JUDGMENT

VIBHU BAKHRU, J

1. The petitioner has filed the present petition under Article 226 of the Constitution of India impugning an order dated 28.12.2016 passed by the Board of Approval, whereby the petitioner’s appeal against an order dated 18.04.2016 passed by the Unit Approval Committee, NOIDA SEZ was rejected. The petitioner also prays that the petitioner may be allowed benefits under Section 26 of the Special Economic Zones Act, 2005 (hereafter ‘the SEZ Act’) in respect of maintenance and duty free imports of raw materials and consumables for operation and maintenance of the power plant (hereafter ‘O&M benefits’). In addition, the petitioner also prays that it should be allowed duty free transfer of surplus power generated by it to the Export Oriented Units (hereafter ‘EOU’).

Factual Context

2. The petitioner is a company, inter alia, engaged in generation of electricity,whichiscaptivelyconsumedandalsosuppliedtootherunits in the Special Economic Zone (SEZ Units). The petitioner had submitteditsproposalforseekingapprovalforitspowergeneratingunit in MBIL-SEZ. The said proposal was accepted and by a Letter of Approval dated 08.10.2009 (hereafter ‘the LoA’), the Development Commissioner, Noida SEZ (Approval Committee) approved the same and extended all facilities and entitlements, as admissible to a unit in the Special Economic Zone (SEZ) subject to the terms of the SEZ Act and the Rules made thereunder, for undertaking “Authorised Operations”. The said approval was subject to certain terms and conditions as stipulated in the LoA including that, the approval was valid for a period of one year from the date of issue, within which the petitioner was obliged to implement the project and commence production. It was also stipulated that the LoA would be valid for a period of five years from the date of commencement of production. It is relevant to note that the petitioner’s proposal was for it to be treated as an SEZ unit in terms of the Guidelines issued by the Department of Commerce by its letter dated 27.02.2009 (hereafter referred to as ‘the

2009 Guidelines’).

3. The petitioner continued to operate its power generation unit in the SEZ for the period 08.10.2009 to 20.03.2012. During this period, it was granted and availed all benefits under Section 26 of the SEZ Act including O&M benefits in terms of the 2009 Guidelines.

4. On21.03.2012,GovernmentofIndia,MinistryofCommerceand Industry, Department of Commerce issued fresh guidelines for power generation in SEZ (hereafter referred to as the ‘2012 Guidelines’), which superseded the 2009 Guidelines. The said Guidelines continued till31.03.2015andduringthisperiodthepetitionercontinuedtooperate its unit and availed O&M benefits as available under Section 26 of the SEZ Act. In the meanwhile, with the expiry of five years, the LoA expired and in terms of the letter dated 04.12.2014, the LoA was renewed for a further period of five years, that is, till 08.10.2019.

5. Thereafter, by a letter dated 06.04.2015 (P6/3/2006-SEZ), Department of Commerce, Government of India communicated its decision to withdraw the 2012 Guidelines with immediate effect (that is, with effect from 01.04.2015) and restore the 2009 Guidelines (Guidelines issued in terms of the letter dated 27.02.2009). The said letter expressly stated that the 2009 Guidelines would be the basis for the relevant policy and operational decisions. A copy of the said letter is annexed as Annexure P-8 to the petition, and it is not disputed that the same contains a typographical error inasmuch as the letter dated 27.02.2009 (the 2009 Guidelines) is referred to as a letter dated

27.02.2012.

6. The Government of India also issued another letter dated 06.04.2015 addressed to all Development Commissioners, Special Economic Zones informing them that, henceforth, setting up of power plant shall be allowed only in non-processing area of SEZs. It further stated that processing power plants presently situated in the processing area would be demarcate