TaxTMI 
TaxTMI 
1997 (12) TMI 114
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.... period prescribed in the I.P.R. 2. It was contended on behalf of the writ petitioner that it had applied for a licence setting up an industry at Betnoti in the District of Mayurbhanj and obtained a provisional registration certificate on 28-11-1979. A permanent registration certificate as a small scale industrial unit was granted by the Director of Industries, Orissa on 10-4-1980. The industrial unit also obtained a production certificate certifying that it had started production on 19-3-1980. The certificate of registration was renewed from time to time. Clause (8) of the I.P.R. effective for the period 1979-83 provided that village cottage and tiny industries certified as such by the State Government and small scale industries shall be exempt from purchase/sales tax for five years on construction material, raw material, machinery and packaging materials. Small scale industrial units in non-backward areas would be entitled to this exemption only for four years. The case of the writ petitioner before the High Court was that it set up its industry in the District of Mayurbhanj pursuant to this I.P.R. It had obtained a huge loan from the United Bank of India. In terms of the I.P.....
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.... the detriment of the assessee after the assessee had set up its plant and had taken a huge loan from the bank for carrying on its business. A prayer was made to declare the notification dated 9-9-1977 as ultra vires Article 19(1)(g) of the Constitution of India. 6. The High Court allowed the writ petition on the ground that in the I.P.R., a clear and unequivocal promise had been made by which a legal relationship was sought to be created between the State and the persons who had acted on the basis of the I.P.R. M/s. Shree Durga Oil Mills, the writ petitioner, had set up its industry on the basis of the declaration made in the I.P.R. and the promise held out therein. There was no way the State Government could back out from the commitments made by it in the I.P.R. after the petitioner had actually set up its industry pursuant to that Resolution which was effective for the period 1977-83. On the strength of this reasoning, the Orissa High Court quashed the assessment orders passed by the Sales Tax Officer. The State has now come up in appeal. 7. One of the points raised in this Court on behalf of the respondent is that the High Court had merely followed its judgments in the ca....
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.... the proposition that for granting exemption from sales tax an I.P.R. was sufficient by itself. A statutory notification was not necessary to implement that policy. Persons who had acted on the basis of the I.P.R. were entitled to get benefit thereunder. It has been contended that this Court has emphasised this rule once again in the case of Pine Chemicals Ltd. v. Assessing Authority - 1993 (67) E.L.T. 25 (S.C.) = (1992) 2 SCC 683. 11.Pine Chemicals case dealt with the exemption from sales tax granted under the J & K General Sales Tax Act, 1962. It was held in that case that if the exemption was claimed on the basis of a Minister's speech or a brochure published by the Government then the claim of promissory estoppel could not be entertained on behalf of any person who claimed that they had changed their position on the basis of the speech or the brochure. It was, however, held that if the Government in exercise of powers under a statute granted exemption then if appropriate conditions existed a case of promissory estoppel could arise. The Court in that case found, that the Government had not made any general declaration of its intention but had actually passed an order gran....
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....8-7-1979. A provisional registration certificate in respect of the respondent's industry was issued on 28-11-1979. The respondent has not given factual details of how in the short span of about four months, it set up its industry on the basis of the I.P.R. 14. Moreover, the Government may change its industrial policy if the situation so warrants. Merely because, the I.P.R. was announced for the period 1979-1983, it does not mean that the Government cannot amend or change the policy under any circumstances. As a matter of fact, in this case the Government had published another I.P.R. on 31-7-1980 modifying the earlier I.P.R. The vires of the second I.P.R. has not been challenged. The two I.P.Rs. have not been issued under any particular statute. A general announcement was made by the Government that certain economic policy would be pursued for the acceleration of the growth of the industrial sector in the State of Orissa. For that purpose, a package of measures for stimulating the growth of industries were announced. It was specifically made clear in the I.P.R. dated 18-7-1979 that : "Government orders will issue laying down the mode of administering the concessions ....
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....sa that after a package of incentives was given to the industries, the Government was faced with severe resource crunch. On a review of its financial position, it was felt that for the sake of the economy of the State, it was necessary to limit the scope of exemption granted to various industries. Accordingly, further notifications were issued under Section 6 of the Orissa Sales Tax Act from time to time. Because of this new perception of the economic scenario, the scope of the earlier notifications was restricted by subsequent notifications issued under Section 6. This also led to issuance of the second I.P.R. dated 31-7-1980. 18. The question of applicability of the doctrine of promissory estoppel against the Government has been considered in a number of cases by this Court. 19. In the case of Kasinka Trading and Another v. Union of India and Another, 1994 (74) E.L.T. 782 (S.C.) = (1995) 1 SCC 274, a notification was issued by the Customs Department under Section 25(1) of the Customs Act in public interest exempting certain goods from basic import duty and specified the date up to which it will remain in force. Prior to expiry of that date another notification was issued wi....