Sumit Enterprises vs The State Of Jharkhand & Ors.

10/28.07.2026 Heard Mr. Ajay Kumar Sah, the learned counsel appearing on behalf of the petitioner, Mr. Ashutosh Anand, the learned counsel appearing on behalf of the respondent nos.1 to 4 (State) as well as Mr. C.A. Bardhan, the learned counsel appearing on behalf of the respondent nos.5 and 6 (Adityapur Industrial Area Development Authority/ AIADA).

This petition has been filed under Article 226 of the Constitution of India for quashing of the order dated 26.10.2013 contained in Memo No.3002/Ranchi dated 26.10.2023 issued by Deputy Director, Department of Industries, Government of Jharkhand. Whereby the application made by the petitioner for grant of Capital subsidy has been rejected. The prayer is also made for direction upon respondents to allow the claim of the petitioner with regard to the capital investment subsidy to the tune of Rs.20 lakhs with interest.

Mr. Sah, the learned counsel appearing for the petitioner submits that the petitioner is carrying business of manufacturing auto components, fabrication, metal sheet processing in the name and style of ‘M/s Sumeet Enterprises’ which is a partnership firm having permanent registration number SSI Registration 03/17/ 03310/ PMT/ SSI Dated 15.06.1987 and it represented through one of the partners. He next submits that after the creation of the State of Jharkhand, Industrial Policy 2001 was introduced by the Government of Jharkhand to optionally utilize the available resources of the State in a planned manner to accelerate the industrial development of the State. He next submits that under clause 29.0 of the said Policy, the provision of granting several types of incentives to the units is disclosed and he also submits that for the commercial production during the period this policy is effected and the capital investment incentive is one of the criteria. He next submits that in the year 2007 the petitioner started to expand his business activity by setting up a Bumper painting plant/ sheet metal processing and painting. He next submits that the date of the commencement of the expansion project is 26.06.2007 and this expansion project was financed by the State Bank of India on 24.02.2007. He next submits that after the expansion was completed, the unit started its production on 29.02.2008. He next submits that in light of the Policy, 2001, particularly, Clause IV (घ) of the Jharkhand Incentive Rules, 2003, for getting the capital investment subsidy the unit has to file the application along with all the necessary documents before the competent authority within six months from the date of commencement of its commercial production. He next submits that the commercial production after the expansion of said unit, started on 29.02.2008 and as per the requirement enshrined in Annexure -1 of the Jharkhand Industrial Policy, 2001, the petitioner filed an application before the Managing Director, Adityapur Industrial Area Development Authority/AIADA on 12.04.2008 for the expansion programme of the unit as well as for issuance of the Certificate with regard to the commencement of the commercial production as contained in Annexure-1. He next submits that in light of the Clause 4(घ) of Jharkhand Incentive Rules, 2003, it is mandatory to submit the application before the appropriate authority for such gain within six months from the date of the commercial production, however, the petitioner submitted his application for claiming capital investment subsidy on 23.9.2008 before the appropriate authority along with the necessary documents, except the commercial production certificate which could not be submitted by the petitioner due to laches on the part of the respondent nos.5 and 6/ AIADA. He next submits that the application is annexed as Annexure-2. He submits that the petitioner could not apply the application within six months as the petitioner was not sure as to what date is fixed for date of commercial production and since in spite of the fact that the petitioner filed an application for commercial production certificate before AIADA on 12.4.2008 but, as on 23.9.2008 it was