IPA without Financial Cap for Mega Projects: Calcutta HC Upholds Birla Corporation’s Claim under West Bengal Incentive Scheme
In a significant ruling, the Calcutta High Court dismissed the appeal of the State of West Bengal, affirming the entitlement of Birla Corporation Ltd. (BCL) to Industrial Promotion Assistance (IPA) under the West Bengal Incentive Scheme, 2000 (WBIS, 2000), without any financial cap. The bench, comprising the Hon’ble Chief Justice T. S. Sivagnanam and the Hon’ble Justice Hiranmay Bhattacharyya, pronounced the judgment on April 9, 2024, in the case involving the State of West Bengal and Birla Corporation Ltd.
Legal Point:
The core legal issue revolved around BCL’s eligibility for IPA as a Mega Project under the WBIS, 2000. The dispute centered on whether the IPA for BCL had a financial cap, particularly in light of the special package for Mega Projects.
Facts and Issues:
BCL set up a cement manufacturing unit in Durgapur, eligible under the WBIS, 2000 as a Mega Project. The State, in 2023, rejected BCL’s claim for additional IPA, stating that all due amounts had been disbursed and capping the incentives at the Fixed Capital Investment (FCI) limit. This led to the present legal challenge.
Court Assessment:
Mega Projects Special Package: The court observed that the special package for Mega Projects, like that of BCL, allows IPA without any financial cap, different from other terms of WBIS, 2000.
No Financial Cap on IPA: It was held that there was no overall financial cap on BCL’s IPA under the special package. The court found the State’s imposition of a cap based on Fixed Capital Investment to be an impermissible addition to the package.
Eligibility under WBIS, 2000: The court affirmed BCL’s entitlement to IPA as per the special package, ruling that BCL’s claim cannot be assessed under the WBIS, 2004 guidelines, as its benefits were claimed under the WBIS, 2000.
Direction for Disbursement: The court directed the State to disburse admitted amounts for 2010-11, 2011-12, and 2012-13. Additionally, the State was instructed to verify claims for 2013-14, 2014-15, and part of 2015-16, and disburse any entitled amounts.
Decision: The appeal of the State of West Bengal was dismissed, and the orders of the Principal Secretary were quashed for lacking relevance and basis. BCL’s entitlement to IPA under the special package was unequivocally affirmed.
Date of Decision: April 9, 2024
State of West Bengal & Anr. Vs. Birla Corporation Ltd. & Ors
