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3. In pursuance of the said policy the petitioner after obtaining consent under Section 44 of the Electricity (Supply) Act, 1948 [ for short `the Act' ] and the policies framed by the Board set up a captive generation plant. Such captive power generation plants were provided exemption of electricity duty in respect of power generating plants. As pleaded, the State Legislature enacted M.P. Upkar Adhiniyam, 1981 [for short `the 1981 Act'] for levy of certain cess. Levy of energy development cess was imposed on every distributor of electrical energy. In the year 2001 new power policy came into existence as a consequence of which cess of 20 paise per unit of electrical energy produced by the industries was imposed. In order to achieve the said purpose an ordinance, namely, Madhya Pradesh Upkar (Sanshodhan), Adhyadesh, 2001 was promulgated. The said ordinance was subsequently replaced by the M.P. Upkar (Sanshodhan) Adhiniyam, 2001.

6. As put forth the Apex Court allowed the appeal and came to hold that Section 3(2) of the 1981 Act as amended by the Amending Act 2001 and further amended by Amending Act 2003 were ultra vires the Constitution being outside the legislative competence of the State Legislature. While so holding the Apex Court directed refund of cess collected after 01-03-2002 to the appellants therein with interest at the rate of 9% per annum.

7. After rendering of the decision of the Apex Court the State Legislature in order to save the loss caused to the State exchequer enacted an Act namely, M.P. Upkar (Sanshodhan Tatha Vidhimanyatakaran) Adhiniyam, 2004 [ for brevity `the Validation Act of 2004' ] on 15-4-2004 which is deemed to have come into force with effect from 29th June, 2001. The constitutional validity of the provisions of the said Act are challenged on various grounds. It is urged in the petition that the Validation Act is beyond the legislative competence of the State Legislature as the effect of the Validation Act is still to levy energy development cess on the production of the electricity. It is put forth that there is hostile discrimination between the consumer buying from producers under Section 3(2) and the consumers buying from distributor under Section 3(1), as the cess is 20 paise per unit under Section 3(2) and 10 paise per unit under Section 3(1). It is contended that the classification not being with reference to the consumer but qua the producer, the discrimination among the producers amounts to taxing the producers. It is also set forth that the Validation Act is not preceded by due consultation with the State Electricity Regulatory Commission as required under Section 12(3) of the MP Vidyut Sudhar Adhiniyam, 2000 (for short 'Sudhar Adhiniyam 2000'). In this backdrop it is prayed in the writ petition that Section 1(2) of the Act of 2004 and Section 3(2) of the 1981 Act as amended by the Act of 2004 be struck down as unconstitutional. There is a further prayer to strike down Section 3(1)(a) and 3(1)(b) of the Validation Act, 2004 as unconstitutional and to hold that the petitioner is entitled to refund of energy development cess collected from him with interest.

9. It is the further stand of the respondents No. 1 and 2 that the Legislature, for the levy of energy development cess of electricial energy sold or supplied to consumers, has created two categories or classes. First is those who are engaged in distribution of electrical energy for consumption and second those who generate electrical energy by installing their own captive power unit for the purpose of consuming by themselves or their employees or for the purpose of selling or supplying the same. The first category has been dealt with under the provision of Section 3(1) while the second category or class has been dealt with under Sub-section (2). Under the first category or class such statutory body like MPSEB etc. is covered as licensee distributor and whereas in the second category the individuals who have set up their own captive power unit for self consumption or for their employees are included. There is logical and rational criteria for classifying these to categories and prescribing different rates. It is further urged that the MPSEB, a distributor, distributes electrical energy all over the State and it has to suffer transmission and distribution losses up to 35% and hence, it is a class apart from those who have installed their own captive power generating units. Regard being had to the aforeaid, the State Legislature in its wisdom has prescribed energy development cess at 10 paise per unit in respect of MPSEB and 20 paise per unit in respect of those who are captive power generators. It is contended that there is intelligible differentia between the two categories/classes and by such classification no discrimination is caused and it does not offend Article 14 of the Constitution of India. It is further put forth that imposition of tax on consumption and sale of electricity comes within the legislative competence of the State as per Entry 53 of List II of the 7th Schedule to the Constitution and keeping that in view the amendment has been made and hence, the consent of the President of India was not necessary inasmuch as there is no overlapping repugnancy. It is further put forth that the Validation Act falls within the four corners of the legislative competence and validates the previous levy by removing the lacuna retrospectively and, therefore, the assail to the provision of the enactment is untenable.

3. Validation.-(1) Notwithstanding anything contained in any judgment, decree or order of any court, the energy development cess imposed and recovered or purported to have been imposed or recovered in pursuance of Section 2 of this Act, shall, for all purposes, be deemed to be and to have always been validly imposed and recovered as if Sub section (2) of Section 3 of the Principal Act as amended by Section 2 of this Act were enforced at all material times when such energy development cess was imposed or recovered and accordingly