not provided to the petitioner. However, the application was made within further six months which could be condoned and since only the production certificate was not filed as the AIADA not provided on time. He further submits that the petitioner had waited for some time in anticipation of receiving production certificate from AIADA, however, it was not received and the petitioner has filed the application on 23.9.2008 after a delay of 24 days. However, within six of the further condoning period. By way of referring annexure-3, he submits that on 03.01.2009, the commercial production certificate was issued by the AIADA after more than 10 months of the submission of the application by the petitioner, whereas, the date of production is disclosed as 29.2.2008. He next submits that by way of Annexure-4, the petitioner has provided the said certificate to the competent authority. By way of Annexure-5, the Managing Director, AIADA has also recommended the case of the petitioner for giving the capital incentive subsidy to the Director (Industries), Government of Jharkhand, however, by Annexure-6, the Director (Industries), Government of Jharkhand has pointed out certain incognities in the said application to the Managing Director of AIADA and asked to submit the documents details disclosed in the said communication. Thereafter, the petitioner has filed the compliance report as contained in Annexure-7 before the AIADA. He next submits that the petitioner has explained as to why the delay has occurred and in spite of that, the capital incentive subsidy request of the petitioner has been rejected by the order dated 30.11.2010 on the ground of delay of 24 days which was challenged by the petitioner before this Court in W.P.(C) No.5803 of 2011 and during pendency of the said writ petition, the respondents pointed out to the petitioner that the grievance of the petitioner has been redressed and stating that fact, the petitioner has filed IA No.2676 of 2012 in the said writ petition disclosing the reason of withdrawing the said writ petition and pursuant to that, the writ petition was dismissed as withdrawn by the order dated 10.09.2012. He next submits that, however, the grievance of the petitioner was not redressed in spite of the assurance. He next submits that since the certificate was there and in view of that the petitioner has also moved before the competent authority to grant the said subsidy prior to filing of the writ petition, and that was pending. He next submits that now by the impugned order, the same has been dismissed by the impugned order dated 26.10.2013 on the ground that the Director (Industries), Department of Industries, Government of Jharkhand is having no power to review his own order and there is disparity between the Consent to Operate and the Date of Production (DOP). He next submits that the said order is illegal and in spite of the fact that assurance was provided and pursuant to that, the petitioner has withdrawn the earlier writ petition. He next submits that in the counter affidavit of the AIADA, the committee report dated 19.6.2013 is annexed as Annexure-G and that committee was constituted to reconsider the application of the petitioner and the said committee has further recommended to provide subsidy in terms of the Policy and in spite of that, it has been rejected on the frivolous grounds. He lastly submits that identical was the issue before this court in the case of Kohinoor Steel Pvt. Ltd, through its Authorized Signatory Sri Praveen Ghosh v. The State of Jharkhand in W.P.(C) No.6727 of 2010 which was allowed by the learned Single Judge and further that was challenged by the state of Jharkhand before the Division Bench in L.P.A. No.501 of 2012 and by the judgment dated 3.7.2014 the Writ Court order was partially allowed to the effect that capital subsidy was affirmed and for the rest of the claim, the matter was remanded back to the concerned authority of the State of Jharkhand. On these grounds, he submits that the Writ Petition may kindly be allowed and the appropriate direction may kindly be issued to provide the said subsidy to the petitioner.

