Gauhati High Court

Page No.# 1/ vs The Union Of India And 8 Ors on 6 February, 2025

Author: Devashis Baruah

Bench: Devashis Baruah

                                                                  Page No.# 1/11

GAHC010043922022




                                                            2025:GAU-AS:1370

                       THE GAUHATI HIGH COURT
  (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

                            Case No. : WP(C)/1633/2022

         JERICHO CHEMICALS LLP
         HAVING ITS REGD. OFFICE AT IIT ROAD, JAIGURI, VILL. NUMALIJULAH,
         NORTH GUWAHATI, KAMRUP (R), ASSAM-781031, REP. BY ITS
         DESIGNATED PARTNER, SRI ASHIS AGARWAL, S/O. SRI P.G. AGARWAL,
         R/O. G.N.B. ROAD, AMBARI, GUWAHATI-781001, KAMRUP (M), ASSAM.



         VERSUS

         THE UNION OF INDIA AND 8 ORS
         REP. BY THE SECRETARY, DEPTT. FOR PROMOTION OF INDUSTRY AND
         INTERNAL TRADE, HAVING ITS OFFICE AT UDYOG BHAWAN, NEW DELHI-
         110011.

         2:THE STATE OF ASSAM

          REP. BY THE PRINCIPAL SECRETARY TO THE GOVT. OF ASSAM
         INDUSTRIES AND COMMERCE DEPTT.
          ASSAM D-BLOCK
          3RD FLOOR
          ASSAM SECRETARIAT
          GUWAHATI-781006.

         3:THE COMMISSIONER OF INDUSTRIES AND COMMERCE

          UDYOG BHAWAN
          BAMUNIMAIDAM
          GUWAHATI-781021
          ASSAM.

         4:THE DIRECTOR OF INDUSTRIES

          UDYOG BHAWAN
                                                          Page No.# 2/11

BAMUNIMAIDAM
GUWAHATI-781021
ASSAM.

5:THE ADDL. DIRECTOR (UAZ)

OFFICE OF THE COMMISSIONER OF INDUSTRIES AND COMMERCE
UDYOG BHAWAN
BAMUNIMAIDAM
GUWAHATI-781021
ASSAM.

6:THE JOINT DIRECTOR OF INDUSTRIES (EXTN)

I/C DISTRICT INDUSTRIES AND COMMERCE CENTRE
(RURAL) MIRZA
781125
ASSAM.

7:THE GENERAL MANAGER

DISTRICT INDUSTRIES AND COMMERCE CENTRE
KAMRUP (R)
MIRZA
781125
ASSAM.

8:THE STATE LEVEL COMMITTEE UNDER THE FREIGHT SUBSIDY
SCHEME 2013
 REP. BY ITS CHAIRMAN
THE PRINCIPAL SECRETARY TO THE GOVT. OF ASSAM INDUSTRIES AND
COMMERCE DEPTT.
ASSAM D-BLOCK
 3RD FLOOR
ASSAM SECRETARIAT
 GUWAHATI-781006.

9:NORTH EASTERN DEVELOPMENT FINANCE CORPORATION LTD.
 (NEDFI) REP. BY ITS CHAIRMAN HAVING ITS OFFICE AT (NEDFI HOUSE)
 G.S. ROAD
 DISPUR
 GUWAHATI
ASSAM-781006
                                                                           Page No.# 3/11



       Advocates for the petitioner(s)      :     Mr. K Agarwal,
                                                   Senior Advocate
                                                   Mr. M Das


       Advocates for the respondent(s) :          Mr. A Kalita

Standing Counsel Industries and Commerce Mr. K Gogoi Central Govt. Advocate Mr. RK Bhatra For the NEDFi

Date of hearing & judgment : 06.02.2025

BEFORE HONOURABLE MR. JUSTICE DEVASHIS BARUAH

JUDGMENT & ORDER(ORAL)

Heard Mr. K Agarwal, the learned senior counsel assisted by Mr. M Das, the learned counsel appearing on behalf of the petitioner. I have also heard Mr. A Kalita, the learned Standing counsel for the Industries and Commerce Department, Government of Assam. Mr. K Gogoi, the learned counsel appears on behalf of the Union of India and Mr. RK Bhatra, the learned counsel appears on behalf of the North Eastern Development Finance Corporation Ltd. (for short 'the NEDFi').

2. The petitioner herein has challenged the communication dated Page No.# 4/11

15.09.2021/16.09.2021 issued by the Additional Director (UAZ) Office of the Commissioner of Industries and Commerce (for short, hereinafter referred to as 'the impugned order') on the ground that the said communication so issued was without taking into consideration the registration of the petitioner, i.e. M/s. JD Chemicals under the Transport Subsidy Scheme, 1971 vide the communication dated 15.03.2012 and the subsequent endorsement being made by the General Manager, District Industries and Commerce Centre that M/s. JD Chemical's name was changed to Ms. Jericho Chemicals Private Limited and further that Ms. Jericho Chemicals Private Limited was converted to Ms. Jericho Chemicals LLP.

