Gauhati High Court
M/S Ishwar Food Products Pvt. Ltd vs The Union Of India And Ors on 11 June, 2019
Author: Kalyan Rai Surana
Bench: Kalyan Rai Surana
Page No.# 1/10
GAHC010182952012
THE GAUHATI HIGH COURT
(HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
Case No. : WP(C) 4388/2012
1:M/S ISHWAR FOOD PRODUCTS PVT. LTD.
REPRESENTED BY ITS DIRECTOR SRI SANWAR MAL AGARWAL, S/O LATE
CHETRAM AGARWAL, R/O TINSUKIA TOWN, P.O. and DIST- TINSUKIA,
ASSAM
VERSUS
1:THE UNION OF INDIA and ORS
REPRESENTED BY THE SECRETARY GOVT. OF INDIA, MINISTRY OF FOOD
PROCESSING INDUSTRIES, PANCHSHEEL BHAWAN, AUGUST KRANTI
MARG, NEW DELHI
2:THE UNDER SECRETARY
MINISTRY OF FOOD PROCESSING INDUSTRIES
PANCHSHEEL BHAWAN
AUGUST KRANTI MARG
NEW DELHI
3:THE ASSTT. GENERAL MANAGER
DBD
STATE BANK OF INDIA
CHANDINI CHOWK
DELHI-6
4:THE CHIEF MANAGER
SBI
SREE GOPAL GOSHALA
CHIRING CHAPARI
DIBRUGAR
Advocate for the Petitioner : MR A SAIKIA
Advocate for the Respondent : MR.A KHANIKAR
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BEFORE
HONOURABLE MR. JUSTICE KALYAN RAI SURANA
JUDGMENT
Date : 11-06-2019 Heard Ms. N. Saikia, learned counsel for the petitioner. Also heard Mr. S.C. Keyal, learned Asst. Solicitor General of India, appearing for respondent nos. 1 and 2. And also heard Mr. A. Khanikar, learned counsel appearing for proforma respondent nos. 3 and 4.
2. By this writ petition filed under Article 226 of the Constitution of India, the petitioner is seeking a direction to the respondents No.1 and 2 to release balance grant-in- aid of Rs.10.62 lakh. In this writ petition, the case projected by the petitioner that the Govt. of India had formulated a scheme for technology up-gradation/establishment/modernization of food proceeding industries to cover for setting-up/expansion/modernization of food processing industries covering all segments, viz., fruits and vegetables, milk products, meat, poultry, fishery, oil seeds and such other agri-horticultural sectors leading to value addition and self-life enhancement including food flavours and colours, oleoresins, spices, coconut, mushroom, hops, etc. It was envisaged that such industries would be eligible for financial assistance in the form of grant, subject to 25% of the investment in (i) plant and machinery, and (ii) technical civil works, subject to a maximum of Rs.50.00 lakh in "General Areas" and 33.33% upto Rs.75.00 lakh in "Difficult Areas". Accordingly, vide letter dated 17.03.2004, the petitioner had applied for grant before the Ministry of Food Processing Industries, Govt. of India (hereinafter referred to as "MoFPI" for short) by projecting that they were going to set up a 38 MT. Roller Flour Mill at the total project cost of Rs.94.00 lakh for which they had taken term loan assistance of Rs.28.00 lakh from the State Bank of India (proforma respondents No.3 and 4). Thus, the petitioner had set up a Food Processing Industry to manufacture atta, maida, suji, bran, etc. Page No.# 3/10
