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TMI Blog2012 (1) TMI 47X X X X Extracts X X X X X X X X Extracts X X X X ..... ion. 5. The Scheme envisaged grant of Sales Tax incentives by way of Sales Tax Exemption or Sales Tax Deferment or Composite Schemes, for Premier/Prestigious Units according to the location, investment and status of the project. Essar fell in the category of premier unit i.e. new industrial unit having a project cost of more than Rs.1,000/- crores and employing 100 workers on a regular basis and following the employment policy of the State Government. Clause (v) of the Scheme defined premier unit in the following terms:- "(v) PREMIER UNIT A new industrial unit or industrial complex fulfilling the following criteria will be considered for granting status of a "Premier Unit". (a) The industrial unit shall have a project cost of Rs.500 crores or more. Such units having project cost of Rs.1,000 crores and above shall be entitled for extended period to avail incentive as provided under para 6 B. (b) Only one unit per taluka will be eligible for the Premier Unit status. In banned area no unit is permitted. (c) The unit shall employ at least 100 workers on a regular basis and shall follow the employment policy of the State Government." 6. P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial production on or before 15th February 2003. Such units shall have to apply to industries Commissioner for extending date of commercial production by 31st August 2000." 10.A High Power State Level Committee (hereinafter "HPSLC") was the Sanctioning Authority for granting permanent registration of all the Prestigious/Premier Units 11.Part III provides the procedure for Registration for Premier/Prestigious Status, the relevant clause of the said Part in respect of instant case is set out below: "An Industrial unit eligible for Prestigious/Premier status under the scheme will apply to Industries Commissioner in prescribed form before expiry of the scheme along with details of following effective steps. i) Possession of plot or shed in GIDC Estate. For units located outside GIDC Estate, the unit must be in legal possession of land with valid non-agricultural use permission of industrial use or as per Revenue Act as modified from time to time. ii) The Letter of intent/Letter of Approval or Registration/ obtained receipt against filling of IEM to the appropriate authority. iii) NOC of GPCB (Gujarat Pollution Control Board) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... objection from the Environmental Pollution potential point of view in the setting up of the refinery project subject to certain environmental pollution control measures to be taken by the appellant. Essar's proposal regarding the environmental pollution control system was approved by the GPCB on 17th April, 1993 and a Site Clearance Certificate was issued on that date. 16. On 10.11.1994, Essar filed an application for right of way over 15.49 hectares of forest land for laying Submarine Crude Oil Pipeline, Cooling Water/Return Water Pipeline and Product Jetty for establishment of its Refinery Project at Vadinar, District Jamnagar, to the Conservator of Forests, Marine National Park, Jamnagar. Undisputedly, 15.49 hectares of forest land applied for includes 8.79 hectares of Jamnagar Marine National Park and Sanctuary. Therefore, permission under Section 2 of the Forest Conservation Act ("FCA") was required for the entire 15.49 hectares. At the same time, permission of State Government was required under the Wildlife Protection Act ("WPA") for 8.79 hectares. 17.On 13.02.1995, the State Government requested the Chief Conservator of Forests, Regional Office, Western Reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 16.10.1997 its permission under section 29 of WPA to Essar's proposal of right to way through the National Park and Sanctuary subject to Essar's compliance with certain terms and conditions including obtaining permission of the Central Government under the FCA, 1980 (which was granted on 08.12.1999, mentioned later) and also getting clearance under the Coastal Regulation Zone (CRZ) Regulations, which was granted on 03.11.2000. 23.This permission was conveyed to Essar by the Conservator of Forests under cover of his letter-dated 18.10.1997. The permission was, however, restricted to the Kandla Port Trust area. Kandla Port Trust granted permission to Essar to install "marine facilities" on 10.10.1997. 24.On 27.11.1997 the Ministry of Environment & Forest, Government of India granted "in-principle" approval to Essar under FCA, 1980 for diverting 15.49 hectares of forest land for non-forest purpose. 25.On 25.06.1999 Essar was issued the provisional Premier Registration Certificate by the Industries Commissioner. The provisional certificate was valid upto 15.08.2000 i.e. the last date of Scheme, within this time period Essar was obliged to start commercial produ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent and Forest, Government of India granted approval under section 2 of the FCA for the total land of 15.49 hectares of forest land. 32.In April 2000, said Samiti filed another PIL being Special Civil Application No.1778, and subsequently two other PILs were also filed by one Jan Sangarsh Manch and one Shri Alpesh Y. Kogje, being Civil Application Nos.5476 and 5928 of 2000, (hereinafter "second PILs") in the High Court of Gujarat challenging, inter alia, the permission granted by the State Government to one Bharat Oman Refineries Ltd. (`BORL') to lay pipeline in the Marine National Park and Sanctuary Area. It is pertinent to note here that Essar was not a party to these petitions. 