The Bombay High Court directed the State of Maharashtra to release ₹4.79 crore in export subsidies to VRS Foods Limited under the Government Resolution (GR) dated 31st July 2018. Despite prior approvals and confirmations, the State had delayed payment, citing procedural issues. The Court found the denial of payment violated the principles of Article 14 of the Constitution, affirming the petitioner’s entitlement to parity with similar beneficiaries.

Acts & Sections Discussed:

1. Constitution of India, Article 14: Equality before the law and equal protection of laws.
2. Rules of Business under Article 166(3): Mandatory compliance with procedural rules for executive decisions.

1. Background and Hardship (Paras 2–4)

• Milk powder manufacturers, including the petitioner, faced economic losses in 2018 due to plummeting prices.
• The Maharashtra Government introduced subsidies under the GRs dated 20th and 31st July 2018 to support manufacturers and alleviate the crisis for dairy farmers.

2. Eligibility and Claims (Paras 6–7)

• VRS Foods exported 959.88 metric tons of milk powder and claimed subsidies at ₹50/kg under the GR dated 31st July 2018.
• The Dairy Development Officer and subsequent inquiries confirmed their entitlement.

3. Administrative Delays (Paras 9–16)

• Despite several representations, the State failed to release the subsidy, citing lack of Finance Department concurrence.

4. Judicial Interventions (Paras 13, 17–19)

• Similarly situated entities, such as Indapur Dairy, obtained favorable court orders for subsidy release.
• The Court had previously directed payment to such entities, holding administrative delays unjustifiable.

5. Respondents’ Objections (Paras 23–26)

• The State argued non-compliance with procedural rules under Article 166(3) and alleged risk of double benefits for milk powder producers.
• The Court dismissed these claims, emphasizing the distinct nature of schemes under different GRs.

6. Final Decision (Paras 31–37)

• The Court found the State's actions discriminatory and violative of Article 14.
• Directed immediate release of ₹4.79 crore to VRS Foods Limited, ensuring parity with similar beneficiaries like Indapur Dairy.

Ratio Decidendi:

1. Equality Under Article 14: Discriminatory treatment of similarly situated parties is unconstitutional.
2. Binding Nature of Prior Orders: Orders directing payments to one entity (Indapur Dairy) must be consistently applied to others identically placed.
3. Procedural Compliance vs. Equity: Lack of procedural adherence does not justify withholding subsidies when substantive eligibility is undisputed.

Subjects:

Constitutional Law—Article 14 (Equality Before Law)
Administrative Law—Government Resolution & Procedural Compliance

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