3. The learned counsel for the petitioner has submitted that as the Industry of the petitioner fell within "Difficult Area", the petitioner was eligible for financial grant to the extent of 33.33% of its investment in plant and machinery, and technical civil works. It is submitted that as the total investment of the petitioner to set up the industry was Rs.116.31 lakh, the amount of grant on eligible items was Rs.22.99 lakh. It is submitted that the Addl. Director (F.P.), Directorate of Industries and Commerce, Assam had carried out the physical verification and inspection of the industry of the petitioner and vide letter dated 25.03.2004, forwarded the proposal submitted by the petitioner to the Secretary to the Govt. of Assam, Industries and Commerce Department, for grant from Ministry of Food Processing Industries, Govt. of India. Accordingly, by an Office Memorandum dated 03.08.2007, the Under Secretary to the Govt. of India had circulated the Minutes of Meeting of PAC (3 rd of 2007-08) held on 13.07.2007, inter-alia, indicating the summary of the projects pending with MoFPI prior to 01.04.2007 and transferred to Banks for disbursement of grant. It is submitted that the MoFPI had found the petitioner to be eligible for grant of Rs.17.24 lakh. It is further submitted that vide letter dated 15.10.2007, the MoFPI had informed the State Bank of India, Tinisukia Branch, that there was decentralization of schemes and disbursal of grants to Food Processing Units during the 11th Plan and for transferring of pending cases received during 10th Plan for disbursement of grants to eligible units and accordingly, the relevant documents were sent to the proforma respondents (i.e. SBI) with a direction to inspect the unit along with State Nodal Agency to ensure that the units had physically come up with all the plant and machinery installed, technical civil works completed and ready for commercial production.
4. The learned counsel for the petitioner has submitted that the State Bank of India had sought clarification from the MoFPI as to whether the eligible grant to the petitioner should be Rs.22.99 lakh (33.33%) or Rs.17.24 lakh (25%). It is submitted that as the petitioner was in urgent need of money, in the meanwhile, necessary documents were signed by the petitioner and forwarded to the State Bank of India for release of first instalment of Page No.# 4/10 subsidy of Rs.11,49,500/-. It is submitted that owing to delay in disbursement of grant- in- aid, the petitioner had submitted their protest along with surety bond, claiming that the grant- in- aid of Rs.22.99 lakh may be given with interest. However, by a letter dated 07.10.2008, the MoFPI had informed the State Bank of India, that eligible grant was calculated as per guidelines and that grant of Rs.12.37 lakh had been calculated at the rate of 33.33% of eligible cost of the installed plant and machinery and technical civil works. It is submitted that thereafter by letter dated 04.03.2009, the State Bank of India (SBI), Dibrugarh wrote to the Asst. General Manager (DBD), SBI, Chandni Chowk Branch, Delhi that the petitioner was eligible for 33.33% subsidy and though documents for sanction of Rs.12.37 lakh had been submitted, the matter of grant may be reconsidered as apprised by the Bank for Rs.22.99 lakh. It is submitted that thereafter the first instalment of Rs.6,18,500 was received and the request letter dated 20.05.2009 was issued by the State Bank of India to the MoFPI for release of second instalment of grant/ subsidy. It is submitted in the meanwhile the SBI vide letter dated 20.05.2009, once again requested the MoFPI for releasing the second instalment of balance amount of subsidy amounting to Rs.16,18,500/- issued to the petitioner as the e-portal sheet downloaded from the internet website of the Ministry disclosed that Rs.22.99 lakh had been sanctioned.
