HC sets aside Industrial Investment Policy ‘clause’ for grant of incentives
The HP High Court has set aside the clause 5B of the Himachal Pradesh Industrial Investment Policy, 2019, along with Rule 4B(b) and 4F of the Rules regarding the grant of incentives, concessions and facilities for investment promotion to the extent they are inconsistent with the Industrial Policy, 2019.
A Division Bench comprising Justice Tarlok Singh Chauhan and Justice Sushil Kukreja passed the judgment on a petition filed by an industrial unit alleging that the state had on August 16, 2019, notified the Himachal Pradesh Industrial Investment Policy, 2019. Under this policy, eligible enterprises were assured that they would be charged 15 per cent less for energy if they did substantial expansion in accordance with the “Rules Regarding the Grant of Incentives, Concessions and Facilities for Investment Promotion in Himachal Pradesh-2019”.
It was averred in the petition that the state government after framing the Industrial Policy, 2019, had assured the eligible industries (new or existing) of particular incentives and in terms thereto, therefore, the state was under obligation to show an appropriate enabling/follow-up notification to effectually convey the incentives relating to electricity to the eligible industrial units.
However, on the other hand, the state contended before the court that Rule 4-A specifically provides that the incentives given under the rules would be admissible from the date of the commencement of commercial production/operation or from the date on which the administrative department concerned issued an enabling notification under the relevant statute/law to operationalise incentives notified under these rules, whichever was later.
While rejecting the contention of the state, the court observed that “the state government cannot speak in two voices. Once the government has taken a policy decision to extend certain benefits to the petitioner, the same cannot be withheld simply for the want of a notification.”
It observed that “the petitioner admittedly did substantial expansion in terms of the policy, but the state failed to issue the enabling notification despite having promised to do so by virtue of words “whichever is later” in clause 5 (B) of the policy and till the department is “not issuing” the enabling notification, the rights of the petitioner under the erstwhile clause 16 (A) are being withheld though no reasons for the same are forthcoming in the reply, which will only show bureaucratic lethargy. An assurance has been given by the Department of Industries being nodal agency for the implementation of the policy in terms of Rule 27.”
