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2001 DIGILAW 267 (AP)

Sanjay Alloys (P) Ltd. v. Government of India

2001-03-15

ELIPE DHARMA RAO

body2001
ELIPE DHARMA RAO, J. ( 1 ) THE petitioner filed this petition seeking a writ of mandamus declaring the action of respondents in not granting the Central Subsidy to the petitioner as illegal and arbitrary and consequently direct the respondents to grant Central subsidy and pass further orders in the interest of justice. ( 2 ) THE petitioner is a small scale industrial unit for manufacture of corrosion resistant castings, heat resistant castings, steel alloy and alloy iron castings and was granted provisional SSI registration in certificate No. 01 -02-0481 -PROV/ssi/rural, dated 25-7-1986, in LDis No. 4773/bb/86 dated 25-7-1986 by the third respondent initially for one year and valid upto 24-7-1987 and licence was revalidated upto 23-7-1988. When further revalidation was refused, petitioner filed WP No. 5574 of 1989 and the same was allowed on 30-4-1990 and subsequently, the petitioner was granted permanent SSI registration. The petitioner unit has gone into commercial production with effect from 8-12-1989. ( 3 ) THE petitioner unit was established in industrially backward area and as per the policy of the Central Government, the petitioner is entitled to Central Subsidy on the capital investment. After the grant of provisional registration and when the works were in progress, the petitioner registered claim for grant of 10% Central Subsidy with third respondent, who informed the petitioner vide letter dated 14-10-1991 that its application is kept pending until further orders are received from 2nd respondent. Inspite of reminders, there was no response from the respondents. Hence, this writ petition. ( 4 ) THE respondents 2 and 3 filed counter-affidavit stating that the petitioner unit went into production on 8-12-1989 and was given permanent Small Scale Industries registration vide D. Dis. No. 45458/a1/91 dated 20-5-1992. The petitioner unit filed claim application on 24-10-1989 for grant of eligible Central Subsidy with the General manager, District Industries Centre, Chittoor and the application was returned vide letter dated 14-12-1989 to the petitioner with a request to resumbit the same with the following documents:"1. Valid Small Scale Industries registration Certificate. 2. State Bank of India loan sanction and disbursement letters". Further, the petitioner has not resubmitted the claim application on or before 31-12-1989 but resubmitted on 29-8-1991 i. e. , after the expiry of Central Subsidy Scheme. Valid Small Scale Industries registration Certificate. 2. State Bank of India loan sanction and disbursement letters". Further, the petitioner has not resubmitted the claim application on or before 31-12-1989 but resubmitted on 29-8-1991 i. e. , after the expiry of Central Subsidy Scheme. The Government of India vide letter dated 21-7-1989 informed that in respect of manufacturing activities, the Government of india would reimburse subsidy disbursed by the State Government provided that the following conditions are satisfied:1. The project was approved by the approval Committee i. e. , the State level Committee or the District Level committee as the case may be on or before 30th September, 1988. 2. The disbursements are made before 31st December, 1989. Hence the application of the petitioner unit kept pending awaiting further instructions from Government of India. Thus the Central Subsidy Scheme was closed for all purposes. ( 5 ) IT is specifically stated that the government of India have discontinued central Subsidy Scheme vide Lr. No. 6/1/89- dba. II dated 21-7-1989 and hence, pending applications were not considered. ( 6 ) IT is seen from the facts and circumstances of the case, the petitioner is not entitled to Central Outright Subsidy. As per the procedure contemplated under the scheme, the unit has to be registered and steps have to be taken for investment of the 60% capital and then an application has to be made and the same has to be approved by the State Level Committee or District level Committee for grant of Central outright Subsidy. Subsequently, the scheme was withdrawn by the Government vide letter dated 21-7-1989. It is made clear that the Central Government will Central Subsidy to the projects approved by the Approval committee i. e. , State Level Committee or the District Level Committee, as the case may be, on or before 30th September, 1988 and that the disbursements are made to the companies which are admitted, and paid a portion of the subsidy before 31st December, 1989. It is also seen that the petitioner unit was given permanent small Scale Industries Registration vide communication dated 20-5-1992 and went into commercial production on 8-12-1989. It is also seen that the petitioner unit was given permanent small Scale Industries Registration vide communication dated 20-5-1992 and went into commercial production on 8-12-1989. The petitioner made an application on 24-10-1990 claiming Central Subsidy and the same was returned as two documents namely SSI Registration Certificate and state Bank of India loan sanction and disbursement Certificate were not attached to the application and the petitioner was asked to resubmit the said application. The petitioner resubmitted the said application on 29-8-1991 after a gap of more than two years and that too after the Central Subsidy was withdrawn by the Central Government. On the other hand, learned Counsel for the petitioner raised the contention of promissory estoppel and also relied on the judgment of High Court of Madhya Pradesh in Shri Bajrang Extraction Private Ltd. v. Secretary, Government of M. P. , AIR 1993 mp 202 , granting relief of the subsidy on the ground that there is delay in process of application before withdrawal of the scheme. ( 7 ) IN the above said case, the Division bench of the Madhya Pradesh High Court came to the rescue of the petitioner therein on the ground that when the scheme of granting subsidy was withdrawn by the government, his application was pending before the authorities and the authorities have delayed processing of the application for granting subsidy. Therefore, the Division bench, in the interest of justice, has granted relief. It is not the fault of the petitioner therein, but