Sales tax exemption under industrial policy upheld only subject to statutory conditions; promissory estoppel could not defeat the notification.

Sales tax exemption under the 1986 policy and the Assam Industries (Sales Tax Concessions) Act, 1986 was confined to the conditions the State prescribed. The court held that the authorisation-certificate requirement was valid because the statutory scheme separated raw-material concessions from exemption on finished products, and the notification lawfully imposed conditions for new industrial units. The claim that finished-product sales enjoyed an unconditional exemption failed. Promissory estoppel also failed because the policy reserved governmental discretion, no clear and unequivocal promise of unconditional exemption was shown, and estoppel cannot override the statute or the notification. The statutory scheme and the impugned notification were upheld.

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Issues: (i) Whether sales tax exemption under the 1986 policy and the Assam Industries (Sales Tax Concessions) Act, 1986 extended to sales of finished products by a new industrial unit, and whether the impugned notification validly imposed the condition of an authorisation certificate; (ii) Whether the denial of exemption could be defeated on the basis of promissory estoppel.

Issue (i): Whether sales tax exemption under the 1986 policy and the Assam Industries (Sales Tax Concessions) Act, 1986 extended to sales of finished products by a new industrial unit, and whether the impugned notification validly imposed the condition of an authorisation certificate.

Analysis: The policy promised sales tax exemption on raw materials and finished products only as would be decided by the Government from time to time, and therefore did not confer an absolute or unconditional right. The statutory scheme kept the concessions in two compartments: Chapter II dealt with raw materials through authorisation certificates, while section 3A, inserted by section 12, empowered the State Government to exempt sales of goods produced in new industrial units subject to conditions specified in a notification. The Rules and the forms under them showed that the authorisation certificate was connected with raw materials for manufacture, not with finished products. The impugned notification merely exercised the reserved power to prescribe conditions for exemption on finished products and was consistent with the policy and the Act.

Conclusion: The condition requiring an authorisation certificate was valid, and the denial of exemption was not illegal.

Issue (ii): Whether the denial of exemption could be defeated on the basis of promissory estoppel.

Analysis: The pleadings did not establish a clear and unequivocal promise of unconditional exemption or a definite alteration of position in reliance on such a promise. The policy itself reserved governmental discretion, and a promise contrary to the statutory framework could not be enforced. Since the Act and the notification lawfully regulated the grant of exemption, estoppel could not operate against the statute or override the conditions prescribed for availing the concession.

Conclusion: The plea of promissory estoppel failed.

Final Conclusion: The statutory scheme and the notification were upheld, and the appellants were not entitled to the claimed sales tax exemption on the basis asserted.

Ratio Decidendi: Where a tax incentive policy reserves governmental discretion and the governing statute authorises exemption only subject to prescribed conditions, no enforceable right to exemption arises beyond those conditions, and promissory estoppel cannot be invoked to defeat the statute.

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