TaxTMI 
TaxTMI 
2016 (12) TMI 1770
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....inance Department dtd. 31.3.2009 is liable to be quashed and the same is hereby quashed and it is directed that the petitioner company would continue to be given increased rebate/subsidy of 75% of the additional tax liability under the notification dtd. 2.12.2005 for a period of 7 years in pursuance of Entitlement Certificates already issued in its favour for both the units at Ras, Pali and Bhiwadi, Alwar and withdrawal notification dtd. 28.4.2006 and clarification dtd. 22.5.2008 would not come in way of the petitioner company in getting such increased rebate/subsidy. The respondents shall release the arrears of such subsidy and allow set off thereof of against additional tax liability within a period of one month from today failing which the petitioner company would be entitled to interest also thereon @9% per annum. Cost are however made easy." 2. In D.B. Civil Special Appeal (Writ) No. 644/2012 preferred by the appellant Shree Cement Company Ltd. the company has prayed for reliefs, in addition to the relief granted in the judgment dated 11.10.2011 passed in SB Civil Writ Petition No. 4790/2009 and specifically prayed for following directions: "As per submissions made herei....
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.... was also aggrieved against the direction of PSF by aforesaid order to the Assessing Authority to make a reassessment of tax liability and to take steps to recover tax in excess of its eligibility in terms of the new Eligibility Certificate to be issued by SLSC, so also, challenged the clarification of the Finance Department (Tax Division) dated 22.5.2008. 4. As per the facts of the case, the Government of Rajasthan with a view to encourage investment in the State of Rajasthan promulgated a Scheme know as 'Rajasthan Investment Promotional Scheme' on 28.7.2003 (RIPS-2003). The said scheme came into force w.e.f. 1.7.2003 and remained in force upto 31.3.2008, but later on, extended upto 31.3.2009 by amendment dated 15.3.2007 and further extended upto 31.3.2011 vide amendment order dated 6.8.2008. The RIPS-2003 was amended from time to time and vide amendment dated 22.10.2003, subsidy upto 75% was provided for higher investment and it was further amended on 2.12.2005, whereby the sub-clause (vi) and (vii) to Clause 7 were inserted in the RIPS-2003 whereby 75% subsidy to the new and existing cement unit, which were under expansion upon fulfilling certain conditions envisaged ....
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....titioner-respondent Shree Cement Company Ltd. granted eligibility certificate under clause 7(vii) of RIPS-2003. While doing so, the SLSC considered that options were registered within limitation period as per notification dated 2.12.2005 when it was in full force prior to premature amendment dated 28.4.2006 whereby the clauses 7(vi) and (vii) were deleted. The SLSC issued entitlement certificate No. 2/66 dated 27.6.2007 for a period of seven years from 26.3.2007 to 25.3.2014 in favour of the petitioner-respondent Shree Cement Company Ltd. According to the petitioner-respondent Shree Cement Company Ltd. the subsidy was granted upto 75% till April, 2008 including upfront subsidy of 45% and remaining 30% of interest and wages/employment subsidy over and above, additional tax generated due to expansions made by the petitioner-respondent Shree Cement Company Ltd. 8. The Finance Department, Government of Rajasthan on 22.5.2008 issued amendment order putting the cement plant of capacity above 200 MT. per day both new and expansions in negative list, making it ineligible for subsidy under RIPS-2003 and simultaneously issued a "clarification" dated 22.5.2008 stating therein that there is....
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.... 11. The Principal Secretary, Finance passed an order dated 31.3.2009 accepting both the applications dated 18.7.2008 submitted by the Commissioner, Commercial Taxation and quashed the orders of SLSC dated 29.7.2006 and 27.6.2007 for expansions made by the company granted under clause 7(vii) of RIPS-2003 and issued directions to the SLSC to reconsider and issue new eligibility certificate to the extent that only original dispensation existing prior to amendment dated 2.12.2005 in the scheme. The assessing authority also directed to make re-assessment of the tax liability and take steps to recover tax paid in excess of new eligibility certificate issued by the SLSC. 12. Being aggrieved with the decision of PSF dated 31.3.2009, the petitioner-respondent Shree Cement Company Ltd. preferred writ petition being No. 4790/2009 challenging the said order. 13. In the writ petition, a detailed reply was filed by the appellant State of Rajasthan, but learned Single Judge quashed the order dated 31.3.2009, which is under challenge in the special appeal No. 1719/2011 filed by the State of Rajasthan. 14. The learned Sr. Advocate Sh. M.S. Singhvi, assisted by Sh. Hemant Dutt vehementl....
