WATER (PREVENTION AND CONTROL OF POLLUTION) CESS ACT, 1977

36 of 1977

7th December, 1977

SECTION 01: SHORT TITLE, EXTENT, APPLICATION AND COMMENCEMENT

(1) This Act may be called the Water (Prevention and Control of Pollution) Cess Act, 1977.

(2) It extends to the whole of India except the State of Jammu and Kashmir.

(3) Subject to the provisions of sub-section (2), it applies to all the States to which the Water (Prevention and Control of Pollution) Act, 1974 (6 of 1974) applies and the Union territories.

(4) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.

SECTION 02: DEFINITIONS

-In this Act, unless the context otherwise requires,-

(a) "local authority" means a municipal corporation or a municipal council (by whatever name called) or a cantonment board or by other body, entrusted with the duty of supplying water under the law by or under which it is constituted;

(b) "prescribed" means prescribed by rules made under this Act;

¹(c) "industry" includes any operation or process, or treatment and disposal system, which consumes water or gives rise to sewage effluent or trade effluent, but does not include any hydel power unit;

(d) words and expressions used but not defined in this Act and defined in the Water (Prevention and Control of Pollution) Act, 1974 (6 of 1974) shall have the meanings respectively assigned to them in that Act.

SECTION 03: LEVY AND COLLECTION OF CESS

(1) There shall be levied and collected a cess for the purposes of the Water (Prevention and Control of Pollution) Act, 1974 (6 of 1974) and utilisation there under.

(2) The cess under sub-section (1) shall be payable by-

(a) every person carrying on any industry; and

(b) every local authority,

and shall be calculated on the basis of the water consumed by such person or local authority, as the case may be, for any of the purposes specified in column (1) of Schedule n, at such rate, not exceeding the rate specified in the corresponding entry in column (2) thereof, as the Central Government may, by notification in the Official Gazette, from time to time, specify.2[(2A) Where any person carrying on any industry or any local authority consuming water for domestic purpose liable to pay cess fails to comply with any of the provisions of section 25 of the Water (Prevention and Control of Pollution) Act, 1974(6 of 1974) or any of the standards laid down by the Central Government under the Environment (Protection) Act, 1986 (29 of 1986), cess shall be, notwithstanding anything contained in sub-section

(2) of this section, calculated and payable at such rate, not exceeding the rate specified in column (3) of Schedule II, as the Central Government may, by notification in the Official Gazette, from time to time, specify.]

(3) Where any local authority supplies water to any person carrying on any industry or to any other local authority and such person or other local authority is liable to pay cess3[under sub-section (2) or sub-section (2A)] in respect of the water so supplied, then, notwithstanding anything conned3[in those sub-sections], the local authority first mentioned shall not liable to any such cess in respect of such water.

SECTION 04: AFFIXING OF METERS

(1) For the purpose of measuring and recording the quantity of water consumed, every person carrying on any industry and every local authority shall affix meters of such standards and at such places as may be prescribed and it shall be presumed that the quantity indicated by the meter has been consumed by such person or local authority, as the case may be, until the contrary is proved.

(2) Where any person or local authority fails to affix any meter as required by sub-section (1), the Central

Government shall, after notice to such person or local authority, as the case may be, cause such meter to be affixed and the cost of such meter together with the cost for affixing the meter may be recovered from such person or local authority by the Central Government in the same manner as an arrear of land revenue.

SECTION 05: FURNISHING OF RETUNIS

[(1)] Every person carrying on any industry and every local authority, liable to pay the cess under section 3-, shall furnish such returns, in such form, at such intervals and containing such particulars to such officer or authority, as may be prescribed.

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[(2) If a person carrying on any industry or a local authority, liable to pay the cess under section 3-, fails to furnish any return under sub-section (1), the officer or the authority shall give a notice requiring such person or local authority to furnish such return before such date as may be in the notice.]

SECTION 06: ASSESSMENT OF CESS

(1) The officer or authority to whom or which the return has been furnished under section 5-shall, after making or

causing to be made such inquiry as he or it thinks fit and after satisfying himself or itself that the particulars stated in the

return are correct, by order, assess the amount of cess payable by the concerned person carrying on any industry or

local authority, as the case may be.

