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TMI Blog1981 (7) TMI 248X X X X Extracts X X X X X X X X Extracts X X X X ..... nd there from the raw material, namely, groundnut oil, for, the manufacture of Vanaspati ghee was obtained. Thus by setting up the oil mill the petitioners were starting what may be called a vertical integration. Somewhere in the year 1973 the petitioner firm erected cotton seed plant and the said cotton seed plant was for the manufacture of cotton seed oil by crushing cotton seeds. At that time the Government of India had started giving rebate in connection with excise duty on the usage of non-traditional oils like indigenous cotton seed oil in the manufacture of Vanaspati ghee. In the year 1974 the petitioner firm erected a solvent extraction plant for maximum recovery of oil from oil cakes. All these activities, namely, manufacture of Vanaspati gbee, extraction of groundnut oil, extraction of cotton seed oil and solvent extraction plant are fully carried on in the same premises as before by the petitioners. During the year 1977-78 there was a heavy shortage of edible oil in Gujarat and the Central Government banned the use of groundnut oil in the manufacture of Vanaspati ghee in order to encourage use of minor oil seeds like cotton seeds, soyabean seeds, rice-bran, etc. As a res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacturing cotton lints by erecting a delinting plant and the said process of delinting of cotton seeds for the purpose of the recovery of cotton lints therefrom was amongst the first few to be adopted in the State of Gujarat. They have further submitted that the aforesaid expansion was done by the petitioner company with an intention to get the aforesaid two incentive benefits, namely, cash subsidy and interest-fee sales tax loan, though the cost for the said expansion was very high. Thus there is a specific case of the petitioners that relying on the two resolutions, both dated 22nd Dec., 1977, collectively marked Annexure 'A', they have erected the plant by spending considerable amount in that behalf. So far as the cash subsidy is concerned, it may be pointed out that it was recognised that the cotton delinting plant of the first petitioner firm was entitled to cash subsidy under the provisions of the first scheme, and by Annexure 'C' to the petition, the decision of the State Level Committee in its 34th Meeting held on 27th Feb., 1979, had sanctioned cash subsidy of ₹ 6,43,891/- to the first petitioner firm, and it was mentioned in that document, Annexu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vanaspati manufacture, were to be reserved for co-operative sector and it was further declared that for the units failing outside the co-operative sector, so far as the above-mentioned reserved areas were concerned, the benefits of the schemes set out in the resolutions of Dec. 22, 1977 would not be available to those private sector units. 3. In the affidavit-in-reply, C. N. Shah, Additional Commissioner of Industries, State of Gujarat, being the affidavit dated 14th July, 1981, so far as the remaining amount of cash subsidy is concerned, the deponent says that the Government is prepared to pay the amount provided the formalities for the obtaining of that cash subsidy are complied with. Mr. Trivedi for the petitioners is agreeable that on complying with the necessary formalities, the balance of the cash subsidy may be., made available to them. As regards the exemption from sales tax, there is no claim on behalf of the petitioners and as regards the claim for interest-free sales tax loans, the case of the Government is that because the cotton seed delinting plant of the petitioners falls in Items 12 and 13 of Clause 6 of the second resolution of Dec. 22, 1977 the petitioners are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icers. (4) When the officer, acts within the scope of his authority under a scheme and enters into an agreement and makes a representation and a person acting on that representation put, himself in a disadvantageous position, the Court is entitled to require the officer to act according to the scheme and the agreement or representation. The officer cannot arbitrarily act on his mere whim and ignore his promise on some undefined and undisclosed grounds of necessity or change the conditions to the Prejudice of the person who had acted upon such representation and put himself in a disadvantageous position. (5) The officer would be justified in changing the terms of the agreement to the prejudice of the other party on special considerations such as difficult foreign exchange position or other ' matters which have a bearing on general interest of the State. The position was again reiterated in more or less the same terms in para 50 at p. 1305: On a consideration of the decisions of this Court it is clear that there can be no promissory estoppel against the exercise of legislative power of the State. So also the doctrine cannot be invoked for preventing the Government f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... J. in Bihar Eastern Gangetic Fishermen Co-operative Society Ltd. v. Sipahi Singh, AIR 1977 SC 2149. There, it was pointed by Jaswant Singh J. speaking for the Supreme Court that there could not be any estoppel against the Government in exercise of its sovereign legislative and executive functions. The decision in the Bihar Eastern Gangetic Fishermen Co-operative Society's case (supra) was thus explained by Kailasam, J. in Jit Ram's case (AIR 1980 SC 1285 at p. 1300) (supra). ......... this Court held that the respondent could not invoke the doctrine of promissory estoppel because he was unable to show that relying on the representation of the Government, he had altered his position to his prejudice. The Court accepted the view of this Court expressed in Ram Kumar's case (AIR 1976 SC 2237) and held that there cannot be any estoppel against the Government in the exercise of its sovereign, legislative or executive functions. 8. The legal position being very clear in the light of proposition No. (4) and in the light of the last portion of para 50 in lit Rain's case (supra), in the instant case since the petitioners, have shown that they have spent nearly ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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