In Brief
UltraTech Cement Limited sought to enforce a 75% sales tax subsidy under the Rajasthan Investment Promotion Scheme-2003 on the basis of alleged approval by a high-powered board (BIDI). The Supreme Court held that the company was entitled only to 50% subsidy. The Court found that while BIDI approved application of the scheme in 2006, it never specifically authorized 75% subsidy. The erroneous state committee decisions granting 75% were invalid. The Government properly exercised its revisional power to recover the 25% excess. However, the Court reduced the interest rate from 18% to 12% per annum as per the company's undertaking, since the excess subsidy resulted from administrative error, not breach by the company.
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