Maris Spinners Limited has received a significant interest subsidy from the government's textiles department, providing a financial boost to the Chennai-based textile manufacturer.

Interest Subsidy Details

The company announced that the Commissioner of Textiles and Director, Bangalore has partially released an interest subsidy payment. The subsidy details are as follows:

Regulatory Compliance

Maris Spinners Limited informed the Bombay Stock Exchange about this development through a formal communication dated 23 March 2026. The disclosure was made under general regulatory requirements, ensuring transparency with stakeholders and compliance with stock exchange norms.

The communication was signed by C Srinivasan, Chief Financial Officer of the company, and addressed to the Corporate Relationship Department of the Bombay Stock Exchange.

Company Operations

Maris Spinners Limited operates manufacturing facilities across two locations in South India:

• Unit I: Located at Kattemalavadi Village, Hunsur Taluk, Mysore District
• Unit II: Situated on Kulithalai Road, Manapparai, Trichy District

The company's corporate office is based at Cathedral Road, Chennai, and it has been incorporated since 1979 with CIN L93090TN1979PLC032618.

Financial Impact

The receipt of Rs 53,00,000 as interest subsidy represents a positive development for the company's financial position. While this is a partial release against the total claimed amount, it provides immediate cash flow benefits and reduces the company's financial burden related to interest costs.

Maris Spinners Limited has achieved a significant legal victory with the Madras High Court directing the Ministry of Textiles to pay Rs 19,73,65,57 as interest subsidy under the Technology Upgradation Fund Scheme (TUFs). The court order, pronounced on 05.01.2026, mandates payment within two months from receipt of the order.

Court Ruling Details

The High Court of Madras, presided over by Justice N. Sathish Kumar, quashed the Ministry of Textiles' order dated 31.10.2018 that had rejected the company's subsidy claim. The ministry had categorized Maris Spinners' case as a "left out case" and refused to extend TUFs benefits on grounds that the nodal bank uploaded loan details only on 10.01.2014, well after the stipulated timeframe.

Background of the Dispute

Maris Spinners, engaged in manufacturing 100% cotton yarn with 49,536 spindles capacity across Tamil Nadu and Karnataka, had availed a term loan of Rs 10 crores from Indian Overseas Bank on 15.06.2010. The loan was confirmed as eligible for 4% interest subsidy under the TUFs scheme through the bank's letter dated 31.07.2010.

Despite the company's compliance with all prescribed conditions and regular filing of Quarterly Interest Subsidy Claims (QISC), the subsidy amounts remained undisbursed. The company's total interest payment on the term loan amounted to Rs 6,09,60,644, of which Rs 1,97,36,557 represented the eligible 4% quarterly interest subsidy.

Key Legal Arguments

The court established a principal-agent relationship between the Ministry of Textiles and Indian Overseas Bank as the nodal agency. Justice Kumar ruled that once eligibility for subsidy is acquired, beneficiaries cannot be denied accrued rights due to negligent acts by the nodal agency.

Court's Key Findings:

• The petitioner's eligibility for 4% interest subsidy was undisputed
• Delays in documentation submission were attributable to the nodal bank, not the company
• The doctrine of promissory estoppel applies when government schemes create legitimate expectations
• Administrative lapses by implementing agencies cannot prejudice eligible beneficiaries

Government and Bank Positions

The Ministry of Textiles argued that claims should have been submitted within six months of loan sanction (by 14.12.2010) as per circular guidelines. The ministry maintained its policy decision not to extend benefits to "left out cases" where documentation was submitted beyond prescribed timelines.

Indian Overseas Bank contended that the first loan disbursement on 27.09.2010 fell within a "blackout period" when the TUFs scheme was non-operational due to fund constraints. However, the court noted contradictions between the ministry's and bank's positions regarding the nature of the case.

Legal Precedents Cited

The judgment referenced several Supreme Court cases establishing the doctrine of promissory estoppel against government actions, including:

• Pournami Oil Mills vs. State of Kerala (1987): Established rights under earlier government orders
• Pine Chemicals vs. Assessing Authority (1992): Confirmed exemption benefits for entire specified periods
• Manglore Chemicals vs. Deputy Commissioner (1992): Applied promissory estoppel doctrine to government executive functions

Financial Impact

The court rejected the company's claim for additional interest on the delayed payment, considering the nature of the subsidy claim. However, the principal amount of Rs 19,73,65,57 must be paid within the stipulated two-month period.

Industry Implications

This judgment sets an important precedent for textile industry participants who may have faced similar issues with TUFs scheme implementation. The ruling reinforces that government scheme benefits, once eligibility is established, cannot be arbitrarily denied due to procedural delays by implementing agencies. The decision strengthens the position of textile manufacturers seeking legitimate subsidy claims under various government modernization schemes.