(Downloaded on 08/04/2026 at 04:58:22 PM)
Powered by TCPDF (www.tcpdf.org)