VIJAYAWADA: The Andhra Pradesh High Court has directed the State government to clear the pending incentive amounts payable to spinning mill owners by the end of September, observing that the government cannot cite its financial condition as a reason for delaying legally due payments.
A division bench comprising Chief Justice Lisa Gill and Justice Challa Gunaranjan passed the orders on Monday while hearing appeals filed by the State government against an earlier judgment concerning incentive payments.
The court questioned the government’s stand that payments were being delayed due to financial constraints.
It observed that the State could not encourage entrepreneurs to establish industries by promising incentives and subsequently cite its financial position when it came to making payments.
The court reportedly questioned whether the government could get work done and then claim that it had no money to pay those who had performed the work.
The dispute relates the incentives that were promised under the Industrial Investment Promotion Policy (IIPP) to entrepreneurs setting up spinning mills.
Several industrialists established units after raising substantial bank loans and generating employment.
They later approached the High Court complaining that the government had failed to release substantial incentive dues, causing financial difficulties.
In December 2024, the High Court had directed the government to pay the pending incentives, along with interest, within four months. The State challenged the order through appeals.
Advocate General Dammalapati Srinivas admitted that incentive dues remained pending but attributed the delay to the State’s financial position. The bench directed the government to clear the dues by September-end and posted the matter for October.
