THE HON’BLE Dr.JUSTICE G.YETHIRAJULU W.P. No.19412 of 2003 ORDER: This Writ Petition is filed by the petitioner seeking to declare that the action of the third respondent in not granting final approval to the petitioner for the establishment of 6.00 M.W. Biomass Power Project in Ramachandrapuram, East Godavari District, as illegal, arbitrary, unjust and violative of Article 14 of the Constitution of India and consequently to set aside the letters dated 12-07-2002 and 25-01- 2003 as illegal and direct the respondents to grant two years time for implementing project by extending various incentives in terms of G.O. Ms. No.147 Energy (Res) Department, dated 15-11-1995, G.O.Ms. No.93 Energy (Res) Department, dated 18-11-1997 and G.O. Ms. No.112 Energy (Res) Department, dated 22-12-1998. 2. The averments of the affidavit filed in support of the petition are briefly as follows: The petitioner is a Public Limited Company with its registered office at Kurnool. The Government of A.P. took a policy decision to permit the private entrepreneurs to set up wind farm projects in private sector by offering various incentives to those industries set up in private sector. The incentives were also extended to projects which generated non-conventional energy from biomass, municipal waste, mini hydle etc. In pursuance of the policy of the Central Government to encourage private sector for production of non- conventional energy, wide publicity was given by the third respondent requiring interested entrepreneurs to make applications. In response to the above, the petitioner made an application. The petitioner submitted the required information and also the information relating to the availability of biomass in East Godavari District. The third respondent in its meeting held on 14-06-2000 decided to allocate 6 M.W. project in East Godavari District to the petitioner and the said decision was communicated through the letter dated 29-06-2000 and required the petitioner to submit a detailed project report, but subsequently to the surprise of the petitioner a letter dated 12-07-2003 was received from the third respondent informing that the third respondent is not considering for the sanction of the power project in view of the reservations made by MNES, Government of India. The petitioner made a detailed representation on 25-10-2002 to the third respondent and requested to agree for final approval. On 21-01-2003 also the petitioner submitted another letter wherein the petitioner has brought to the notice of the Chairman of the third respondent that it has been allotted firewood to an extent of 5000 cmt by A.P. Forest Development Corporation from Rajahmundry region and the said allocation of firewood is sufficient to meet the requirement of 6 M.W. Biomass Power Project, which is proposed to be set up by the petitioner. On 03-02-2002, the petitioner gave a detailed representation about the steps taken by the petitioner in response to the promise made by the Government and the third respondent and required the third respondent to keep the matter before the Board of Directors for its decision. So far the matter has not been placed before the Board of Directors. Hence, the petitioner is being put to serious loss and irreparable damage. Having granted necessary permission on 14-06-2000, the third respondent cannot resile from its promise and now refuse to grant final approval without there being any basis. The reasons for refusal of final approval by the third respondent is unknown and undisclosed, except mentioning about some reservations of MNES, Government of India. After 12-07-2002, the third respondent has issued final approval for 5 M.W. project to Vamshi Industries Limited; 4.50 M.W. project to Sudha Agro & Chemical Industries Limited; 6.00 M.W. project to Sree Papers Limited and 6.00 M.W. project to B.B.S. Power Project. Apart from the above industries, various existing industries are granted permission for additional capacity. Therefore, it is surprising as to how the third respondent can refuse final approval on the alleged reservations made by the MNES, Government of India. The refusal of final approval to the petitioner by the third respondent is irrational, capricious, arbitrary and unjust. The petitioner is discriminated in the matter of grant of final approval. The respondents 1 to 3 are estopped from going back on the promises and assurances made by them, as the petitioner spent about Rs.50,00,000/- on the land cost, besides Rs.20,00,000/- for other expenses. Hence, the action of the third respondent is not according to the principles of law and the affected party can invoke doctrine of Promissory Estoppel. Therefore, the writ petition for the reliefs as mentioned above. 3. The second respondent filed a counter mentioning that it has no role in issuing approval for setting up biomass power project to the petitioner. Non-Conventional Energy Development Corporation of Andhra Pradesh Limited is the nodal agency for sanctioning of Non- Conventional Energy Projects. For setting up of biomass power project, NEDCAP will examine the Detailed Project Report submitted by the petitioner and also availability of biomass in the District keeping in view of the district level sanctioning ceiling limit as assessed and fixed by the State Level Committee and after satisfying the above it will issue permission for setting up of the project. The A.P. Electricity Regulatory Commissioner reviewed the incentives available to NCE projects and passed order in O.P. No.1075 of 2000, dated 20-06-2001, refusing certain incentives. The order of APERC has been challenged by some of NCE Developers in the High Court of A.P. and the matter is pending consideration. The commission has already initiated proceedings for review of the incentives announced in O.P. with effect from 01-04-2004. In the light of the above circumstances, the second respondent requested not to consider the prayer of the petitioner for extending