DHAMPUR SUGAR MILLS LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners' sugar mill was establishedin 1933. A substantial expansion of its capacity was allowed bythe Government under the Industries (Development and Regulation) Act, in 1965. The cane crushing capacity under the saidexpansion Scheme was increased from 2,000 tonnes to 2250tonnes of sugar cane per day. On 16-2-1973 the Governmentof India issued a Notification under Section 29-(B) of the saidAct and inter-alia, exempted the sugar industry from. applicationof Section 10, 11,11-A and Section 13 of the Act as well asthe Rules framed under the Act. Broadly speaking, the exemption was applicable for setting up new industry and expansionof the existing industry. The exemption could be granted wherethe investment did not exceed Rs. one crore. The said newliberalised Scheme envisaged that the undertaking should merelyregister itself with the Government, without requirement of alicence and other conditions laid down by the said Sections ofthe Act. On 6/12/1975 the Directorate of Sugar andVanaspati, Ministry of Agriculture and Irrigation issued anIncentive Scheme for new facrories and for expansion programmes by established undertakings. All sugar factories wereinformed of the Incentive Scheme. The object of the Schemewas as follows:

(2.) In order to take the benefits of the liberalised licensingand incentive policy of the government of india. the petitionersdecided upon further expansion of their crushing capacity. In1978, the Government of India decided to further liberalise thelicensing policy and issued a Notification to that effect on 26/04/1978. Under the new Scheme the investment limitof I crore was raised to three crores. The Notification furtherlaid down that the industrial undertaking which was exemptunder the said Notification "shall register itself with the Directorate General of Technical Development.. . ....and shall furnisha return in Form-G appended to the registration and licensingof Industrial Undertakings Rules, 1952 in respect the progress made by the undertaking and shall also submit productionreturns every month in such form as may be notified under theprovisions of the said Rules to the concerned authorityb mentioned above."

(3.) Through a press note issued along with the said Notification, the industry was further informed that on receipt of theapplication for registration, the D.G.T.D. etc. will take theapplications on record expeditiously and communicate thefacts of registration and the registered number to the party.The industry was further informed that the "industrial undertakings which have licence-application pending with Government,should review their application and any application which iscovered by the new exemption limit, may be withdrawn bywriting to the Government." The industry was also assuredthat in the light of the above clarification, Government expected that the new licensing policy would ensure greater freedomand opportunity for entrepreneurs. Along with the liberalisationof the licensing policy, the Government continude the policy ofgiving incentives to sugar industries started in 1975. Before thefirst Scheme of incentives came to an end on 31/10/1980, a new Scheme for incentives was issued by the Government on 4/10/1980. The new Scheme was applicable,inter-alia. to all licensed expansions completed on or after 1/10/1980, The Scheme was also applicable tothe expansion projects already licensed.