Scheme-based revisional power upheld to correct erroneous subsidy grants prejudicial to State revenue; constitutional challenge rejected.

The Rajasthan Invest Promotion Scheme-2003 was construed to allow the State Government to revise an entitlement certificate where a Screening Committee's subsidy order was erroneous and prejudicial to revenue. The Court noted that the 01.04.2006 Board resolution did not confer an unconditional 75% subsidy, that the enhanced cement-package provisions were later deleted, and that the Screening Committee could not enlarge its power by misreading the Scheme. Clause 13 was also upheld as a valid supervisory provision protecting the public exchequer, with no violation of Articles 14 or 19(1)(g) shown.

---

---

Issues: (i) whether the State Government was entitled under Clause 13 of the Rajasthan Invest Promotion Scheme-2003 to revise the entitlement certificate and withdraw the benefit of 75% subsidy granted by the Screening Committee, and (ii) whether Clause 13 of the Rajasthan Invest Promotion Scheme-2003 was unconstitutional or arbitrary.

Issue (i): whether the State Government was entitled under Clause 13 of the Rajasthan Invest Promotion Scheme-2003 to revise the entitlement certificate and withdraw the benefit of 75% subsidy granted by the Screening Committee.

Analysis: The Scheme permitted the State Government to revise any order of a Screening Committee that was erroneous and prejudicial to the State revenue. The 01.04.2006 decision of the Board of Infrastructure Development and Investment Promotion did not itself grant an unqualified 75% subsidy; it only directed that the recently announced cement package and the Scheme would apply. The enhanced cement-package provisions inserted on 02.12.2005 were deleted on 28.04.2006, and the later application for higher subsidy was therefore not sustainable under those deleted provisions. The Screening Committee could not enlarge its own power beyond the Scheme and could not grant 75% subsidy merely by misreading the Board's resolution. The order granting 75% subsidy was thus treated as erroneous and prejudicial to revenue, and the revisional power was held validly invoked within the time prescribed by Clause 13.

Conclusion: The revision and withdrawal of the excess subsidy were upheld in favour of the Revenue.

Issue (ii): whether Clause 13 of the Rajasthan Invest Promotion Scheme-2003 was unconstitutional or arbitrary.

Analysis: Clause 13 created a supervisory power to protect the public exchequer from erroneous decisions of Screening Committees and was part of a composite incentive scheme. The petitioners had availed the Scheme with knowledge of this clause and did not establish lack of competence, violation of fundamental rights, repugnancy, or manifest arbitrariness. The limitation built into Clause 13 also confined revision to a defined period after full availing of the benefits. The challenge based on Articles 14 and 19(1)(g) was rejected.

Conclusion: Clause 13 was held to be valid and constitutional.

Final Conclusion: The writ petition failed on both the merits of the subsidy revision and the constitutional challenge, and the revised recovery action under the Scheme was sustained.

Ratio Decidendi: Where a screening committee's order granting subsidy is based on a mistaken construction of the scheme and is prejudicial to the State revenue, the State may validly exercise a scheme-based revisional power to correct it, and a beneficiary cannot invoke estoppel to defeat the statute.

---