5[(1A) If the return has not been furnished to the officer or authority under sub-section (2) of section 5-, he or it shall, after making or causing to be made such inquiry as he or it thinks fit, by order, assess the amount of cess payable by the concerned person carrying on any industry or local authority, as the case may be.]

(2) An order of assessment made under sub-section (1)6[or sub-section (1A)] shall specify the date within which the cess shall be paid to the State Government.

(3) A copy each of the order of assessment made under sub-section (1)7[or sub-section (1A)] shall be sent to the person or, as the case may be, to the local authority concerned and to the State Government.

(4) The State Government shall, through such of its officers or authorities as may be specified by it in this behalf by notification in the Official Gazette, collect the cess from the person or local authority liable to pay the same and pay the amount so collected to the Central Government in such manner and within such time as may be prescribed.

SECTION 07: REBATE

Where any person or local authority, liable to pay the cess under this Act, installs any plant for the treatment of sewage or trade effluent, such person or local authority shall from such date as may be prescribed, be entitled to a rebate of 8[twenty five per cent.]' of the cess payable by such person or, as the case may be, local authority.9[Provided that a person or local authority shall not be entitled to any rebate, if he or it-

(a) consumes water in excess of the maximum quantity as may be prescribed in this behalf for any industry or local authority; or

(b) fails to comply with any of the provisions of section 25 of the Water (Prevention and Control of Pollution) Act, 1974(6 of 1974) or any of the standards laid down by the Central Government under the Environment (Protection) Act, 1986 (29 of 1986).]

SECTION 08: CREDITING PROCEEDS OF CESS TO CONSOLIDATED FUND OF INDIA AND APPLICATION THEREOF

The proceeds of the cess levied under section 3-shall first be credited to the Consolidated Fund of India and the Central Government may, if Parliament, by appropriation made by law in this behalf, so provides, pay the Central Board and every

State Board, from time to time, from out of such proceeds, after deducting the expenses on collection, such sums of money as it may think fit for being utilised under the Water (Prevention and Control of Pollution) Act, 1974 (6 of 1974): Provided that while determining the sum of money to be paid to any State Board under this section, the Central Government shall have regard to the amount of cess collected by the State Government concerned under sub-section (4) of section 6-

SECTION 09: POWER OF ENTRY

Any officer or authority of the State Government specially empowered in this behalf by that Government may,-

(a) with such assistance, if any, as he or it may think fit , enter at any reasonable time any place which he or it considers it necessary to enter for carrying out the purposes of this Act including the testing of the correctness of the meters affixed under section 4-;

(b) do within such place anything Necessary for the proper discharge of his or its duties under this Act; and

(c) exercise such other powers as may be prescribed.

SECTION 10: INTEREST PAYABLE FOR DELAY IN PAYMENT OF CESS

If any person carrying on any industry or any local authority fail to pay any amount of cess payable under section 3-to the

State Government within the date specified in the order of assessment made under section 6-, such person or local authority,

as the case may be, shall be liable to pay10[interest on the amount to be paid at the rate of two percent, for every month or

part of a month comprised in the period from the date on which such payment is due till such amount is actually paid.]

SECTION 11: PENALTY FOR NON--PAYMENT OF CESS WITHIN THE SPECIFIED TIME

If any amount of cess payable by any person carrying on any industry or any local authority under section 3-is not paid to the State Government within the date specified in the order of assessment made under section 6-, it shall be deemed to be in arrears and the authority prescribed in this behalf may, after such inquiry as it deems fit, impose on such person or, as the case may be, local authority, a penalty not exceeding the amount of cess in arrears: Provided that before imposing any such penalty, such person or, as the case may be, the local authority shall be given a reasonable opportunity of being heard and if after such hearing the said authority is satisfied that the default was for any good and sufficient reason, no penalty shall be imposed under this section.

SECTION 12: RECOVERY OF AMOUNT DUE UNDER THE ACT

Any amount due under this Act (including any interest or penalty payable under section 10-or section 2-, as the case may be) from any person carrying on any industry or from any local authority may be recovered by the Central Government in the same manner as an arrear of land revenue.

