2020 Supreme(SC) 319

SUPREME COURT OF INDIA
Arun Mishra, M. R. Shah, B.R. Gavai, JJ.
Union of India & Another Etc. Etc. – Appellants
Versus
M/s V.V.F Limited & Another Etc. Etc – Respondents
Civil Appeal Nos. 2256-2263 of 2020 (Arising Out of SLP(C) Nos. 28194-28201 of 2010) with C.A. No. 2264 of 2020 @ SLP(C) No. 14751 of 2013, C.A. No. 2265 of 2020 @ SLP(C) No. 14752 of 2013, C.A. No. 2266 of 2020 @ SLP(C) No. 14753 of 2013, C.A. Nos. 2267-2275 of 2020 @ SLP(C) Nos. 15481-15489 of 2011, SLP(C) No. 19998 of 2013, SLP CC No. 1787 of 2014, C.A. No. 2276 of 2020 @ SLP(C) No. 11878 of 2015, C.A. No. 2277 of 2020 @ SLP(C) No. 19370 of 2015, C.A. No. 2278 of 2020 @ SLP(C) No. 19868 of 2015, C.A. No. 2279 of 2020 @ SLP(C) No. 19386 of 2015, C.A. No. 2280 of 2020 @ SLP(C) No. 19379 of 2015, C.A. No. 2281 of 2020 @ SLP(C) No. 19376 of 2015, C.A. No. 2282 of 2020 @ SLP(C) No. 19384 of 2015, C.A. No. 2283 of 2020 @ SLP(C) No. 19380 of 2015, C.A. No. 2284 of 2020 @ SLP(C) No. 20626 of 2015, C.A. No. 2285 of 2020 @ SLP(C) No. 21583 of 2015, C.A. No. 2286 of 2020 @ SLP(C) No. 19320 of 2015, C.A. No. 2287 of 2020 @ SLP(C) No. 19371 of 2015, C.A. No. 2288 of 2020 @ SLP(C) No. 20109 of 2015, C.A. No. 2289 of 2020 @ SLP(C) No. 19378 of 2015, C.A. No. 2290 of 2020 @ SLP(C) No. 19375 of 2015, C.A. No. 2291 of 2020 @ SLP(C) No. 21406 of 2015, C.A. No. 2292 of 2020 @ SLP(C) No. 23331 of 2015, C.A. No. 2293 of 2020 @ SLP(C) No. 20630 of 2015, C.A. No. 2294 of 2020 @ SLP(C) No. 20631 of 2015, C.A. No. 2295 of 2020 @ SLP(C) No. 20628 of 2015, C.A. No. 2296 of 2020 @ SLP(C) No. 20627 of 2015, C.A. No. 2297 of 2020 @ SLP(C) No. 19228 of 2015, C.A. No. 2298 of 2020 @ SLP(C) No. 23394 of 2015, C.A. No. 2299 of 2020 @ SLP(C) No. 23399 of 2015, C.A. No. 2300 of 2020 @ SLP(C) No. 23328 of 2015, C.A. No. 2301 of 2020 @ SLP(C) No. 19373 of 2015, C.A. No. 2302 of 2020 @ SLP(C) No. 23329 of 2015, C.A. No. 2303 of 2020 @ SLP(C) No. 23326 of 2015, C.A. No. 2304 of 2020 @ SLP(C) No. 20442 of 2015, C.A. No. 2305 of 2020 @ SLP(C) No. 23398 of 2015, C.A. No. 2306 of 2020 @ SLP(C) No. 23393 of 2015, C.A. No. 2307 of 2020 @ SLP(C) No. 20370 of 2015, C.A. No. 2308 of 2020 @ SLP(C) No. 19842 of 2015, C.A. No. 2309 of 2020 @ SLP(C) No. 22568 of 2015, C.A. No. 2310 of 2020 @ SLP(C) No. 21605 of 2015, C.A. No. 2363 of 2020 @ SLP(C) No. 23303 of 2015, C.A. No. 2311 of 2020 @ SLP(C) No. 23301 of 2015, C.A. No. 2312 of 2020 @ SLP(C) No. 23334 of 2015, C.A. No. 2313 of 2020 @ SLP(C) No. 21584 of 2015, C.A. No. 2314 