The Calcutta High Court criticizes alleged contemnors for a ‘patently recalcitrant attitude’ in the Electrosteel Castings case, ordering their personal appearance on October 31 to ensure compliance.
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KOLKATA: On 26 September 2025, the Calcutta High Court passed a significant order in Electrosteel Castings Limited v. Smt. Vandana Yadav. Appearing for the petitioner, Mr. Prabhat Kumar Srivastav, Advocate, argued before the Court that the alleged contemnors had engaged in repeated delaying tactics by seeking adjournments under the pretext of a pending appeal.
Justice Sabyasachi Bhattacharyya took serious note of these submissions, observing that the alleged contemnors had sought adjournments on at least seven prior occasions, citing pendency of the appeal. However, it was revealed through the petitioner’s counsel that the appeal had already been dismissed for default on 9 September 2025, exposing the lack of bona fides in the contemnors’ defense.
Background of the Case
Electrosteel Castings Ltd., represented by Mr. Srivastav, initiated contempt proceedings for non-compliance with a court order. Instead of compliance, the alleged contemnors repeatedly delayed proceedings, and only at a later stage sought to rely on the West Bengal Incentive Scheme and Obligations in the Nature of Grants and Incentive Act, 2025, notified on 2 April 2025.
The alleged contemnors argued that under Section 4 of the Act, the State Government and its agencies had no past, present, or future liabilities under incentive schemes, thereby rendering the contempt petition infructuous.
Arguments by the Parties
For the Petitioner:
Appearing on behalf of Electrosteel Castings Ltd., Mr. Prabhat Kumar Srivastav, Advocate, argued that the alleged contemnors were deliberately stalling the contempt proceedings. He pointed out that adjournments had been repeatedly sought on the ground of a pending appeal, even though the said appeal (APOT/5/2025) had already been dismissed for default on 9 September 2025. This, he submitted, was clear evidence of a lack of bona fides and an attempt to frustrate the course of justice.
For the Alleged Contemnors:
Counsel for the alleged contemnors contended that the contempt petition no longer survived in light of the revocation of the West Bengal Incentive Scheme and Obligations in the Nature of Grants and Incentive Act, 2025, notified on 2 April 2025. They relied particularly on Section 4 of the Act, which seeks to relieve the State Government and its agents from any past, present, or future liabilities under incentive schemes or related court orders. On this basis, it was urged that the contempt application had been rendered infructuous.
Court’s Observations
Justice Bhattacharyya was unconvinced. He criticized the “patently recalcitrant attitude” of the alleged contemnors and made the following key observations:
- The reliance on the 2025 Act was a belated and tactical ploy to avoid compliance.
- The appeal cited for adjournments was itself dismissed, showing a lack of diligence.
- Retrospective nullification of court orders through legislation cannot extinguish rights already accrued under judicial pronouncements, as per the General Clauses Act.
- Contempt jurisdiction flows from Article 215 of the Constitution, giving the High Court inherent powers to enforce its orders.
The Court clarified that even if the 2025 Act is ultimately upheld, it cannot absolve contemnors of liability for willful disobedience committed before the Act came into force.
The Court noted,
“There is no reason why penal action should not be taken against the alleged contemnor.”
Justice Bhattacharyya directed the alleged contemnor to appear personally before the Court on 31 October 2025 at 10:30 AM for further orders, signaling the possibility of penal consequences.
The West Bengal Industries Minister tabled the Revocation of State Incentive Schemes and Obligations Bill, 2025, which scrapped industrial incentive schemes dating back to 1993, including subsidies on land, tax refunds, electricity, and interest repayments. The government justified the repeal as fiscally unsustainable and argued that funds should instead benefit socio-economically disadvantaged groups, noting that the state’s economy has since shifted towards AI, tourism, green industries, and revised mining policies. A new industrial policy is being drafted by a committee led by the Chief Secretary.
Meanwhile, Electrosteel Casting and others challenged the Act as unconstitutional, contending that its retrospective withdrawal made many businesses unviable. In parallel, the state also introduced the State Fiscal Responsibility and Budget Management Bill, 2025, raising the borrowing cap from 3% to 3.5% of GSDP in line with Finance Commission guidelines and power sector reforms.
Section 4 of the Act:
The provisions state that:
- Removal of Liabilities – The West Bengal Government and its authorised agents will no longer have any past, present, or future obligations or liabilities under the West Bengal Incentive Schemes or related grants, contracts, or promises.
- Extension Power – The Government can extend this Act to cover other schemes, grants, or obligations by notifying them in the Schedule.
- Overriding Effect – This Act will prevail over anything inconsistent in other laws, contracts, eligibility certificates, government letters, or even judgments, decrees, or arbitral awards.
- Bar on Legal Proceedings – No suit, claim, or proceeding for incentives, payments, or refunds under such schemes can be filed, continued, or enforced in any court, tribunal, or authority. Any such pending proceedings will automatically abate (end) immediately.
In short, this law cancels all incentive-related claims against the West Bengal Government, nullifies existing court/tribunal orders on the matter, and prevents any future legal action regarding such claims.
Appearance:
For the petitioner: Advocate Mr. Prabhat Kumar Srivastav, Advocate Arif Ali
For the WBIDCL: Mr. Kishore Dutta, Ld. AG., Advocate Mr. Tanoy Chakraborty, Advocate Mr. Suddhadev Adak
For the alleged contemnors: Advocate Mr. Nilotpal Chatterjee, Advocate Mr. DebangshuDinda
Case Title:
ELECTROSTEEL CASTINGS LIMITED VS SMT. VANDANA YADAV
CC/84/2024 WITH WPO/192/2024
Read Order:
