Statutory sales tax on liquor sales prevails where no lawful exemption or enforceable promise exists.

Sales tax on IMFL and beer sold by L-4/L-5 licencees under the Haryana General Sales Tax Act, 1973 was explained as being levied under the applicable statutory scheme, which did not extend the Section 27(3) exemption to such sales. A discrimination challenge under Article 14 was rejected because an internal departmental treatment of the Corporation did not override the taxing provisions or create a right to parity. The memo relied on for relief was also held incapable of founding promissory estoppel, as it was not shown to have been conveyed to the petitioners, involved no proved reliance, and could not override the statute or the Rules of Business.

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Issues: (i) Whether levy of sales tax on IMFL and beer sold by L-4/L-5 licencees during 1998-99 was discriminatory and violative of Article 14 of the Constitution of India; (ii) Whether a memo issued by the Prohibition, Excise and Taxation Commissioner to the Managing Director of the Corporation created a promise or inducement attracting promissory estoppel against recovery of sales tax.

Issue (i): Whether levy of sales tax on IMFL and beer sold by L-4/L-5 licencees during 1998-99 was discriminatory and violative of Article 14 of the Constitution of India.

Analysis: The liability to tax was governed by Section 16-A and Section 27(3) of the Haryana General Sales Tax Act, 1973, read with entry 2(iv) of Schedule C and entry 24-A of Schedule B. The statutory scheme made foreign liquor and Indian-made foreign liquor taxable at the stage of sale by L-4/L-5 licencees, and the exemption in Section 27(3) did not extend to such sales by that class of dealers. The plea of discrimination based on a separate departmental decision concerning the Corporation did not displace the statutory mandate, and no enforceable right to parity in an internal governmental write-off could be claimed by the petitioners.

Conclusion: The levy was not discriminatory, and the petitioners were liable to pay sales tax under the Act.

Issue (ii): Whether a memo issued by the Prohibition, Excise and Taxation Commissioner to the Managing Director of the Corporation created a promise or inducement attracting promissory estoppel against recovery of sales tax.

Analysis: Promissory estoppel can operate against the Government only where there is a clear promise by an authority, lawful power to make it, and actual alteration of position in reliance on it. The memo was not shown to have been addressed to or conveyed to the petitioners, and no material established that they refrained from collecting tax in reliance on it. More importantly, the Commissioner had no authority under the Act to grant exemption, and any such memo was contrary to the statutory provisions and the Rules of Business requiring fiscal decisions to be taken with Finance Department concurrence. A representation contrary to law cannot found estoppel.

Conclusion: No enforceable promise arose, and promissory estoppel did not bar recovery of sales tax.

Final Conclusion: The statutory levy was upheld, no constitutional or equitable ground for exemption was made out, and the writ petitions failed.

Ratio Decidendi: A departmental memo issued without statutory authority cannot create promissory estoppel against a tax liability imposed by statute, and a plea of discrimination cannot succeed where the levy is expressly supported by the applicable taxing provisions.

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