Water users like Pepsi must pay higher cess:SC

New Delhi: The Supreme Court today ruled major industries and soft drink giants like Pepsico Holdings, which extensively use water as a raw material for their products, are bound to pay higher rates of water cess imposed by government.

A bench of justices Mukundakam Sharma and A R Dave rejected the plea of the Pepsi soft drink manufacturer that government`s decision to adopt differential rates of cess for different users was discriminatory.

"The appellant (Pepsico Holdings) is receiving the facility of water supply from the Corporation and is obliged to pay at such rates which are demanded by the Corporation as the same rate is being charged by government.

"The Corporation cannot be asked to suffer a loss for extensive use of water by the appellant using water as raw material for its business as it is discharging its public and welfare duty for supplying water to help and assist industries like the appellant," the apex court said.

The bench passed the ruling while dismissing the appeal filed by the soft drink manufacturer challenging the decision of the Maharashtra Industrial Development Corporation to increase by 10-fold the water cess imposed on water users in the State from 2001.

As several industries had made representations, government had initially held back the increase in abeyance but subsequently in 2003 approved the increase and sought payment of the cess with retrospective effect.

Aggrieved, Pepsico moved the Bombay High Court which dismissed its plea, following which it appealed in the apex court.

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