Authority: High Court of Sikkim, Single Bench (Chief Justice A. Muhamed Mustaque)

Order Date: 10.09.2026

Case Overview

  • Parties: Lupin Limited (Petitioner) vs. Union of India, Director, Commerce and Industries Department, Government of Sikkim, and State of Sikkim (Respondents).
  • Nature of Proceeding: Writ Petition under Articles 226 and 227 of the Constitution challenging denial of the full Central Capital Investment Subsidy (CCISS) under the North‑East Industrial and Investment Promotion Policy, 2007 (NEIIP, 2007).
  • Key Dates:
  • NEIIP, 2007 introduced: 01.04.2007, effective until 31.03.2017.
  • Union Government suspended NEIIP: 01.12.2014.
  • Amendment Notification restricting subsidy to ₹5 cr (manufacturing) and ₹3 cr (service) units: 22.11.2016.
  • Lupin executed 99‑year lease deed: 27.05.2008.
  • Commenced commercial production: 10.02.2017.
  • Applied for District Industries Centre (DIC) registration: 23.02.2017; registration granted: 08.03.2017.
  • Applied for CCISS benefit: 05.02.2018.
  • ₹5 cr credited to Lupin’s account: 22.05.2024.
  • Petitioner’s Claim: Entitlement to a subsidy of ₹13,65,75,271/- based on original NEIIP, 2007 provisions, arguing that substantial investment was made before the 22.11.2016 amendment and invoking legitimate expectation and promissory estoppel.
  • Respondents’ Position: Since Lupin’s registration occurred after the amendment, it is a “new industrial unit” subject to the revised ₹5 cr ceiling; the government retains power to modify policies in public interest.
  • Legal Precedents Cited:
  • Union of India & Anr. v. M/s V.V.F. Ltd. & Anr. – promissory estoppel is not absolute; government may modify policy for public interest.
  • M/s Sidhbali Steels Ltd. & Ors. v. State of U.P. & Ors. – statutory action not restrained by promissory estoppel.
  • Hero MotoCorp Ltd. v. Union of India – tax exemption promises do not create indefeasible rights.
  • MRF Ltd. v. Assistant Commissioner (Assessment), Bannari Amman Sugars Ltd. v. Commercial Tax Officer, Union of India v. Hindustan Development Corporation, Motilal Padmapat Sugar Mills Co. Ltd. v. State of Uttar Pradesh – principles of legitimate expectation, fairness, and need for overriding public interest.
  • Mahabir Vegetable Oils (P) Ltd. v. State of Haryana – accrued rights cannot be retrospectively taken away.
  • Manjushree Extrusions Ltd. v. State of Assam – promissory estoppel cannot create a right absent underlying entitlement.
  • State of Rajasthan v. J.K. Udaipur Udyog Ltd. – exemptions are defeasible, not indefeasible.
  • Court’s Reasoning:

1. Registration under the NEIIP was a condition precedent; Lupin’s registration (23.02.2017) post‑dated the 22.11.2016 amendment, making the ₹5 cr ceiling applicable.

2. The petitioner did not establish that a vested or accrued right to the larger subsidy existed before the amendment; mere investment and early production do not create a vested right.

3. The doctrine of legitimate expectation does not override the government’s power to amend policy where public interest justifies it.

4. No reasoned order was provided for denying the balance amount, but the lack of a vested right precludes any entitlement beyond the amount already credited.

Final Outcome

  • The writ petition is dismissed.
  • Lupin Limited is not entitled to the balance of the claimed ₹13.65 crore subsidy; only the ₹5 crore credited on 22.05.2024 stands.

Topics: Subsidy Litigation, Industrial Policy