Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Gujarat Sales Tax Act |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Act(s) Referred | Gujarat Sales Tax Act, 1969 (1 of 1970) |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Dismissed |
Headnote | Gujarat Sales Tax Act, 1969: ss. 15 & 49(2)-Tax exemption for a period of five years from commissioning of industry- Withdrawal of-Effect and validity of Government notification. Promissory estoppel-Doctrine of-Grant of exemption from sales tax to new industry-Withdrawal of-Whether permissible.By a notification dated April 29, 1970 issued under s. 49(2) of the Gujarat Sales Tax Act, 1969 the State Government exempted wholly orpartly from payment of sales ,tax or purchase tax certain specified classes of sales and purchases·described in entries I to 52 in the Schedule.This notification was subsequently amended by another dated November 11, 1970 by adding a new entry No. 53 in the Schedule·exempting a manufacturer, who established a new industry, from the whole of (a) purchase tax under s. IS of the.Act, (b) sales tax leviableunder the Act, for a period of five years from the date or commissioning the industry. By another notification issued on July 17, 1971 theGovernment amended the explanation contained in the second notification thereby taking out certain industries, including oil mills, out of thepurview of the Act.The appellants' oil mill set up in a conforming area, was commissioned on May 14, 1970. Their application for eligibility certificate forclaiming exemption from payment of sales tax as per the second notification having been rejected by the Industries Commissioner, they filedspecial civil application under Art. 226 of the Constitution for an order directing the Industries Commissioner to grant them eligibilitycertificate. It was contended for them that the notification dated July 17, I 97 I would have no effect on the eligibility already acquired bythem in terms of the second notification. The High Court took the view that the notification dated July 17, 1971 was only prospective in operation and not retrospective, that it did not affect the exemption enjoyed by the petitioners under the second notification in respect or the purchases and sales effected prior to July 17 1971 and that the second notification created only existing rights not vested rights and such existing rights could be taken away by the subsequent notification. It, therefore, held that the appellants were entitled to exemption from payment of tax only for the period anterior to July 17, 1971, and for the period thereafter they had no rights to claim exemption.In this appeal by certificate under Art. 133(1)(c) of the Constitution it was contended for the appellants that by virtue of the first andthe second notifications they had acquired a vested right to a tax holiday for a period of five years and the Government acting in exercise of thedelegated powers did not have competence to nullify the exemption by giving retrospective effect to its notification dated July 17, 1971, andthat in any event they were entitled to the benefit of tax exemption for a period of five years on the ground of promissory estoppel and theGovernment was obligated to give tax exemption for the full period of the claim. |
Judge | Hon'ble Mr. Justice S. Natarajan |
Neutral Citation | 1986 INSC 231 |
Petitioner | Bakul Oil Industries & Anr. |
Respondent | State Of Gujarat & Anr. |
SCR | [1987] 1 S.C.R. 185 |
Judgement Date | 1986-11-11 |
Case Number | 2061 |
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