5. By heavily relying upon the documents relating to sanction of grant of subsidy to the petitioner, which was downloaded from the website of MoFPI on 10.09.2012, it is submitted that the said document disclosed that on 28.03.2008, the approved amount of subsidy/grant- in- aid was Rs.22,99,000/-. It is also submitted that as on 13.07.2007, when the meeting of PAC (3rd of 2007-08) was held, the eligible grant was reduced from Rs.22.99 lakh to Rs.17.24 lakh, which was further brought down to Rs.12.37 lakh vide letter dated 07.10.2008. Therefore, it is submitted that after approval of such grant, the respondents No.1 and 2 had curtailed the grant and the MoFPI had illegally withheld the balance grant amount of Rs.10,62,000/- by showing some baseless and undisclosed calculations and, as such, the petitioner was entitled to the said differential amount of grant together with usual banking Page No.# 5/10 rate of interest. It is submitted that as per the documents submitted by the petitioner, the SBI, who was the competent authority as well as the agent of the MoFPI, had apprised the grant at Rs.22.99 lakh and, as such, the respondents No. 1 and 2 were bound by such appraisal, and accordingly, the deduction of the eligible grant of the subsidy from Rs.22.99 lakh to Rs.17.24 lakh and then to Rs.12.37 lakh was illegal, arbitrary, baseless and whimsical. It is also submitted that as the respondents No. 1 and 2 had initially apprised the subsidy of the grant at Rs.22.99 lakh, being 33.33% of the eligible investment, the petitioner is entitled to the grant of such subsidy along with interest thereon. It is submitted that Rs.17.24 lakh would be 25% of eligible investment and 33.33% of such investment would be Rs.22.99 lakh, as such, the respondents No.1 and 2 were making an unjust attempt to justify the grant- in- aid of Rs.17.24 lakh by claiming as if Rs.17.24 lakh was 33.33% of eligible investment and when the petitioner had objected, the MoFPI had further scaled down the grant to Rs.12.37 lakh.
6. In support of her submissions, the learned counsel for the petitioner has relied on the following cases: (i) Under Secretary, Ministry of Industries & Ors. Vs. Marchon Textiles Inds. (P) Ltd. & anr., (2005) 10 SCC 554, (ii) K.K. Velusamy Vs. N. Palanisamy, (2011) 11 SCC 269, (iii) Deepa Bhargava & anr. Vs. Mahesh Bhargava & ors., (2009) 2 SCC 294, (iv) Union of India Vs. J. Tariang, 2013 (3) GLT 16, (v) Shankarlal Jhawar Vs. State of Assam & Ors., 2010 (4) GLT 378, and (vi) Ever Assam Tea Pvt. Ltd. Vs. State of Assam & Ors., 2018 (2) GLT 516.
7. The learned ASGI, per-contra, has submitted that this is not a case where the approved grant- in- aid had been scaled down behind the back of the petitioner as sought to be portrayed by the learned counsel for the petitioner. It is submitted that the documents annexed at page 30 and 31 of the writ petition where eligible grant for the petitioner was mentioned that Rs.17.24 lakh was merely a summary of the projects pending with MFPI prior Page No.# 6/10 to 01.04.2007, which cannot be claimed to be final. It is submitted that later on, along with several other proposals, the proposal in respect of the claim of grant- in- aid of the petitioner was examined in detail by the Integrated Finance Wing (IFW in short) of the MoFPI. It is submitted that on scrutiny of record, the IFW had raised objection on the estimated grants- in-aid worked out earlier by the PAC by pointing out that the eligible cost of technical civil work amounting to Rs.18.73 lakh was wrongly assessed and the appraised cost of the same was shown as nil and similarly, the eligible cost of plant and machinery, which was considered as Rs.50.27 lakh, and the apprised cost of the same was shown as Rs.41.13 lakh. Therefore, based on such objection by IFW of MoFPI, the proposal was once again scrutinized and the eligible cost of technical civil work was re-worked as per PWD Engineer's Certificate and the same was calculated at Rs.11.23 lakh and similarly, the eligible cost of plant and machinery was re-worked on the basis of apprised cost and that by eliminating some ineligible cost, the eligible cost of plant and machinery was reduced to Rs.25.88 lakh. Hence, it is submitted that the total eligible cost of the project for the purpose