Govt cannot back out from a conscious decision taken by it

New Delhi, May 28 (UNI) The Supreme Court has held that the government can not back out from a conscious decision taken by it.

The ruling came on May 12 while setting aside the J&K high court judgment dismissing the writ petition filed by the appellant M/s Jai Beverages Pvt Ltd(JBPL) challenging the state government order denying the benefits of J&K Industrial policy giving exemption to 'prestigious units' investing Rs 25 crores or more from the General Sales tax and Central Sales Tax.

The appellant company JBPL which started commercial production from March 2000 was permitted to invest Rs 25 crores latest by Sept 30, 2000 to get exemptions announced by the state government for Prestigious units.

Later on when the appellant company invested over Rs. 27 crores the state government changed its mind and declined to grant exemptions to the appellant from payment of General and Central sales tax and insisted on payment of the same.

A three judge bench of the Supreme Court comprising Mr Justice B P Singh, Mr Justice Tarun Chatterjee and Mr Justice Altamas Kabir observed, "The documents and material on record disclose that the government took this decision after full discussion on all aspects of the matter and in particular by reference to the date by which the appellant was required to invest Rs 25 crores in the industrial unit being set up by it. The state can not be permitted to ignore its own conscious decision to permit the appellant to invest a sum of Rs 25 crores or more by Sept 30, 2000." Acting on the decision of the state government the appellant set up a soft beverages manufacture and bottling plant with a capacity of approximately 800 bottles per minute in Jammu.

The Supreme Court while allowing the appeal of JBPL declared that the appellant company was entitled to all incentives and subsidies applicable to 'prestigious units' under the new Industrial Policy announced on May 27, 1998 described the change of mind by the state government as unreasonable. The incentives were available for five years as per the state's new industrial policy.

UNI AKS/SC RP GC1119