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2013 (5) TMI 733 - HC - Central ExciseWithdrawal of exemption - principle or doctrine of promissory estoppel - Indian Mouth Freshner - Pan Masala - unit in Sikkim - held that:- Undisputedly, the petitioner acted on the assurance, promise and representation of the Government of India through its IPR and exemption Notification dated 9-9-2003 and the State of Sikkim by virtue of its Notification dated 17-2-2003 and invested huge amount of about Rs. 3.00 crores by altering its position. The respondents are bound to honour their promises, commitments and assurances and are not entitled to breach the same on mere conjectures, whims and absolute discretions. The respondents are, however, entitled to recall benefits of such promise on the basis of valid, justifiable policy and supervening public interest or in exercise of its sovereign authority or if any statute authorises them. In Mahavir Vegetable Oil (P) Ltd. (2006 (3) TMI 234 - Supreme Court), Hon’ble Supreme Court held that doctrine of promissory estoppel operates even in legislative field and accrued rights cannot be taken away by amendment of statutory notification. Since both, i.e. the exemption and withdrawal notifications, are issued in exercise of delegated legislation, the first contention of the respondents deserves to be rejected. Coming to the real and basic question of public interest, the only public interest indicated in the reply is about the nature of the product being manufactured by the petitioner, i.e. Pan Masala, which has been termed to be falling in the category of “demerit goods” and health hazardous. Both the contentions deserve to be rejected in view of the observations made hereinabove. At the cost of prolixity, it may be noticed that the demerit goods have not been defined anywhere. Pan Masala has not been declared as a health hazardous by any notification or order of the Government of India or the State Government. Even no material or scientific reports have been placed on record to demonstrate that the Pan Masala containing no tobacco is health hazardous. Mere ipse dixit terming the goods manufactured by the petitioner as health hazardous or under the category of demerit goods does not in any manner constitute justifiable public interest. The doctrine of promissory estoppel thus becomes enforceable in the present case. The petitioner is entitled to exemption from payment of excise duty on the manufacture of Pan Masala from its unit situated in the State of Sikkim for a period of 10 (ten) years from the date of commencement of commercial production, i.e. 27-6-2006. - Decided in favor of assessee.
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