33.On 29.04.2000 the Government of Gujarat discontinued the said Scheme with effect from 01.01.2000. However, vide the same Government Resolution dated 29.04.2000, it was specifically mentioned that industry units in pipelines cases which have been registered should start production within two years from January 1, 2000 failing which such units shall be rendered ineligible for sales tax incentive. Therefore, the time to start commercial production was thus extended to 01.01 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad also incurred 25% of the Project Cost before 15.08.2000 and therefore, it was entitled to the benefit of this extension. 40.Essar challenged the aforesaid judgment and order dated 13.07.2000, 18.07.2000, 20.07.2000, 27.07.2000, 03.08.2000 and 23.02.2001 of the High Court delivered in the second PILs and the rejection of its review petition in that second PILs respectively by way of filing Special Level Petition being (SLP) CC No.3654 of 2001 [later SLP No.9454-9455 of 2001] before this Hon'ble Court. 41.By interim order-dated 11.05.2001 this Court granted stay of the judgment of the High Court in so far as Essar was concerned in SLP No.9454-9455 of 2001 i.e. SLP filed by Essar. The text of the order of this Court is set out: "Permission to file Special Leave Petition is granted. Issue notice. Stay of the High Court judgment in so far as the petitioner is concerned. Counter affidavit be filed within four weeks. Rejoinder be filed within four weeks thereafter. List after eight weeks." 42.In view of the above stay order granted by this Court, Essar moved the State Government for permitting it to proceed with the construction o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hin the specified time i.e. till 15.08.2003. Essar, therefore, submitted a representation dated 19.06.2002 to the Chief Minister pointing out the circumstances which had delayed the completion of the project. Similar representations were thereafter made to different authorities of the State Government on 27.06.2002, 14.03.2003, 30.07.2003, 02.12.2003 and 26.12.2003. It appears that the said representations were not responded to. 46.By an order-dated 19.01.2004, this Court quashed and set aside the judgment dated 03.08.2000 of High Court and directed the State Government to issue the authorization to Essar in the requisite format under Sections 29 and 35 of the Wild Life (Protection) Act within a fortnight after disapproving the interpretation placed by the High Court on the provisions of the Wild Life (Protection) Act, 1972. This Court took the view that the permission granted by the State Government on 16.10.1997 was the permission contemplated by Section 29 of the Wild Life (Protection) Act. 47. In compliance with the above judgment, by letter dated 12.02.2004, the State Government authorized the Chief Wild Life Warden, Gujarat State under Sections ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he delay to the Forests and Conservation Department of State Government, but the petitioner Company is not interested in pursuing those allegations and in fact would like to withdraw those allegations and the petitioner would like to invoke the following maxims of equity:- (i) "An act of the Court shall prejudice no man", and (ii) "The law does not compel a man to do that which he cannot possibly perform." 53. Before the High Court Essar contended that reason for delay in commencement of commercial production was on account of the injunction granted by the High Court on 13.07.2000/03.08.2000, restraining the State from granting further permission under Section 29 of the WPA in the second PILs (where Essar was not a party). And this situation continued till 27.02.2004, when pursuant to the judgment-dated 19.01.2004 of this Court the Chief Warden granted the said permission. Therefore Essar was entitled to get benefit of the exclusion of the said intervening period of from 13.07.2000 to 27.02.2004 i.e. three years and 230 days in calculating the time limit for commencement of commercial production. 54. By impugned order-dated 22.04.2008 the High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Incentive Scheme on the basis of the eligible capital investment made by Essar in the unit under consideration shall be reduced by Rs.700 crores. 57.The learned counsel for the respondents made an attempt to urge that the judgment of the High Court was virtually rendered by way of a concession and the impugned judgment is a consent order. As such the appeal, at the instance of the State, is not maintainable. Learned counsel for the State strongly opposed this contention and submitted that the same contention was raised at the time of admission of the special leave petition. Then, further affidavit was filed by the State with the leave of the Court. The Court was satisfied and then issued notice. 58. Ultimately, the matter was argued on merits before this Court and it was common ground that the impugned judgment is not by consent. 59.The impugned judgment of the High Court is based on two basic line of reasoning that the respondents are entitled to the benefit of Sales Tax Waiver Scheme firstly on the principle of restitution and secondly, that the respondents cannot be made to lose the benefit under the Sales Tax Waiver Scheme, for an act of Court. In this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revents a party from retaining money or some benefit derived from another which he has received by way of an erroneous decree of Court. Such remedy in English Law is generally different from a remedy in contract or in tort and falls within a third category of common law remedy which is called quasi contract or restitution. 