In a significant relief to Gujarat’s Agriculture Produce Market Committee (APMC), Deesa, the Supreme Court has ordered release of the full subsidy amount under a government cold storage scheme after setting aside a Division Bench judgment that had denied the claim. The Court held that the record clearly showed repeated attempts by the appellant to secure inspection and final payment.
Background of the Case
The dispute arose from a subsidy scheme titled Capital Investment Subsidy for Construction/Expansion/Modernization of Cold Storages/Storage of Horticultural Produce, operated through the National Horticulture Board (NHB) and NABARD.
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Deesa APMC had constructed a cold storage facility after obtaining a loan of Rs.1 crore. It submitted expenditure details of over Rs.4.25 crore and sought subsidy benefits. A sum of Rs.25 lakh, being 50% advance subsidy, was credited initially.
Later, a joint monitoring visit found low capacity use at the facility, and release of the remaining subsidy was kept pending.
Justice Sanjay Karol, writing for the Bench, examined whether Deesa APMC had made genuine efforts to get the facility re-inspected and the remaining subsidy released.
The Court noted several letters sent between 2009 and 2011 by the appellant and its financing bank to NABARD and NHB requesting inspection, reconsideration, and final release of subsidy.
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The Bench observed that the documentary record made the position clear. It said,
“Efforts were indeed made by the appellant through its bank to have the money released".
The Court also expressed surprise at NHB’s stand that no efforts were made. Referring to the inspection report itself, the Bench noted that it had recorded that the unit was completed and commissioned.
During the period when correspondence was continuing, the cold storage unit caught fire in May 2011 due to a short circuit. Thereafter, NABARD moved to withdraw the subsidy already granted and sought recovery of the paid amount.
The Supreme Court found that despite repeated requests for further inspection, authorities neither released the final amount nor gave convincing reasons for recovery.
Setting aside the Division Bench ruling, the Supreme Court restored the earlier Single Judge order in favour of Deesa APMC.
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The Court directed that if the earlier subsidy amount had already been repaid, then the entire subsidy should now be released. If it had not been repaid, then the final installment must be released to the appellant.
The appeal was accordingly allowed, and pending applications were disposed of.
Case Details
Case Title: Agriculture Produce Market Committee, Deesa v. National Horticulture Board & Ors.
Case Number: Civil Appeal arising out of SLP(Civil) No. 13129 of 2025
Judge: Justice Sanjay Karol and Justice Augustine George Masih
Decision Date: April 17, 2026
