TaxTMI 
TaxTMI 
TaxTMI 
2024 (5) TMI 737
X X X X Extracts X X X X
X X X X Extracts X X X X
....ime limit stipulated thereunder. By the said order, the order of the Additional Chief Secretary dated 14.02.2019 was set aside. 3. Ambuja Cement Ltd. (for short "ACL") shifted its cement manufacturing unit to Farakka in the District of Murshidabad. The Commerce and Industries Department vide letter dated 02.03.2006 granted Special Package of Incentives to ACL Farakka unit under the West Bengal Incentive Scheme, 2000 (for short "WBIS, 2000") which inter alia included the benefit of Industrial Promotion Assistance (for short "IPA") without any financial cap for a period of five years and two months from the date of commencement of commercial production. The Director of Industries, West Bengal issued the Certificate of Registration under the WBIS, 2000 to ACL on May 16, 2006 in respect of its Farakka unit, the validity period of which was up to May 15, 2009. The unit claims to have commenced its commercial production at its Farakka unit from May 31, 2007. ACL claims that the unit is entitled to claim incentives for a period of five years and two months from the date of commencement of commercial production i.e., from May 31, 2007 to July 31, 2012. 4. West Bengal Industrial Developme....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he decisions of the Hon'ble Supreme Court in Gherulal Parakh vs. Mahadeodas Maiya and Others reported at AIR 1959 (SC) 781 and Central Inland Water Transport Corporation Ltd. and Another vs. Brojo Nath Ganguly and Another reported at (1986) 3 SCC 156. 8. He contended that the purpose for grant of incentives is to encourage setting up of industries. According to him, FCI is the benchmark and in the absence of a declared policy that the amount of IPA may exceed FCI, a direction upon the State to grant IPA over and above the FCI would be against public interest. 9. Mr. Banerjee learned Senior Counsel submitted that Special Package of Incentives granted to ACL vide letter dated 02.03.2006 specifically states that IPA would be without any financial cap. He submitted that the learned Single Judge after considering the special package observed that the appellants herein went on continuously acting on the said special package for more than two years by duly disbursing the subsidies in favour of ACL. He further submitted that the learned Single Judge observed that the special package given to ACL was clear to the effect that there would not be any financial cap by way of adjustment agains....
X X X X Extracts X X X X
X X X X Extracts X X X X
....PA was specifically laid down in the approval letter dated 02.03.2006. The unit was entitled to make applications in prescribed forms, on commencement of commercial production and on investment of Rs. 25 crores, to the Managing Director WBIDC Ltd. praying for release of incentives. On receipt of the application, Managing Director, WBIDC would intimate the Commissioner, Commercial Taxes certifying that the unit has been duly registered with Director of Industries, W.B under WBIS, 2000 and Eligibility Certificate has been issued by the WBIDC under the said Scheme. The unit has to apply before the Commissioner, Commercial Taxes requesting him to certify the total amount of tax paid during the year on sales and purchase in respect of which the application has been made. Upon receipt of such application the Commissioner, Commercial Taxes, W.B, after verification, would issue a certificate to the MD, WBIDC certifying the tax paid by the unit on its sales during the year in question. The MD, WBIDC Ltd., on receipt of the aforesaid intimation, will issue cheques for an amount of 75% of the Tax paid by the Unit on its sales in the previous year as IPA. The system would continue for the numb....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of IPA over and above the limit of FCI in the order extending Special Package of Incentives, the claim for release of IPA could not have been rejected on the ground that it exceeds FCI limit. Any contrary interpretation would amount to adding a restrictive clause in the Special Package of Incentives, which is impermissible. 25. Pursuant to the order dated 31.01.2018 passed in W.P. No. 1397 of 2018, Additional Chief Secretary, Department of Industry, Commerce & Enterprise, Government of W.B conducted a hearing and passed an order dated 14.02.2019 thereby rejecting the application of ACL for disbursement of incentive in excess of Fixed Capital Investment. 26. The finding returned by the Additional Chief Secretary in its order dated 14.02.2019 is based on the observation of the Finance Department dated 28.12.2018. This Court finds that such observation of the Finance Department was in the context of specification of overall financial limit in Para 20 (e) (iii) of WBIS, 2004 that the total incentive shall not exceed 100% of the FCI in any case. 27. The Additional Chief Secretary after quoting a portion of the observation of the Finance Department dated 28.12.2018 in his order dated ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....le as per the scale detailed in the enclosed Annexure "A" which is relatable only to the date of commencement of commercial production and the number of years for which IPA would be available. To the mind of this Court, the order dated 02.03.2006 in no uncertain terms states IPA would be released for the period mentioned in statement A. It goes without saying that only the period for which IPA would be released has been fixed but no financial cap has been imposed therein. 35. The finding of the Additional Chief Secretary is based on irrelevant materials as the observation of the Finance Department relates to WBIS, 2004 which does not have any manner of application to the case on hand. That apart the finding is based on incorrect interpretation of the relevant clauses of the order dated 02.03.2006. The findings of the Additional Chief Secretary in his order dated 14.02.2019, suffer from perversity. 36. This Court also had the occasion to deal with a Special Package of Incentives for a Mega Project containing more or less identical terms and conditions, in MAT 1965 of 2022 in the case of State of West Bengal and Another vs. Birla Corporation Ltd. & Others delivered on 09.04.2024. I....
X X X X Extracts X X X X
X X X X Extracts X X X X
....age of Incentives as a Mega Project, issued the order dated 02.03.2006. Admittedly, IPA was released in favour of ACL for a considerable length of time. The State thereafter did not disburse IPA of the subsequent period(s), which prompted ACL to approach this Court. The stand of the State that IPA has a financial cap as reflected in the order of the Additional Chief Secretary, has not been accepted by this court as will be evident from the observation made herein before. ACL approached the writ court seeking to enforce the order dated 02.03.2006. The said action cannot be said to be tainted with illegality. It is for the State to satisfy the court that the said order contains certain terms and conditions which are so unfair and unreasonable that they shock the conscience of the Court. There is no pleading in support of the stand of the State that certain terms are opposed to public policy. Except the submission advanced at the Bar, no materials in support thereof have been produced before this Court. The Additional Chief Secretary, in his order dated 14.02.2019, only stated that the interpretation should not be contrary to the public policy of the State without disclosing as to how....