TMI Blog1991 (9) TMI 77X X X X Extracts X X X X X X X X Extracts X X X X ..... f reference to the said notification reveals that the Government of India was concerned with achieving a rapid increase in production of cement by the establishment of a large number of mini cement plants. The establishment of mini cement plants was considered desirable as it would result in exploitation of smaller limestone deposits, dispersal of cement production capacity all over the country, reduction of burden on railway transportation, lower capital cost and quicker installation and higher employment etc. The capacity for a mini cement plant was limited to a plant which can produce 200 tonnes per day or 66,000 tonnes per annum. The choice of technology to be utilised in setting up the mini cement plants was left to the enterpreneurs of the mini cement plant. In clause (iv) of the said press-note it is stated that the ex-works price of cement produced by the mini cement plants would be the same as the price admissible to new large sized plants viz., Rs. 296/- per tonne. This price was assured for a period of five years from the date of going into commercial production. Clause (v) of the said press-note says that mini cement plants will be allowed a rebate in the payment of exc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government of India in the Ministry of Finance (Department of Revenue) No. 194/79-C.E., dated 30th May, 1979. The notification says that the Central Government exempts cement falling under Item No. 23 of the First Schedule to the Central Excises and Salt Act, 1944 and manufactured in a mini-cement plant, from so much of the duty of excise leviable thereon under the said Act at the rate specified in the said First Schedule as is in excess of the amount calculated at the rate of Rs. 170/- per Metric Tonne. As in the case of the previous notification in this notification also it is stated that this notification shall be in force upto and inclusive of the 31st day of March, 1984. Thereafter, Notification No. 61/85-C.E., dated 17th March, 1985 was issued under sub-rule (1) of Rule 8 of the Central Excise Rules, 1944 by 1virtue of which the Central Government directed that the notifications mentioned therein shall be amended in the manners pecified in the corresponding entry in Col. No. 3 of the table given in the said notification. The table itself is reproduced hereunder to enable a ready reference in so far as it is required for the purpose of this judgment, which is as follows : T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the 1st petitioner obtained a letter of intent on 10-6-1980 and placed orders for the supply of machinery for erecting the mini-cement plant. The plant was set up at Somappanagar, Asifabad taluk, Adilabad District. The 1st petitioner was granted industrial licence on 5-8-1981. Since 4-1-1979, i.e., the date of press-note the excise duty payable on cement manufactured by mini-cement plant was Rs. 32.50 as normal excise duty for cement was Rs. 65/- per tonne. This means that the rebate of 50% was given in the payment of excise duty to the mini cement plant. By Notification No. 81/82 the excise duty was revised for cement at Rs. 150/- per tonne and the Central Government issued a separate notification fixing excise duty for mini cement plant at Rs. 100/-, but it should have been half of Rs. 150/- i.e., Rs. 75/- per Metric Tonne. Subsequently by a Notification No. 60/83 dated 1-3-1983 the excise duty for cement was revised to Rs. 205/- per tonne and similarly the excise duty for cement manufactured by mini cement plants was revised at Rs. 170/-. Since 31 -3-1985 even the mini-cement plant manufacturers were paying excise duty at the rate of Rs. 205/-per tonne which was revised to Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 50% rebate in payment of excise duty should be given for a period of five years from the date of the mini-cement plants going into commercial production is totally incorrect. A reading of the relevant notifications reveals the point that the incentives for establishment of mini-cement plants have been given for a period of five years from the date of notification. The Press-Note bearing No. 9-98/78-Com. dated 4-1-1979, issued by the Government of India, Ministry of Industry, Department of Industrial Development, New Delhi merely mentions in clause (v) that the mini-cement plants will be allowed a rebate in the payment of excise duty upto 50% for a period of five years. A reading of this paragraph in the press note clearly reveals the fact that the rebate is to be allowed for a period of five years from the date of notification. In clause (iv) of the said press-note it is stated that "the ex-works price of cement produced by the mini-cement plants would be the same as the price admissible to new large sized plants, viz., Rs. 296/- per tonne. This price will be assured for a period of five years from the date of going into commercial production." It is quite true that in so far as th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s given is quite correct but it will have to be seen in the light of the fact that these concessions to mini cement plants were to be in force only upto 31st day of March, 1984 and no concession is to be given beyond the said date and therefore the petitioners have no right to claim the concessions after the due date i.e., 31-3-1984, has expired. 