STUTI ELECTRONICS Vs. STATE OF RAJASTHAN

JUDGEMENT

(1.) M/s. Stuti Electronics Limited, petitioner herein, seeks to challenge the order dated March 31, 1998 denying the grant of subidy to the petitioner company and the Notification dated Feb. 28, 1998 whereby proviso after clause 4 (L) of "the State Capital Investment Subsidy Scheme for New Industries 1990" was inserted providing that the benefit of subsidy would be available only to those small scale industrial units whose investment in Plant and Machinery did not exceed Rs. 60 lacs. The amendment came into force retrospectively i. e. w. e. f. April, 1997.

(2.) CONTEXTUAL facts depict that the petitioner purchased plots in Industrial Area Bhiwadi and executed lease agreement dated March 27, 1995. A sum of Rs. 330 lacs was sanctioned by the Industrial Development Bank of India for setting up the industrial units vide orders dated August 22, 1995 and December 2, 1996. The petitioner got provisional registration certificate in the category of SSI Unit on January 28, 1998 and got permanent registration certificate in the category of SSI Unit on July 23, 1998. It is an admitted case of the petitioner that it is an SSI Unit but they have incurred more than 300 lacs in establishing the unit. As per the Central Government Industries (Development and Regulation) Act, 1951 the investment ceiling for plant and machinery of SSI was enhanced to Rs. 3 crore. The petitioner being fully eligible for disbursement of subsidy as per the State Capital Investment Subsidy Scheme, submitted application to the respondent No. 3 on January 19, 1998. The respondent No. 3 issued order on March 31, 1998 rejecting the subsidy application on the ground that the petitioner invested more than Rs. 60 lacs in plant and machinery. On Feb. 28, 1998 a Notification was also issued whereby the SSI Units whose investment in plant and machinery did not exceed Rs. 60 lacs were not entitled to subsidy. This amendment was made applicable with effect from 1. 4. 1997. Calling in question the notification the petitioner has prayed to issue direction to the respondents to provide subsidy to the petitioner.

(3.) IN M. P. Sugar Mills vs. State of U. P. (AIR 1979 SC 621) the Hon'ble Supreme Court propounded that the Government cannot claim to be exempt from liability to carry out the promise on some indefinite and undisclosed ground of necessity or expediency. The Government cannot claim to be the sole judge of its liability and repudiate it.