of 2020 @ SLP(C) No. 23391 of 2015, C.A. No. 2315 of 2020 @ SLP(C) No. 23297 of 2015, C.A. No. 2316 of 2020 @ SLP(C) No. 23898 of 2015, C.A. No. 2317 of 2020 @ SLP(C) No. 23251 of 2015, C.A. No. 2318 of 2020 @ SLP(C) No. 23896 of 2015, C.A. No. 2319 of 2020 @ SLP(C) No. 23903 of 2015, C.A. No. 2320 of 2020 @ SLP(C) No. 23396 of 2015, C.A. No. 2321 of 2020 @ SLP(C) No. 23294 of 2015, C.A. No. 2322 of 2020 @ SLP(C) No. 23897 of 2015, C.A. No. 2323 of 2020 @ SLP(C) No. 23900 of 2015, C.A. No. 2324 of 2020 @ SLP(C) No. 23295 of 2015, C.A. No. 2325 of 2020 @ SLP(C) No. 23299 of 2015, C.A. No. 2326 of 2020 @ SLP(C) No. 23902 of 2015, C.A. No. 2327 of 2020 @ SLP(C) No. 27036 of 2015, C.A. No. 2328 of 2020 @ SLP(C) No. 23296 of 2015, C.A. No. 2329 of 2020 @ SLP(C) No. 26286 of 2015, C.A. No. 2330 of 2020 @ SLP(C) No. 23693 of 2015, C.A. No. 2331 of 2020 @ SLP(C) No. 26764 of 2015, C.A. No. 2332 of 2020 @ SLP(C) No. 23247 of 2015, C.A. No. 2333 of 2020 @ SLP(C) No. 23899 of 2015, C.A. No. 2334 of 2020 @ SLP(C) No. 23901 of 2015, C.A. No. 2335 of 2020 @ SLP(C) No. 27041 of 2015, C.A. No. 2364 of 2020 @ SLP(C) No. 27024 of 2015, C.A. No. 2336 of 2020 @ SLP(C) No. 27034 of 2015, C.A. No. 2337 of 2020 @ SLP(C) No. 26284 of 2015, C.A. No. 2338 of 2020 @ SLP(C) No. 27053 of 2015, C.A. No. 2339 of 2020 @ SLP(C) No. 27058 of 2015, C.A. No. 2340 of 2020 @ SLP(C) No. 25804 of 2015, C.A. No. 2341 of 2020 @ SLP(C) No. 27046 of 2015, C.A. No. 2342 of 2020 @ SLP(C) No. 26767 of 2015, C.A. No. 2343 of 2020 @ SLP(C) No. 27043 of 2015, C.A. No. 2344 of 2020 @ SLP(C) No. 26821 of 2015, C.A. No. 2345 of 2020 @ SLP(C) No. 27050 of 2015, C.A. No. 2346 of 2020 @ SLP(C) No. 26294 of 2015, C.A. No. 2347 of 2020 @ SLP(C) No. 27048 of 2015, C.A. No. 2348 of 2020 @ SLP(C) No. 26283 of 2015, C.A. No. 2349 of 2020 @ SLP(C) No. 27049 of 2015, C.A. No. 2350 of 2020 @ SLP(C) No. 25799 of 2015, C.A. No. 2351 of 2020 @ SLP(C) No. 26295 of 2015, C.A. No. 2352 of 2020 @ SLP(C) No. 26287 of 2015, C.A. No. 2353 of 2020 @ SLP(C) No. 25797 of 2015, C.A. No. 2354 of 2020 @ SLP(C) No. 26290 of 2015, C.A. No. 2355 of 2020 @ SLP(C) No. 27744 of 2015, C.A. No. 2356 of 2020 @ SLP(C) No. 26972 of 2015, C.A. No. 2357 of 2020 @ SLP(C) No. 1907 of 2016, C.A. No. 2358 of 2020 @ SLP(C) No. 7208 of 2016, C.A. No. 2359 of 2020 @ SLP(C) No. 10257 of 2018, C.A. No. 2360 of 2020 @ SLP(C) No. 10253 of 2018, C.A. No. 2361 of 2020 @ SLP(C) No. 12148 of 2018 and C.A. No. 2362 of 2020 @ SLP(C) No. 12496 of 2018.
Decided on : 22-04-2020

