Patna High Court
M/s. Johnson Paints Pvt. Ltd.versusThe State of Bihar
- Decided
- Disposal
- DISPOSED
- Bench
- A ABHISHEK REDDY
Holding
The court directed the Principal Secretary, Department of Industry, Bihar to verify the petitioner’s claim and, if the required documents are on record, process the VAT and GST reimbursement within eight weeks, otherwise give the petitioner a further opportunity to submit the documents.
Summary
The petition was filed by Johnson Paints Pvt. Ltd. seeking reimbursement of 80% of VAT for April‑June 2017 and SGST deposited from July 2017 onward, invoking Clause 3 of the Bihar Industrial Policy Resolution 2011. The State of Bihar argued that the claim could not be processed because the petitioner had not submitted required documents despite multiple notices. The petitioner contended that the necessary documents were submitted on 14 October 2025 and urged the court to direct the authorities to process the claim within a fixed time. The court examined whether the petitioner had complied with the documentary requirements and whether the State was bound to honour the policy‑based subsidy. It held that the authorities must verify the claim and, if the documents are on record, process the reimbursement within eight weeks, otherwise give the petitioner a further opportunity to produce the documents. Consequently, the writ petition was disposed with directions to the Principal Secretary, Department of Industry, to act accordingly.
Issues considered
- Whether the State of Bihar is obligated to reimburse VAT and SGST under the Industrial Incentive Policy 2011.
- Whether the petitioner complied with the documentary requirements for claim processing.
- Whether a writ court can compel the State authorities to process the subsidy claim within a specified time frame.
Legislation cited
- Bihar GST Act, 2017
- Companies Act
- Industrial Incentive Policy, 2011
Subjects
- VAT reimbursement
- SGST
- Industrial Incentive Policy 2011
- state subsidies
- writ petition
- document compliance
- Bihar GST Act
- Companies Act
Judgment
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.9725 of 2024
======================================================
M/s. Johnson Paints Pvt. Ltd. a Company registered under the Companies
Act, having its Registered Office at Fathua Road, Sabalpur, Patna City, Patna
through one of its Director, Vikram Khanna, Male, Aged about 48 years, son
of Sri Shyam Narayan Khanna, Resident of City Centre Apartment, G-4
Block, Hajiganj, Opp. Punjab and Sind Bank, Patna City, P.S. Chowk Patna
City, District- Patna.
... ... Petitioner/s
Versus
1. The State of Bihar through the Chief Secretary, Cabinet Secretariat,
Government of Bihar, Patna.
2. The Principal Secretary-cum-Commissioner, Department of State Tax,
Government of Bihar, Patna.
3. The Principal Secretary, Department of Industry, Government of Bihar,
Patna.
4. The Director of Industries, Department of Industry, Government of Bihar,
Patna.
5. The Deputy Commissioner of State Tax, Patna South Circle, District- Patna.
6. The General Manager, District Industry Centre, Patna.
... ... Respondent/s
======================================================
Appearance :
For the Petitioner/s : Mr. Mohit Agarwal, Advocate.
For the Respondent/s : Mr. Vivek Prasad, GP 7 with
Mr. Sanjay Kumar, AC to GP 7.
Ms. Roona, AC to GP 7.
======================================================
CORAM: HONOURABLE MR. JUSTICE A. ABHISHEK REDDY
ORAL ORDER
4 05-02-2026 Heard learned counsel for the parties.
2. The present Writ Petition has been filed for the
following reliefs:-
“(i) For issuance of an
appropriate writ or direction upon the
Respondent Commissioner of
Commercial Taxes now known as
Patna High Court CWJC No.9725 of 2024(4) dt.05-02-2026
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Commissioner of State Taxes as also the
Deputy Commissioner of Commercial
Taxes now known as Joint Commissioner
of State Taxes/Director of Industries to
reimburse 80% of VAT for the period
April, 2017 to June, 2017 and the
admitted SGST (State Tax) deposited
under the Bihar GST Act, 2017 by the
Petitioner for the period July, 2017 to till
date, and thereafter uptil the date of
eligibility of the petitioner company, as
promised to be granted by the
Respondent State in terms of Clause 3 of
the Industrial Policy Resolution, 2011
(hereinafter referred as ‘Policy, 2011’) as
the same has been abruptly not being
reimbursed in most arbitrary and illegal
manner.
