Facts of the Case

M/s Planet International, proprietorship successor to M/s Alok Printing Works, held a leasehold industrial plot at Bokaro Industrial Area allotted originally in 2015, with change of ownership approved by BIADA (Bokaro Industrial Area Development Authority). The petitioner claimed rent was regularly paid and that infrastructure setup was interrupted by the COVID-19 pandemic. On 20.07.2021, BIADA issued a show cause notice alleging that industrial activity had not commenced despite about six years since allotment, and cited absence of evidence such as a GST number or proof of electricity bill payment as indicators that no genuine steps toward production had been taken. The allotment was cancelled by order dated 30.09.2021, and the petitioner's subsequent appeal was dismissed on 21.10.2022.

Issues Involved

  1. Whether the cancellation of the plot allotment, made without a prior opportunity of hearing, violated the one-month notice requirement under Section 6(2)(a) of the Jharkhand Industrial Area Development Act.
  2. Whether the absence of a GST/VAT registration number and proof of electricity connection justified the finding that no bona fide industrial activity had commenced.

Petitioner's Arguments

  • No show cause notice was issued before the original cancellation order, and no opportunity of hearing was given, violating natural justice and Section 6(2)(a) of the Jharkhand Industrial Area Development Act.
  • The appeal was dismissed in a mechanical manner without proper consideration.

Respondent's Arguments

  • A show cause notice was in fact issued on 20.07.2021 for non-commencement of industrial activity; there was no GST number, VAT registration, or proof of electricity bill payment to show that steps had actually been taken toward starting production, even after about six years since allotment.

Court Order / Findings

  • The Court found no material on record to suggest that the petitioner, in a bona fide manner, had taken steps for installation of electrical connection, purchase of raw materials, or obtaining VAT and GST registration.
  • In the absence of such material, the cancellation of allotment (affirmed in appeal) was held justified.
  • The Court declined to interfere in exercise of its extraordinary jurisdiction, and the writ petition was dismissed.

Important Clarification

This is not a GST ruling — it is a decision under the Jharkhand Industrial Area Development Act concerning cancellation of an industrial plot allotment for non-commencement of business. The absence of a GST or VAT registration number was treated only as one piece of circumstantial evidence that no genuine industrial activity had begun; it was not itself the legal basis for cancellation, which rested on the industrial-area statute's requirement of actual production activity.

Sections Involved

  • Jharkhand Industrial Area Development Act, 1994, Section 6(2)(a)
  • Constitution of India, Article 226

Decision – In Favour of

Decided against the petitioner — the writ petition was dismissed and the cancellation of the industrial plot allotment was upheld.

Case Details

  • Court: High Court of Jharkhand at Ranchi
  • Case Number: W.P.(C) No. 1681 of 2023
  • Coram: Justice Gautam Kumar Choudhary
  • Date of Order: 02.08.2023

Link to Download the Order

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