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....rious representations were filed by the petitioner-respondent Shree Cement Company Ltd., but it is not correct that amendment in the scheme for grant of subsidy 40% to 75% was made to satisfy any assurance to the company. It is true that on 2.12.2005 sub-clauses (vi) and (vii) were inserted in clause 7 of RIPS, 2003 whereby it was provided that amount of subsidy shall be subject to maximum of 75%. The petitioner-respondent Shree Cement Company Ltd. submitted option for expansion of the unit at Ras, Tehsil Jaitaran where commercial production in the said first unit was commenced from 17.12.2005 and tax on commercial production was paid for the first time on 21.12.2005. The petitioner-respondent Shree Cement Company Ltd. moved an application to the SLSC for grant of subsidy under RIPS, 2003 on 10.12.2005. While inviting attention towards the fact that petitioner-respondent Shree Cement Company Ltd. moved an application to SLSC for availing benefit under the amendment notification dated 2.12.2005 showing investment of Rs. 450 crores and stated that commercial production likely to commence in the year 2007 on 9.2.2006, the petitioner-respondent Shree Cement Company Ltd. submitted optio....
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....udgments of the Hon'ble Supreme Court, but learned Single Judge committed an error while observing in the judgment impugned that subsidy can be claimed as a matter of right under the scheme framed by the Government. 18. While inviting attention towards the pleadings, it is submitted that there is no foundation in the writ petition that any investment was planned by the petitioner-respondent Shree Cement Company Ltd. only on the basis of notification dated 2.12.2005. It was the duty of the petitioner-respondent Shree Cement Company Ltd. to plead all correct facts, when project was conceived and the same was finalize, therefore, in absence of such pleadings, the petitioner-respondent Shree Cement Company Ltd. was not entitled to claim subsidy as a matter of right under the amendment made in RIPS, 2003 vide notification dated 2.12.2005. It is also argued that no minimum subsidy was ensured, which is evident from the scheme itself, which is only subject to maximum limit of 75%. In the clauses of scheme, it is specifically mentioned that amount of subsidy shall be subject to maximum limit of 75%, therefore, on this count also, the petitioner-respondent Shree Cement Company Ltd. i....
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....ot have been reduced, the State Government, which is a welfare State would have suffer huge revenue losses because the investment carried out by the petitioner-respondent Shree Cement Company Ltd. in the first phase was approximately Rs. 303.91 crores and in the second phase, it was approximately Rs. 683.38 crores. On other hand, the benefit availed by the petitioner-respondent Shree Cement Company Ltd. under the head of subsidy comes to Rs. 353.44 crores, if 75% of subsidy as ordered by the learned Single Judge is to be granted then the additional burden of approximate Rs. 250 crores is to be paid by the State Government. In view of the above, it is submitted that the finding given by the learned Single Judge in the judgment impugned for restoring the order passed by the SLSC deserves to be quashed because as per the provisions of the scheme neither any vested right created to the petitioner-respondent Shree Cement Company Ltd. nor the principle of promissory estoppel can apply to maintain the order passed by the SLSC, but learned Single Judge committed grave error while quashing the order passed by the revisional authority vide order dated 31.3.2009. The learned counsel for the a....
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.... contra, learned Senior Counsel Sh. S. Ganesh submits that the petitioner-respondent Shree Cement Company Ltd. is entitled to claim 75% subsidy (which is subsidy equal to 75% of the sales tax) and the same is founded and based on three distinct pillars, each of which stands on its own, independent to the other two pillars, therefore, even if one of three pillars remains intact and standing, then petitioner-respondent Shree Cement Company Ltd. would be entitled to grant subsidy in pursuance of certificate issued by SLSC. 23. Learned counsel for the petitioner-respondent Shree Cement Company Ltd. submits that on promissory estoppel, the learned Single Judge has rightly quashed the order passed by the Secretary, Finance dated 31.3.2009. While inviting attention towards the fact, it is submitted that on representations filed by the petitioner-respondent Shree Cement Company Ltd. to the Chief Minister, Government of Rajasthan, meetings were held with the Chief Minister on 7.2.2005, 7.5.2005 and 21.5.2005 and in the budget speech on 24.3.2005, the factual report was submitted on the basis of request made by the petitioner-respondent Shree Cement Company Ltd., thereafter, 75% subsidy w....
