Retrospective tax incentive amendment and revisional recovery upheld under the amended statutory computation formula.

A retrospective amendment to the Maharashtra VAT incentive provisions was treated as valid and enforceable because the tax concession remained subject to legislative control, and promissory estoppel could not prevent the Legislature from restructuring the benefit by statute. The amended formula required incentives to be limited proportionately, and excess benefit could be recovered under the validating provision. The revisional authority's recomputation of deferred sales tax benefits was also sustained because it could intervene where earlier assessments were erroneous and prejudicial to revenue, especially where the factual basis for full deferral was unsupported and the amended statutory method governed the computation.

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Issues: (i) Whether the retrospective amendment to Section 93 of the Maharashtra Value Added Tax Act, 2002, introducing proportionate incentives and validating recovery of excess benefit, was legally sustainable and enforceable against the eligible unit; (ii) Whether the revisional order under Section 25 of the Maharashtra Value Added Tax Act, 2002, recomputing the petitioner's deferred sales tax benefits and directing recovery, suffered from lack of jurisdiction or illegality.

Issue (i): Whether the retrospective amendment to Section 93 of the Maharashtra Value Added Tax Act, 2002, introducing proportionate incentives and validating recovery of excess benefit, was legally sustainable and enforceable against the eligible unit.

Analysis: The incentive under the Package Scheme was a statutory concession granted in public interest and was always subject to the governing tax legislation. The amendment to Section 93 operated retrospectively from the appointed date and had already been upheld as a valid legislative measure. The doctrine of promissory estoppel could not be invoked to prevent the Legislature from withdrawing or restructuring a tax concession by statute. The scheme, read with the non-obstante language of the amended provision, required incentives to be limited to the proportion prescribed by the statutory formula.

Conclusion: The retrospective amendment to Section 93 was held valid and applicable against the petitioner.

Issue (ii): Whether the revisional order under Section 25 of the Maharashtra Value Added Tax Act, 2002, recomputing the petitioner's deferred sales tax benefits and directing recovery, suffered from lack of jurisdiction or illegality.

Analysis: Section 25 empowered the superior authority to examine whether tax had been brought to tax at a lower rate or whether an assessment order was erroneous and prejudicial to revenue. The authority found that the assessments had proceeded on an incorrect assumption that separate identification of purchases and production capacity justified full or higher deferral, whereas the factual material showed common facilities and no reliable segregation of purchases for the two divisions. On that footing, the earlier assessments were treated as erroneous and recovery was directed in accordance with the amended statutory formula.

Conclusion: The revisional order was upheld and the challenge to jurisdiction failed.

Final Conclusion: The writ petition failed on all substantial grounds, the statutory amendment and the revisional recovery were sustained, and the petitioner was denied relief.

Ratio Decidendi: A tax incentive granted under a statutory scheme remains subject to later legislative modification, and once the Legislature retrospectively prescribes a proportionate method of computation, promissory estoppel cannot defeat the statute; a revisional authority may reopen an assessment that has granted benefits contrary to the amended legal formula when the order is erroneous and prejudicial to revenue.

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