NILAGIRI ICE FACTORY Vs. DISTRICT INDUSTRIES CENTRE

JUDGEMENT

(1.) Petitioner assails the order of the first respondent dated 20/02/1992 cancelling the Certificate of Registration No. 2699 dated 27/09/1991 issued under the Liberalised State Incentive Scheme, 1989 and the consequent temporary eligibility certificate No. 5295/A6/91 dated 30/10/1991 enabling the petitioner to claim sales tax exemption issued under G.O.Ms. No. 498 Industries and Commerce (IA) Department, dated 16/10/1989.

(2.) Petitioner applied to the A.P. State Financial Corporation on 23/09/1989 for project finance. The Corporation sanctioned loan in his favour by order dated 18/11/1989. On 11/09/1989 petitioner availed of the first advance for purchase of machinery. Construction of the factory commenced thereafter, and the machinery was installed still later. Commercial production commenced on 2/04/1990. On 20/06/1990 petitioner filed a formal application for incentives in accordance with G.O.Ms. No. 498 dated 16/10/1989 and the Manual of Guidelines issued by the State Government. By an order dated 28/06/1990 his application was rejected. The State Level Committee which has to determine eligibility of industrial units for Liberalised Incentive Scheme had its meeting held on 28/02/1991, decided to relax the norms contained in clause 10 of the Government order by providing that mere filing of application by an industrial unit to a financing institution for sanction of loan need not be taken as implementation step as prescribed in C.O. No. 498. Apparently, pursuant thereto, temporary registration was granted to the petitioner by order dated 27/09/1991 and eligibility certificate was issued to claim exemption from payment of sales tax by order dated 30/10/1991. It was those proceedings granting registration and eligibility certificate which were cancelled by the Government in its order dated 20/02/1992.

(3.) Petitioner submits that on the facts of the above proceedings dated 27/09/1991 and 30/10/1991, he has ordered the affairs of the industrial unit and the impugned order dated 20/02/1992 which cancelled those orders, which were in his favour without notice are illegal and unsustainable. Counsel also submits that according to G.O. No. 498, the State Level Committee consists of the Secretary to Government, Industries and Commerce Department as Chairman and Director or Commissioner of Industries as Principal Secretary. He submits that the recommendation or a decision of the State Level Committee which consists of the top functionaries of the Government in the concerned department shall be taken as efficacious to alter or clarify the conditions contained in the Government order and any proceedings granting him the eligibility to claim sales tax exemption shall he unimpaired, unless they are cancelled for valid reasons after due notice to him.