The Hindu Business Line : ‘Blue metal crushing small-scale units can’t demand capital subsidy’

Chennai, Feb. 4 Blue metal crushing units in the small scale sector, which are ‘conventional and resource based’, are not eligible to avail themselves of 15 per cent capital subsidy (area subsidy) as per the policy decision taken by the Standing Committee on Incentives to Industrial Promotion, the Madurai Bench of the Madras High Court has ruled.

Dismissing a writ petition by the owner of Saravanan Blue Metals, challenging the order dated October 26, 2004, of the District Industries Centre, Tirunelveli, which rejected his application for capital subsidy as the unit was located in a backward taluk, Mr Justice K. Chandru said that the standing committee which took the decision, not only dealt with blue metals crushing industries, but various other factories also. Hence, it (GO) could not be split into two portions by holding that reasons stated by the standing committee would apply only to future applicants and not to the existing units.

The petitioner had submitted that the minutes of the meeting of the standing committee held on October 7, 2002, would apply only to future applicants, and not to the petitioner herein. He further contended that the concept of legitimate expectation would apply in case of his unit, which was started in the backward taluk.

He contended that he was eligible for capital subsidy on the unit’s fixed assets. The judge said that the respondents had taken a policy decision at the meeting of the standing committee. It could not be stated that the State had taken any wrong decision. The Court could not, therefore, issue any direction to the respondents as prayed for by the petitioner, the judge held and dismissed the writ petition.

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