2000 (3) TMI 1069 - SC - Indian Laws

Supreme Court dismisses writ petition seeking financial assistance from Steel Development Fund.

The Supreme Court upheld the dismissal of a writ petition by the High Court, where a private sector steel plant sought financial assistance from the Steel ... What of the petitioner has in the SDF when it was not even born and fund was created and how the petitioner, a competitor, would have any right to claim the fund? Held that:- While the collection and remittance to SDF has been discontinued w.e.f. April 1994, the petitioner made its claim for the first time in 1999 which would appear to be rather incongruous. It is submitted that the claim made by the petitioner is not bona fide and writ petition has been filed with ulterior motives, which are not difficult to fathom. SAIL had stressed immediate need for restructing and modernising all the main steel plants. Due to recession, SAIL has been passing through severe financial position and has to suffer a loss of Rs.1574 crores in 1998-99. It has further to suffer burden of interest to the tune of Rs.2017 crores per annum for modernisation. In the aforesaid circumstances, the petitioner does not have any right to claim any relief in the writ petition pertaining to utilisation of SDF. It is quite apparent that from the very nature of the creation of SDF, manner of remittance to SDF and purpose of its utilisation, it is a fund created ultimately for the utilisation by the member steel producers only. We do not think it is a fit case where this Court in the exercise of its powers under Article 136 of the Constitution of India should grant leave to appeal from the impugned judgment of the High Court. Leave to appeal is refused. Issues Involved:1. Locus standi of the petitioner.2. Parity between public and private sector steel plants.3. Differential treatment of public sector and private sector steel plants regarding loans from the Steel Development Fund (SDF).4. Government's authority to waive loans or interest for public sector industries.5. Consideration of financial assistance to private sector industries from the SDF.Issue-wise Detailed Analysis:1. Locus Standi of the Petitioner:The Division Bench of the High Court affirmed that the petitioner/appellant has the locus standi to invoke jurisdiction under Article 226 of the Constitution of India. This means the petitioner has the legal standing to bring the case before the court.2. Parity Between Public and Private Sector Steel Plants:The High Court concluded that the appellant cannot claim parity with the plants/industries in the public sector. This indicates that the court recognized a fundamental difference in the treatment of public and private sector entities within the steel industry.3. Differential Treatment of Public Sector and Private Sector Steel Plants Regarding Loans from the SDF:The court held that steel plants/industries in the public sector can be treated differently than those in the private sector, particularly concerning loans advanced from the Steel Development Fund. This differential treatment is legally permissible and justified.4. Government's Authority to Waive Loans or Interest for Public Sector Industries:The judgment noted that in the case of Public Sector Industries (SAIL), the Government can waive the interest or even write off the loan itself. This underscores the government's discretion in managing financial assistance to public sector entities.5. Consideration of Financial Assistance to Private Sector Industries from the SDF:The court stated that if the Government decides to extend any financial help to Private Sector Industries from the SDF, the representation of the petitioner for loan/financial assistance may be considered along with other similarly situated private sector steel plants/industries. This implies that while the petitioner's request could be considered, it is not guaranteed and must be evaluated in the context of other similar entities.Additional Context and Conclusion:The petitioners sought multiple reliefs, including declarations of eligibility for financial assistance from the SDF, and various writs of mandamus and prohibition against the respondents. The High Court dismissed the writ petition, imposing costs on the petitioners, and the Division Bench upheld this dismissal.The Supreme Court examined the nature and utilization of the Steel Development Fund (SDF), which was created by administrative orders and funded primarily by contributions from SAIL and TISCO. The court noted that the SDF had no statutory backing and was intended for the modernization and development of the main steel plants, which were public sector entities.The court highlighted that the petitioner, a private sector entity, was not a member of the Joint Plant Committee, did not contribute to the SDF, and only commenced production in 1998, four years after contributions to the SDF had been discontinued. Consequently, the petitioner had no legitimate claim to the SDF.The court concluded that the petitioner's claim was not bona fide and appeared to be motivated by ulterior motives. Given the circumstances, the Supreme Court refused to grant leave to appeal and dismissed the Special Leave Petition.