4. The other contention raised on behalf of the doctrine of promissory estoppel operates in favour of the petitioners and the respondents should not be allowed to go back on the promises made by them in regard to the concession in payment of excise duty to the extent of 50% on the cement produced by the mini-cement plants for a period of five years from the date of the units going into commercial production. At the very outset there is an inherent contradiction in this assertion of the petitioners in the sense that the concession granted in regard to payment of excise duty is valid only upto a period of five years from the date of notification and not from the date of the units going into commercial production. As stated above, in all the notifications issued by the Central Government from time to time it is clearly mentioned that these ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n published in exercise of the statutory power vested in the Central Government under Rule 8 of the Central Excise Rules, 1944. Rule 8 has now been omitted vide Notification No. 19/88-C.E., dated 1-7-1988, but it wasin force at the time when the various notifications, referred to above, were issued and published in the Official Gazette. In this connection it is relevant to refer to Section 38 of the Central Excises and Salt Act, 1944 (Act No. 1 of 1944) which is in the following terms: "Section 38. - Publication of rules and notifications and laying of rules before Parliament :- (1) All rules made and notifications issued under this Act shall be published in the Official Gazette. (2) Every rule made under this Act and every notification issued under sub section (1) of Section 5A and Section 11C shall be laid, as soon as may be after it is made or issued, before each House of Parliament, while it is in session for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or successive session aforesaid, both Houses agree in making any modification in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 38, which is reproduced above, it can be seen that all rules made and notifications issued under this Act come into force on publication in the Official Gazette. In sub-section (2) of Section 38, as amended vide Amendment Act No. 29 of 1988 it is provided that every rule made under this Act and every notification issued under sub-section (1) of Section 5A and Section 11C shall be laid, as soon as may be after it is made or issued, before each House of Parliament while it is in session for a total period of thirty days which may be comprised in one session or in two or more successive sessions and if, before the expiry of the session immediately following the session or the successive session aforesaid, both Houses agree in making any modification in the rule or notification or both Houses agree that the rule should not be made or the notification should not be issued, the rule or notification shall thereafter have effect with such modification or in such form as is directed by the Parliament. Under sub-section (2) of Section 38, therefore, every rule made and every notification issued under sub-section (1) of Section 5A and Section 11C is to be laid before each House of Parliament ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ub-section (2) of Section 38 continue to be directory and the use of the word "shall" for laying the notifications before the Parliament does not make it mandatory. Even if the rules have not been laid before the Parliament, since it is not mandatory to lay such rules, by the imputation of the word "shall" therein it cannot be said that the notifications are rendered void and inoperative by the force of law. It is a negative procedure which bas been followed in sub-section (2) of Section 38 and unless there is a resolution passed by both Houses of Parliament the rules will continue to be in force. The direction given in sub-section (2) of Section 38 is purely directive in its character and does not assume the position of a legal obligation on the part of the Central Governmentto lay the rules before both Houses of Parliament, in mandatory fashion. Failure to place the rules before the Houses of Parliament does not affect the validity of the rules merely because they have not been placed before the Houses of Legislature. In Jain Mohd. v. State of Gujarat the Supreme Court has held that the rules framed under Section 26 (5) of Bombay Agricultural Produce Markets Act (22 of 1939) does ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their publication in the official gazette. These notifications have been issued in exercise of the power of delegated legislation vested in the authorities and once they acquire the statutory force in accordance with the terms of sub-section (1) of Section 38, they are deemed to be as much a legislative measure as any other enactment can be. This being the position, the further discussion with regard to the question of promissory estoppel is curtailed down to a very large extent in the light of the principle that there cannot be a promissory estoppel against the Legislature, in the exercise of its legislative functions. In Vasantkuimar RadhakisanVora v. Board of Trustees of the Port of Bombay the Supreme Court held that the doctrine of promissory estoppel has been evolved by equity to avoid injustice. It is neither in the realm of contract nor in the realm of estoppel. Its object is to interpose equity shorn of its form to mitigate the rigour of strict law. In the same judgment the Supreme Court has cited with approval the passage in Motilal 'P' Sugar Mills' case (AIR 1979 S.C. 621) which is in the following terms : "There can be no promissory estoppel against the legislature in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms that the doctrine of promissory estoppel is applicable against the Government in the exercise of its governmental, public or executive functions and it cannot be defeated by invoking the defence of executive necessity, but no such promissory estoppel operates against the legislature in the exercise of its legislative functions nor can the Government or the public authority be debarred by promissory estoppel from enforcing a statutory prohibition. 7.In the light of the above discussion, two conclusions are to be clearly drawn - firstly, that the period of five years mentioned in the notification dated 4-1-1979 for the grant of rebate in the payment of excise duty to the extent of 50% cannot be deemed to be from the date of the Mini Cement Plant going into commercial production. As stated earlier, there is no warrant in reading the words "from the date of the Unit going into commercial production in the matter of grant of rebate of 50% of excise duty in the notification issued by the Central Government. It is also as clear as day light that in all the notifications issued by the Central Government, cut off date 31-3-1984" has been mentioned as a standard clause beyond which the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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