{"id":77629,"date":"2008-10-17T00:00:00","date_gmt":"2008-10-16T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/meckamalil-polymers-pvt-ltd-vs-the-director-of-industries-on-17-october-2008"},"modified":"2015-05-04T04:03:47","modified_gmt":"2015-05-03T22:33:47","slug":"meckamalil-polymers-pvt-ltd-vs-the-director-of-industries-on-17-october-2008","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/meckamalil-polymers-pvt-ltd-vs-the-director-of-industries-on-17-october-2008","title":{"rendered":"Meckamalil Polymers Pvt.Ltd vs The Director Of Industries & … on 17 October, 2008"},"content":{"rendered":"
Kerala High Court<\/div>\n
Meckamalil Polymers Pvt.Ltd vs The Director Of Industries & … on 17 October, 2008<\/div>\n
       \n\n  \n\n  \n\n \n \n  IN THE HIGH COURT OF KERALA AT ERNAKULAM\n\nWP(C).No. 5546 of 2008(I)\n\n\n1. MECKAMALIL POLYMERS PVT.LTD.,\n                      ...  Petitioner\n\n                        Vs\n\n\n\n1. THE DIRECTOR OF INDUSTRIES & COMMERCE,\n                       ...       Respondent\n\n2. GENERAL MANAGER,\n\n3. THE STATE OF KERALA, REPRESENTED\n\n4. THE MONITORING AND TECHNOLOGY\n\n                For Petitioner  :SRI.ABRAHAM VAKKANAL (SR.)\n\n                For Respondent  :GOVERNMENT PLEADER\n\nThe Hon'ble MR. Justice V.GIRI\n\n Dated :17\/10\/2008\n\n O R D E R\n                       V.GIRI, J.\n       -------------------------\n                W.P.(C).No.5546 of 2008\n       -------------------------\n        Dated this the 17th day of October, 2008.\n\n\n                     JUDGMENT\n<\/pre>\n
       The   petitioner       company,      incorporated<\/p>\n
under the Companies Act, is engaged in the<\/p>\n
manufacture   of    plastic     moulded      Goods,  PET<\/p>\n
preforms and PET Bottles       etc.   The unit started<\/p>\n
functioning on 7.3.2001.\n<\/p>\n
       2.   Ext.P2 is a scheme which was floated<\/p>\n
by the Government in order to encourage small<\/p>\n
scale unit holders to increase productivity by<\/p>\n
upgrading  technology,      by    providing    a  credit<\/p>\n
capital  subsidy.        The    scheme,     inter  alia,<\/p>\n
comprehended existing SSI units registered with<\/p>\n
the  Directorate    of    Industries     and   Commerce,<\/p>\n
which upgrades to      State-of-art technology with<\/p>\n
or without expansion.       The scheme provided that<\/p>\n
the existing units which undertake a technology<\/p>\n
upgradation by improving productivity or quality<\/p>\n
of the products or resulting in reduction of<\/p>\n
cost of production would entitle the unit for<\/p>\n
subsidy. The scheme further states that subsidy<\/p>\n
@ 12% of loan amount sanctioned and disbursed by<\/p>\n
the financial institutions will be given.           The<\/p>\n
W.P.(C).NO.5546\/08<\/p>\n
                      :: 2 ::\n<\/p>\n
\nfurther terms and conditions, under which the<\/p>\n
subsidy could be availed of, are also mentioned<\/p>\n
in Ext.P2.  The technology, if it is deployed by<\/p>\n
the unit which is reported as eligible for the<\/p>\n
capital subsidy scheme, will have to be approved<\/p>\n
and monitored by a Monitoring and Technology<\/p>\n
Approval Board.   The Board is to be headed by<\/p>\n
the   Principal    Secretary     of    Industries<\/p>\n
Department.    The   Technical   Expert  in  the<\/p>\n
relevant field would be co-opted to the Board by<\/p>\n
the convener.   The maximum eligibility would be<\/p>\n
12% of the loan amount.    The scheme was brought<\/p>\n
into force with effect from 2.1.2003 as is<\/p>\n
evidenced by G.O.NO. 2\/2003\/ID.<\/p>\n
       3.   The petitioner contends, inter alia,<\/p>\n
that, on the strength of the capital subsidy<\/p>\n
scheme floated as per Ext.P2, it had decided to<\/p>\n
upgrade the technology.    Accordingly it availed<\/p>\n
financial  facility  from    the UTI  bank,  now<\/p>\n
renamed as Axis Bank, which is also a financial<\/p>\n
institution in terms of Ext.P2.   It is also the<\/p>\n
case of the petitioner, which does not seem to<\/p>\n
be controverted by the respondent, that the last<\/p>\n
instalment of the loan availed was disbursed on<\/p>\n
W.P.(C).NO.5546\/08<\/p>\n