of disbursing grant- in- aid was worked out to Rs.37.11 lakh and thus, 33.33% grants-in-aid came to Rs.12.37 lakh and accordingly, the PAC note was also revised. In this regard, the learned ASGI has referred to the original records, which was produced as per order dated 22.01.2019, and he has supported his submissions by referring to the documents contained in the MoFPI File No. M-15012/8/04- 05(FM)(2 files). It is submitted that the petitioner had withheld the letter dated 04.09.2008 (Annexure I to the affidavit-in-apposition), by which the MoFPI had informed the SBI, Chandni Chowk, Delhi with copy to the petitioner and SBI, Tinisukia that the approved grant in this case at 33.33% had been arrived at Rs.12.37 lakh and accordingly, they were required to send (i) a revised e-portal request sheet, (ii) Bank Certificate, and (iii) surety bond for Rs.12.37 lakh to enable the Ministry to release first instalment of grant expeditiously. By referring to the original records, it is submitted that the SBI by the letter No. RASMECCC/DBD/08-09/2132 dated 18.09.2008, while sending the relevant documents has also forwarded a protest letter dated 18.09.2008 by the petitioner which is referred to in letter dated 07.10.2008 by MFPI (Annexure-9 to the writ petition). Thereafter, the SBI, Chandi Chowk, Delhi by referring to the said letter dated 07.10.2008 vide letter No. SBI:DBD/FPC/1792 dated 06.03.2009, had enclosed (i) the surety bond, (ii) copy or resolution by petitioner, and (iii) affidavit duly notarized and countersigned by the bank for Page No.# 7/10 further action from MoFPI (Page 92 to 100 of file/ Annexure 2 to 5 of the affidavit-in- opposition). Therefore, it is submitted that when the first and second instalment of the sanctioned grant of Rs.12,37,000/- was availed, the petitioner had forgone the protest as well as the claim of grant/subsidy amount of Rs.22.99 lakh. It is submitted that the SBI, RASMECCC, Dibrugarh had submitted a fresh Bank Certificate, wherein it is reflected that they had scrutinized the application of the petitioner for MoFPI grant as per their guidelines and arrived at the grant of Rs.12.37 lakh. It is submitted that accordingly, the petitioner had also submitted a surety bond for Rs.12.37 lakh as per the MoFPI sanctioned order for grant. Accordingly, the learned ASGI has submitted that the petitioner had suppressed material facts regarding submission of fresh documents to claim grant/ subsidy of Rs.12.37 lakh along with fresh appraisal by SBI in form of Bank Certificate towards, calculating the grant of Rs.12.37 lakh. It is further submitted that notwithstanding that the document downloaded from e- portal of MoFPI on 10.09.2012 (Annexure-14 of the Writ Petition), the summary sheet/ e- portal document (Annexure 5 to the affidavit-in-opposition) would show that although an assistance of Rs.22,99,000 was sought for, the approved grant was Rs.12,37,000/-. It is also submitted that the sanction letter of grant dated 30.03.2009, grant-in-aid bill, etc. (Annexure- 6 to 8 of the affidavit-in-opposition), clearly indicated that the approved grant was Rs.12,37,000/- and that the first as well as second instalment of such was Rs.6,18,500/- each.
8. The learned ASGI has submitted that contrary to the various schemes and guidelines, for setting up an industry, the petitioner could avail only one form of assistance from the Central Govt. However, upon scrutiny it was found that the petitioner had not only availed grant of Rs.12.37 lakh from the MoFPI, but had also availed grant-in-aid/subsidy of Rs.18.18 lakh from North Eastern Council (NEC) under Ministry of Development of North Eastern Region (DoNER), for which the petitioner has become liable to return the grant-in-aid availed from MoFPI.
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9. The learned counsel for the proforma respondents No.3 and 4 i.e. SBI has submitted that they had appraised the grant of Rs.22.99 lakh, but as the MoFPI had scaled down the grant amount first to Rs.17.24 lakh and then to Rs.12.37 lakh, they were bound to act in accordance with the directives.
10. Having heard the learned counsel for the parties, the materials available on records including MoFPI record (two files) produced by the learned ASGI have been perused.