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.... the case for grant of 75% subsidy was decided by the SLSC by two orders issued on 29.7.2006 and 27.6.2007 on the ground that petitioner-respondent Shree Cement Company Ltd. exercised option and proceeded on footing when Clauses 7(vi) and (vii) were part of RIPS, 2003. The deletion of sub-clauses (vi) and (vii) on 24.4.2006 do not in any manner interfered with or affect the pre-existing vested and crystallized rights of petitioner-respondent Shree Cement Company Ltd. to get 75% subsidy in terms of options already exercised and registered to avail benefit under said sub-clauses. According to the learned counsel for the petitioner-respondent Shree Cement Company Ltd. the impugned revisional order dated 31.3.2009 by which the orders of SLSC dated 29.7.2006 and 27.6.2007 were quashed was per-se not only contrary to law but bad in law, therefore, the said revisional order is null and void. The learned Single Judge accepted the plea of preexisting, vested and crystallized rights upon which SLSC issued the certificate for grant of subsidy upto 75%, therefore, the judgment impugned in this appeal is perfectly in consonance with law. 25. Learned Senior Counsel Sh. S. Ganesh submits that ....
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....oppel and vested right quashed the order of revisional authority dated 31.3.2009, therefore, there is no force in this appeal. 27. The written submissions are filed by appellant as well as the petitioner-respondent Shree Cement Company Ltd. and in support of their grounds, number of judgments have also been cited by both the parties. We have considered the arguments as well as the written submissions filed by both the parties, so also, perused the judgments cited by both the parties. 28. The learned Senior counsel Sh. S. Ganesh assisted by Sh. Ramit Mehta, Advocate invited our attention towards following judgments in support of their grounds of promissory estoppel, legitimate expectation, vested right, exercising impermissible revisional jurisdiction and contemporaneous exposition to quash the decision of Principal Secretary, Finance dated 31.3.2009 whereby Principal Secretary quashed and set aside the eligibility certificate dated 29.7.2006 and 27.6.2007 whereby SLSC granted subsidy upto 75% in pursuance of Clause 7(vi) and (vii) of the RIPS, 2003. The judgments on the aforesaid grounds are as follows: A. PROMISSORY ESTOPPEL AND LEGITIMATE EXPECTATION: i. State o....
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....e parties submitted number of written submissions in support of their grounds. We have considered the arguments as well as the written submissions filed by both the parties and perused the judgments cited by both the parties. 30. Upon consideration of pleadings and RIPS, 2003, it emerges from the facts that to promote the industrial sick units, more particularly, cement manufacturing units in the State of Rajasthan, the State Government issued a scheme known as RIPS, 2003 vide notification dated 28.7.2003. The said scheme was operative w.e.f. 1.7.2003 to 31.3.2008. In the said scheme sub-clause (7) was inserted for providing subsidy to the eligible units making new investment during operative period of the said scheme in the form of interest subsidy and wage subsidy subject to a maximum limit of 50% of the tax payable and deposited under the Rajasthan Sales Tax Act, 1994 and the Central Sales Tax Act, 1956 and the Value Added Tax Act as and when introduced in the State. The Value Added Tax Act, 2003 came into force in the State of Rajasthan with effect from 1.4.2006, as per scheme in case of investment made for Modernization/Expansion/Diversification, the amount of subsidy shall....
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....Act, 1956 for a period of 7 years from the date of commencement of production, subject to certain conditions. 32. The petitioner-respondent Shree Cement Company Ltd. claimed right of subsidy under the scheme under sub-clause (vii) of Clause 7 whereby the interest subsidy and wage subsidy, an upfront subsidy to be paid to the extent of 75% of the RST/VAT/CST was allowed to such eligible units having made investment exceeding Rs. 200 crores with further condition that minimum regular employment of 100 persons. The petitioner-respondent Shree Cement Company made investment over Rs. 200 crores in aforesaid two expansion units at Pali and Bhiwadi and therefore, fell within the aforesaid clause 7 (vii) of the amending notification dated 2.12.2005. As per contention of petitioner-respondent Shree Cement Company Ltd. as per the condition No. 1 of clause 7 (vii), the investor was required to make an option before the Member Secretary of the SLSC to avail benefit under the Scheme within 180 days of aforesaid amendment. The petitioner- respondent Shree Cement company Ltd. exercised such option vide its letter dated 10.12.2005 immediately after the said amended notification vide its letter ....
