Gauhati High Court
Union Of India (Uoi) And Ors. vs India Carbon Ltd. And Ors. on 21 June, 1996
Equivalent citations: AIR1997GAU83, AIR 1997 GAUHATI 83
JUDGMENT Baruah, J.
1. This appeal is directed against the common judgment dated 25-1-95 passed by the learned Single Judge in Civil Rule No. 2441/1994 and 3117/1994.
2. The main grounds of attack of the impugned judgment is that the respondent company, namely, India Carbon Limited is not entitled to transport subsidy under the Transport Subsidy Scheme, 1971 in respect of manufacture of Calcined Petroleum Coke by the respondent company and that the appellants have full discretion in matter of granting subsidy.
3. The facts may be stated as follows :--
The Government of India in the year 1971 announced a Scheme known as "Transport Subsidy Scheme, 1971". This Scheme came into force with effect from 15-7-71 and it is still in force. The Scheme is applicable to all industrial units situated in specified hilly, remote and inaccessible areas of the country including the States of Jammu and Kashmir, Assam, Meghalaya, Nagaland, Manipur, Tripura and Arunachal Pradesh. The scheme is applicable to industrial units set up on or after 1-1-60. The scheme is however not applicable to plantation, refineries and power generating units.
4. Respondent company carries on business of manufacture of "Calcined Petroleum Coke" for short "CPC" from the raw materials received from the refinery. The company owns a factory at Noonmati, Gauhati which was established in the year 1962. Originally the company was not entitled to the benefits of the Scheme; but became entitled to the subsidy with effect from 1-9-86. the date on which the amendment was made on 25-9-86. The subsidy was enhanced to 92% from 75% of the total cost of transportation of raw material between Siliguri and location of industrial unit in the State and on finished products for the cost of movement by road from the location of the industrial unit to the nearest Railway Station and thereafter on the cost of movement by Railways to Siliguri. The respondent company being entitled to the benefits of the Scheme spent money for transportation.
5. On 30-3-88 the Government of India, Ministry of Industry issued a circular clarifying that transport subsidy would not be made available on "CPC" which was a product of the refineries.
6. By Annexure-VI letter dated 21-6-88 (all the annexures referred to herein are the annexures to the writ petition) the Director of Industries, Government of Assam, Guwahati wrote to the Dy. Secretary, Govt. of India, Ministry of Industrial Development, New Delhi, stating inter alia that "CPC" was not a refinery product and therefore the Govt. of Assam requested the Govt. of India to allow transport subsidy on "CPC".
7. By Annexure-VII letter dated 5-7-88 the respondent company submitted a representation to the Joint Secretary, Govt. of India, Ministry of Industry, Department of Industrial Development, New Delhi pointing out that the factory of the respondent company being not a refinery, "CPC" produced in the said factory could not be a refinery product and therefore the respondent company requested the Govt. of India to grant transport subsidy to it.
8. In the meantime a writ petition was filed in the Calcutta High Court by Hindustan Development Corporation (Matter No. 5388 /1988) wherein it was clarified that "CPC" produced by the respondent company was not a refinery product. Later on the said writ application was however withdrawn from the Calcutta High Court.
9. By Annexure-X letter dated 8-2-89 the Deputy Secretary to the Govt. of India, Ministry of Industry, Department of Industrial Development wrote a letter to the Secretary, Department of Industries, Government of Assam informing that the Government had decided to allow transport subsidy to industrial units producing "CPC" in the notifiqd areas covered under the Transport Subsidy Scheme.
10. By Annexurc-XI dated 18-8-89 the Govt. of India informed the Secretary, Department of Industries, Govt. of Assam, that no transport subsidy would be available to industrial units producing "CPC" till further orders as Government had cancelled its earlier letter dated 8-2-89.
11. By Annexure-XII letter dated 18-8-89 the Joint Secretary to the Govt. of India (respondent-2) in C.R.3117/1994 informed the Director of Industries, Govt. of Assam that it was decided that transport subsidy would not be available to the manufacture of "CPC". The Director of Industries requested to recover a sum of Rs. 37,19,993/- which had been given to the respondent company towards the part of the transport subsidy. Letters were issued thereafter for refund of the said subsidy. Situated thus the respondents filed Civil Rule No. 1825/1989 before this court.