it is due to the delay in processing the application of the petitioner by the authorities the petitioner could not get the subsidy and therefore, directed the government to grant the subsidy. The facts are different in the present case. As on the date of withdrawal of the subsidy by the government, no application of the petitioner is pending before the authorities, though it was filed earlier, it was returned requesting the petitioner to comply certain defects pointed out by the authorities. The petitioner resubmitted the same on 29-8-1991 after complying with the defects so pointed out, by which date the subsidy was already withdrawn by the Government. Therefore, the principle laid down by the Division bench of Madhya Pradesh in Shri Bajrang s case, cannot be applied to the petitioner s case. The petitioner resubmitted the same on 29-8-1991 after complying with the defects so pointed out, by which date the subsidy was already withdrawn by the Government. Therefore, the principle laid down by the Division bench of Madhya Pradesh in Shri Bajrang s case, cannot be applied to the petitioner s case. ( 8 ) THE learned Counsel for the petitioner vehemently contended that the principle of promissory estoppel applies in the facts and circumstances of the case, inasmuch as due to the promise of the respondents, the petitioner has changed his position and he has invested so much of amount for the establishment of the factory in a backward area with a fond hope that he will get the subsidy from the government. In support of his contention, he relied on a plethora of decisions of both the Supreme Court and this Court. ( 9 ) THE principle of estoppel could have been made applicable to the petitioner s case had the petitioner complied the procedure contemplated under the scheme within the time limit prescribed under the scheme viz. , he has to register his industry and thereafter he has to take steps to spend atleast 60% of the capital and he has to commence production. Then only he can make application to the State Level committee or the District Level Committee, as the case may be, for approval of his project and to admit into the outright subsidy. Though the industry was started in 1986 and obtained provisional registration as a small Scale Industry, but it was renewed from year to year and when the respondents failed to renew the said provisional certificate, he filed writ petition and obtained orders to renew the registration certificate and ultimately, permanent registration certificate was obtained on 20-5-1992 after withdrawal of the scheme by the Central government and the industry went into commercial production on 8-12-1989 and the application was made on 24-10-1989 claiming outright subsidy which was returned for compliance of certain defects on 14-12-1989. But the petitioner instead of resubmitting the application on or before 31-12-1989, submitted the same on 29-8-1991 after withdrawal of the scheme. Therefore, when the petitioner has failed to make application on or before 31-12-1989, he cannot invoke the principle of promissory estoppel to direct the Government to grant subsidy. But the petitioner instead of resubmitting the application on or before 31-12-1989, submitted the same on 29-8-1991 after withdrawal of the scheme. Therefore, when the petitioner has failed to make application on or before 31-12-1989, he cannot invoke the principle of promissory estoppel to direct the Government to grant subsidy. As per the letter addressed by the Central Government, the project has to be approved by the State Level Committee or the District Level Committee, as the case may be, on or before 30-9-1988. Therefore, when the petitioner failed to get approved his project by the State Level committee or the District Level Committee on or before 30-9-1988, he cannot claim invocation of principle of estoppel. It cannot be said that mere certificate issued by the Registrar of Industries enables the petitioner to apply for grant of subsidy and it also cannot be said that the project was approved by the State Level Committee or the District Level Committee. Therefore, i hold that when the petitioner has failed to comply with the procedure contemplated under the scheme within the prescribed time and failed to submit his application on or before 30-9-1988, he cannot invoke the principle of promissory estoppel and make complaint that by virtue of the promise made by the Central Government, he has changed his position and incurred huge expenditure for establishment of the industry and, therefore, entitled for the grant of subsidy. When the petitioner has not made application within the stipulated time, as prescribed under the scheme, he cannot invoke the principle of estoppel. Further application of the principle of promissory estoppel is made applicable based on the facts and circumstances of each case. When the scheme contemplates the petitioner to get approval of his project by the State Level Committee or the District level Committee, as the case may be, before 30-8-1988 the petitioner has failed to make application on or before 31-12-1989, the time limit prescribed by the Government of india, the principle of promissory estoppel cannot be made applicable in the facts and circumstances of the case. ( 10 ) IN the present case, the permanent registration was obtained on 20-5-1992 and though it went into commercial production on 8-12-1989. ( 10 ) IN the present case, the permanent registration was obtained on 20-5-1992 and though it went into commercial production on 8-12-1989. The application was filed on 24-10-1989 for grant of subsidy after the withdrawal of scheme and the same was returned on 14-12-1989 to comply with defects and the application was resubmitted on 29-8-1991 but the respondent was kept pending for the reason that they are waiting for the order of Union of Indian Government. Therefore, as on the date of withdrawal of the scheme, the application of the petitioner was not pending before the respondents. The decision of High Court of Madhya pradesh and also the principle of promissory estoppel are not applicable to the facts of this case as the petitioner has not made application within the prescribed time. In these circumstances, I see no merit in this writ petition. ( 11 ) THE writ petition is accordingly dismissed. No order as to costs.