M/S Goodwill Energy Enterprises vs. Union of India
Background
The petitioner company bought a small hydro power project in Himachal Pradesh through a SARFAESI bank auction in 2017, after the original developer (KEPL) defaulted on its loan. KEPL had earlier been sanctioned a government capital subsidy of over Rs. 8.9 crore for the project, half of which was released against a bank guarantee, but the subsidy was later withdrawn and the guarantee encashed when KEPL's loan turned into a non-performing asset and the project wasn't completed on time. After acquiring the project, the petitioner applied for the same subsidy but was refused.
Decision Breakdown
The Court dismissed the petition on two independent grounds. First, it was filed more than two years after the impugned refusal letters, an inordinate and unexplained delay that itself defeats a writ petition under the doctrine of laches. Second, on merits, the subsidy scheme had already expired in 2017 and was tied to the sanction originally made to KEPL, which had been validly withdrawn for non-fulfilment of conditions; a subsequent purchaser acquiring the project through a bank auction cannot revive an expired scheme's benefits or claim a "fresh" sanction that was never available to it.
Lesson Learnt
Government subsidy schemes are tied to specific timelines, conditions and the original beneficiary; buying a stalled project does not automatically transfer a discontinued subsidy entitlement to the new owner, and unexplained delay in approaching the Court can independently sink an otherwise arguable claim.