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....100 persons, therefore, they are entitled under the special dispensation provided for cement units vide F.D. Order dated 2.12.2005." "The SLSC, perused the facts of the case and after considering all relevant facts, decided to grant the eligibility certificate to the petitioner-respondent Shree Cement Company Ltd., for interest subsidy @5% and wage/employment subsidy @25% for a period of 7 years to start with commencement of commercial production/operation as per clause 4(b) of the Scheme. Further, held that the amount of subsidy will be subject to maximum limit of 75% of the additional tax (calculated by taking an average of last three years) deposited under RST Act, 1994/VAT and CST Act, 1956. Consequent to the aforesaid decision dated 29.07.2006 by the SLSC, an Entitlement Certificate was also issued to the petitioner-respondent Shree Cement Company Ltd. by Commissioner of Industries and Member Secretary of SLSC on 8.9.2006 for a period of seven years for the subsidy to the extent of 75% for first expansion unit of Pali. The SLSC again met on 27.6.2007 in which the case of second unit situated at Bhiwadi of the petitioner-respondent Shree Cement Company Ltd. was considered after....
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....sed by the respondent company. 35. After issuance of those certificates by the SLSC, the subsidy upto 75% was allowed for a period of about two and half years, out of 7 years entitlement, but a clarification was issued on 22.5.2008 in RIPS by the Tax Division of Finance Department, Government of Rajasthan and in pursuance of the said clarification, the benefit of subsidy upto 75% was extended to the petitioner-respondent Shree Cement Company Ltd. under the entitlement certificate. 36. The petitioner-respondent Shree Cement Company Ltd. raised an objection that in the garb of said notification issued on 22.5.2008 the benefit already granted to the petitioner-respondent Shree Cement Company Ltd. cannot be withdrawn because as per principle of promissory estoppel, the vested right of the petitioner-respondent Shree Cement Company Ltd. cannot be withdrawn in casual manner. Upon receiving such objection, two revisions petitions under clause 13 of the RIPS, 2003 were filed by the Commissioner, Commercial Taxes Department before the Finance Secretary, Government of Rajasthan on 18.7.2008. In the revision petition, a prayer was made by the Commissioner, Commercial Taxes Department to....
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....ncentive because establishment would not be viable on the basis of mere 35% sales tax exemption. As per respondent-company, this position absolutely made it clear to the State Government by its letter dated 15.05.2004. The State Government in July, 2003 issued Rajasthan Investment Promotion Scheme, 2003 (RIPS 2003) and offered 50% subsidy to the eligible units including the cement units. 41. On 22.10.2003, a provision was added for higher incentive at 75% through BIDI, in its discretion if the investment exceeded Rs. 200 crores. Inspite of above provision, no new cement unit come up in response to the above sales tax incentive limited by way of only wages subsidy and interest subsidy subject to actual. 42. According to respondent company, the entire cement industries in Rajasthan made appeal to the State Government that without 75% subsidy no new cement unit/plant is likely to come up in Rajasthan. According to respondent, the representative of the company met the Hon'ble Chief Minister in the month of April, 2004, and once again pointed out that Shree Cement Ltd. would be in a position to invest new cement unit only if 75% tax incentive is granted. According to responden....
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....regard to all the expenditure on the second expansion including grinding unit of Khushkhera, framed up and was incorporated only after 02.12.2005. As per respondent company the State Government actual honoured its promise by amending the RIPS 2003 on 02.12.2005 while inserting an amendment in RIPS, 2003, whereby 75% sales tax incentive was granted as the new cement unit would not be viable without that incentive. The respondent company claimed its right up to 75% as per verdict of the Hon'ble Supreme Court in the case of Nestle reported in 2004 (6) SCC 465, in which a speech was made by the Chief Minister at a public gathering followed by the Budget Speech and while considering the speech given by the Chief Minister followed by Budget speech, held that it constitutes a promise and assurance by the State Government, on which the pea of promissory estoppel could be found. 46. Learned counsel for the appellant submitted that all the facts stated in the writ petition did not make out any case of any promise being made to grant minimum subsidy of 75% and even the notification dated 02.12.2005 does not assure grant of minimum subsidy. It is also pointed out that neither the Bud....