(ii) For a direction to the
Respondents for grant of subsidies at the
earliest to save the petitioner’s unit as it
is suffering due to discontinuance of
reimbursement of the amount of SGST
(State Tax) deposited by the petitioner
and also for non-grant of the amount of
capital subsidy and other subsidies.”
3. In the counter-affidavit filed by the Respondent
Nos. 3, 4 and 6, at paragraph- 8, 9, 10 and 11, it is specifically
stated as under:-
“8. That since there was huge
amount involved in applications received
from the units through online portal till
31.08.2023, the Finance Department
advised the department to obtain the
approval of cabinet. In the cabinet
meeting dated 25.04.2025, approval was
granted to the proposal of considering
Patna High Court CWJC No.9725 of 2024(4) dt.05-02-2026
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the claim of the units which made
application on departmental portal till
31.08.2023. The units shall fulfill all
necessary conditions enshrined in
Industrial Incentive Policy 2011 (in short
IIP-2011). Accordingly a resolution to
process the claim of such units was
passed through Memo No. 1107 dated
05.05.2025.
9. That accordingly, action is
being taken on the claim of unit under
IIP-2011. It is relevant to state here that
after verification/scrutiny of the
application received through portal till
31.08.2023 it was found that the
petitioner unit got consent over its
investment proposal for establishment of
manufacturing cement paints, wall putty,
dry colour and vermillion in the meeting
of District Level Single Window
Clearance Committee dated 30.12.2012.
Later on unit got VAT Eligibility
Certificate by the General Manager.
District Industry Centre, Patna, vide
Letter No. 2004 dated 26.09.2013. And
date of commercial production of the unit
is 01.06.2013.
10. That after
verification/scrutiny of the application of
the petitioning unit vide Letter No. 1106
dated 05.05.2025 as well as Letter No.
1307 dated 27.05.2025 unit was asked to
provide required necessary documents
like property filled SGST format of claim
period, CGWA Certificate, CA Certificate
for Quarter wise capacity Utilization.
Fire audit report from State fire Officer,
CTO from Pollution Department and
Factory license, so that payment be
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made. But till date those required
necessary documents could not be
submitted by the petitioner unit.
11. That as such due to non
supply/submission of the necessary
documents, claim of the petitioner unit
was not further processed and pending
for consideration. Once the required
necessary document will be supplied by
the petitioner, its claim regarding grant
incentives will processed further and if
found admissible the same will paid to
the petitioner.”
4. Learned counsel appearing on behalf of the
petitioner submits that the petitioner has supplied the requisite
documents on 14.10.2025 and the same is evidenced from
Annexures-P/10 and P/11. Learned counsel submits that in view
of the same, the respondent-authority may be directed to process
the application of the petitioner and make the necessary
payments by fixing a time frame.
5. Having regard to the same, the present writ petition
is disposed of directing the Principal Secretary, Department of
Industry, Government of Bihar, Patna (Respondent No. 3) to
verify the claim made by the petitioner and, in case, the
requisite documents have been submitted by the petitioner on
14.10.2025 through e-mail as evidenced in Annexure-P/11, they
shall process the application made by the petitioner for
reimbursement of VAT and GST, as the case may be, as
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expeditiously as possibly preferably within a period of 8 weeks
from the date of the receipt of the copy of this order. If after
verification, the authority finds that the documents have not
been supplied to the authority, they shall put the petitioner on
notice and grant him sufficient opportunity to produce the
requisite documents.
6. With the above directions, the present writ petition
stands disposed of.
(A. Abhishek Reddy, J)
shakir/-
U
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