IN THE HIGH COURT OF GAUHATI, ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH
DEVASHIS BARUAH, J.
M/s Sri Shyam Cold Storage – Petitioner
Versus
The Union of India and Others – Respondents
W.P. (C) No. 7564 of 2018
Decided On : 06-02-2024
NHB - Cold Storage Project - Operational Guidelines for Capital Investment Subsidy Scheme - Chapter-2 - Summary: The court discussed the petitioner's application for In Principle Approval (IPA) for a cold storage project under the National Horticulture Board's (NHB) new scheme and the requirement of term loan sanction date and application window. The court also examined the rejection of the petitioner's application and the relevance of the Operational Guidelines for Capital Investment Subsidy Scheme. The court found that the petitioner did not meet the requirements of the new scheme and did not apply for subsidy as per the guidelines, leading to the dismissal of the writ petition.
Fact of the Case:
The petitioner sought relief to set aside and quash certain letters and obtain In Principle Approval (IPA) or Letter of Intent (LOI) for a cold storage project. The petitioner's term loan was sanctioned before the new scheme's effective date, and the application was made after the specified window. The petitioner did not pursue the earlier application process and did not avail the opportunity granted under a public notice.
Finding of the Court:
The court found that the petitioner did not meet the requirements of the new scheme and did not apply for subsidy as per the guidelines, leading to the dismissal of the writ petition.
Issues: The issues involved the petitioner's eligibility for In Principle Approval (IPA) or Letter of Intent (LOI) under the new scheme, the rejection of the petitioner's application, and the requirement of meeting the Operational Guidelines for Capital Investment Subsidy Scheme.
Ratio Decidendi: The court held that the petitioner did not meet the requirements of the new scheme and did not apply for subsidy as per the guidelines, leading to the dismissal of the writ petition.
Final Decision: The court dismissed the writ petition with no costs.
JUDGMENT :
DEVASHIS BARUAH, J.
1. The instant writ petition has been filed by the petitioner seeking a writ for setting aside and quashing the letter bearing No. NHB/IPA-Sri Shyam Cold Storage/2018-19 dated 02.05.2018 as well as the letter bearing No. NHB/IPA/18AAS/OCS/000015/2018-19 dated 01.08.2018 and further a declaration that the petitioner is entitled to either In Principle Approval (IPA) for construction of the cold storage under NHB’s new scheme “Capital Investment Subsidy Scheme for construction/expansion/modernization of cold storage and storages for horticultural produces” or “Letter of Intent” (LOI) as per the earlier scheme as on 30.03.2017 and further seeking a direction that the In Principle Approval as per the new scheme or the Letter of Intent as per the old scheme be issued to the petitioner.
2. The facts involved in the instant case is that the petitioner which is a proprietorship firm on coming to learn about the various schemes of the National Horticulture Board (NHB) decided to open up a cold storage with storage capacity of 11000 MT for storage of vegetables and fruits at Palashbari Road, Village-Sorapara, Mouza-Chayani of Palashbari Revenue Circle. In that regard, the petitioner firm had approached the respondent authorities and Operational Guidelines were issued to the petitioner firm for the project. It is claimed by the petitioner that the petitioner firm changed its financial position and applied for term loan from the Punjab National Bank, Fancy Bazar Branch. The term loan was sanctioned on 09.03.2017 for an amount of Rs. 600 lakhs. It is further stated that the petitioner thereupon filed an application for obtaining the Letter of Intent (LOI) as per the scheme on 30.03.2017. Along with the said application, the petitioner submitted various documents. The said application however was returned on 03.04.2017 stating inter-alia that various documents were not placed on record. It is not known as to whether the petitioner thereupon pursued on the basis of the said application filed on 30.03.2017, but one aspect is clear from a perusal of the paragraph No. 8 of the writ petition that the petitioner applied afresh on 24.01.2018 which clearly goes to show that the petitioner has foregone the earlier application process. It is however relevant to take note of that on 15.08.2017, a Public Notice was issued by the National Horticulture Board wherein it was mentioned that the said Board has introduced In Principle Approval (IPA) system w.e.f. 01.04.2017 for the credit linked back-ended subsidies scheme on commercial horticulture and cold storage. It was also mentioned that the online applications in prescribed format would be accepted only for new projects where the bank has sanctioned term loan on or after 01.04.2017. Further to that, it was also clearly mentioned that the online applications would be accepted between 01.09.2017 to 30.09.2017. It is also relevant to take note of the Operational Guidelines for Capital Investment Subsidy Scheme for construction/ expansion/modernization of cold storage and storages for horticulture in relation to the new scheme. The said Operational Guidelines is a part of Annexure-III to the writ petition. In terms with the said Operational Guidelines, it was mentioned that from 01.04.2017, In Principle Approval is mandatory for availing financial assistance under credit linked back-ended subsidy schemes of NHB. Further to that, it was also mentioned that it was mandatory to submit the online IPA in the prescribed format available on Board’s website and with the online application, it was made necessary to upload copy of detailed term loan sanction letter of Bank/FI (In Principle Sanction Letter/Bank Consent letter not accepted) issued on or after 01.04.2017 for a new project/activity and a copy of the DD as proof of payment of application fee, in case payment is not made online. Therefore, from a perusal of Annexure-III to the writ petition it is clear that to avail under the ne
AI
The main legal point established is that the petitioner must meet the requirements of the new scheme and apply for subsidy as per the Operational Guidelines to be eligible for relief.
The central legal point established in the judgment is the requirement for scrupulous adherence to the conditions for subsidy approval under the Horticulture Scheme, including obtaining prior approva....
The main legal point established in the judgment is that the rejection of a subsidy claim must adhere to the terms and provisions of the applicable scheme, and must not be arbitrary or contrary to co....
Time limit for completion of project provided under Scheme does not contain any clause that time period prescribed for completion of project cannot be extended by Board.
Administrative authorities must provide substantiated reasons for withdrawing subsidies, especially when an applicant's eligibility is uncontested.
Subsidy claims under the Poultry Venture Capital Fund are contingent upon strict adherence to procedural guidelines; failure to comply negates entitlement, especially after scheme closure.
The court reaffirmed that procedural fairness and adherence to guidelines are essential in administrative actions related to subsidy eligibility, mandating a fresh hearing and review process.
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