TaxTMI 
TaxTMI 
2023 (3) TMI 1003
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....Thiruvallur and Chennai, in which cases, minimum investment was pegged at a sum of Rs.350 crores. 3. The policy further adumbrated on the umbrella of measures that were proposed to be meted out to eligible investors in various arenas. For instance, and as regards power, a back-ended state capital subsidy and electricity tax exemption on power purchased from TNEB or generated and consumed captively was extended for all manufacturing units based on employment and investment in eligible fixed assets made within three years. 4. That apart, both new and expansion units were granted electricity tax exemption for five years from date of commercial production. In addition, manufacturing units located within SIPCOT industrial park or SEZ were to be provided an additional 50% capital subsidy over and above eligible limits. 5. An exemption from stamp duty was provided in certain enumerated circumstances, and where the new manufacturing units had set up dedicated Effluent Treatment Plants (ETP) or Hazardous Waste Treatment Storage and Disposal Facilities (HWTSDF), they were granted a special subsidy for this purpose. 6. Special and specific incentives were also extended, sector-wis....
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.... Accordingly, the Government offer the following Special Package of Incentives for investments less than Rs.250 crores to be made in new manufacturing facilities or expansion projects within the Southern Districts of Madurai, Theni, Dindigul, Sivagangai, Ramanathapuram, Virudhunagar, Thirunelveli, Thuthukudi and Kanniyakumari:- (i) New manufacturing facilities or expansion projects with an investment in eligible fixed assets of less than Rs.250 crores in a period of 3 years from the date of sanction order, Memorandum of Understanding or any other date to be fixed by Government (investment period), will be given a soft loan equivalent to the net output VAT + CST paid to the Government, in the following manner:- Sl. No . Investment within 3 years Soft loan given would be equal to VAT paid in the 1 Rs.50 crores - Rs.100 crores First 3 years from commencement of commercial production 2 Rs.100 crores - Rs.200 crores First 4 years from commencement of commercial production 3 Rs.200 crores - Rs.250 crores First 5 years from commencement of commercial production Expansion projects will mean those projects, which create net additional ca....
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.... MTPA capacity at Karikali along with additional captive thermal power plant in the same location. This was expected to provide direct employment to 400 persons and indirect employment to around 600. 10. The petitioner sought structured assistance for an investment of Rs.572 Crores in eligible fixed assets for setting up of the aforesaid plants. The request came to be considered favourably and on 28.10.2010, G.O.Ms.No.150, specific to the petitioner, came to be issued, granting various benefits upon compliance with the conditions therein. 11. The eligible investment and period of investment was quantified as follows: a) Investment Investment in Green Field Cement Plant at Karikali Village, Dindigul District amounting to 520 crores and a sum of Rs.52 crores (out of Rs.160 crores investment in captive power plant) being 10% of the investment in Eligible Fixed Assets of Rs.520 crores, (i.e 572 crores Rs.520+52 crores) will be taken as eligible investment for sanctioning of structured package of Assistance to M/s.Chettinad Cement Corporation Limited. b) Investment Period Since the proposal for expansion of Karikali Plant was given on 04.06.2009....
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....ly and effective from date of commencement of commercial production. It was also given a capital subsidy for a dedicated ETP/HWTSDF, upon condition that such plant was to be set up on back-ended capital subsidy. The order stipulated full compliance of the petitioner in regard to the level of investment, creation of capacity and provision of employment within the investment period. 14. By way of analogy one may compare the investment benefit granted to another unit of this petitioner, which is a manufacturing unit at Puliyur village, Karur. On an application made by that unit, G.O.Ms.No.65 dated 01.03.2011 was issued. Aside from various stipulations, conditions and benefits set out, the investment promotion subsidy was itself granted for a period of 10 years from date of commercial production subject to a ceiling of 50% of the eligible investment as defined in that Government Order. The unit in Puliyur opted for the soft loan method for incentive. 15. The petitioner proceeded to set up a unit and has, admittedly, commenced commercial production on 29.09.2010. Also admittedly, there has been, till date, notwithstanding the elapse of 13 years from date of first commercial produc....
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.... request from the petitioner to R1, wherein they draw an analogy to the subsidy granted in the case of its own sister unit, that I have referred at paragraph 14 supra. 20. Vide letter dated 20.08.2009, the petitioner thus requests that the period of benefit be capped to a minimum period of 10 years. Thus, without prejudice to its main demand of a permanent largesse from the State, the petitioner pursues the alternate argument that it be granted the benefit for a period of 10 years. To be noted, that even the period of ten years as sought for alternatively expired as on date, leaving one to suspect that that is perhaps the reason why the primary argument was at all being advanced. 21. The submission of Mr. Ramanlal, learned Additional Advocate General assisted by Mr.B.Vijay, learned Additional Government Pleader for the State/R1 and Mr.Silambanan, learned Additional Advocate General assisted by Mr.V.S.Rajaram, learned counsel for SIPCOT/R2 is that the 2007 Industrial Policy is a document that sets out the aims, intentions and objects of the State in regard to the economic benefits that it proposes to grant to eligible units in certain identified and specified sectors upon thei....
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....y issued a clarification pending Writ Petition, is certainly going to have no effect on such a decision. 27. Thus, in my considered view, the amendment to G.O.Ms.No.150, by virtue of G.O.No.235 dated 02.12.2022 is irrelevant and in bad taste. If at all, the State were confident in its stand, it ought to have rested content with the documentation, as available. Thus, and being of the view that the clarification is irrelevant, I eschew the same in deciding this matter. 28. The counters filed on behalf of both the State and SIPCOT, and their stand, in one voice, is that the incentive package has been crafted taking note of the specifics of the petitioner's case. Being a matter of policy, and one that empowers the respondents to customise the same, including the duration thereof, no fault can be attributed to the time limit fixed. 29. They also point out that it is the petitioner that had itself, sought a ten year minimum period for the benefit. Though that period was not accepted under the impugned order, even that period has worked itself out as on date. Thus, even if the respondents had granted the period as per the request of the petitioner, nothing would have turned on th....
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....owed or on the restriction imposed. The petitioner cannot dictate any aspect of the benefit that it seeks and it is a matter of negotiation between the petitioner and the respondents as to the kind of aid that it receives. No doubt, it is always within its discretion to seek a particular benefit and in this case, the petitioner has sought the benefit of 10 years, which has been rejected. The policy and consequential the Government Orders issued reveal that there are several considerations to be taken into account by the State in curating an incentive/aid package to an applicant. 35. Interference in such a decision would, in my view, fall outside the realm of judicial review, unless the applicants were to establish conclusively and unambiguously that the decision taken, and the customisation offered, is perverse. In the present case, the petitioner has utterly failed to do so. 36. The last ditch of argument is that it would be impossible for it to ever achieve a production of 65 lakhs MT and thus the question of exceeding that capacity will simply not arise. However, the petitioner has not challenged the fixation of base volume and the entirety of the thrust of its challenge i....