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....unit shall start commercial production within 5 years of filing of application for option; and 3. The sum total of 75% subsidy shall be calculated in the following manner: - (a) Subsidy of 45% of the Rajasthan Sales Tax or Value Added Tax and Central Sales Tax shall be allowed upfront on the basis of actual tax liability; and (b) The remaining subsidy to the extent of 30% of Rajasthan Sales Tax or Value Added Tax and Central Sales Tax liability shall be allowed in form of interest subsidy, wage/employment subsidy out of which interest subsidy shall be limited to 5% of the documented rate of interest and the amount actually paid as interest shall not include penal interest, and wage/employment subsidy. A unit not claiming any interest subsidy can claim wage/employment subsidy to the extent of 30% subject to other conditions under this amendment. 4. The claim of the subsidy shall be as per the provisions of this scheme. (vii). Notwithstanding anything contained in sub clause (i) to (v) above, in case of investments for expansion of existing cement unit having investment exceeding Rs. 200 crores and with a minimum regular employment of 100 person....
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....hushkhera, on 28.01.2006 and 09.02.2006 involving investment of Rs. 450 crores. It was also proposed for setting up of captive power plant at Raas. The respondent company filed an application for grant of subsidy on 12.05.2007. The total purchase cost under expansion project was assessed by the Financial institution as Rs. 1,01,165 crores. With an additional employment of 395 numbers was generated growing up of expansion making the total number of 2567 employees. 52. After registration of the options by the respondent company, while the application filed on 30.01.2006 was under consideration, in the meantime, the respondent State Government issued an order on 28.04.2006, whereby the State Government deleted the sub-clauses (vii) of Clause-7 of RIPS 2003. However, in the 16th Meeting, the SLSC (State Level Screening Committee) which was held on 27.06.2007, in which after considering all the relevant facts, held the respondent company entitled for availing of Clause (vii) and 7 of RIPS, 2003. The SLSC considering that options were registered within limitation period as per Notification dated 02.12.2005 when it was in full force and prior to premature amendment dated 28.04.2006, wh....
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....The respondent company make out a case before the SLSC that the vested right accrued to the company because applications were filed for grant of subsidy up to 75% in between the period when the amendment was in existence and the said amendment was made by the State Government after giving assurance to cement units. In the said scheme i.e. RIPS 2003, there is provision in Clause 13, which provides for revision by the State Government and further there is a provision of review and modification of the Scheme under Clause 14. Both these clauses are quoted herein below for ready reference: - "13. REVISION BY THE STATE GOVERNMENT: (a) The State Government in Finance Department may suo motu or otherwise revise an order passed by any Screening Committee wherever it is found to be erroneous and prejudicial to the interest of the State revenue, after affording an opportunity of being heard to the beneficiary industrial unit. (b) No order under the sub-clause (a) shall be passed by the State Government after the expiry of a period of five years after the date by which the benefits under this scheme are fully availed of. 14. REVIEW OR MODIFICATION OF SCHEME: The State Government....
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....ts under deleted sub-clause (vi) and (vii) of clause 7 of RIPS-2003 on or after 28.4.2006: 1. Where the option was submitted before 28.04.2006 and benefits were also granted by SLSC before 28.04.2006. 2. Where the option was submitted before 28.04.2006 and benefits were granted by SLSC after 27.04.2006. 3. Where the option was submitted before 28.04.2006 and benefits have not been granted by SLSC. 4. Whether the option was submitted after 27.04.2006 but within 180 days of 02.12.2005 and benefits has not been granted by SLSC. 5. Where the option was submitted after 27.04.2006 but within 180 days of 02.12.2005 and the case has not been considered by SLSC, and 6. Where the option was submitted after 27.04.2006 but within 180 days of 02.12.2005 and the unit has still not applied for the benefits. Kindly ensure necessary action accordingly. By Order Sd/- (S.S. Rajawat) Spl. Secretary to Government" 58. Against the said clarification, representations were made by the respondent company. During the pendency of the representation, the State Government (Taxation Division of Finance Department) issued an order on 30.09.2008, whereby following amendment was....
