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Issues Involved:
1. Withdrawal of the cash assistance scheme by the Government of India. 2. Application of the doctrine of equitable or promissory estoppel against the Government. 3. Whether the withdrawal of the scheme was arbitrary and violated the rules of natural justice. 4. Determination of actual loss suffered by the petitioners due to the withdrawal of the scheme. 5. Preliminary objections regarding the maintainability of the writ petition. Detailed Analysis: 1. Withdrawal of the Cash Assistance Scheme by the Government of India: The petitioners, engaged in the export of walnuts, challenged the withdrawal of the cash assistance scheme by the Government of India, which was initially introduced to incentivize exports and augment foreign exchange earnings. The scheme promised cash assistance of 5% of the f.o.b value on exports, with an additional 2.5% under certain conditions. The petitioners argued that they had relied on this scheme, invested significantly, and expanded their business, only for the scheme to be unilaterally withdrawn, causing them prejudice. 2. Application of the Doctrine of Equitable or Promissory Estoppel Against the Government: The petitioners contended that the Government was estopped from withdrawing the scheme under the doctrine of equitable or promissory estoppel, as they had altered their position based on the Government's promise. They cited precedents such as Union of India v. Anglo Afghan Agencies Ltd., AIR 1968 SC 718, where the Supreme Court held that the Government is bound by its promises if a citizen has acted upon them to their detriment. However, recent judgments have narrowed the scope of this doctrine, especially when applied to the Government's sovereign functions. The court noted that the doctrine would not apply to the Government when acting in its public, governmental, or sovereign capacity unless necessary to prevent fraud or manifest injustice. 3. Whether the Withdrawal of the Scheme was Arbitrary and Violated the Rules of Natural Justice: The petitioners argued that the withdrawal was arbitrary and violated natural justice principles. The Government, however, justified the withdrawal by stating that the international market conditions had changed, with walnut prices rising significantly, eliminating the need for the scheme. The court found that the withdrawal was not arbitrary and was justified in light of the changed economic conditions. Notice had been given to the exporters' association, and the petitioners were aware of and had opposed the withdrawal, satisfying the requirements of natural justice. 4. Determination of Actual Loss Suffered by the Petitioners Due to the Withdrawal of the Scheme: The petitioners claimed that they had suffered losses due to the withdrawal. However, the Government's affidavit stated that no actual loss was incurred by the petitioners, as the international market prices for walnuts had increased, ensuring profitability without the cash assistance. The court observed that the petitioners failed to provide concrete evidence of actual losses, and the alleged loss was essentially a loss of additional profit rather than an incurred detriment. 5. Preliminary Objections Regarding the Maintainability of the Writ Petition: The Government raised preliminary objections, arguing that the cash assistance scheme was a concession and not enforceable by a writ petition. The court noted that the doctrine of equitable estoppel could not be applied against the Government in its sovereign capacity unless to prevent fraud or manifest injustice. Additionally, the court emphasized that disputed questions of fact, such as the actual loss suffered, are not suitable for determination in writ jurisdiction and should be addressed through a civil suit for damages if necessary. Conclusion: The court dismissed the writ petition, holding that the doctrine of promissory or equitable estoppel does not apply to the Government when acting in its public, governmental, or sovereign capacity, except to prevent fraud or manifest injustice. The withdrawal of the cash assistance scheme was justified due to changed economic conditions, and the petitioners failed to prove any actual loss suffered. The preliminary objections regarding the maintainability of the writ petition were also upheld to the extent discussed in the merits of the case. No costs were awarded.
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