Central Power and Light Co. v. Sharp
Central Power and Light (CP&L) appealed a summary judgment concerning the Comptroller's interpretation of the Franchise Tax Act, specifically regarding the computation of a company's surplus. The core of the dispute involved CP&L's capitalization of Allowance for Funds Used During Construction-equity (AFUDC-equity) for its nuclear power plant, which it argued should not be capitalized for franchise tax purposes, leading to a three-million-dollar refund claim. CP&L contended that the Comptroller's interpretation resulted in unequal taxation, resurrected an unconstitutional 'books and records' rule, and constituted an unconstitutional delegation of legislative power. The court affirmed the trial court's judgment, finding a rational basis for the disparate tax treatment between regulated and non-regulated entities due to regulated utilities' assurance of recovering AFUDC-equity through rate-making. The court also rejected CP&L's 'books and records' and delegation arguments, the latter on jurisdictional grounds.