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2019 (12) TMI 61 - SC - VAT and Sales TaxPower of the State to rescind the notification with retrospective effect - doctrine of promissory estoppel - notification providing for rebate in respect of tax payable under the Uttar Pradesh Trade Tax Act, 1948 - withdrawal of facility even in respect of industrial units, which had commenced production and had complied with the conditions for grant of such rebate in terms of Notification dated 27th February, 1998, with retrospective effect - Doctrine of Promissory Estoppel. HELD THAT:- The parties have proceeded on the premise that the State Government or the Executive is competent to rescind the earlier notification and the doctrine of promissory estoppel can be no impediment in that behalf. That, however, is hedged or laced with condition that the burden is upon the Government to show that it acted in furtherance to public interest in issuing such a notification otherwise than in accordance with the promise and that the public interest is so overwhelming that it would be inequitable to hold the Government bound by the promise. It is well established that the Court would not act on mere ipse dixit of the Government and must insist on a highly rigorous standard of proof in discharge of its burden by the Government. Resultantly, it is not necessary for us to dilate on the precedents pressed into service by the respondents on the application of doctrine of promissory estoppel of the State Government like any other private party or individual. On a bare reading of provision of Section 5 of the Uttar Pradesh Trade Tax Act, 1948, it is evident that there is no express authority given to the Executive to issue notification for “withdrawing or rescinding the rebate facility” from a date prior to the date of notification. Section 5(2) merely constrict that power only for “allowing” rebate with effect from a date prior to the date of notification. That does not include, by necessary implication or otherwise, power to “withdraw” or “rescind” the rebate from a date prior to the date of the notification - also, Section 21 of the 1904 Act, is pari materia to the above provision and will be of no avail for withdrawing the rebate from a date prior to the date of the notification. In the present case, it is not necessary to dilate further on this aspect as the plain language of the notification dated 14th October, 2004, itself expressly rescinds notification dated 27th February, 1998 with effect from 14th October, 2004. There is no express or tacit intent manifested from this notification, so as to construe it as bestowing power to withdraw the rebate facility with effect from a date prior to the date of notification as such. On this finding, nothing more is required to be said as the concomitant of this finding would necessarily be that all the industrial units set up after 27th February, 1998 and before 14th October, 2004 which had commenced commercial production, must continue to qualify for rebate for specified term mentioned in notification dated 27th February, 1998, subject to fulfilling all other conditions specified therein. The question of future revenue loss would not arise as the industrial units established in the neighbouring States would not be eligible to avail of the rebate because of rescinding the earlier notification. Suffice it to observe that the argument about future revenue loss cannot be invoked against the industrial units who had already established and commenced production after 27th February, 1998 and before 14th October, 2004. For, it can be safely presumed that the policy makers were fully conscious about the so-called loss of future revenue due to rebate to those units when they had issued notification dated 27th February, 1998. That ground cannot be set up against the industrial units who qualify in all other respect under the notification dated 27th February, 1998 and have made substantial investment running into crores much less as being supervening public interest, as is being placated by the State in these proceedings. Thus, the impugned notification dated 14th October, 2004 can have no application to the settled enforceable right accrued to industrial units who fulfill all other conditions specified in the notification dated 27th February, 1998, having commenced commercial production of the specified goods before 14th October, 2004 - the stand of the State Government about the supervening public interest qua the respondents herein and similarly placed persons, is hereby rejected. The notification dated 14th October, 2004 cannot be construed as having retrospective or retroactive effect to whittle down the accrued rights in favour of such industrial units. Appeal dismissed.
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