SECTION 13: APPEALS

(1) Any person or local authority aggrieved by an order of assessment made under section 6-or by an order imposing penalty made under section 2-may, within such time as may be prescribed, appeal to such authority in such form and in such manner as may be prescribed.

(2) Every appeal preferred under sub-section (1) shall be accompanied by such fees as may be prescribed.

(3) After the receipt of an appeal under sub-section (1), the appellate authority shall, after giving the appellant an opportunity of being heard in the matter, dispose of the appeal as expeditiously as possible.

(4) Every order passed in appeal under this section shall be final and shall not be called in question in any court of law.

SECTION 14: PENALTY

(1) Whoever, being under an obligation to furnish a return under this Act, furnishes any return knowing, or having reason to believe, the same to be false shall be punishable with imprisonment which may extend to six months or with fine which may extend to one thousand rupees or with both.

(2) Whoever, being liable to pay cess under this Act, wilfully or intentionally evades or attempts to evade the payment of such cess shall be punishable with imprisonment which may extend to six months or with fine which may extend to one thousand rupees or with both.

(3) No court shall take cognizance of an offence punishable under this section save on a complaint made by or under the authority of the Central Government.

SECTION 15: OFFENCES BY COMPANIES

(1) Where an offence under this Act has been committed by a company, every person who, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly: Provided that nothing contained in this sub-section shall render any person liable to any punishment, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

(2) Notwithstanding anything contained in sub-section (1), where an offence, under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

SECTION 16: POWER OF CENTRAL GOVERNMENT TO EXEMPT THE LEVY OF WATER CESS.

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(1) Notwithstanding anything contained in Section 3, the Central Government may, by notification in the Official Gazette, exempt any industry, consuming water below the quantity specified in the notification, from the levy of water cess.

(2) In exempting an industry under sub-section (1), the Central Government shall take into consideration—

(a) the nature of raw material used;

(b) the nature of manufacturing process employed;

(c) the nature of effluent generated;

(d) the source of water extraction;

(e) the nature of effluent receiving bodies; and

(f) the production data, including water consumption per unit production, in the industry and the location of the industry.

SECTION 17: POWER TO MAKE RULES

(1) The Central Government may make rules for carrying out the purposes of this Act.

(2) Without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:-

(a) the standards of the meters to be affixed and the places at which such meters are to be affixed under sub-section (1) of section 4-;

(b) the retunis to be furnished under section 5-, the form in which and the intervals at which such returns are to be furnished, the particulars which such returns shall contain and the officer or authority to whom or which such retunis shall be furnished; (c) the manner in which and the time within which the cess collected shall be paid to the Central Government under subsection (4) of section 6;

(d) the date from which any person or local authority liable to pay cess shall be entitled to the rebate12[and the maximum quantity of water in excess of consumption whereof any person or local authority shall not be entitled to the rebate.)

(e) the powers which may be exercised by the officer or authority under section 9-;

(f) the authority which may impose penalty under section 11-;

(g) the authority to which an appeal may be filed under sub-section (1) of section 13-and the time within which and the form and manner in which such appeal may be filed;

(h) the fees which shall accompany an appeal under sub-section^) of section 13-; and

(i) any other matter which has to be or may be prescribed.

(3) Every rule made under this Act, shall be laid, as soon as may be after it is made, before each House of Parliament while it is in session for a total period of thirty days which may be comprised in one session or in two or more successive sessions and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule or both Houses agree that the rule should not be made, the rule shall there after have effect only in such modified form or be of on effect, as the case may be so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule.