Mr. Ashutosh Anand, the learned counsel for the respondent State opposed the prayer and submits that the authorities have rightly passed the order and that was opined by the Law Department, Government of Jharkhand, that the said Director (Industries) has got no power to review his own order and the first Consent to Operate was also not found to in accordance with law and there was delay of 24 days. He next submits that earlier the writ petition was already withdrawn by the petitioner and, in view of that, this writ petition may kindly be dismissed.

Mr. C.A. Bardhan, the learned counsel appearing on behalf of the respondent nos.5 and 6 submits that the Director (Industries), Government of Jharkhand, is having no power to review his own order and further the Consent to Operate was not found to be proper.

On query made by this Court, Mr. Bardhan, the learned counsel for the respondent nos.5 and 6 admits that the production certificate was issued to the petitioner on 03.01.2009 by way of Annexure -3 to the writ petition. He also submits that the committee has recommended the case of the petitioner further on 17.07.2013.

In view of the above submission of the learned counsels appearing on behalf of the parties and after going through the annexures annexed to the writ petition as well as the Policy produced before this Court, it transpires that the petitioner has gone for expansion of the said unit with permission of AIADA and filed application on 12.04.2008 to give the certificate by way of Annexure-1. In Annexure-3, which is a letter dated 03.01.2009, the AIADA has admitted that the production of the said unit was started by the petitioner on 29.02.2008. However, that was provided to the petitioner after more than 10 months of the application made by the petitioner, and in the meantime, the petitioner was compelled to file the application taking into account the limitation provided under Clause-IV(घ) in absence of the said certificate and later on, it was also pointed out by the Director (Industries), Government of Jharkhand to the AIADA and on query made by the AIADA, the petitioner has further provided the details to the AIADA and it was submitted before the Director (Industries), however, the same was rejected on the ground that it was filed after a delay of 24 days. It transpires that in passing of the said order, the Director (Industries) has not taken into consideration the correct spirit of Clause-IV(घ) as it also provides to condone the six months’ delay within further six months. The petitioner has, thereafter, filed a review petition before the competent authority and moved before this Court in W.P.(C) No.5803 of 2011 in which I.A has been filed disclosing that the grievance of the petitioner has been redressed, and in view of that, the writ petition was permitted to be withdrawn on 10.09.2012 whereas the Committee of the AIADA has already taken a decision in favour of the petitioner to recommend for providing such relief on 28.08.2012. Thus, the said application was filed bona-fidely in light of the Committee decision before this Court and pursuant to that, the said order, in the writ petition, has been passed. Thereafter, the impugned order has been passed on 26.10.2013 and the claim of the petitioner was rejected on the ground that the Director (Industries) is having no power to review his own order and the Date of Production [DOP] is not in accordance with the Consent to Operate [CTO].

In view of above background, it is crystal clear that the AIADA has admitted that the Unit has started its production on 29.02.2008. However, within the stipulated time, the petitioner has made the application before the AIADA and the AIADA sat over the matter and, thereafter, issued the Certificate on 03.01.2009 stating that the production was started on 29.02.2008. Thus, the petitioner is having no role in filing the said Certificate belatedly and for that, the responsibility is fastened upon the AIADA and subsequently, a review application has been filed by the petitioner and the AIADA Committee has taken a decision in favour of the petitioner on 28.08.2012 and the earlier writ petition was withdrawn on that ground by the order dated 10.09.2012.

Clause-IV(घ) of The Jharkhand Incentive Rules, 2003 stipulates as under:

On perusal of the above, it transpires that the application is required to be made within six months from the date of production, and for six months’ condonation, the further power is there with the authority concerned. The first application itself was filed within the period of condoning power of limitation, however, that has been rejected without complying the said condoning power.

So far as the irregularity relating to Consent to Operate [CTO] is concerned, that is also not coming to the way to allow the prayer of the petitioner as it has been pointed out that the petitioner is still operating the unit and the said Consent to Operate Certificate has not been cancelled by the competent authority till date.

The identical was the situation in the case of Kohinoor Steel Pvt. Ltd, through its Authorized Signatory Sri Praveen Ghosh v. The State of Jharkhand (supra) by which the learned Single Judge of this Court has allowed the writ petition which has been affirmed partially by the Division Bench of this Court in the aforesaid L.P.A. The case of the petitioner is fully covered in light of the Division Bench judgment of this Court, and as such, the Order dated 26.10.2013 as contained in Annexure-13 to the writ petition is, hereby, quashed.

Consequently, the Director (Industries), Government of Jharkhand/ Respondent No.4 is, hereby, directed to determine the amount of claim of the petitioner for having Capital Investment Incentive and take a decision in light of the recommendation made by the Committee of the AIADA Dated 28.08.2012 and ensure its payment within a period of 8 (eight) weeks from the date of receipt/ production of a copy of this order.

With the aforesaid direction, this petition being W.P.(C) No.2540 of 2014 is allowed and disposed of.

Pending petition, if any, also stands disposed of.