Name of the Court
Supreme Court of India
All Citations of the Case
AIR 1995 SC 874 : (1995) 50 ECC 31 : (1994) ECR 637 : (1994) 74 ELT 782 : (1994) 7 JT 362 : (1994) 4 SCALE 806 : (1995) 1 SCC 274 : (1994) 4 SCR 448 Supp
[Judgment Source] https://www.courtkutchehry.com/Judgement/Search/AdvancedV2?docid=270755
Facts of the Case
Kasinka Trading and others challenged the withdrawal of a customs duty exemption notification for importing PVC resins. Initially, a notification (No. 66 dated 15.3.1979) had exempted PVC resins from basic customs duty until 31.3.1981. However, before the deadline, the government issued a new notification (No. 205 dated 16.10.1980) reducing the exemption. The appellants, relying on the original exemption, had placed import orders. They invoked promissory estoppel, claiming that the government could not withdraw the exemption before its stated expiry.
Law Points Raised
1. Whether the doctrine of promissory estoppel binds the government to the exemption till 31st March 1981.
2. Whether the withdrawal of exemption before the expiry date violates legitimate expectations.
3. Whether public interest can override promissory estoppel.
4. Scope of delegated legislation under the Customs Act.
Acts / Provisions / Articles Referred
• Customs Act, 1962 — Sections 12, 25, 57, 156
• Customs Tariff Act, 1975 — Section 2
Judgements Referred
Several prior Supreme Court rulings on the doctrine of promissory estoppel were discussed but not cited explicitly.
Obiter Dicta
Promissory estoppel cannot be enforced against the government if overriding public interest is established. Government policy decisions must allow room for reevaluation, especially concerning revenue and trade.
Ratio Decidendi
The government may withdraw exemption notifications under Section 25 of the Customs Act if public interest necessitates it. Promissory estoppel cannot override statutory powers exercised in public interest.
Final Ruling
The Supreme Court dismissed the appeal. It upheld the withdrawal of the exemption notification, holding that public interest justified superseding the earlier notification even before its expiration date.
Relevant Paragraph Numbers
Paragraphs: 4, 5, 10, 11, 12
Summary
The Supreme Court ruled that the doctrine of promissory estoppel does not prevent the government from withdrawing tax exemptions in public interest. This decision reinforces the principle that policy decisions can evolve with changing economic and public needs, especially in the domain of delegated legislation and fiscal management.