                      :: 3 ::\n<\/p>\n
\n29.3.2007.  This is sought to be substantiated<\/p>\n
by Ext.P1 statement issued from the bank.   It is<\/p>\n
seen from Ext.P1 that the first instalment was<\/p>\n
availed on 18.1.2007.\n<\/p>\n
       4. Ext.P2 scheme further provided that<\/p>\n
the unit, which claims eligibility in terms of<\/p>\n
Ext.P2, is to file an application for subsidy<\/p>\n
within three months from the date of availing<\/p>\n
the   last   instalment     from   the  financial<\/p>\n
institution.   Accordingly, the petitioner had<\/p>\n
time till 29.6.2007 to submit the application.<\/p>\n
It submitted the application Ext.P4 on 6.6.2007.<\/p>\n
The  said  application    was   met  with  Ext.P5<\/p>\n
communication from the 2nd respondent intimating<\/p>\n
that  the   1st respondent     had  rejected  the<\/p>\n
application on the premise that Ext.P2 scheme<\/p>\n
was  discontinued  with   effect   from 1.4.2007.<\/p>\n
Thereafter the petitioner, on enquiries, came to<\/p>\n
know that   Ext.P2 scheme was discontinued with<\/p>\n
effect from 1.4.2007 and orders in this regard<\/p>\n
were issued as per Government Order         dated<\/p>\n
20.6.2007.   It is in the wake of this, the<\/p>\n
petitioner  has   filed     this  writ  petition,<\/p>\n
challenging  Ext.P5.       He   also  sought  for<\/p>\n
W.P.(C).NO.5546\/08<\/p>\n
                      :: 4 ::\n<\/p>\n
\nconsideration of the application for subsidy in<\/p>\n
terms of Ext.P2 scheme.\n<\/p>\n
       5. A counter affidavit has been field by<\/p>\n
the respondents affirming that Ext.P2 scheme was<\/p>\n
discontinued with effect from 1.4.2007;      that<\/p>\n
the  petitioner’s  application    was  originally<\/p>\n
processed and recommended to the respondent and<\/p>\n
thereafter the application was rejected on the<\/p>\n
basis of Ext.P7 Government Order issued by the<\/p>\n
Government. It is affirmed that applications<\/p>\n
received after 1.4.2007 will not be considered<\/p>\n
in the light of the GO.\n<\/p>\n
       6. I heard learned senior counsel for<\/p>\n
the petitioner Sri.Abraham Vakkanal and learned<\/p>\n
Senior Government Pleader.\n<\/p>\n
       7. That the petitioner had availed a<\/p>\n
loan from a financial institution listed in that<\/p>\n
behalf under Ext.P2 is not a matter in dispute.<\/p>\n
The petitioner’s case is that it had acted on<\/p>\n
Ext.P2 scheme and it is, therefore, that it had<\/p>\n
upgraded its technology.     The respondents have<\/p>\n
rejected the petitioner’s application on the<\/p>\n
ground that the petitioner had submitted an<\/p>\n
application for the benefit of the scheme only<\/p>\n
W.P.(C).NO.5546\/08<\/p>\n
                      :: 5 ::\n<\/p>\n
\non  6.6.2007  and  that    by  Ext.P7  order  the<\/p>\n
Government had accepted the        recommendations<\/p>\n
made by the Monitoring Committee to discontinue<\/p>\n
the scheme with effect from 1.4.2007.         The<\/p>\n
scheme  contemplated   availing     of   financial<\/p>\n
facility from scheduled\/nationalised financial<\/p>\n
institutions and deploying of the same by the<\/p>\n
small scale industrial units.     In other words,<\/p>\n
if an industrial unit is to avail the benefit of<\/p>\n
the  scheme,   it  should    first   upgrade  its<\/p>\n
technology  and  the  said   upgradation  of  the<\/p>\n
technology  should  have     entailed  a   capital<\/p>\n
investment.  It   should     further   have  made<\/p>\n
upgradation by availing a credit facility from<\/p>\n
the financial institutions.     Once it is done,<\/p>\n
then it is entitled to apply for financial<\/p>\n
assistance under the scheme.        The competent<\/p>\n
Board under the scheme should evaluate whether<\/p>\n
the  technology   has  been    upgraded   by  the<\/p>\n
industrial  unit.    Thereafter    the  competent<\/p>\n
authority is to consider the amount which the<\/p>\n
unit is entitled to.\n<\/p>\n
       8.   What  is  crucial    in  the  present<\/p>\n
context is whether the petitioner had acted on<\/p>\n
W.P.(C).NO.5546\/08<\/p>\n
                      :: 6 ::\n<\/p>\n
\nthe strength of the scheme as it existed and<\/p>\n
