14-05-2025
Setback for Himachal govt as HC quashes key clauses of industrial policy
Shimla: In a setback to the Himachal Pradesh govt, the state high court set aside clause 5B of The Himachal Pradesh Industrial Investment Policy, 2019' along with rule 4B(b) and 4(F) of the 'Rules Regarding Grant of Incentives, Concessions and Facilities for Investment Promotion in Himachal Pradesh-2019'.
The court observed that these rules are inconsistent with the industrial policy and wrongfully deny a 15% promised rebate on electricity charges to industries due to "bureaucratic lethargy""The state govt cannot speak in two voices. Once the govt has taken a policy decision to extend certain benefits to the petitioner (industry), the same cannot be withheld simply for want of notification," held a division bench comprising Justice Tarlok Singh Chauhan and Justice Sushil Kukreja, in a judgment having wide ramifications. The bench, while allowing a petition moved by Kundlas Loh Udyog of Barotiwala in Solan district, directed the state govt to issue the enabling notification in terms of the incentive of a 15% concession in electricity charges under clause 16 (A) of the Industrial Policy, 2019 with effect from the date commercial production started by the petitioner within a period of four petitioner industrial unit had submitted before the high court that the state govt, on August 16, 2019, notified 'The Himachal Pradesh Industrial Investment Policy, 2019', assuring the eligible enterprises that they would be charged 15% less energy charges if they do substantial expansion in accordance with the 'Rules regarding Grant of Incentives, Concessions and Facilities for Investment Promotion in Himachal Pradesh-2019'. The petitioner said that despite fulfilling all the criteria under the policy and bringing the issue to the notice of the chief minister, the state govt has not fulfilled its promise to state govt took a stand that the petition is not maintainable as the petitioner industrial unit cannot claim the incentive of a concessional rate of electricity charges under Rule 16(i)(a) as a matter of right, and Rule 4-F specifically provides that incentives are provided under the discretionary powers of the state govt and do not create any claim or right against the govt. But, the division bench held that the state govt is bound by the promise so held out on the doctrine of promissory estoppel. "The doctrine of promissory estoppel consists of ingredients of promise and estoppel like equity. The doctrine has been introduced to reduce the rigor of the common law as well as the statutory law. Equitable estoppel yields a remedy in order to prevent unconscionable conduct on the part of the party who, having made a promise to another acts on it to his detriment, seeks to resile from the promise," emphasised the division bench also noted that it is not in dispute that the state industries department had itself issued the certificate of commercial production in favour of the petitioner industrial unit on Feb 12, 2021, wherein it is certified that the petitioner made a substantial investment of Rs 8.07 crore in plant and machinery and thus made a total expansion of Rs 17.18 crore, which was to the tune of 88.69% though the required eligibility as per the policy was only 25%. "The petitioner admittedly did substantial expansion in terms of the policy, but the state has 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 erstwhile clause 16 (A) are being withheld from the petitioner, even though no reasons for the same are forthcoming in the reply, which would only show bureaucratic lethargy," underlined the division 121166239 413 |
