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IFGL Refractories Ltd. v. Orissa State Financial Corporation & Ors.

Not available · 2026 INSC 18Decided 6 Jan 2026
Not available
Justice J.B. Pardiwala · Justice R. Mahadevan

Background

A company's new manufacturing plant qualified for state subsidies sanctioned in 2003, but the Corporation refused to pay in 2008, claiming the company had already used its overall subsidy quota under earlier policies. The High Court upheld the refusal.

Decision Breakdown

The Supreme Court held the plant was genuinely a "new" unit (not an expansion), so earlier caps didn't apply, and, crucially, the government was bound by promissory estoppel: having formally sanctioned the subsidy in writing and let the company rely on it, it could not renege years later.

Lesson Learnt

When a government authority formally sanctions a benefit in writing and a business relies on it, the authority generally cannot arbitrarily go back on that promise later.

Official source (sci.gov.in)View Judgment (PDF)

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