whether it had, in pursuance of the said scheme<\/p>\n
availed a financial facility from the financial<\/p>\n
institution and deployed     the technology. Going<\/p>\n
by Ext.P1 and as per the stand taken in the<\/p>\n
counter   affidavit,   the     last   among    the<\/p>\n
instalments from the UTI bank was drawn by the<\/p>\n
petitioner on 29.3.2007.    In such circumstances,<\/p>\n
there is prima facie material to show that the<\/p>\n
petitioner had acted on the strength of the<\/p>\n
scheme as is listed in Ext.P2.     There does not<\/p>\n
seem to be any serious dispute on this aspect on<\/p>\n
the part of the respondents.\n<\/p>\n
       9. If therefore the petitioner had acted<\/p>\n
under the scheme as it existed, the mere fact<\/p>\n
that the petitioner had applied only on 6.6.2007<\/p>\n
should not act in derogation of the petitioner’s<\/p>\n
eligibility to avail the benefit under Ext.P2<\/p>\n
scheme.  After all, the question of applying for<\/p>\n
the  benefit   under  the    scheme   is  only  a<\/p>\n
consequential  action   to    avail  the   benefit<\/p>\n
available   under    the      scheme.   In   such<\/p>\n
circumstances, the reason afforded in Ext.P5<\/p>\n
does not seem to be sustainable.\n<\/p>\n
W.P.(C).NO.5546\/08<\/p>\n
                      :: 7 ::\n<\/p>\n<\/p>\n
       10.   The   Government   is  entitled  to<\/p>\n
withdraw a scheme offered to industrial units.<\/p>\n
If therefore, the Government decides to put an<\/p>\n
end to a scheme with reference to a report of<\/p>\n
the Monitoring committee as done in Ext.P5,<\/p>\n
there is nothing wrong in doing that. But if any<\/p>\n
unit, which has acted in accordance with the<\/p>\n
scheme,  that  was  already   in existence,  the<\/p>\n
benefit which would have otherwise gone to it<\/p>\n
cannot be taken away with retrospective effect.<\/p>\n
This is the law that has been consistently laid<\/p>\n
down  by  the  Apex  Court.   The law  has  been<\/p>\n
reiterated in Kusumam Hotels (P) Ltd. v. KSEB<\/p>\n
2008(KHC  792}.     In   other   words,  if  the<\/p>\n
petitioner had acted on the strength of Ext.P2<\/p>\n
scheme,  it   is   entitled   to   the  benefits<\/p>\n
thereunder.  Such benefit cannot be withdrawn on<\/p>\n
the strength of Ext.P7 Government order.<\/p>\n
       11. For all these reasons, I find that<\/p>\n
the petitioner is entitled to succeed.    Ext.P5<\/p>\n
is quashed.  Respondents 1 and 2 shall consider<\/p>\n
the   petitioner’s   application   Ext.P4   with<\/p>\n
reference to Ext.P2 scheme.    If the petitioner<\/p>\n
is found eligible in terms of Ext.P2 scheme, the<\/p>\n
W.P.(C).NO.5546\/08<\/p>\n
                        :: 8 ::\n<\/p>\n
\namount which it is entitled to, by way of<\/p>\n
subsidy in terms of Ext.P2 shall be disbursed to<\/p>\n
it.  Appropriate decision, in this regard, shall<\/p>\n
be taken within three months from the date of<\/p>\n
receipt of a copy of this judgment.<\/p>\n
       Writ petition is allowed as above.<\/p>\n
                                    Sd\/-\n<\/p>\n
                                  (V.GIRI)
\n                                   JUDGE
\nsk\/<\/p>\n
              \/\/true copy\/\/<\/p>\n","protected":false},"excerpt":{"rendered":"
Kerala High Court Meckamalil Polymers Pvt.Ltd vs The Director Of Industries & … on 17 October, 2008 IN THE HIGH COURT OF KERALA AT ERNAKULAM WP(C).No. 5546 of 2008(I) 1. MECKAMALIL POLYMERS PVT.LTD., … Petitioner Vs 1. THE DIRECTOR OF INDUSTRIES & COMMERCE, … Respondent 2. GENERAL MANAGER, 3. THE STATE OF KERALA, REPRESENTED 4. […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,21],"tags":[],"class_list":["post-77629","post","type-post","status-publish","format-standard","hentry","category-high-court","category-kerala-high-court"],"yoast_head":"\nMeckamalil Polymers Pvt.Ltd vs The Director Of Industries & ... on 17 October, 2008 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/meckamalil-polymers-pvt-ltd-vs-the-director-of-industries-on-17-october-2008\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Meckamalil Polymers Pvt.Ltd vs The Director Of Industries & ... on 17 October, 2008 - 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