IMPORTANT POINTS
Section 35AC(7) of the Income Tax Act, 1961 is prospective.
There cannot be promissory estoppel against exercise of legislative power.
Validity of a taxing statute cannot be challenged on the basis of equity or/and hardship.
Once the action is held in accordance with law, question of invoking powers under Article 142 of the Constitution does not arise.

JUDGMENT :

Abhay Manohar Sapre, J.

1. Leave granted.

2. This appeal is filed against the final judgment and order dated 14.09.2017 passed by the High Court of Gujarat at Ahmedabad in SCA No.7558 of 2017 whereby the High Court dismissed the petition filed by the appellant herein.

3. A few facts need mention hereinbelow for the disposal of this appeal, which involves a short point.

4. The appellant herein is the petitioner and the respondents herein are the respondents in the petition out of which this appeal arises.

5. The appellant is a Charitable Trust registered under the provisions of the Bombay Public Trust Act, 1950. The appellant has set up a Heart Hospital in Ahmadabad. The commencement of the project of the appellant's hospital began in the year 2014 (05.05.2014).

6. On 27.09.2014, the appellant filed an application under Section 35AC of the Income Tax Act, 1961 (hereinafter referred to as "the Act) to the National Committee for Promotion of Social and Economic Welfare, Department of Revenue, North Block, New Delhi (hereinafter referred to as “the Committee") for grant of approval to their hospital project as specified in Section 35AC of the Act so as to enable any "assessee" to incur expenditure by way of making payment of any amount to the appellant for construction of their approved hospital project and accordingly claim appropriate deduction of such payment from his total income during the previous year. Like the appellant, several persons, as specified in Section 35AC of the Act, also made applications to the Committee for grant of approval to their hospital projects.

7. A notification was issued by the Government of India on 07.12.2015 mentioning therein that the Committee has approved 28 projects as "eligible projects" under Section 35AC of the Act. The name of the appellant appears at serial No. 10 in the notification dated 07.12.2015. It reads as under:

8. According to the appellant, they received amount by way of donation from several assesses during the years 2015-2016 and 2016-2017. These assesses then claimed deduction of the amount, which they had donated to the appellant for their hospital project, from their total income. As per the appellant, they received donations in three financial years from several assesses for their hospital project as detailed below:

9. The benefit of claiming deduction was, however, discontinued from the assessment year 2018-2019 by insertion of sub-section (7) in Section 35AC of the Act by the Finance Act, 2016 with effect from 01.04.2017.

10. It is this insertion of sub-section (7) in Section 35AC of the Act, which gave rise to filing of the petition by the appellant in the Gujarat High Court. The appellant in the petition questioned the constitutional validity of sub-section (7) of Section 35AC of the Act inter alia on the ground that once the Committee granted an approval to the appellant's hospital project for a period of three financial years, the same could not be withdrawn qua the appellant on the strength of insertion of sub-section (7) in Section 35AC of the Act. In other words, the challenge was on the ground that sub-section (7) of Section 35AC is essentially prospective in natu