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TMI Blog1991 (8) TMI 323X X X X Extracts X X X X X X X X Extracts X X X X ..... ts have been divided into three different categories, viz., (i) new industrial units; (ii) new industrial units covered by 1985 dispensation; and (iii) sick industrial units. The different districts of Rajasthan were also divided into two categories with different ceiling limits to be allowed under the Sales Tax Incentive Scheme as per annexure C of the said Scheme (annexure 1). It is submitted that the petitioner-unit is covered by 1985 dispensation as defined in the Scheme, 1987 (annexure 1), which came into force retrospectively from March 5, 1987. 3.. It is pointed out by Mr. Mehta, learned counsel, that in annexure C of the Scheme, 1987, limits have been prescribed for different categories of districts. Note 3 of the said annexure C lays down that sales tax exemption will be subject to an overall limit of Rs. 4 crores in each/any case. The overall limit in case of pioneering industry will be Rs. 6 crores and in case of prestigious unit Rs. 8 crores . It is further pointed out that the petitioner commenced its commercial production on April 1, 1986 and exceeded the target as per project report. The petitioner was granted eligibility certificate under the Scheme, 1987 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apna, learned counsel, that the commercial production, as pointed out by the petitioner, started from April 1, 1986, whereas, the Scheme, 1987 was published on May 23, 1987, which came into effect retrospectively from March 5, 1987, therefore, the petitioner did nothing to alter its position, after the Scheme, 1987, came into force. The petitioner took only benefit in the industry, which was already established earlier. Therefore, the question of application of doctrine of promissory estoppel does not arise. It is further submitted that this is wrong to say that the petitioner under the bona fide and earnest belief made an effort for expansion/ diversification of the project, with a view to get the benefit under the Scheme, 1987 up to the limit of Rs. 4 crores. It is also submitted that the limit of Rs. 4 crores was reduced to Rs. 1 crore vide annexure 2, which the Government was authorised to reduce. The loan for expansion and diversification, as pointed out by the petitioner, amounting to Rs. 20 crores, was sanctioned by the Industrial Credit Investment Corporation Limited vide its letter dated May 23, 1989. The limit was reduced to Rs. 1 crore on August 6, 1988 and the loan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt was not within the knowledge of the petitioner, at the time of filing of the petition, since the same was not mentioned in the book written by Mr. Khetan and some of the text books on this subject which have been written by other authors. Therefore, the petitioner could not challenge this amendment, at the time of filing of the petition. It was prayed that since this is only a legal question, the petitioner may be permitted to do the same by way of filing this application. Since the challenge is only to the legality of a particular provision, the application of the petitioner was allowed. It is contended by the learned counsel that under section 4(2) of the Act, 1954 and section 8(5) of the Central Sales Tax Act, 1956 (for brevity, the Act, 1956 ), the State Government has power to grant exemptions/concessions in respect of tax by issuing notifications from time to time under the aforesaid sections, do not authorise it to withdraw an exemption or concession retrospectively. Therefore, the above notification dated September 10, 1987, making amendment in clause 2(e) of the Incentive Scheme are illegal and without authority of law and needs to be struck down. 6.. I have heard bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed from payment of tax on sales made within the State of the goods manufactured by it. The quantum of sales tax exemption and the period of eligibility of exemption will be as per annexure C . Clause 5 deals with Incentive to new industrial units covered by 1985 dispensation. It reads as under: (i) The new industrial units covered by 1985 dispensation as defined in clause 2(b) which have not availed of any interest-free sales tax loan so far, will be eligible for the incentive specified in clause 4 provided that the total benefit admissible to small, medium and large industrial units shall not exceed 75 per cent, 50 per cent and 25 per cent respectively of their fixed assets in five years, from March 5, 1987. The total period during which this benefit will be available to such units shall be five years. (ii) The new industrial units covered by 1985 dispensation which have not availed of any interest-free sales tax loan up to 31st March, 1987, shall have an option to avail the benefit of the old scheme at the prescribed scales of the old scheme. Clause 7 refers to grant of eligibility certificate. It reads as under: (a) An industrial unit eligible for sales tax exempti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... forma of which has been published along with the scheme. Clause 11 of form A provides five clauses for basis of the eligibility. Any petitioner, who wants to avail the benefit of the Scheme, 1987, is expected to specify any of the five basis for eligibility, as mentioned in clause 3 of the Scheme, 1987 and enumerated in clause 11 of the pro forma of form A . Therefore, it is necessary for every applicant to show on which basis of the five basis, enumerated in clause 11, the benefit of Scheme, 1987, is claimed. The petitioner has claimed benefit of this Scheme on the basis of sub-clause (c) of clause 11 mentioned in form A which is regarding new industrial unit covered by 1985 dispensation. Thus, the petitioner is evidently entitled to receive all benefits under the Scheme, 1987, regarding a new established industrial unit which, admittedly, is covered by 1985 dispensation. Apart from this, the petitioner also claims to be given the benefit for expansion/diversification as provided in sub-clause (5) of clause 3 and also in sub-clauses (d) and (e) of clause 11 of the pro forma of form A mentioned above. However, as enumerated in clause 3 of the scheme as also in clause 11 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... discussed the present matter as laid down by the apex Court in Motilal Padampat Sugar Mill Co. Ltd. v. State of Uttar Pradesh [1979] 44 STC 42; AIR 1979 SC 621 that the doctrine of promissory estoppel is an equitable doctrine, where one party has, by his words or conduct, made to the other a clear and unequivocal promise, which is indicated to create legal relations or effect a legal relationship to arise in future and it is, in fact, so acted upon, the promise would be binding on the party making it and would not be entitled to go back upon it. This principle is, therefore, in the facts and circumstances, mentioned above, applicable to the matter under consideration also. 8.. It has been further submitted by the learned counsel for the respondents that the Scheme, 1987, was published on May 23, 1987 and came into effect retrospectively from March 5, 1987, whereas, the petitioner did nothing to alter its position, after the Scheme, 1987 came into force. Therefore, the petitioner cannot be said to have acted on the basis of Scheme, 1987, more so, after issue of annexure 2. I do not find any force in this contention also, since the Scheme, 1987 itself provides that such new industr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counsel, since clause 11 clearly provides that the Scheme may be reviewed/amended at any time. 10. So far as the legality of notification dated September 10, 1987, published in the Rajasthan Gazette dated September 14, 1987 is concerned, it may be stated by this notification, a new sub-clause (3) has been added in clause 2 of the Scheme, 1987. It is contended by the learned counsel for the petitioner that under section 4(2) of the Act, 1954 and under section 8(5) of the Act, 1956, the State Government has power to grant exemptions/concessions in respect of payment of tax by issuing notifications, but the aforesaid provisions do not authorise the State Government to withdraw, reduce, exemption or concession retrospectively. Therefore, it is contended that, on this account, the notification dated September 10, 1987 is arbitrary and violative of article 14 of the Constitution. I find force in this contention of the learned counsel. When the Scheme, 1987 was issued, certain concessions/benefits were offered to entrepreneurs and those, who established new industries, it can be said that the entrepreneurs, keeping in view the benefits under the Scheme, 1987, took certain steps and acte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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