The court affirmed the petitioner's entitlement to an export subsidy under the Government Resolution, emphasizing equal treatment under Article 14 of the Constitution.

JUDGMENT :

FIRDOSH P. POONIWALLA, J.

1. Rule. Rule made returnable forthwith. Heard finally by consent of the parties.

2. By this Petition, what the Petitioner seeks is a direction to the respondents to pay to the Petitioner a sum of Rs.1,57,24,400/- towards Export Subsidy for export of Milk Powder as per the Government Resolution dated 31st July 2018. This relief is sought on the basis that the Petitioner, under the scheme of the GR dated 31st July 2018, exported 314.488 Metric Tons (MTs) of Milk Powder for which they were entitled to be paid Rs.50 per Kg of Milk Powder exported. According to the Petitioner, there is no dispute about the quantity of Milk Powder exported as well as the amount claimed by them because the correctness of the same have been determined by (i) a letter dated 11th June 2019 issued by the Dairy Development Officer, Nashik Division and (ii) an Order dated 4th March 2022 passed by Respondent No. 2 read with the report dated 26th May 2022 also given by Respondent No. 2 in the Petitioner’s case. Despite all this material, the Respondents have failed and neglected to pay the Export Subsidy to the Petitioner, and hence the present Petition.

3. Before we proceed to decide this controversy, it would be apposite to set out some brief facts. In 2018, there was a drastic fall in the prices of Milk Powder in the domestic as well as in the international market. Because of this, all manufacturers of Milk Powder were not even able to sell their Milk Powder at a price which would break even their costs. The prices had reduced drastically and did not cover the basic cost of milk, production cost, manufacturing cost, and other expenses etc. Due to the same, the stock of Milk Powder with each and every manufacturer in Maharashtra was increasing. As a consequence, the manufacturers, including the Petitioner, reduced the procurement of milk from the end milk farmers as the demand of Milk Powder had reduced. Since the procurement of milk reduced, consequently, fresh production of milk was also reduced. The milk farmers were accordingly unable to sell their milk which resulted in additional milk in the State of Maharashtra.

4. To alleviate this hardship, Respondent No. 1 floated a Scheme for grant of Export Subsidy to clear the existing stock of Milk Powder within the State and restart the manufacturing/production of Milk Powder. The intention behind such subsidy was that the manufacturers of Milk Powder would sell their existing stock in the international market, start manufacturing fresh Milk Powder and for the same would start procuring milk from the milk farmers.

5. One such Scheme was introduced by Respondent No. 1 by issuing Government Resolution dated 20th July 2018. The said Government Resolution dated 20th July 2018 introduced two schemes, i.e. Scheme A and Scheme B. Scheme A provided for a subsidy for Rs.50 per kg. of Milk Powder and Rs.5 per litre of Milk for export of the same in three months, i.e. August, September and October 2018. Scheme B provided for subsidy of Rs. 5 per litre of milk supplied for conversion into Milk Powder, which would be payable either to the milk supplier or the milk producer. Further, Respondent No. 1 introduced a clarification to that Scheme and an additional clause bearing No. B-3 was introduced whereby it was clarified that if the milk manufacturer would take benefit under Scheme-B then it would not be entitled to the Export Subsidy as per Scheme-A.

6. Due to several reasons, the Scheme contemplated under the GR dated 20th July 2018 were not implemented. Therefore, Respondent No. 1 issued an amended Government Resolution dated 31st July 2018 whereby a revised scheme was introduced in place of the earlier Scheme. The revised Scheme was applicable only to the stock of Milk Powder which existed as on 30th June 2018. Respondent No. 1 had inspected the stock of Milk Powder in the Milk Dairies/manufacturing units all over the State of Maharashtra and the same was calculated at 30,183 Metric Tons