Court grants extension, deeming rejection discriminatory & arbitrary. Board's actions inconsistent & unjustified.

The court quashed the Board of Approval's decision rejecting the petitioners' renewal request, granting them a one-year extension of their Letter of Approval. The court found the decision to be discriminatory, arbitrary, and contrary to its previous order, directing equal treatment with other units for future extensions. The ruling deemed the Board's actions as inconsistent and unjustified, emphasizing compliance with court directions and rejecting the alleged policy to phase out plastic recycling units.

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Issues Involved:
1. Legality of the Board of Approval's decision to reject the renewal of the petitioners' Letter of Approval.
2. Allegations of discrimination and arbitrariness in the Board of Approval's decision.
3. Compliance with the court's previous directions.
4. Interpretation and application of Rule 18(4) of the SEZ Rules.

Issue-wise Detailed Analysis:

1. Legality of the Board of Approval's Decision:
The petitioners challenged the decision of the Board of Approval (BoA) taken in its 84th meeting on 5.10.2018, which rejected their proposal for the extension/renewal of their Letter of Approval (LoA). The petitioners argued that this decision was illegal, without jurisdiction, and contrary to the court's specific directions for reconsideration of their case. The BoA's decision was based on a purported policy to phase out plastic recycling units, which the court found to be non-existent as no such policy was presented or proven.

2. Allegations of Discrimination and Arbitrariness:
The petitioners contended that their case was similar to other units, such as M/s R.R. Vibrant Polymers Ltd. and M/s Plastic Processors and Exporters Pvt. Ltd., which were granted renewal despite being non-operational for extended periods. The court noted that the BoA had granted extensions to 28 similar units on 22.11.2018, indicating discriminatory treatment towards the petitioners. The court found the BoA's rejection of the petitioners' renewal request to be discriminatory, arbitrary, and capricious.

3. Compliance with the Court's Previous Directions:
The court had previously directed the BoA to reconsider the petitioners' case and examine its similarity with other existing units. Despite the Development Commissioner's report confirming the similarity, the BoA rejected the petitioners' renewal request, citing a new ground of a policy to phase out plastic recycling units. The court found that the BoA's actions did not comply with its previous directions and appeared to be an attempt to evade granting the renewal.

4. Interpretation and Application of Rule 18(4) of the SEZ Rules:
The respondents argued that Rule 18(4) of the SEZ Rules barred the setting up of new units for recycling plastic waste but allowed the BoA to decide on the extension of existing units' LoAs. The court clarified that Rule 18(4) did not imply a policy to phase out existing units and that the BoA had consistently granted extensions to other units under this rule. The court concluded that the BoA's interpretation of Rule 18(4) in the petitioners' case was inconsistent and unjustified.

Judgment:
The court quashed and set aside the BoA's decision dated 5.10.2018, rejecting the petitioners' renewal request. The petitioners were granted an extension of their LoA for one year, in line with the extensions granted to 28 other units. The court directed that the petitioners be treated on par with these units for any future extensions. The court ruled that the BoA's decision was discriminatory, arbitrary, and contrary to its previous order, thus making the rule absolute with no order as to costs.

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