3. The learned Senior Counsel appearing on behalf of the petitioner submitted that though in the instant writ petition, there was a mandamus sought for, thereby directing the respondents to forthwith release the transport subsidy to the petitioner under the Freight Subsidy Scheme 2013, the petitioner would not insist on the said prayer in the instant proceedings. But rather upon appropriate orders being passed in respect to the impugned communication, the petitioner would take appropriate steps before the concerned respondent authorities.

4. Taking into account the above, the limited question which arises before this Court is as to whether the grounds on which the petitioner's entitlement to the Freight Subsidy Scheme was negated vide the impugned communication was in accordance with the law?

5. From the materials on record, it is seen that that a partnership firm in the name of M/s. JD Chemicals was registered under the then existing Transport Page No.# 5/11

Subsidy Scheme and was allotted the Registration No.DICC/K-TS/11-12/621 dated 03.03.2012. In the said communication, it was mentioned that the commercial production had not taken place then and it was only proposed. The record further reveals that a company in the name of Jericho Chemicals Private Limited was incorporated and a certificate of incorporation was issued by the Registrar of Companies. On the basis thereof, from the very Certificate issued on 15.03.2012, it is seen that the General Manager, District Industries and Commerce Centre had made an endorsement that the name and style of M/s. JD Chemicals had been changed to Jericho Chemicals Private Limited. It is further seen that Jericho Chemicals Private Limited was again converted to Jericho Chemicals LLP and in that regard, a Certificate of Registration on conversion was given by the Registrar of Companies on 22.03.2018. On the basis thereof, an endorsement was made by the General Manager, District Industries and Commerce Centre in the communication dated 15.03.2012 to the effect of the change of the Unit name from Ms. Jericho Chemicals Private Limited to Ms. Jericho Chemicals LLP. Thereupon on 01.06.2019, a communication was issued to the petitioner herein, in connection with the Registration under the Freight Subsidy Scheme, 2013. In the said communication, it was mentioned that the Transfer Subsidy Registration of the Unit which was granted vide the communication dated 15.03.2012 was converted to registration under the Freight Subsidy Scheme, 2013 as a new unit and allotted Registration No. DI&CC/K-TS/11-12/821 dated 03.03.2012 (issued on 31.05.2019). It was also mentioned in the said communication that the date of commencement of commercial production was proposed.

6. It is relevant to take note of that the Transport Subsidy Scheme 1971, Page No.# 6/11

which was issued on the basis of a Notification dated 23.07.1971 was superceded by another scheme in the name and style of Freight Subsidy Scheme, 2013.

7. Clause-6 of the said Scheme related to the applicability. In terms with Sub- clause (1) of Clause 6, the scheme was applicable to all eligible industrial units, both in the public and private sectors, irrespective of their size, located in the selected areas and which commence commercial production within the period of validity of the scheme. In terms with Sub-clause (2) of Clause 6 of the said scheme, the subsidy will be admissible to eligible industrial units for a period of five years from the date of commencement of commercial production.

8. This Court further finds it relevant to take note of Clause 8 which relates to Registration under the Scheme. It was mentioned in Sub-clause (1) of Clause 8 that industrial unit, desirous of claiming subsidy under the Scheme, shall get registered with the District Industries Centre concerned, prior to the date of commencement of its commercial production for new industrial units or before undertaking substantial expansion for existing industrial unit. It is further mentioned in Sub-clause (2) of Clause 8 that the General Manager of the District Industries Centre concerned shall be the competent authority to issue the Registration Certificate.

9. Therefore, from a combined reading of the provisions of Clause 6 and Clause 8, it would be seen that the entitlement under the Freight Subsidy Scheme was dependent upon commencement of commercial production within Page No.# 7/11

the period of validity of the Scheme. It is further relevant to take note of that though as per Clause 4 of the Freight Subsidy Scheme, it was mentioned that the said scheme would automatically terminate after five years from the date of publication in the Official Gazette, but by the Notification dated 22.11.2016, the Government of India decided to discontinue with the Freight Subsidy Scheme, 2013 with immediate effect.

