1986 (6) TMI 236 - HC - VAT and Sales Tax

Summary

Issues:
1. Entitlement of interest-free sales tax loan under government orders.
2. Validity of State Level Committee's decision to reduce eligibility limits.
3. Competency of State Level Committee to amend government orders.
4. Application of principles of promissory estoppel.

Detailed Analysis:

1. The petitioner, a public limited company, sought a mandamus to compel the State of Andhra Pradesh to sanction an interest-free sales tax loan as per government orders. The company claimed entitlement to the loan based on the tax paid on construction materials and sales tax under State and Central Sales Tax Acts. The dispute arose when the State Level Committee sanctioned a significantly lower amount than claimed by the petitioner, leading to the filing of the writ petition to enforce the full loan amount.

2. The State Government disputed the value of the petitioner's fixed assets and defended the Committee's decision to reduce eligibility limits for incentives. The core issue was whether the Committee's decision effectively amended the petitioner's eligibility limits under the government orders. The Court noted that the Committee lacked the authority to alter the orders and could only recommend amendments to the State Government. Without valid amendments to the orders, the Committee's deviation from enforcement was deemed unjustified.

3. The Court emphasized that the State Level Committee's actions did not supersede the government orders, as no valid orders were presented to modify the eligibility limits. The Court rejected the Committee's competence to issue valid orders superseding or amending the government orders. Referring to legal precedents, the Court highlighted that the orders issued by the competent authority were binding on the Government and enforceable by the Court, emphasizing the impermissibility of subordinate officers ignoring such orders.

4. Regarding the application of promissory estoppel, the Court found it unnecessary to delve deeply into the doctrine, as the case primarily revolved around the enforcement of government orders. Instead, the Court directed the respondents to reevaluate the petitioner's case for the interest-free sales tax loan in accordance with the relevant government orders. The Court allowed the writ petition, directing the grant of the entitled loan amount and awarded costs to the petitioner.