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....d on 29.07.2006 and 27.06.2007, in which notices were issued to the respondent company and after providing opportunity of hearing and considering the arguments, the Secretary Finance passed an order on 31.03.2009 whereby the Principal Secretary, Finance Department, Government of Rajasthan, quashed both the orders issued by the SLSC while accepting the revision application and passed following order, which reads as under: "The first decision of SLSC dated 29.7.06 had extended benefits of up front tax subsidy to a unit for which, investment was certainly not propelled by the insertion of clause 7 (vi) and (vii). The investment was made much earlier and cannot be said to have been motivated by the new scheme. Accordingly, the unit cannot claim eligibility under the scheme as has been discussed in detail above. There is also, therefore, no question of promissory estoppels and the Applicant Company cannot get any benefit thereof. As regards the second decision of the SLSC dated 27.6.07, for various arguments stated above, the Applicant Company can derive no extraordinary benefit beyond what it has been enjoying under the original provisions of Clause 7 of RIPS 2003. When the decision....
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.... clause 7(vi) and (vii) of RIPS, 2003 vide notification dated 28.4.2006? D. Whether the ground raised by the respondent company with regard to doctrine of "contemporanea expositio" will apply in this case or not? E. Whether the order passed by the Principal Secretary, Finance exercising revision petition can be interfered in the writ of certiorari preferred by the respondent-company?" A. Whether the learned Single Judge rightly applied the principle of promissory estoppel to quash the order impugned dated 31.3.2009? 65. To consider the applicability of promissory estoppel, upon which the learned Single Judge quashed the order dated 31.3.2009 passed by the Principal Secretary, Finance, Government of Rajasthan, Jaipur, the doctrine of promissory estoppel is required to be perused. 66. The principal of promissory estoppel is a rule of evidence incorporated in Section 115 of the Indian Evidence Act, 1872. It is true that principle of promissory estoppel is where one party has by his words or conduct made to the other a clear and unequivocal promise, which is intended to create legal relations or effect a legal relationship to arise in the future, knowing or intending tha....
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....nding of the learned Single Judge on the principle of promissory estoppel is not in consonance with law for the reason that the order of deletion dated 28.4.2006 was challenged, but not pressed by the petitioner-respondent-company itself before the learned Single Judge. Therefore, Principal Secretary, Finance Department, Government of Rajasthan has rightly held that there was no question for the SLSC to ignore the said deletion of the provision or to interpret the said deletion in favour of the respondent-company so as to grant benefit of subsidy under the provision, which was not in existence. It is also one of the important aspect of the case that in between 2.12.2005 to 28.4.2006 no such benefit of subsidy upto 75% was allowed by the State Government or SLSC to any of the unit in the State of Rajasthan. 69. The core question arises in the present appeal whether 75% subsidy within clause 7(vii) of RIPS, 2003 can continue after deletion of clause 7(vii) vide notification dated 28.4.2006? 70. To consider the said aspect of the matter, we have examined the arguments of both the parties. 71. The petitioner-respondent Shree Cement Company Ltd. claimed its right on the basis o....
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....dated 28.4.2006. Meaning thereby, the provision for grant of subsidy upto 75% under RIPS, 2003 remained in currency for five months and in between that period, no order or entitlement certificate was issued by the SLSC to allow subsidy upto 75% to the respondent Shree Cement Company or any other unit. Before the learned Single Judge, the respondent company claimed its rights on the ground of promissory estoppel and vested right. There is no doubt that as per principle of promissory estoppel and legitimate expectation and vested right created under the statute or a scheme, cannot be taken away, but at the same time, the reason for insertion and deletion for enhancement of percentage of subsidy is required to be seen at the time of adjudication. 73. Upon assessing the law laid down by the Hon'ble Supreme Court in various pronouncements cited by the learned counsel for the parties, this Court cannot lose sight of the fact that in this case the question of enhancement of subsidy from 50% to 75% is involved. In our opinion, the State Government being welfare state requested to act in public interest to consider the financial condition of the State so as to grant subsidy for indus....
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....ny error was committed by the Finance Secretary while exercising the revisional power to set aside orders passed by the SLSC for grant of entitlement certificate. 76. In view of the above discussion, we are of the firmed opinion that the finding of the learned Single Judge to quash the order dated 31.3.2009 passed by the Principal Secretary, Finance, Government of Rajasthan, Jaipur is contrary to law and against the public interest because it is not a case in which the principle of promissory estoppel will come to the rescue of respondent company to get the benefit of subsidy upto 75% under RIPS, 2003 on the basis of misinterpretation of the provision by the SLSC. B. Whether the respondent company is entitled for the relief prayed on the ground of legitimate expectation? 77. To consider the finding of the learned Single Judge on the ground of legitimate expectation, first of all, it is required to be understand what is "legitimate expectation". As per settled principle of law, the legitimate expectation is not a legal right. It is an expectation of a benefit, relief or remedy that may ordinarily flow from a promise or established practice. The term 'established practic....