10. It is the case of the petitioner herein that although Clause 6 of the Freight Subsidy Scheme mentioned about the applicability of the scheme to eligible industrial units who have commenced commercial production within the period of the validity of the scheme i.e., on or before 22.11.2016, but by virtue of Clause 17, the petitioner herein was entitled to inasmuch as Clause 17 of the Freight Subsidy Scheme saved those industrial units which were registered under the Transport Subsidy Scheme, 1971. The learned Senior Counsel, therefore, submitted that the non-consideration of the respondent authorities as regards the changes being made to the communication dated 15.03.2012, insofar as, the registration of M/s. J D Chemicals and thereupon, M/s. Jericho Chemicals Private Limited and subsequently M/s. Jericho Chemicals LLP had affected the rights of the petitioner, insofar as, to claim the benefits under Clause 17 of the Freight Subsidy Scheme. The learned Senior Council further referred to the communication dated 01.06.2019 issued by the Joint Director of Industries (Extension) In-charge, District Industries and Commerce Centre Kamrup (Rural), Mirza, wherein it was also noted about the change in the constitution of the partnership firm and thereupon the Company and subsequently the LLP. The learned Senior Counsel, therefore, submitted that the rejection of the application of the claim of the petitioner on the basis of Clause 8 Page No.# 8/11

of the Freight Subsidy Scheme was totally contrary to the Freight Subsidy Scheme and as such required to be interfered with.

11. Per contra, Mr. A. Kalita, the learned counsel appearing on behalf of the respondents Industries and Commerce Department submitted that taking into account that the General Manager, Industries and Commerce Centre had categorically made the endorsement in the registration to the Transport Subsidy Scheme, the concerned respondent authorities ought to have taken into account the said aspect of the matter. He, however, submitted that Clause 17 of the Freight Subsidy Scheme would not aid the petitioner to receive any freight subsidy in terms with the Freight Subsidy Scheme 2013, inasmuch as, the petitioner commenced commercial production in the month of March 2017, which was much after the withdrawal of the Freight Subsidy Scheme 2013, by the communication dated 22.11.2016.

12. Mr. RK Bhatra, the learned counsel appearing on behalf of the respondent NEDfi submitted that he is only the disbursing authority and has, therefore, no role to play, more so, taking into account that the petitioner's limited prayer in the instant proceedings is only as regards the impugned communication dated 15.09.2021/16.09.2021 and not as regards seeking a mandamus from this Court regarding disbursal of the claims of the petitioner.

13. Mr. K Gogoi, the learned counsel appearing on behalf of the Union of India submitted that the Freight Subsidy Scheme 2013, although was initially for a period of five years, but the Government of India in its wisdom had decided to Page No.# 9/11

discontinue with it and for that a Notification was issued on 22.11.2016. He further submitted that taking into account that the petitioner herein had admittedly not gone for commercial production, during the period the Freight Subsidy Scheme, 2013 was in existence, the petitioner would not be entitled even to the Benefits under Clause 17 of the Freight Subsidy Scheme, 2013.

14. The learned counsels appearing on behalf of the parties were heard and the materials on record were perused. The limited aspect on which the instant writ petition is being taken up for disposal is as to whether the impugned communication is required to be interfered with?

15. This Court duly takes note of that the petitioner herein have claimed the benefits under Clause 17 of the Freight Subsidy Scheme, 2013 on the basis of a registration made under the Transport Subsidy Scheme 1971. Under such circumstances, the petitioner could not have been brought within the ambit of a new industrial unit as mentioned in Clause 8(1) of the Freight Subsidy Scheme, 2013. It is the opinion of this Court that the respondent Department i.e., the Industries and Commerce Department of the Government of Assam ought to have taken into consideration as to whether the petitioner in the extant facts would have been entitled to the benefits under Clause 17 of the Freight Subsidy Scheme read with the Notification dated 22.11.2016, whereby the Freight Subsidy Scheme, 2013 was withdrawn with immediate effect.

16. However, from a perusal of the impugned communication, it is seen that the impugned communication merely rejects the entitlement of the petitioner on the basis of Clause 8 of the Freight Subsidy Scheme, 2013 without taking into Page No.# 10/11

consideration as to whether, the petitioner would be entitled to in terms with Clause 17 of the Freight Subsidy Scheme, 2013. Accordingly, the impugned communication dated 15.09.2021/16.09.2021 issued by the Additional Director (UAZ) of the Office of the Commissioner of Industries and Commerce, Assam is required to be interfered with.

17. Accordingly, the writ petition stands disposed of with the following observation(s) and direction(s):

(i). The impugned communication dated 15.09.2021/16.09.2021 issued by the Additional Director (UAZ) Office of the Commissioner of Industries and Commerce is set aside and quashed.

(ii). The respondent authorities shall carry out the exercise as to whether the petitioner would be entitled to in terms with the Freight Subsidy Scheme, 2013 having been already registered under the Transport Subsidy Scheme in terms with the provisions of the Freight Subsidy Scheme, 2013 and further taking into account that the Freight Subsidy Scheme 2013 was discontinued vide the Notification dated 22.11.2016.

(iii). This Court has not expressed any opinion as to whether the petitioner herein would be entitled to the benefits under Clause 17 of the Freight Subsidy Scheme, 2013, it shall be absolutely within the wisdom of the concerned respondent authorities to adjudge and adjudicate the entitlement of the petitioner on the basis of the Freight Subsidy Scheme, 2013 read with the Notification dated 22.11.2016.