the incentives referred by them. 4. The third respondent filed a separate counter wherein it was contended that the petitioner has applied for permission to set up 6.25 M.W. capacity Biomass Power Project at Ramachandrapuram and the petitioner was requested to furnish the intimation, including the Detailed Project Report. The petitioner revised the application to 13.5 M.W. capacity, instead of 6.25 M.W. capacity as initially applied. As the sanction on the Biomass Power Project is linked to the availability of the Rice Husk, the details to this effect are obtained from the company. The State Level Committee on Biomass assessment had assessed the biomass availability in the East Godavari District and the power generation capacity that can be taken up with the available biomass is fixed as 15.25 M.W. A capacity of 12.00 M.W. has already been sanctioned before the application of the petitioner, therefore, the company was requested to reduce the project capacity as the remaining capacity in the District is only 3.25 M.W. In response, the company has informed that it would not be possible to reduce the capacity and requested to keep their application in the waiting list. During the meeting held on 14-06-2000 at NEDCAP office, it was decided formally to allocate 6.00 M.W. capacity project to the petitioner and the company was requested to revise their application to 6.00 M.W. capacity and submit the Detailed Project Report to consider for sanction of the project by placing the matter before the Board of Directors Meeting of NEDCAP, which is the competent authority to sanction the NCES based power projects. The company has furnished the revised application for 6.00 M.W. capacity on 04-07-2000 and Detailed Project Report on 24-08-2000 and the contents of the Detailed Project Report were further revised through the letter dated 23-11-2000. The company also furnished the other information like Memorandum of Articles, High Court order approving the amalgamation vide letter, dated 06-02-2001. The third respondent further contended that the site for the proposed project was acquired by the company without obtaining the final approval for the project by NEDCAP. MNES, Government of India has taken up Biomass assessment study in A.P. through Administrative Staff College of India. In the assessment study conducted by ASCI, the Biomass power potential in the state was estimated at 224.43 M.W. The report was submitted in the month of March, 2002. The potential estimated by ASCI is far below the potential estimated at 448.50 M.W. by the Expert Committee during March, 1997. 356 M.W. capacity Biomass based power projects were sanctioned by NEDCAP before the submission of the Biomass Assessment Report by ASCI. The Secretary, MNES, Government of India, in his D.O. letter No.8/4/2000- CPG, Dated 18-09-2001 addressed to the Chief Secretary, Government of Andhra Pradesh communicated that the main finding of the rapid survey is that no further Biomass power projects should be sanctioned by NEDCAP in the State and the Ministry decided to continue the temporary embargo on sanction of the power projects by India Renewable Energy Development Agency (IREDA) until further orders. The meeting was conducted by the Hon’ble Union Minister for State (NCES) on 14-03-2002 wherein it was suggested that future Biomass based power projects needs to be carefully reviewed. In view of the directions of the MNES and the limited Biomass power potential, NEDCAP had decided not to sanction any further Biomass based power projects in the State. The petitioner was also informed on 12-07-2002 that their application for sanction of 6 M.W. Biomass Power Project would not be considered for sanction. The same was reiterated to the company vide letters dated 03-10-2002 and 25-01- 2003. 5. The third respondent further contended that the NEDCAP is not responsible for the initial investments made by the company without obtaining approval from NEDCAP and without entering any Memorandum of Understanding. The petitioner was not granted any permission and it was only agreed in principle to consider for according the permission. But, in view of the directions from MNES, the proposal is not placed before the Board of Directors, which is the authority to sanction the power projects. The third respondent further contended that the NEDCAP accorded sanction to M/s.Vamshi Industries Limited for 4.00 M.W. on 21-09-1998; M/s.Sudha Agro & Chemicals Limited for 4.00 M.W. on 21-09-1998 and M/s.Shree Papers Limited for 4.00 M.W. on 03-05-1999. The allotments made to the above companies were prior to the finalization of the proposal of the petitioner. The power project based on captive generation of fuel was sanctioned to M/s. BBS power projects on 24-06-2002 and it cannot be considered as power project sanctioned based on the Biomass availability in the District. There were 26 proposals aggregating to a capacity of 146.60 M.W. pending with NEDCAP and in view of the directions of MNES, no further sanction of power project was granted to any one of the project promoters. It was further contended by the third respondent that when there was a request to the petitioner to submit a revised application along with Detailed Project Report to place it before the Board of Directors of NEDCAP, there was delay on the part of the petitioner to furnish these details and other details, therefore, NEDCAP could not take action on the proposals to place before the Board of Directors to take final decision and in view of the directions issued by MNES, 26 proposals pending with NEDCAP for sanction of power projects to a capacity of 146.60 M.W., including the petitioner’s proposal, were not considered. No discrimination was made and no injustice was done to the petitioner, as the NEDCAP could not consider sanction of Biomass Power Project to anyone of the similarly pending project proposals and acted only as per the directions of MNES, Government of India, to safeguard the interests of the projects that were sanctioned earlier, as the Biomass availability will become difficult and operation of the projects will become economically not viable. Therefore, the third respondent requested to dismiss the Writ Petition in the interest of justice. 