12. On 15-2-93 after hearing the learned counsel for the parties learned single Judge while allowing the writ petition observed thus:--
"For the foregoing reasons, the letter dated 18-8-89, cancelling the communication dated 8-2-89 under which the petitioner company was permitted to enjoy transport subsidy and letter dated 7/8-9-89 by which the petitioner company was asked to refund the subsidy granted are quashed with a direction to the Central Government to give an opportunity to the petitioner company of being heard before making any decision in this regard."
13. On 13-7-1993 the Joint Secretary, Ministry of Industry, pursuant to the order passed by the learned single Judge in Civil Rule No. 1825/1989 heard the representative of the company. After hearing the representatives of the company on 15-7-94 the Under Secretary to the Government of India, Ministry of Industry, Department of Industrial Development by Annexure-XXVII sent a letter to the Director of Industries, Government of Assam informing that the question of applicability of the Transport subsidy to the "CPC" was again considered and the Government of India was still of the view that the transport subsidy in the said item would not be available to the industrial unit manufacturing "CPC" and therefore requested to expedite recovery of the amount (Rs. 37,19,993/-) disbursed to the respondent company.
14. Thereafter by Annexure-XXVIII letter dated 29-7-94 the Director of Industries, Assam, Guwahati also directed the respondent company to deposit the amount of Rs. 37,19,993/- to the Govt. of Treasury. Situated thus, the respondent company filed the aforesaid Civil Rule.
15. In the Civil Rule the respondent company contended inter alia that as per the scheme the respondent company was entitled to receive transport subsidy on the ground that respondent company was not a refinery unit. It only produces "CPC" from the raw materials, namely Raw Petroleum Coke. According to the respondent company raw petroleum coke is a finished product so far refinery is concerned and therefore the prohibition as per the scheme is not applicable to the respondent company.
16. In the writ petition (Matter No. 5388/ 1988) filed by Hindustan Development Corporation before the Calcutta High Court an affidavit-in-opposition was filed by the Union of India. The Hindustan Development Corporation also used to manufacture similar product. After filing of the affidavit-in-opposition the said writ petition was withdrawn.
17. Another writ petition was filed by the respondent company (Civil Rule No. 2441/ 1994) against the circulars dated 14-9-93 and 12-1-94 (Annexure-XIII and XIV) issued by the Govt. of India and those are Annexures-XVIII and XIX in Civil Rule No. 3117/1994. By the aforesaid two circulars the Government of India fixed the time limit for disbursement of the amount claimed to the respondent unit. In both the Civil Rules Union of India filed counter affidavit. After hearing the learned counsel for the parties the learned single Judge disposed of both the Civil Rules by a common judgment and order dated 25-1-95. The impugned order dated 15-7-94 (Annexure-XXVII) and the impugned order dated 29-7-94 (Annexure-XXVIII) in Civil Rule No. 3117/1994 were quashed and the impugned order dated 14-9-93 and 12-1-94 in Civil Rule No. 2441/1994 (Annexures-XIII and XIV) were treated to be not applicable in so far as the petitioners were concerned. Accordingly both the aforesaid two Civil Rules were allowed. Hence the present appeal.
18. We have heard Mr. K.N. Choudhury, learned Senior Central Govt. Standing Counsel for the appellants and Mr. P.K. Goswami, learned senior counsel assisted by Dr. A.K. Saraf, for the respondents.
19. Mr. Choudhury submits that as per Clause 6(xv) of the Scheme the Government of India or the Government of the State concerned have full discretion to refuse to entertain or reject any claim for transport subsidy. In this connection Mr. Choudhury has drawn our attention to Annexure-I of Civil Rule No. 3117/1994. As per the said Annexure-I the scheme is applicable to all industrial units barring plantations, refineries, and power generating units both in the public and the private sectors irrespective of their size in the States of Jammu and Kashmir and other notified areas. Therefore, according to Mr. Choudhury the scheme is not applicable to the respondent company and he further submits that refinery includes also units engaged in the manufacture of refinery products. Besides Mr. Choudhury has drawn our attention to earlier judgment dated 15-2-93 passed in Civil Rule No. 1825/1989 particularly para-6 of the said judgment wherein also it was observed that the Government of India had the full discretion to refuse to entertain or reject any claim for transport subsidy. Therefore, according to Mr. Choudhury the rejection of the claim for transport subsidy was fully justified in this case. Mr. Choudhury also submits that this aspect of the matter was not dealt with in the impugned judgment.
