The government cannot retroactively change subsidy claims based on later communications that deviate from previously established entitlements, respecting the doctrines of promissory estoppel and legitimate expectation.

JUDGMENT :

Heard Mr. G. N. Sahewalla, the learned senior counsel assisted by Mr. H. K. Sarma, the learned counsel for the petitioner. Also heard Mr. M. R. Adhikari, the learned counsel appearing on behalf of the Union of India and Mr. A. Kalita, the learned Standing Counsel appearing on behalf of the Industries Department of the Government of India.

2. The petitioner being aggrieved by the action on the part of the respondent authorities in reducing the entitlement on account of Central Capital Investment Subsidy Scheme, 2007 (for short, ‘CCISS, 2007’) has preferred the instant writ petition seeking a direction upon the respondents to cancel, recall and/or otherwise forbear from giving effect to the letter No.9(2)/2012-DBA-II/NER dated 25.02.2013 and the revised operation guidelines bearing No.10(3)/2011-DBA-II/NER(PT-II) dated 07.05.2013 to the extent of specifying eligible and non-eligible components for the purpose of CCISS 2007 in respect to the plant and machinery so far claims for Central Capital Investment Subsidy are submitted prior to the issuance of those communications and also seeking a writ in the nature of mandamus directing the respondent authorities to grant the petitioner Central Capital Investment Subsidy at the rate of 30% of the petitioners total investment in plant and machinery in the cement plant as per the guidelines of 2007 etc.

3. The North East Industrial Policy (NEIP), 1997 was announced on 24.12.1997 covering the States of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland and Tripura which was valid for a period of 10 years from the date of commercial products by the eligible units. Subsequent thereto, in the year 2007, the Government of India, Ministry of Commerce and Industry in the Department of Industrial Policy and Promotion had approved the package of fiscal incentive and concession for the North Eastern Region, namely, the North East Industrial and Investment Promotion Policy (NEIIPP), 2007 w.e.f. 01.04.2007. For the sake of convenience, the said policy of the year 2007 is hereinafter is referred to as the ‘Industrial Policy, 2007’. In terms with the said Industrial Policy, 2007 all new units as well as existing units which go for substantial expansion, unless otherwise specified and which commence commercial production within the 10 years period from the date of the Notification of the Industrial Policy, 2007 would be eligible for incentive for a period of 10 years from the date of commencement of commercial production.

4. In terms with the said Industrial Policy, 2007, various incentives in the form of exemptions and subsidies were being provided to those eligible units. Amongst the various incentives, one such incentive was the Central Capital Investment Subsidy. In the said Industrial Policy, 2007 itself and more particularly at Clause (VII), it was mentioned that the Capital investment Subsidy would be enhanced from 15% of the investment in plant and machinery to 30% and the limit for automatic approval of subsidy at the said rate would be Rs.1.5 crore per unit, as against Rs.30 lakhs as was available under the NEIP, 1997. In the said Industrial Policy, 2007, it was mentioned that such subsidy shall be available to units in the pr