Tax exemption for welfare-scheme television supplies continued despite changed beneficiaries; promissory estoppel barred withdrawal of the benefit.

Tax exemption under the Government order for procurement of colour television sets, issued for a welfare supply scheme, continued to apply where the manufactured sets were ultimately distributed to Government departments and institutions instead of individual families. A later policy change stopping further procurement did not automatically withdraw the exemption for sets already manufactured and supplied under the same scheme objective. A mere change in the end beneficiaries did not alter the exempt character of the transaction, and promissory estoppel supported continuation of the benefit. The tax levy on the disputed supply was therefore not justified.

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Issues: Whether tax exemption granted for procurement of colour television sets under the Government order continued to apply when the manufactured sets were ultimately distributed to Government departments and institutions instead of individual families.

Analysis: The exemption was issued as part of a welfare scheme for free supply of colour television sets, and the purchase order itself proceeded on the basis that no tax was payable. The later policy change discontinued further procurement, but the already manufactured sets were still taken and distributed under the same scheme objective, only with different end users. A mere change in the beneficiaries did not mean that the exemption stood withdrawn automatically. The principle of promissory estoppel also supported continuation of the exemption.

Conclusion: The exemption continued to apply, and the levy of tax on the disputed supply was not justified.

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