Turnover tax exemption dispute under an industrial incentive scheme and rehabilitation plan, with promissory estoppel supporting relief.

The text discusses whether an exemption under the West Bengal Incentive Scheme, 1993 and a rehabilitation arrangement under the Sick Industrial Companies (Special Provisions) Act, 1985 extended to turnover tax introduced later under section 16B of the West Bengal Sales Tax Act, 1994. It explains that the scheme treated turnover tax as part of sales tax liability on the turnover of sales, rather than as a separate levy. It also notes that the assessee acted on the Government's promise by making substantial investment, supporting promissory estoppel, and that the BIFR rehabilitation order, enforceable under section 32 of SICA, prevailed over inconsistent State law for the relevant period.

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Issues: Whether the exemption promised under the West Bengal Incentive Scheme, 1993 and the rehabilitation arrangement under the Sick Industrial Companies (Special Provisions) Act, 1985 extended to turnover tax introduced later under section 16B of the West Bengal Sales Tax Act, 1994, and whether the State could refuse the benefit on the ground that turnover tax was a separate levy.

Analysis: The Scheme defined sales tax due for payment to include turnover tax, and the exemption granted to the sick unit was framed in the context of sales tax liability on the turnover of sales. The Court held that turnover tax under the relevant sales tax laws was not a distinct impost divorced from sales tax, but a levy in the same category and on the same taxable turnover. It further held that the petitioner had altered its position by investing substantial sums on the faith of the Government's promise, so the doctrine of promissory estoppel applied. The Court also held that the BIFR rehabilitation order, enforceable under section 32 of the Sick Industrial Companies (Special Provisions) Act, 1985, prevailed over inconsistent State law and covered the tax burden in question.

Conclusion: The petitioner was entitled to exemption from turnover tax for the promised period, and the State could not recover such tax during that period.

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