Summary
The Court upheld Jammu and Kashmir’s curtailment of an executive CST-refund incentive for small-scale units. Fraudulent claims, revenue loss and erosion of non-plan resources were relevant public-interest grounds for changing the concession. Judicial review could test arbitrariness but could not reassess the adequacy of the policy reasons as an appellate authority. Refund benefits already granted and availed were expressly protected.
Issues
- Whether the State could cap the executive CST-refund concession on the stated public-interest grounds.
- Whether previously availed benefits could be reopened.
Held
- No indefeasible refund entitlement existed independently of the executive scheme. The State could modify or withdraw the concession for just, valid and cogent reasons; review was confined to legality and arbitrariness rather than substitution of judicial policy preferences. (¶ 9–10)
- Verified concerns about false receipts, nonexistent suppliers, unpaid CST, vigilance proceedings and fiscal depletion were germane considerations. Passage of time and loss of documentary records for the stated reasons did not render a valid original policy decision illegal. (¶ 11–13)
- Claims already granted with financial benefit availed were not to be reopened or withdrawn, and the beneficiary units were not required to repay those amounts. (¶ 14–15)
Result
State appeals allowed; High Court order set aside, subject to protection against reopening or recovery of benefits already granted and availed.