SCHEDULE 1 SCHEDULE

[See section 2 (c)][* * * * *]

SCHEDULE 2 SCHEDULE

(See section 3)

Purpose for which water is consumed Maximum rate under subsection

(2) of Section 3

Maximum rate under sub-section (2-

A) of Section 3

(1) (2) (3)

1. Industrial cooling, spraying in mine Five paise Ten paise

pits or boiler feeds per kilolitre per kilolitre

2. Domestic purpose Two paise Three paise

per kilolitre per kilolitre

3. Processing whereby water gets Ten paise Twenty paise

polluted and the pollutants are — per kilolitre per kilolitre

(i) easily biodegradable; or

(ii) non-toxic; or

(iii)both non-toxic and easily

biodegradable

4. Processing whereby water gets Fifteen paise Thirty paise

polluted and the pollutants are — per kilolitre per kilolitre"

(i) not easily biodegradable; or

(ii)toxic; or

(iii)both toxic and not easily

biodegradable

WATER (PREVENTION AND CONTROL OF POLLUTION) CESS RULES, 1978

In exercise of the powers conferred by section 17 of the Water (Prevention and Control of Pollution) Cess Act, 1977 (36 of 1977), the Central Government hereby make the following rules, namely:-

RULE 1 Short title and commencement

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(a) These rules may be called the Water (Prevention and Control of Pollution ) Cess Rules, 1978.

(b) They shall come into force on the date of their publication in the official Gazette2

RULE 2 Definitions

-In these rules, unless the context otherwise requires:-

(a) "Act" means the Water (Prevention and Control of Pollution) Cess Act, 1977 (36 of 1977);

(b) "assessing authority" means-

3(i) in relation to a Union Territory, the member-secretary of the Central Pollution Control Board and in those Union Territories where Pollution Control Committees have been constituted by the Administrator, Lt. Governor, a member nominated by the Administrator/Lt. Governor, a member nominated by the man thereof, and].

(ii) in relation to a State the member-secretary of the State Board;

(c) "consumer" means a person or local authority by whom the cess under sub- section (1) of section 3 is payable under sub-section (2) of that section;

(d) "form" means a form annexed to these rules;

(e) "section" means a section of the Act;

(f) "State Government", in relation to a Union Territory means the Adminis- trator thereof appointed under Article 239 of the Constitution.

RULE 3 Standards of meters and places where they are to be affixed

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(1) For the purposes of measuring and recording the quantity of water consumed, every consumer shall affix water meters, venturi meters or Orifice meters with integrators and recorders in conformity with the standards laid down by the Indian Standards Institution and where no standards have been laid down by that institution in conformity with such standards as may be specified by the Board.

(2) Wherever the meters referred to in sub-section (1), are not available, the consumer shall install Vee notches or rectangular notches, with indicators and recorders or pressure gauges and pumping installations, after obtaining the permission of assessing authority.

(3) Every consumer shall provide a separate meter for assessing the quantity of water used for each of the fourpurposes mentioned in column (1) of Schedule II to the Act.

(4) The meters shall be affixed at the entrance of the water supply connections with the premises of the consumer or at any other place to be approved by the assessing authority, so that such meters are easily accessible for inspection and maintenance and for other purposes of the Act: Provided that the place where the meter is affixed shall,-in no case, be at a point before which water has been tapped by the consumer for utilisation for any purpose whatsoever.

RULE 4 Furnishing of returns

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4[(1)] Every consumer shall furnish on or before the 5th of every calendar month, to the assessing authority, a return in Form I showing the quantity of water consumed in the previous month.

5(2) If the consumer fails to submit the return as specified in sub-rule (1) the assessing authority or the officer authorised in this regard shall issue a notice in Form 1-A.]

RULE 5 Manner of payment of the cess to the Central Government and the time within which it shall be paid

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(1) Every State Government shall remit to the Central Government, the amount of cess collected from the consumer before the 10th day of the calendar month succeeding the month in which it is collected from the consumer.

(2) The amount of cess referred to in sub-rule (1) shall be remitted to the Central Government in the form of a bank draft drawn in favour of the6Pay and Accounts Officer, Department of Environment], New Delhi in whose books of accounts, the receipts would be adjusted finally.

(3) On receiving the bank draft, the Ministry of Works and Housing shall remit the same through a challan into the Reserve Bank of India, New Delhi for the purpose of crediting under relevant Major Head.