11. It appears that when the grant-in-aid was envisaged at Rs.17.24 lakh, the MoFPI by letter dated 28.03.2008, had informed the SBI, Chandni Chowk, Delhi that the subsidy for the petitioner was 33.33%. Accordingly, the petitioner had signed, notarized and sent the surety bond of Rs.17.24 lakh to the SBI for onward submission to the MoFPI. The records also reveal that the MoFPI had revised the grant/ subsidy from Rs.17.24 lakh to Rs.12,37,000/- and such revision was communicated to the SBI with copy to the petitioner and accordingly, the petitioner had executed another surety bond for the revised grant of Rs.12.37 lakh, which was submitted to SBI for onward submission to MoFPI. However, it appears that the said surety bond executed and notarized on 11.09.2008 was "without prejudice" and was accompanied with the petitioner's protest letter dated 18.09.2008, the respondents did not release the grant- in- aid and the SBI was asked to re-submit a fresh surety bond and affidavit together with fresh Bank Certificate, affidavit etc. The said request was complied with by the SBI by its letter dated 06.03.2009. The Bank Certificate (undated; Annexure-4 to affidavit- in- opposition) clearly indicates that the SBI, RASMECCC, Dibrugarh had scrutinized the application of the petitioner and arrived at a grant of Rs.12.37 lakh. There is nothing on record to demonstrate that the fresh document submitted by the petitioner was with any reservation or that it was qualified, or accompanied by any letter of protest. Under such circumstances, it appears that the petitioner had accepted the grant-in-aid of Rs.12.37 lakh without registering any protest while submitting the documents to SBI, which in turn was Page No.# 9/10 submitted by SBI to MoFPI on 06.03.2009. Moreover, there was no protest while receiving first and second instalment of Rs.6,18,500/-, or before appropriating the receipt of such grant. The CA certificate available in record and the CA Certificate dated 14.05.2009 (Annexure-7 to the affidavit-in-opposition) contains reference to the MoFPI sanction letter dated 30.03.2009, and the utilization of the first instalment of grant amounting to Rs.6,18,500/- leaves an indelible impression that the petitioner was aware of sanction of Rs.12.37 lakh as grant-in-aid. In the opinion of this Court, if the sanctioned grant of Rs.12.37 lakh was not acceptable to the petitioner, the petitioner ought not to have submitted any documents to collect such grant and the petitioner ought not to have utilized such money.
12. In the considered opinion of this Court, there is no doubt that the respondents no. 1 and 2 had unequivocally indicated in their communications to the SBI with copy marked to the petitioner to the effect that the petitioner was entitled to grant-in-aid of Rs.12.37 lakh as the total eligible cost of project was revised. This Court cannot be oblivious of the fact that when the petitioner had submitted a letter of protest dated 18.09.2008, the MoFPI had not released the grant of Rs.12.37 lakh. Accordingly, the petitioner had submitted fresh documents to avail the grant. The contents of (i) the Bank Certificate (undated), and (ii) the surety bond signed by the petitioner's authorised representative and notarized on 31.12.2008 are sufficient to indicate that the petitioner was aware that the sanctioned grant- in-aid by MoFPI was Rs.12.37 lakh only. These documents indicate that the petitioner had withheld these facts from this Court. Accordingly, having received the grant-in-aid of Rs.12.37 lakh without registering any protest, the petitioner is not entitled to maintain its projected claim for Rs.22.99 lakh as grant- in- aid from MoFPI.
13. In view of the discussions above, this court is of the considered opinion that the case as cited by the learned counsel for the petitioner does not apply under the facts of this case. Moreover, as the petitioner is not found entitled to any financial relief inform of Page No.# 10/10 balance grant, it is needless to mention that petitioner would not be entitled to any interest either. Hence, this Court is not inclined to burden this order with academic exercise of discussion in respect of the cited cases.
14. Accordingly, this Court finds that the petitioner not entitled to any relief in this writ petition. Accordingly, this writ petition stands dismissed. The Rule issued on 08.12.2014 stands discharged.
15. No cost.
JUDGE Comparing Assistant