Case: M/S. Jai Beverages Pvt. Ltd Vs. State Of J.&amp;K.

the investment was to the tune of over Rs.27 crores by 30th September, 2000. 34. It will be seen from the Memorandum of Understanding that the appellant was to start manufacture of soft beverages in the existing built up accommodation by the end of March, 2000 and complete the minimum capital investment of Rs. 25 crores or more latest by 30th September, 2000. Mr. Rohtagi, learned senior counsel appearing on behalf of the State, also could not dispute the fact that the appellant had invested a sum of Rs.27.11 crores as on September 30, 2000. This fact is admitted in the order of the Director, Industries and Commerce dated December 12, 2000 which declared the appellant as a "prestigious unit". It also appears from the same order that the matter had been examined by the General Manager, District Industries Center, Jammu and J&K State Industrial Development Corporation Ltd. This was also supported by a certificate issued by the Chartered Accountants of the appellant which had been authenticated by the General Manager, District Industries Center, Jammu. This is also apparent from the two certificates issued by the General Manager, District Industries Center, Jammu and J&K State Industrial Development Corporation Ltd. as also from the communication dated April 25, 2000 of the Industries and Commerce Department recommending that SRO be issued permitting the appellant to avail of incentives as a "prestigious unit" from the date of commercial production. Thus it would appear that the Government took a conscious decision to permit the appellant to complete the minimum capital investment of Rs. 25 crores latest by September 30, 2000. It also appears from the letter of the Industries and Commerce Department dated April 25, 2000 that while discussing the proposal of the appellant it was felt that a liberal view needs to be taken of the policy to the extent that if the investment of Rs. 25 cores or more materializes within the maximum period of 6 months from the date of commercial production, the appellant should be given the benefits of the incentives. This proposal had the approval of the Finance department as also the approval of the Cabinet, which did not consider it as a departure from the policy announced. 35. All these facts, therefore, lead to the only conclusion that having considered its new Industrial Policy, and having considered the proposal made by the appellant, the Government took a conscious decision to grant the package of incentives to the industrial unit being set up by the appellant provided it went into commercial production by the end of March 2000 and made the necessary investment of Rs. 25 crores or more on or before September 30, 2000. 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 cannot be permitted to ignore its own conscious decision to permit the appellant to invest a sum of Rs. 25 crores or more by September 30, 2000. The appellant acted on the basis of the decision taken by the State Government and incorporated in the Memorandum of Understanding. The fact that Rs.25 crores was invested by September 30, 2000 was not disputed in the several counter-affidavits filed before the High Court. In view of the voluminous evidence on record the State cannot dispute the fact that over Rs.27 crores was invested by the prescribed date i.e. by September 30, 2000. In this background, the State cannot be allowed to say that the incentives cannot be extended to the industrial unit set up by the appellant because the amount of Rs.25 crores or more was not invested by the date the unit went into commercial production, though the amount of Rs.27 crores was invested within the period prescribed by the Government as incorporated in the Memorandum of Understanding. 36. We, therefore, find no substance in the objection of learned senior counsel appearing on behalf of the State of Jammu and Kashmir that the appellant had not fulfilled the requirement of making the investment of Rs.25 crores or more by the date it went into commercial production. As we have noticed the Government itself was of the view that within the framework of the policy formulated by it, it was permissible to prescribe a time schedule within which the investment of Rs.25 crores or more was to be made. Accordingly it required the appellant to invest a sum of Rs.25 crores or more before September 30, 2000 which the appellant did. We have also not been shown anything in the Policy or in the Notifications issued pursuant thereto, prescribing any date for the capital investment of Rs.25 crores or that within the framework of the policy, the State Government was not entitled to prescribe a date by which the investment of Rs.25 crores or more should be made. 37. In view of our findings that the negative list concept does not apply to prestigious industrial units and that the industrial unit set up by the appellant fulfilled all the conditions laid down in the Governments new Industrial Policy and the notifications issued in connection therewith, it must be held that the appellant is entitled to the package of benefits promised by the new Industrial Policy of the State of Jammu & Kashmir read with various notifications issued pursuant thereto. 38. The question as to whether the certificates issued by the SIDCO or by the Department of Industries and Commerce are valid, or whether the declaration made by the Industries and Commerce Directorate by its order dated December 12, 2000 declaring the appellant a "prestigious unit" is binding on the State Government, has no significance. The appellant having fulfilled all the conditions which it was required to fulfil is entitled to the benefits promised to "prestigious units" under the States new Industrial Policy (1998- 2003). 39.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]All these facts, therefore, lead to the only conclusion that having considered its new Industrial Policy, and having considered the proposal made by the appellant, the Government took a conscious decision to grant the package of incentives to the industrial unit being set up by the appellant provided it went into commercial production by the end of March 2000 and made the necessary investment of Rs. 25 crores or more on or before September 30, 2000. 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 cannot be permitted to ignore its own conscious decision to permit the appellant to invest a sum of Rs. 25 crores or more by September 30, 2000. The appellant acted on the basis of the decision taken by the State Government and incorporated in the Memorandum of Understanding. The fact that Rs.25 crores was invested by September 30, 2000 was not disputed in the several counter-affidavits filed before the High Court. In view of the voluminous evidence on record the State cannot dispute the fact that over Rs.27 crores was invested by the prescribed date i.e. by September 30, 2000. In this background, the State cannot be allowed to say that the incentives cannot be extended to the industrial unit set up by the appellant because the amount of Rs.25 crores or more was not invested by the date the unit went into commercial production, though the amount of Rs.27 crores was invested within the period prescribed by the Government as incorporated in the Memorandum oftherefore, find no substance in the objection of learned senior counsel appearing on behalf of the State of Jammu and Kashmir that the appellant had not fulfilled the requirement of making the investment of Rs.25 crores or more by the date it went into commercial production. As we have noticed the Government itself was of the view that within the framework of the policy formulated by it, it was permissible to prescribe a time schedule within which the investment of Rs.25 crores or more was to be made. Accordingly it required the appellant to invest a sum of Rs.25 crores or more before September 30, 2000 which the appellant did. We have also not been shown anything in the Policy or in the Notifications issued pursuant thereto, prescribing any date for the capital investment of Rs.25 crores or that within the framework of the policy, the State Government was not entitled to prescribe a date by which the investment of Rs.25 crores or more should beview of our findings that the negative list concept does not apply to prestigious industrial units and that the industrial unit set up by the appellant fulfilled all the conditions laid down in the Governments new Industrial Policy and the notifications issued in connection therewith, it must be held that the appellant is entitled to the package of benefits promised by the new Industrial Policy of the State of Jammu & Kashmir read with various notifications issued pursuantquestion as to whether the certificates issued by the SIDCO or by the Department of Industries and Commerce are valid, or whether the declaration made by the Industries and Commerce Directorate by its order dated December 12, 2000 declaring the appellant a "prestigious unit" is binding on the State Government, has no significance. The appellant having fulfilled all the conditions which it was required to fulfil is entitled to the benefits promised to "prestigious units" under the States new Industrial Policy (1998- 2003).