VARDHMAN POLYTEX LIMITED Vs. STATE OF PUNJAB

JUDGEMENT

(1.) THE petitioner Vardhman Polytex Limited (formerly M/s Punjab Mohta Polytex Limited) has filed the instant petition under Article 226 of the Constitution for quashing Memo. dated 20.2.2004 (P-3), issued by the Director, Department of Industries and Commerce, Punjab-respondent No. 2, conveying the decision of the Government dated 18.3.2002. According to the decision no subsidy on enhanced cost of land is admissible as there is no provision to that effect under Rule 11-A of the Industrial Policy 1978 (for brevity, 'the policy'). The petitioner has also prayed for quashing letter dated 4.1.2006 (P-5), declining to release the enhanced subsidy on the same ground.

(2.) BRIEF facts necessary for disposal of the controversy raised in the instant petition are that the respondent State issued a policy vide notification dated 21.3.1979, which incorporated a number of rules for grant of incentives aiming to attract setting up of industry in Punjab. Accordingly, the policy was implemented by acquiring huge piece of land in village Bhatinda, Tehsil and District Bathinda for a public purpose, namely, for setting up a Spinning Mill there. The Land Acquisition Collector determined the rate of compensation payable to the land owners, vide award dated 4.2.1983. Consequently, the State Government took possession of the acquired land after paying compensation to the land owners. A track of land measuring 265 bighas 11 biswas was allotted by the respondents to the petitioner. The petitioner has claimed that on the promise given in the policy that 75% subsidy on the cost of land would be given, it had purchased the land and had established the Spinning Mill on the allotted land by investing huge amount and as per the policy, the petitioner paid the cost of the land in accordance with the award dated 4.2.1983.

(3.) ON 4.10.2002, the petitioner applied to the respondents through the General Manager, District Industries Centre, Bathinda, for payment of 75% of subsidy on the enhanced compensation, amounting to Rs. 17,59,441/- (P-2). On 20.2.2004, respondent No. 2 intimated that no additional subsidy could be granted to the petitioner as its case fell under Rule 11-A (developed land) of the policy and, therefore, it was not eligible for subsidy. However, the petitioner claimed vide its letter dated 21.5.2004 (P-4) that its case fell under Rule 11-B (undeveloped land) of the policy and, therefore, was eligible for subsidy. The aforementioned letter was replied back by the respondents by taking the same stand that after thorough secrutinising of the case even under Rule 11-B of the policy, no subsidy on enhanced cost of land was payable.