6. In the light of the contentions raised by the petitioner, the point for consideration is, Whether the petitioner is discriminated in according sanction to the Biomass Power Project when similarly placed applications were cleared by sanctioning the projects? 7. It is the contention of the petitioner that the companies mentioned in the affidavit were granted permission to set up Biomass Power Projects on the basis of the applications subsequent to the application by the petitioner and it is the further contention of the petitioner that various existing industries are also granted permission for additional capacity. 8. Sri D.V. Nagarjuna Babu, the learned counsel for the petitioner, submitted that when there is no availability of sufficient Biomass, how could the NEDCAP grants permission for additional capacity to the existing industries and how could the third respondent refuse final approval to the petitioner, while granting final approval for new projects. Therefore, the orders passed by the third respondent are irrational, capricious, arbitrary and unjust and discriminated in the matter of granting final approval for setting up the Biomass Power Project. Therefore, he requested the Court to direct the third respondent to accord final approval to the proposal of the petitioner and other consequential reliefs. 9. It is an undisputed fact that the petitioner made its first application for 6.25 M.W. on 26-09-1997 and when the third respondent requested the petitioner through its letter, dated 03-10- 1997, to furnish a Detailed Biomass Assessment Study Report, the petitioner submitted a revised application on 13-04-1998 to set up 13.5 M.W. Biomass Power Project. The petitioner on 18-08-1998, submitted Detailed Project Report for 13.5 M.W. Power Project. When NEDCAP informed about the non-availability of Biomass to the extent of the proposal made by the petitioner and requested to reduce the capacity of the project, the petitioner requested the third respondent to accord sanction and on that basis the third respondent in its meeting held on 14-06-2000 decided to allocate 6.00 M.W. Biomass based Power Project to the petitioner with the following resolution: “It was decided to allocate 6 M.W. Biomass Based Power Project in East Godavari District to M/s. Sree Rayalaseema Petrochemicals Limited” 10. The third respondent addressed a letter Ref. No.NEDCAP/PD/5491/97-98/1309 dated 29-06-2000 to the petitioner informing that during the meeting held on 14-06-2000 it was agreed to allocate 6 M.W. Biomass Based Power Project to M/s.Sree Rayalaseema Petrochemicals Limited, Hyderabad, in East Godavari District. The petitioner was requested to submit the Detailed Project Report along with quotations for purchase of equipment to take further action from their end. The petitioner submitted necessary data as required by the third respondent pursuant to the approval given by the third respondent on 14-06-2000. The sequence of events indicate that the proposal of the petitioner could not finalize before the year 2000. The petitioner did not give specific dates on which the third respondent accorded permission to four companies referred in para 5 of the affidavit, but the respondent gave the dates of approval of 1 to 3 companies and the fourth company was not based on Biomass, though the sanction was accorded to it on 24-06-2002. On the submissions made by the third respondent with specific dates, it can be said that no application for sanction of Biomass power project by other applicants were considered after the final proposal submitted by the petitioner. Therefore, it cannot be said that the impugned order of the respondent is hit by Article 14 of the Constitution of India and it cannot be treated as arbitrary and illegal on this ground. 11. The learned counsel for the petitioner further submitted that the third respondent, having given the initial approval for setting up 6.00 M.W. project, is not justified in refusing the final approval, having made the petitioner to invest so much money for acquiring the land and for other purposes. 12. The learned counsel for the third respondent submitted that in the light of the instructions from MNES, Government of India, through the letter dated 18-09-2001, no further Biomass Power Project could be sanctioned by the third respondent and the Ministry has decided to continue the temporary embargo on sanction of the power projects till further orders. That was also communicated to the petitioner and other applicants. It is not the case of the petitioner that the decision of MNES, Government of India, is not binding on the third respondent. Therefore, it is the specific contention of the third respondent that after receipt of the communication from MNES, Government of India, no project was cleared out of 26 applications pending with the third respondent, including the application of the petitioner. Though the petitioner has been contending that irreparable loss has been caused to it, but no specific instance has been quoted that the third respondent cleared any project out of 26 applications pending with it and the petitioner is discriminated. 13. In the light of the above circumstances, I do not find any force in the ground raised in the Writ Petition. Therefore, no relief can be granted to the petitioner. 14. In the result, the Writ Petition is dismissed, however, the petitioner is at liberty to pursue the matter as and when there is clearance from MNES, Government of India, or in the event of clearance of any application out of 26 applications pending with the third respondent. No order as to costs. ____________________ Dr.G.YETHIRAJULU, J. Dated -06-2008 skmr