Precedents Cited

The judgment references several key precedents that influenced the court's decision:

• Ram Kisan v. State of Haryana (AIR 1969 Punj and Har 104): Examined the principles of res judicata and the applicability of procedural rules in writ proceedings.
• Daryao v. State of U.P (AIR 1961 SC 1457): Clarified that withdrawal of a writ petition does not necessarily bar the institution of a new one.
• Nirod Baran Banerjee v. State of Bihar (AIR 1981 Pat 96): Held that mere withdrawal of a writ petition is not a bar to maintaining a second writ petition.
• Ward v. British Oak Insurance Co. (1932) 1 KB 392: Established that statutes are presumed to operate prospectively unless explicitly stated otherwise.
• James Gardner v. Edward Alucas (1873 AC 582): Affirmed the principle that statutes are to be interpreted as prospective in their operation.
• Sree Bank Ltd. v. Sarkar Dutt Roy & Co. (AIR 1966 SC 1953): Highlighted circumstances under which statutes may be given retrospective effect.
• Prabalpur Sheet Grih Pvt. Ltd. v. Bihar State Electricity Board, First Appeal No. 604 of 1974: An unreported decision on promissory estoppel, influencing the court's stance on contractual obligations upon disconnection.

These precedents collectively reinforced the court's stance against arbitrary administrative action and underscored the importance of adhering to statutory directives unless expressly limited by law.

Legal Reasoning

The court’s legal reasoning was multifaceted:

• Applicability of the Incentive Scheme: The court examined Government Resolution No. 16803 and its amendment, determining that the amendment did not retroactively disenfranchise the petitioners who had already commenced production before the amendment's enactment.
• Role of SEB's Disconnection: The disconnection of electrical supply by the SEB before the petitioners had properly availed themselves of the incentive scheme was deemed arbitrary and legally untenable. The court emphasized that such actions negated the contractual obligations stipulated in the supply agreement.
• Interpretation of Statutory Directives: Relying on established principles of statutory interpretation, the court held that in the absence of clear language indicating retrospective effect, the amendment to the incentive scheme was prospective only.
• Contractual Obligations and Disconnection: The court concluded that disconnection of supply constitutes termination of the contract regarding AMG charges, thereby nullifying the petitioners' liability to pay these charges during periods of non-supply.

The overarching legal principle affirmed was that administrative bodies must act within the confines of statutory mandates, and any deviation or arbitrary action that contravenes these mandates can be challenged successfully in court.

Impact

The judgment has significant implications for the intersection of administrative actions and statutory incentive schemes:

• Protection of Small-Scale Industries: Reinforces the legal protection afforded to small-scale industries under government incentive schemes, ensuring that administrative bodies like the State Electricity Board cannot arbitrarily deny benefits once eligibility criteria are met.
• Administrative Accountability: Establishes that administrative decisions, such as disconnection of services, must adhere strictly to statutory provisions and cannot be executed arbitrarily, especially when public interest and statutory incentives are at stake.
• Prospective Application of Statutory Amendments: Clarifies that amendments to incentive schemes are generally prospective unless explicitly stated, preventing retroactive impairment of existing rights and obligations.
• Legal Precedent for Future Cases: Serves as a judicial precedent for similar disputes involving governmental incentive schemes and the liabilities of service providers, thereby shaping future litigation and administrative policies.