ADAIDYA SOLUTIONS PVT LTD Vs. RIICO

JUDGEMENT

(1.) ACKNOWLEDGING emergence of the information technology in business and industry, the Rajasthan State Industrial Development and Investment Corporation Limited (hereinafter referred to as "the Corporation") planned a new information technology park at Udaipur with an assurance to provide quality infrastructure such as communication facility, power, road, drainage etc. As per information technology policy of the Government of Rajasthan the Corporation while making efforts to inspire entrepreneur to set up IT Projects at proposed information technology park Udaipur also extended concessions and facilities including (1) land rebate upto 50% in land cost (development charges); (2)100% exemption from stamp duty; (3)50% exemption from electricity duty for seven days; (4)benefits under STP Scheme of Government of India for 100% EOU units registered with STPI; and (5) instalment facility for payment of 75% cost over a period of five years in 19 equal quarterly instalments with 13% interest per annum.

(2.) THE petitioner, a company (hereinafter referred as "the Company") incorporated under the Indian Companies Act, 1956 acting upon the plan forwarded by the Corporation applied for allotment of industrial plot to instal information technology project, accordingly, a piece of land measuring 6444 sq. mtr. was allotted and a lease agreement in this regard was executed and registered on 16-5-2007.

(3.) THE decision of the Corporation is assailed by the petitioner company mainly on plea based on doctrine of promissory estoppel with the factual background that the petitioner company on solemn assurance given and representation made by the respondent Corporation acted upon to avail allotment of land and for that purpose it paid Rs.48.36 lacs towards development charges. THE company also obtained loan from State Bank of India for the sum of Rs.100 lacs. A huge amount of that was spent on constructing a building for the purpose of setting up an infotech industry. THE petitioner company also made certain commitments with its clients in India and abroad but by revoking lease agreement and cancelling allotment of land the respondent Corporation has put the company in disadvantageous position i.e. against the principles of promissory estoppel.