THE HON’BLE SRI JUSTICE VILAS V. AFZULPURKAR W.P. NO. 23373 of 2014 Date of Judgment: 21.10.2014 Between:
Varun Industries And …Petitioner State of A.P. and others ..Respondents THE HON’BLE SRI JUSTICE VILAS V. AFZULPURKAR W.P. NO.23373 OF 2014 ORDER:
This writ petition is filed questioning the order dated 2.12.2013 passed by the Additional Director of Industries, A.P., Hyderabad canceling the incentives sanctioned and released to the petitioner’s unit and consequential orders dated 6.1.2014 and 11.7.2014 passed by the third respondent requiring the petitioner to pay the amounts found due to the Government, failing which further proceedings under the Revenue Recovery Act will be taken.
The facts, in brief, are that the petitioner who belongs to scheduled caste community established a small scale industry at Pothepalli village, Machilipatnam Mandal, Krishna district in the year 2009. The petitioner approached the fourth respondent-bank for financial assistance and he was also extended and sanctioned capital investment subsidy of Rs.38,31,360/- under Industrial Investment Promotion Policy-2005-2010. On 29.3.2010 on the request of the petitioner, first instalment was released and subsequently second instalment was also released. The petitioner then claimed for third instalment of subsidy which was pending and not paid to the petitioner. At that stage, the order dated 2.12.2013 came to be passed canceling the very incentives sanctioned and released to the petitioner. The impugned order refers to the inquiries and investigations made by Multi Disciplinary Committee (MDC) and also to serious allegations against the petitioner’s unit, particularly with reference to the machinery claimed by the petitioner for the purpose of getting eligibility for the said subsidy and by the said impugned order, the third instalment of subsidy was not released, while the entire grant of incentive already sanctioned and released was withdrawn and cancelled. The said order is, therefore, questioned in this writ petition inter alia on the ground that it was passed without giving notice and opportunity of hearing to the petitioner.
Counter-affidavit is filed by the respondents 1 to 3 supporting the impugned order and the same is said to be based on joint inspection report of MDC which is stated to have examined the petitioner’s unit, on 10.1.2013 and based on verification of the bills and invoices of the machinery and other inquiries, it was found by the said MDC that the petitioner’s unit was established with some old refurbished machinery items and all the invoices and bills are bogus and no taxes were paid to the Government. Keeping in view the said report of the MDC, the impugned order was passed.
I have heard learned senior counsel appearing for the petitioner as well as learned Government Pleader for Industries and Commerce appearing for the respondents and perused the respective pleadings.
It is not, however, discernible from the counter- affidavit that the petitioner was given any notice before the order canceling the investment subsidy was passed on the aforesaid ground. The said ground remains uncontroverted and the fact that the petitioner was not given any notice and opportunity of hearing to defend the conclusions reached against him by the MDC, stands established and therefore, the impugned order which results in serious consequences cannot be sustained and it is accordingly set aside along with consequential orders passed by the respondents. However, this will not preclude the respondents from passing fresh orders in accordance with law after giving notice, taking explanation from the petitioner and hearing him. The petitioner is at liberty to raise all his contentions in the explanation.
The writ petition is accordingly allowed. Miscellaneous applications, if any, shall stand closed. No order as to costs.
VILAS V. AFZULPURKAR, J Dt. 21.10.2014 KR