63.If we analyze the concept of restitution one thing emerges clearly that the obligation to restitute lies on the person or the authority that has received unjust enrichment or unjust benefit (See Halsbury's Laws of England, Fourth Edition, Volume 9, page 434). 64.If we look at Restatement of the Law of Restitution by American Law Institute (1937 American Law Institute Publishers, St. Paul) we get that a person is enriched if he has received a benefit and similarly a person is unjustly enriched if the retention of the benefit would be unjust. Now the question is what constitutes a benefit. A person confers benefit upon another if he gives to the other possession of or some other interest in money, land, chattels, or performs services beneficial to or at the request of the other, satisfies a debt or a duty of the other or in a way adds to the othe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o question of restitution by the State for the simple reason that it is nobody's case that State has received any unjust benefit or any unjust enrichment in view of stay order given by the High Court in the second PILs filed in the High Court. On the contrary, it is clear from the record that the State contested those proceedings and specially, challenging the orders of the Gujarat High Court dated 13.07.2000, 18.07.2000, 20.07.2000, 27.07.2000 and 03.08.2000 on the second PILs, the State has filed its SLP. Therefore, the State has not at all gained or received any benefit as a result of the orders passed by the High Court on the second PILs. Therefore, the principle of restitution cannot be applied against the State, the appellant before us. The judgment of the High Court to that extent is erroneous. 70.The second principle that an act of court cannot prejudice anyone, based on latin maxim "actus curiae neminem gravabit" is also encompassed partly within the doctrine of restitution. This actus curiae principle is founded upon justice and good sense and is a guide for the administration of law. 71.The aforesaid principle of "actus curiae" was applied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 75.The learned counsel for Essar in support of the applicability of Doctrine of Restitution has cited the case of South Eastern Coalfields Ltd. v. State of M.P. & others reported in (2003) 8 SCC 648 wherein this Court through R.C. Lahoti, J (as his Lordship then was) in para 27 had observed that: "Section 144 C.P.C. is not the fountain source of restitution, it is rather a statutory recognition of a pre-existing rule of justice, equity and fair play. That is why it is often held that even away from Section 144 the Court has inherent jurisdiction to order restitution so as to do complete justice between the parties." 76.His Lordship at para 28 observed as under: "That no one shall suffer by an act of the court is not a rule confined to an erroneous act of the court; the 'act of the court' embraces within its sweep all such acts as to which the court may form an opinion in any legal proceedings that the court would not have so acted had it been correctly apprised of the facts and the law. The factor attracting applicability of restitution is not the act of the Court being wrongful or a mistake or error committed by the Court; the test is whether on account of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... octrine of approbation and reprobation is well established in our jurisprudence and applicable in our laws too. That principle has no application to the facts of this case. 81.The principles decided in the case of Karnataka Rare Earth & Anr. v. Senior Geologist, Department of Mines & Geology and Anr., reported in (2004) 2 SCC 783 is equally of no assistance to Essar. In that case both the doctrines of "actus curiae" and "restitution" were discussed together. We have already held that these equitable doctrines are not applicable in the facts of the present case. In Karnataka Rare Earth (supra), the appellants, on the basis of an interim order granted by this Court, extracted minerals and disposed of the same. Ultimately the interim order was vacated by this Court and the appeal filed by Karnataka Rare Earth was dismissed. In that context this Court held that the appellants cannot enjoy the benefits earned by them under the interim order of this Court and this Court held that the demand of the State for the price of mines and minerals from the appellant is neither unreasonable nor arbitrary. 82.Reliance was placed on the judgment of this Court in Bareilly Development ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... derabad v. Collector of Central Exercise and Customs, Hyderabad [(1994) Supp 3 SCC 606] the question for consideration before this Court was that, in case of ambiguity, which rule of construction will be applicable to exemption provision. This Court relied on the case of Union of India & others v. Wood Papers Ltd & another reported in (1990) 4 SCC 256, wherein at para 4, page 260 this Court observed as under: "...Truly speaking liberal and strict construction of an exemption provision are to be invoked at different stages of interpreting it. When the question is whether a subject falls in the notification or in the exemption clause then it being in nature of exception is to be construed strictly and against the subject but once ambiguity or doubt about applicability is lifted and the subject falls in the notification then full play should be given to it and it calls for a wider and liberal construction." 88.This Court held that the principle that in case of ambiguity, a taxing statute should be construed in favour of the assessee, does not apply to the construction of an exception or an exempting provision, as the same have to be construed strictly. Further this Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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