TMI Blog2003 (4) TMI 493X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 24-12-1997 announcing the new industrial policy and other concession in the North Eastern Region. The aims and objects of the said policy are explained in paragraph 1 of the said office memorandum which reads as follows : Annexure-C No. EA/1/2/96- Government of India Ministry of Industry, Department of Industrial Policy and Promotion 24th December, 1997 OFFICE MEMORANDUM Subject : New Industrial Policy and other concession in the North Eastern Region. In view of the continuing backwardness of North East Region, the need for a new and synergetic incentive package was widely felt to stimulate development of industries (Hon ble Prime Minister made statement at Guwahati on October 27th, 1996 that initiatives would be announced for the industrial development of the North Eastern Region). Expert Groups/Committees were constituted by the Ministry of Industry and Planning Commission to the initiatives. 4. The Fiscal incentives to new Industries units and their substantial expansion are explained in paragraph of the office memorandum which is as follows : Fiscal Incentives to new Industries units and their substantial expansion. (i) Government h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registered office and factory at Byrnihat, Meghalaya carrying on the business of manufacturing of M.S. Ingots and started production from 1-1-1998. 9. The petitioner in W.P. (C) No. 69 (S.H.) 2006 started its industrial unit at Byrnihat in Ri-Bhoi District of Meghalaya and started manufacturing M.S. Ingots and started production from 12-2-1999. 10. The petitioner in W.P. (C) No. 227 (S.H.) of 1999 started its industrial unit for manufacturing of PSC Poles and Steel Fabricated structure at Byrnihat in Ri-Bhoi District of Meghalaya. Subsequently, the company has also started the production of M.S. Ingots, Runners etc. w.e.f. 14-7-1999. 11. The petitioner in W.P. (C) No. 188 (S.H.) 2000 started its industrial unit at 13th Mile, Tamulikuchi, Byrnihat, Meghalaya for manufacturing of M.S. Ingots. The company started its production with effect from 1-8-1997. 12. The petitioner in W.P. (C) No. 189 (S.H.) 2000 started its industrial unit at Byrnihat in Ri-Bhoi District of Meghalaya for manufacturing and selling of M.S. Ingots. The company started production with effect from 12-4-2000 after the unit was expanded with due intimation to the concerned authority. 13. The petitioner in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fications etc. and issue necessary instructions for giving effect to these decisions. 19. Pursuant to the said request to the Finance Department in the said memorandum, the Ministry of Finance (Department of Revenue) issued the Notification No. 23/99 dated 8th July, 1999 whereby the benefits as provided in the office memorandum were granted to the NER units in the areas mentioned in the annexure annexed to the said notification. The said notification reads as follows : (a) The manufacturer shall submit a statement of the duty paid from the said account current to the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise, as the case may be, by the 7th of the next month in which the duty has been paid from the account current. (b) The Assistant Commissioner or Deputy Commissioner of Central Excise, as the case may be, after such verification, as may be deemed necessary shall refund the amount of duty paid from the account current during the month under consideration to the manufacturer by the 15th of the next month. (c) If there is likely to be any delay in the verification, the Assistant Commissioner or Deputy Commissioner of Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he office memorandum is simple i.e., from the date of commencement of commercial production. Therefore, the question is whether the notification issued by the Ministry of Finance is in-consonance with the said provision made in paragraph C(1) of the office memorandum. 22. In the office memorandum dated 24-12-1997 of the Government of-India, Ministry of Industry, Department of Industrial Policy and Promotion, the Government clearly announced and declared that the Government has approved for converting, the course centre and IIDCs into a total tax free zone for the next ten years from the date of commencement of production. This announcement was made in the opening page of the office memo randum that there was a need for a new and synergetic incentive package to stimulate development of industries in the approved areas of the North Eastern region. By virtue of this office memorandum dated 24-12-1997, a promise was made by the Government of India that all industrial activities in the zone were to be free from excise duty for the period of ten years from the commencement of production. The intention of issuing the office memoran dum is to encourage new industries to come up in the No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mulgate the New Industrial Policy was made after the Hon ble Prime Minister has made a statement at Gauhati on 27th October, 1996 that new incentives would be provided for the industrial development of the North Eastern Region. The new industrial policy was announced after the matter was examined by the expert groups/committees constituted by the Ministry of Industry and Planning. Thereafter the policy was approved by the Union Cabinet. 25. While issuing the said Office Memorandum dated 24-12-1997 the Ministry of Finance, etc. were, also, requested to amend the rules/notifications etc. and, issue necessary instructions for giving effect to these decisions. The Ministry of Finance (Deptt. of Revenue) in pursuant thereof has issued the impugned Notification No. 32/99 dated 8-7-1999 whereby the benefits provided in the Office Memorandum were granted only from the date of commencement of production or publication of the Notification in the Official Gazette whichever is later. It is this exemption granted in Clause 4 of the Notification that the writ petitioners in these writ petitions were aggrieved and have approached this court by way of these writ petitions. 26. In view of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld as follows :- ....The industrial incentive policy is issued by the State Government after such policy is approved by the Cabinet itself. The issuance of the notification under Section 7 of the Bihar Finance Act is by the State Government in the Finance Department which notification is issued to carry out the objectives and the policy decisions taken in the industrial policy itself. In this view of the matter, any notification issued by Government order in exercise of power under section 7 of the Bihar Finance Act, if is found to be repugnant to the industrial policy declared in a government resolution, then the said notification must be held to be bad to that extent. In the case in hand, the notification issued by the State Government on 4-4-1994 has been examined by the High Court and has been found, rightly, to be contrary to the Industrial Incentive Policy, more particularly, the policy engrafted in clause 10.4(i)(b). Consequently, the High Court was fully justified in striking down that part of the notification. Which is repugnant to sub-clause (b) of clause 10.4(i) and we do not find any error committed by the High Court in striking down the said notification. We are no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mption shall be available to both new and existing industrial units. It would not be out of place to mention at this stage that it is the specific case of the appellants that they neither paid sales tax on the purchase of materials nor charged sales tax on finished goods. Not only that even implementing agency, admittedly, issued eligibility certificates to all the appellants granting them exemption from payment of sales tax for a period of seven years. No condition whatsoever was laid down in the certificates that the exemption would be available only on the increased introduction resulting from the expansion, modernisation or diversification and in fact, no provision in the Industrial Policy of 1991 contemplated about the increase in production for availaing the full sales tax exemption. In other words, the Industrial Policy was understood both by the industrial units and by the department in the same manner. It is now too late in the day to ask the industrial units to pay the sales tax beyond the increased capacity when they have neither paid the same on raw materials purchased nor charged the same on finished goods from their customers. 70. It appears to me that full sales ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne of Promissory Estoppel was already observed by the Division Bench by holding that the finding of the learned single Judge that the Government is bound by the principles of Promissory Estoppel. 31. The contention raised by the learned counsel for the respondents that the Notification was issued as per Section 5(a) clause 5 of the Central Excise Act, 1944 that the Notification shall come into force from the date of publication in Official Gazette cannot be accepted as such Notification cannot be against the industrial policy which was duly approved by the Union Cabinet. The Notification ought to have been in accordance with the industrial policy laid down by the Central Government after due approval by the Cabinet and it cannot be undermined by issuing an executive Notification to make it effective from a later date which is not contemplated in the industrial policy as per the Office Memorandum. 32. Records also show that the Ministry of Industry has issued notification dated 1-6-1998 by introducing a scheme known as Central Capital Investment Subsidy Scheme, 1997 and Notification dated 19-2-1999 introducing a Scheme known as Central Interest Subsidy Scheme 1997 granting diffe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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