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2024 Supreme(Cal) 1260
IN THE HIGH COURT AT CALCUTTA
T.S. SIVAGNANAM, C.J., HIRANMAY BHATTACHARYYA, JJ.
State of West Bengal & anr. – Appellants
Versus
M/s. Ambuja Cements Limited & Ors. – Respondents
MAT 2458 of 2023 With IA No. CAN 1 of 2023, CAN 2 of 2023
Decided on : 14-05-2024
For the Appellant : Mr. Kishore Dutta, ld. A.G., Mr. Anirban Ray, ld. G.P., Mr. Tanoy Chakraborty
For the Respondent:Mr. Ratnanko Banerjee, ld. Sr. Adv., Mr. Sakya Sen, Mr. Rajarshi Dutta, Mr. Soorjya Ganguli , Mr. Somdutta Bhattacharyya , Mr. Mohit Dang ...advocates
IMPORTANT POINT
The court established that incentives granted under a special package can be disbursed without a financial cap if explicitly stated, overriding general provisions that may suggest otherwise.
Headnote:
Incentives - Special Package of Incentives - WBIS, 2000 - The court interpreted the provisions of the WBIS, 2000, particularly regarding the Industrial Promotion Assistance (IPA) without a financial cap, affirming the entitlement of the petitioner to the claimed incentives.
Fact of the Case:
The State of West Bengal appealed against a decision directing the disbursement of Industrial Promotion Assistance (IPA) to Ambuja Cement Ltd. (ACL) under the Special Package of Incentives granted in 2006, which ACL claimed was without a financial cap.
Finding of the Court:
The court found that the Special Package of Incentives did not impose a financial cap on the IPA, and the State's interpretation to limit it based on Fixed Capital Investment was incorrect and unsupported by the terms of the package.
Issues: Whether the Special Package of Incentives granted to ACL included a financial cap on the Industrial Promotion Assistance (IPA) based on Fixed Capital Investment.
Ratio Decidendi: The court held that the absence of a financial cap in the Special Package of Incentives meant that ACL was entitled to receive IPA without limitation, rejecting the State's argument based on public policy.
Result: The appeal was dismissed, affirming the entitlement of ACL to the claimed IPA.
JUDGMENT :
Hiranmay Bhattacharyya, J.
1. This appeal is at the instance of the State of West Bengal and is directed against an order dated 31.08.2023 passed by a learned Single Judge in WPA 9546 of 2019.
2. By the order impugned, the writ petition stood allowed and the authorities of the State of West Bengal were directed to ensure that the balance amount due to the writ petitioners in terms of the break up given in the supplementary affidavit filed by the writ petitioners before the learned Single Judge is disbursed to the writ petitioners within the time limit stipulated thereunder. By the said order, the order of the Additional Chief Secretary dated 14.02.2019 was set aside.
3. Ambuja Cement Ltd. (for short “ACL”) shifted its cement manufacturing unit to Farakka in the District of Murshidabad. The Commerce and Industries Department vide letter dated 02.03.2006 granted Special Package of Incentives to ACL Farakka unit under the West Bengal Incentive Scheme, 2000 (for short “WBIS, 2000”) which inter alia included the benefit of Industrial Promotion Assistance (for short “IPA”) without any financial cap for a period of five years and two months from the date of commencement of commercial production. The Director of Industries, West Bengal issued the Certificate of Registration under the WBIS, 2000 to ACL on May 16, 2006 in respect of its Farakka unit, the validity period of which was up to May 15, 2009. The unit claims to have commenced its commercial production at its Farakka unit from May 31, 2007. ACL claims that the unit is entitled to claim incentives for a period of five years and two months from the date of commencement of commercial production i.e., from May 31, 2007 to July 31, 2012.
4. West Bengal Industrial Development Corporation (for short “WBIDC”) issued Eligibility Certificate under WBIS 2000 on May 18, 2010 in respect of the cement unit of ACL situated at Farakka. ACL claims that the WBIDC by a letter dated June 13, 2011 sanctioned Rs. 628.22 lakhs for the first year (2007-08), Rs. 1443.41 Lakhs for the second year (2008-09) and Rs. 3518.76 lakhs for the third year (2009-10) towards IPA. The ACL claims that IPA for the periods 2007-08 and 2008-09 has been received in full and only a portion of IPA for the period 2009-10 has been received by ACL.
5. ACL submitted a representation claiming release of IPA under WBIS, 2000. Alleging that the IPA under the WBIS, 2000 has not been released in favour of ACL, a writ petition being WP No. 1397 (W) of 2018 was filed which was disposed of by an order dated 31.01.2018 by directing the first respondent therein to consider and decide the claim lodged by ACL in its letter dated July 14, 2017 in accordance with law after affording a reasonable opportunity of hearing to the writ petitioners and by passing a reasoned order within the time limit stipulated thereunder.
6. Pursuant to the said order dated 31.01.2018 passed in WPA 1397 of 2018, the Additional Chief Secretary passed an order dated 14.02.2019 which was challenged by ACL in writ petition being WPA 9546 of 2019. The said writ petition was allowed by the impugned order. Being aggrieved by the order dated 31.08.2023 passed by the learned Single Judge in WPA 9546 of 2019, the State of West Bengal has approached this Court with this intra court appeal.
7. The Learned Advocate General contended that a sum of Rs. 41.1039 crores was released in favour of ACL as IPA against Fixed Capital Investment (for short “FCI”) of Rs. 41 crores. By referring to Para 2 of the order dated 02.03.2006, he contended that IPA was granted in lieu of Interest Subsidy. He also referred to Para 9 of the said order in support of his contention that there is a financial cap for release of IPA. He also placed reliance on the observations of the Finance Department dated 28.12.2018 to buttress his contention that IPA had a financial cap. The Learned Advocate General further contended that directing the State to release IPA in excess of FCI would be opposed to pu