20. Mr. Goswami on the other hand contends that it is true that the scheme is not applicable to plantations, refineries and power generating units. According to Mr. Goswami respondent company is not a refinery unit. It manufactures "CPC" which can be produced in an industrial unit which is not a refinery. Besides "CPC" is also not exclusively a refinery product. In this regard Mr. Goswami has drawn our attention to the affidavit-in-opposition filed by the Union of India in Matter No. 5388/1988 before the Calcutta High Court particularly paragraphs 10, 15, 16 and 20 and from those paragraphs it is abundantly clear that the respondent company is not a refinery and therefore is entitled to receive transport subsidy.
21. On the rival contention of the learned counsel for the parties it is to be seen whether the respondent company is entitled to the transport subsidy.
22. On perusal of the Transport Subsidy Scheme we find that transport subsidy is available to all industrial units in the specified areas except plantation, refinery and power generating unit. Mr. Choudhury does not dispute that the respondent company is an 'industrial unit. He also agrees that the respondent company is not a refinery. In the scheme the expression 'refinery' has not been defined. If we go by the dictionary meaning as per Webster's New Twentieth Century Dictionary it means "a place, establishment, or plant where oil, sugar, metals, liquors, etc. are refined".
23. In the affidavit-in-opposition filed by the Union of India in Matter No. 5388/1988 before the Calcutta High Court in para-10 it has been stated that in order to know whether CPC is a refinery product or not, the Ministry of Industry, Department of Industrial Development, called a meeting on 26th October, 1988 about the eligibility of CPC units to transport subsidy. This meeting was attended by the representatives from the Ministry of Petroleum and Natural Gas, Assam Government, Indian Oil Corporation Ltd., Bombay and Directorate General of Technical Development, New Delhi. The representatives from the Indian Oil Corporation Ltd. clarified that while processing the Crude Oil, different end products like gas, petrol, kerosene oil etc. are obtained. Out of the Raw Petroleum Coke "CPC" is manufactured. As far as a refinery is concerned, RPC is an end product and it involves an entirely different processing operation to produce CPC from RPC.
24. Besides in para-15 of the said affidavit it has been mentioned thus:--
"The issue is whether CPC produced by M/s. India Carbon Limited is a refinery product. Obviously it is not a refinery product in that India Carbon is not engaged in refining of petroleum crude like other private calcining units."
25. Again in para-20 of the said affidavit it has been mentioned that India Carbon Limited, Guwahati is not a refinery. This affidavit was sworn by an Under Secretary to the Govt. of India.
26. The respondent company has specifically mentioned about this affidavit in paras-13 and 14 of the writ petition (Civil Rule No. 3117/1994) and also in para-10 of the affidavit-in-reply. The respondents in the above noted Civil Rule are silent, without saying anything about the contents of the affidavit. Therefore, the contents of the affidavit are deemed to be accepted by the respondents. The respondents having admitted about filing of the affidavit have not given any reason why there was departure of the stand taken. No material has been produced before this court.
27. In view of the above we have no hesitation to come to the conclusion that the respondent company is not a refinery. As it is not a refinery the prohibition regarding applicability of the scheme does not come. As per the scheme of 1971 the transport subsidy was given to all industrial units barring plantations, refineries and power generating units in the notified areas. Having announced such a scheme the Government is bound to honour the assurance. In the present case also the respondent company did pay some money. This itself is sufficient to indicate that the respondent company is not a refinery and as such the respondent company is entitled to get the transport subsidy as per the scheme. However, Mr. Choudhury submits that the Government has full discretion to reject any of the claims. In our opinion this Clause has no application in the present case. We have gone through the judgment passed by the learned single Judge in Civil Rule No. 1825/1989. In the said judgment the learned single Judge had mentioned that the Government had discretion 10 accept or reject any claim. The learned single Judge in the impugned judgment also had accepted the same. We do not disagree with the proposition. The Government may refuse to grant subsidy in an 'appropriate case when it appears that a particular claimant does not come under the scheme. But this docs not mean that the Government has unfettered discretion to reject claims whenever they like.
28. In view of the above we do not find any infirmity in the impugned judgment passed by the learned single Judge. Accordingly the appeal is dismissed with cost, The cost is assessed at Rs. 2,000/-.
In view of the above the appellants as well as the State of Assam are directed to pay the money as early as possible at any rate within a period of two months from the date of the receipt of the order.