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....to record its conclusion in correct perspective. 80. In view of the above, the finding of the learned Single Judge to quash the order dated 31.3.2009 on the ground of legitimate expectation is completely erroneous for the reason that decision was taken by the Government in public interest to delete the clause 7(vi) and (vii) vide notification dated 28.4.2006. It is worthwhile to observe that benefit under RIPS, 2003 was not completely rescinded vide notification dated 28.4.2006 because in the amendment notification dated 2.12.2005, the subsidy was enhanced from 50% to 75% was deleted vide notification dated 28.4.2006, the said provision remained in existence for five months only and in that period, none of the company was given such benefit. Therefore, on the ground of legitimate expectation, the respondent company was not entitled to get any benefit. More so, the respondent company was not even entitled to raise this ground because the prayer for quashing order/notification dated 28.4.2006 whereby clause 7(vi) and (vii) of RIPS, 2003 was deleted was not pressed before the Single Judge. C. Whether any vested right remained in existence even after deletion of clause 7(vi) and ....
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.... filed by the respondent company. It is true that officers who were sitting as member of the SLSC were the officers of Finance Department of the State Government, but this Court cannot lose its right of the fact that every officer when exercising its jurisdiction vested under any scheme should consider the intention of the legislature to insert and to delete the provision in the scheme, but here in this case, while granting first entitlement certificate, the order of deletion dated 28.4.2006 was completely ignored and in second meeting, though it was considered, but wrongly interpreted without application of mind by the SLSC. Therefore, it was felt necessary by the Commercial Taxation Department to invoke clause 13 and 14 of the RIPS, 2003 in which there is provision of revision and review for quashing the orders of SLSC. 86. Upon perusal of order impugned dated 31.3.2009, it is apparent that Principal Secretary, Finance, Government of Rajasthan applied its mind thoroughly and in well worded judgment while exercising revisional jurisdiction under clause 13 and 14 of RIPS, 2003 quashed the order of entitlement certificate issued by the SLSC in which there is no error. The ground ....
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....r was committed by them because as per doctrine of contemporanea expositio the provision was interpreted by the authorities, who introduced the said amendment for grant of subsidy upto 75%. According to respondent company if entitlement certificates were issued in favour of the company for grant of subsidy upto 75% while considering the deletion of the provision by the same authorities, then it cannot be questioned. 89. The learned Single Judge held that members of SLSC were right in granting entitlement certificate in favour of the respondent company while giving right interpretation of the provision in favour of company. 90. We have minutely perused the judgment of the learned Single Judge, so also, the order passed by the Principal Secretary, Finance, Government of Rajasthan dated 31.3.2009. 91. Upon consideration of facts and reasons, we are of the view that even though number of judgments are cited by the petitioner-respondent Shree Cement Company Ltd. for the claim of subsidy upto 75%, upon the doctrine of contemporanea expositio, we are unable to accept the plea that respondent Shree Cement Company Ltd. is entitled for subsidy upto 75% under the amendment made on 2.....
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....efully deleted due to introduction of Value Added Tax in Rajasthan w.e.f. 1.4.2006 in which tax rate was changed from 28% to 12.5% on cement. 96. We have perused the specific provision of revision and review inserted in the scheme under clause 13 and 14 of the RIPS, 2003 in which it is more than clear that at the time of introducing RIPS, 2003 purposely clauses 13 and 14 were inserted so as to check the illegality or error committed by the Screening Committee to grant entitlement certificate. Here in this case, although in the State level screening committee, the officer of the Finance Department and Industries Department were members and scheme was also formulated by the officers of the Finance Department of State Government, then also it cannot be said that there was no jurisdiction with the Principal Secretary to entertain revision petition because provision was expressly incorporated in clause 13 that the State Government in Finance Department may suo motu or otherwise revise an order passed by any State level screening committee wherever it is found to be erroneous and prejudicial to the interest of State revenue after providing an opportunity of being heard to the benefici....