RULE 6 Rebate

-Where a consumer installs any plant for the treatment of sewage or trade effluent, such consumer shall be entitled to the rebate under section 70Aand from the expiry of fifteen days from the date on which such plant is successfully commissioned and so long as it functions successfully:7Provided that a consumer shall not be entitled to the rebate if he-

(a) consumes water in excess of the maximum quantity specified in column (3) of the First Schedule appended to these rules for the category of industries specified in the corresponding entry in column (2) relating to the specified industry given in column (1) thereto, or

(b) fails to comply with any of the provisions of section 25-of the Water (Prevention and Control of Pollution) Act, 1974 (6 of 1974), or any of the standards laid down by the Central Government, under the Environment (Protection) Act, 1986 (29 of 1986).]

RULE 6A Collection by States/Union Territories

-The Cess Collecting Authority of the State/Union Territory shall furnish a statement with the Central Government before the 10th day of the calendar month of January, April, July and October showing assessment of cess of specified industries, its collection and arrears.]

RULE 7 Powers to be exercised by the Officer or the Authority of the State Government under section 9

- The officer or authority of the State Government specially empowered under section 9-shall have in addition to the powers referred to in clauses (a) and (b) of that section, the power to-

(i) inspect the manufacturing process or plant of the consumer,

(ii) inspect the water supply systems and installations in the plant of the consumer;

(iii) inspect water treatment system and installations, in the plant of the consumer;

(iv) inspect the drainage system and installations, including storm water disposal in the plant of the consumer;

(v) call for and inspect records relating to the use and consumption of materials and water, and those relating to production, in the plant of the consumer;

(vi) call for and inspect the records relating to power consumption in the plant of the consumer; and

(vii) call for any other information or records relating to the supply, consumption and treatment of water in the plant of the consumer.

RULE 8 Authority to impose penalty under section 11

-The authority to impose penalty under section 11-shall be the assessing authority.

RULE 9 Appeal

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(1) Any consumer aggrieved by an order of assessment made under section 6-or by an order imposing penalty made under section 11-may appeal in Form 11 annexed hereto, to a Committee (hereinafter referred to as the appellate committee) consisting of-

(a) where the assessing authority is the member-secretary of the Central Board, the Chairman of that Board, who shall be the Chairman of the Committee, and two members of the Board, to be nominated by the Chairman thereof9[and in those Union Territories where Pollution Control Committees have been constituted by the Administrator/Lt. Governor, the Chairman of such committee and two members to be nominated by the Chairman there of ];

(b) where the assessing authority is the member-secretary of the State Board, the Chairman of that Board, who shall be the Chairman of the Committee, and two members of that Board, to be nominated by the Chairman thereof.

(2) Such appeal shall state the facts of the case and the grounds relied upon by the appellant for preferring the appeal and shall be accompanied by a copy of the order of assessment made under section 6-or a copy of the order imposing penalty made under section 11-, as the case may be.

(3) Such appeal shall be preferred within a period of thirty days from the date of communication of the order of assessment or the order imposing penalty: Provided that if the chairman of the appellate committee is satisfied that there was good and sufficient reason for the delay in preferring the appeal, he may, for reasons to be recorded in writing, allow the appeal, to be preferred after the expiry of the aforesaid period of thirty days and before the expiry of forty-five days from the date of communication of the order of assessment, or the order imposing penalty, on the appellant. (4) Every appeal shall be accompanied by a fees of rupees fifty.

FORM 1A 1A

[See rule 4 (2)] NAME OF THE BOARD Dated.......................... Notice under section 5(2) of the Water (Prevention and Control of Pollution) Cess Act, 1977 (36 of 1977)- To Name and Address of the Consumer: Assessment period: Whereas you were required to furnish a return as provided under sub-section (1) of section 5 of the Water (Prevention and Control of Pollution) Cess Act, 1977-(36 of 1977) read with sub-rule (1) of rule 4 of the Water (Prevention and Control of Pollution) Cess Rules, 1978-, by the 5th of....................; And whereas you have failed to furnish the return by the said date; Now, therefore, you are hereby called upon to furnish the return within 7 days from the date of receipt of this Notice. In case no return is received within the said period of 7 days, action will be taken for making assessment as per sub-section (1-A) of section 6-of the aforesaid Act, exports, besides initiating any other legal action as per law against you. Issuing authority Place................................ Name................................. Date.................................. Address.................................