IMPORTANT POINTS
(1) Doctrine of promissory estoppel cannot be invoked in abstract.
(2) If a statute is curative or merely declaratory of previous law retrospective operation is generally intended.
(3) Person claiming exemption has to establish that his case squarely falls within exemption notification and while doing so, a notification should be construed against assessee in case of ambiguity.

Headnote:

(A) Indian Evidence Act, 1872 – Section 115 – Promissory estoppel – Doctrine of promissory estoppel cannot be invoked in abstract – Courts are bound to consider all aspects including objective to be achieved and public good at large – While considering applicability of doctrine, courts have to do equity and fundamental principles of equity must forever be present to mind of court, while considering applicability of doctrine – Doctrine must yield when equity so demands if it can be shown having regard to facts and circumstances of case that it would be inequitable to hold Government or public authority to its promise, assurance or representation – Principle of promissory estoppel may be applicable against Government – But determination of applicability of promissory estoppel against public authority/Government hinges upon balance of equity or public interest – In case there is a supervening public interest, Government would be allowed to change its stand; it would then be able to withdraw from representation made by it which induced persons to take certain steps which may have gone adverse to interest of such persons on account of such withdrawal – Once public interest is accepted as superior equity which can override individual equity, such principle should be applicable even in cases where a period has been indicated for operation of promise – Even in a case where a party has acted on promise, if there is any supervening public interest which requires that benefit be withdrawn or scheme be modified, that supervening public interest would prevail over any promissory estoppel – When public interest warrants, principles of promissory estoppel cannot be invoked. (Paras 11.1, 11.2, 11.4 and 11.5)

(B) Statute Law – Rule of Retrospectivity – If a statute is curative or merely declaratory of previous law retrospective operation is generally intended – An amending Act may be purely declaratory to clear a meaning of a provision of principal Act which was already implicit – A clarificatory amendment of this nature will have retrospective effect. (Para 13.4)

(C) Central Excise Act, 1994 – Section 5A – Withdrawal of benefit/incentive – By impugned Judgment and Order, High Court has set aside subsequent notification No. 16 of 2008 dated 27.03.2008 mainly on the ground that same is retrospective and not retro-active in nature and same is hit by Doctrine of Promissory Estoppel – Person claiming exemption has to establish that his case squarely falls within exemption notification and while doing so, a notification should be construed against assessee in case of ambiguity – A person who claims exemption has to establish his case – Respective notifications/industrial policies impugned before High Courts can be said to be clarificatory in nature and it can be defined as an Act to remove doubts – It cannot be said that by subsequent notifications/industrial policies benefits which were accrued/granted under earlier notifications were sought to be taken away – It also cannot be said that by subsequent notifications/industrial policies, rights which have been accrued under earlier notifications had been taken away – Main objective of earlier respective notifications/industrial policies was to encourage entrepreneurs to put new industries in the area so as to generate employment and for that an incentive was offered to get back by way of refund excise duty paid – Same was subject to conditions that it will be applied to new industrial units – Once it is held that subsequent notifications/industrial policies which were impugned before respective High Courts are clarificatory in nature and are issued in public interest and in interest of Revenue and they seek to achieve original object and purpose of giving incentive/exemption while inviting persons to make investment on establishing new undertakings and they do not take away any vested rights conferred under earlier notifications/industrial policies and cannot be said to be hit by doctrine of promissory estoppel, same is to be applied retrospectively and they cannot be said to be irrational and/or arbitrary – Respective High Courts have committed grave error in quashing and setting aside subsequent notifications/industrial policies impugned before respective High Courts on the ground that they are hit by doctrine of promissory estoppel and that they are retrospective and not retroactive – Impugned Judgments and Orders passed by respective High Courts set aside – Present judgment shall not affect amount of excise duty already refunded – Cases in which excise duty is already refunded prior to subsequent notifications/industrial policies impugned before respective High Court, they are not to be reopened. (Paras 10, 13.6, 14, 14.1, 15 and 16)

Facts of the Case:

By the impugned Judgment and Order, the High Court has set aside the subsequent notification No. 16 of 2008 dated 27.03.2008 mainly on the ground that the same is retrospective and not retro-active in nature and the same is hit by the Doctrine of Promissory Estoppel. It is the case on behalf of the Union of India that the subsequent notification is as such in continuation of the earlier notification and the same is clarificatory and therefore can be made applicable retrospectively. It is also the case on behalf of the Union of India that the subsequent notification/amendment in the original notification did not in any way alter the basis of the original first notification of 2001. It is also the case on behalf of the Union of India that the subsequent notification of 2008 has been issued in the public interest and has been issued in exercise of the powers conferred under Section 5A of the Central Excise Act. Therefore, the questions which are posed for consideration of this Court are whether in the facts and circumstances of the case the subsequent notification which has been quashed and set aside by the High Court being notification No. 16 of 2008 dated 27.03.2008 can be said to be clarificatory in nature and can it be said that it takes away the vested right conferred pursuant to the earlier notification of 2001 and whether the same can be made applicable retrospectively and whether the same has been issued in the public interest and whether the same is hit by the Doctrine of Promissory Estoppel?

Findings of the Court:

Respective High Courts have committed a grave error in quashing and setting aside the subsequent notifications/industrial policies impugned before the respective High Courts on the ground that they are hit by the doctrine of promissory estoppel and that they are retrospective and not retroactive.

Result : Appeals allowed.