Rehabilitation scheme exemption must follow its original terms; later notification cannot add a tax cap and curtail benefits.

A sanctioned rehabilitation scheme that granted sales tax and VAT exemption for a fixed period, without any monetary ceiling, had to be implemented according to its terms. A later notification could not lawfully curtail that benefit by adding a tax cap inconsistent with the scheme. The rehabilitation authority's directions were limited to enforcing the original scheme and were supported by the VAT savings provision preserving existing exemption benefits for the balance of the scheme period. Because the State had consented to the scheme, objections based on lack of consent or hearing did not establish illegality. The challenge failed and the exemption directions for the remaining period were upheld.

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Issues: Whether the directions issued under the sanctioned rehabilitation scheme to continue sales tax and VAT exemption till the end of the scheme period, without the monetary cap inserted in the later notification, were within the scheme and legally enforceable against the State.

Analysis: The sanctioned scheme expressly granted sales tax benefit for the rolling mill for the stipulated period and did not prescribe any monetary ceiling. The subsequent notification could not curtail the benefit by introducing a tax cap inconsistent with the scheme. The directions issued by the rehabilitation authority were only to ensure implementation of the original scheme and were reinforced by the savings provision under the VAT enactment, which preserved existing exemption benefits for the balance period. Since the State had been a consenting party to the scheme and the later directions did not travel beyond it, the plea of lack of consent or want of hearing did not establish any illegality.

Conclusion: The challenge failed; the directions to extend exemption without any monetary limit for the remaining scheme period were upheld and the writ petition was dismissed.

Ratio Decidendi: A rehabilitation scheme sanctioned with the State's consent must be implemented according to its terms, and a later administrative notification cannot impose a restriction that is absent from the scheme, especially where the successor tax law preserves the pre-existing exemption.

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