1996 (9) TMI 536 - SC - VAT and Sales Tax

Whether the publication of the exemption notification in the Andhra Pradesh Gazette, as required by section 11(1) of the Act, is mandatory or merely directory? Whether the power conferred thereunder is a species of delegated legislation or is it conditional legislation? Whether the power of conditional legislation can be exercised with retrospective effect? Whether the requirement of laying before the Legislature is mandatory? Held that - Appeal dismissed. The requirement of laying prescribed by sub-section (2) of section 11 is not mandatory and an order of exemption under section 11 cannot be said to be ineffective or unenforceable for the reason of non-laying as required by section 11(2) of the Act.

Issues Involved:

1. Validity and enforceability of G.O. Ms. No. 201 dated December 17, 1976.
2. Mandatory nature of publication in the Official Gazette under Section 11 of the Andhra Pradesh Non-Agricultural Lands Assessment Act, 1963.
3. Retrospective effect of G.O. Ms. No. 386 issued on May 2, 1990.
4. Applicability of the doctrine of promissory estoppel and legitimate expectation.
5. Mandatory nature of the requirement of "laying" the order before the Legislature.

Issue-wise Detailed Analysis:

1. Validity and enforceability of G.O. Ms. No. 201 dated December 17, 1976:

The appellant argued that G.O. Ms. No. 201 was a valid order issued under Section 11 of the Act, despite not explicitly stating its source of power. They claimed it fulfilled all requirements except for publication in the Gazette and "laying" before the Legislature, which they argued were directory, not mandatory. Conversely, the respondents contended that G.O. Ms. No. 201 was ineffective due to non-compliance with mandatory requirements of publication and laying before the Legislature. The Court held that the publication in the Official Gazette is mandatory for the validity of an exemption notification under Section 11, and non-compliance rendered G.O. Ms. No. 201 invalid and unenforceable.

2. Mandatory nature of publication in the Official Gazette under Section 11 of the Andhra Pradesh Non-Agricultural Lands Assessment Act, 1963:

The Court emphasized that the publication in the Official Gazette is not merely for public information but serves as an official confirmation of the order, ensuring authenticity and preventing disputes regarding its contents and date of issuance. The Court cited precedents, including Pankaj Jain Agencies v. Union of India and Sammbhu Nath Jha v. Kedar Prasad Sinha, to assert that publication in the Gazette is an imperative requirement and cannot be dispensed with. Consequently, the non-publication of G.O. Ms. No. 201 in the Gazette made it invalid.

3. Retrospective effect of G.O. Ms. No. 386 issued on May 2, 1990:

The Court examined whether the power under Section 11 could be exercised retrospectively. It referred to the decision in A. Thangal Kunju Musaliar v. M. Venkatachalam Potti, which allowed retrospective operation of a notification fixing the commencement of an Act. The Court found no reason why the logic of this decision should not apply to Section 11(1) of the Act, allowing retrospective operation of G.O. Ms. No. 386. Consequently, G.O. Ms. No. 386, which provided exemption for five years from the date of establishment or until the industry reached its rated capacity, was deemed valid and lawful with retrospective effect from December 17, 1976.

4. Applicability of the doctrine of promissory estoppel and legitimate expectation:

The appellant argued that G.O. Ms. No. 201 constituted a representation and promise, invoking the doctrine of promissory estoppel. The Court, however, held that where an act is done in violation of a mandatory statutory provision, such an act cannot form the basis for invoking promissory estoppel. The Court emphasized that allowing such a plea would nullify mandatory legal requirements and provide a license to the Government to act contrary to binding provisions of law. The doctrine of promissory estoppel cannot be used to defeat statutory provisions.

5. Mandatory nature of the requirement of "laying" the order before the Legislature:

The Court considered whether the requirement of "laying" the order before the Legislature under Section 11(2) was mandatory. Citing the decision in Atlas Cycle Industries Ltd. v. State of Haryana, the Court held that the requirement of "laying" is not mandatory, even if the provision uses the term "shall." The Court concluded that non-laying of the order before the Legislature does not render the exemption order ineffective or unenforceable.

Conclusion:

The appeals were dismissed, affirming the invalidity of G.O. Ms. No. 201 due to non-compliance with mandatory publication requirements. The retrospective effect of G.O. Ms. No. 386 was upheld, and the doctrines of promissory estoppel and legitimate expectation were deemed inapplicable against statutory provisions. The requirement of "laying" the order before the Legislature was held to be directory, not mandatory.

← Previous Next →