TaxTMI 
TaxTMI 
1996 (12) TMI 61
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....eon specified in the first schedule. The relevant part of the Notification No. 66 is as under :- "In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), and in supersession of the Notification of Government of India in the Ministry of Finance, Department of Revenue, No. 145-Customs, dated the 27th July, 1980, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts polyvinyl chloride resins, falling within Chapter 39 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), when imported into India, from the whole of the duty of Customs leviable thereon which is specified in the said First Schedule. The Notification shall be in force upto and inclusive of the 31st March, 1981." The case of the appellant is that on the faith of the solemn assurance given by the Government of India that no duty of customs would be leviable on the importation of PVC resins upto 31-3-1981, they entered into an arrangement for the import of PVC resin as an actual user with the U.P. Export Corporation, Kanpur and opened Letters of Credit against the foreign suppliers on 2-10-1980 an....
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....pugned Notification could not be quashed, be it a legislative function or an executive one. "... In M.P. Sugar Mills it was recognised that where the Government owes a duty to the public to act differently, promissory estoppel cannot be invoked to prevent the Government from doing so. The Government cannot be prevented from acting in the discharge of its duty under the law (AIR 1979 SC 621 at 646). One thing is clear from the authorities. There is not a42. single case which has gone to the length of saying that estoppel can be pleaded even against public interest. The present is a case essentially of "public interest". All the authorities uniformly hold that against "public interest" the plea of estoppel will not avail a party. Otherwise the Government will not be able to assert its power and will be a helpless spectator even if public interest requires it to act differently. It would amount to surrender by the Government of its legislative powers which have to be used for the public good. This is why Section 25 confers a statutory power on the Central Government to act in public interest and to grant exemption or rescind it. Estoppel cannot be invoked where the result wil....
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....se there is a supervening public equity, the Government would be allowed to change its stand; it would then be able to withdraw from representation made by it which induced persons to take certain steps which may have gone adverse to the interest of such persons on account of such withdrawal. However, the Court must satisfy itself that such a public interest exists. The law on this aspect has been emphatically laid down in the case of M/s. Motilal Padampat Sugar Mills Co. (P.) Ltd. v State of Uttar Pradesh & Others [1979] 2 S.C.R. 641. The portion relevant for our purpose is extracted below : "It is only if the Court is satisfied, on proper and adequate material placed by the Government, the overriding public interest requires that the Government should not be held bound by the promise but should be free to act unfettered by it, that the Court would refuse to enforce the promise against the Government. The Court would not act on the mere ipse dixit of the Government, for it is the Court which has to decide and not the Government whether the Government should be held exempt from liability. This is the essence of the rule of law. The burden would be upon the Government to show tha....
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....us material, the material was examined by the Government of India and it was decided in "public interest" to withdraw the exemption Notification. Thus, the Union of India has disclosed the circumstances under which the exemption was initially granted as well as the change of circumstances which warranted the withdrawal of the exemption notification. The reasons given by the Union of India justifying withdrawal of the exemption notification, in our opinion, are not irrelevant to the exercise of the power in `public interest', nor are the same shown to be insufficient to support the exercise of that power. From the material on the record it is apparent that the exemption Notification issued under Section 25(1) of the Act, in "public interest", was designed to off set the excess price which the local entrepreneurs were required to pay for importing PVC resin at a time when the difference between the indigenous product and the imported product was substantial. No importer could be expected to import PVC resins after paying duty and incur losses. The exemption Notification, was therefore, issued with a view to set off those losses to the extent possible. The Notification was not issued ....