Honble SINGH, J. — This is defendants miscellaneous appeal arising out of an injunction order passed in the suit for mandatory injunction and also for permanent injunction restraining the defendant No.l - Municipal Board from realising octori on raw materials, plants and machinery.

(2). The case set up by the plaintiffs was that the Government of Rajasthan had issued a Notification No.Tax/F- 30(Misc.)L.S.G./60/32 Jaipur dated July 3,1990, exempting the imposition of octroi on raw materials which were to be used by the newly established (small, medium and large scale industries) or which were to be established in the State during the Eighth-Five- Year Plan from April, 1990 to March 31,1995 for a period of 5 years from the date of commencement of the commercial production and also on the imported plants and machineries which are to be used in the new industrial units to be set-up during this period. On the same day, similar notification was issued with regard to Municipal Board, Kota.

(3). This Notification was obviously issued by the Government in order to give incentive to people to set-up the industries for development of the State. It may provide more employmentr to the persons who needed it. On the basis of this Notification, the plaintiff set-up the industry in the year,1991. The validity of the notification of Municipal Board, Kota was challenged in D.B. Civil Misc. Writ Petition No.3065/90. It was dismissed on 22.4.1993. The notification was held to be valid.

(4). The suit was filed on 7.12.1991, but since in the writ petition No. 365/90 the operation of the similar notification was stayed, the injunction application was rejected on the ground of the stay order having been passed by the High Court. After the dismissal of the writ petition on 24th April,1993, regarding Kota Municipal Board, a fresh application for injunction was filed. It has been allowed on 10.09.1993. The Municipal Board, Bundi has been restrained from realising the octroi from the date of the order. Till that date it had already recovered about a sum of Rs.50,000/- as octroi from the plaintiff.

(5). The order passed by the District & Sessions Judge, Bundi granting injunction is under challenge in the present appeal.

(6). At the admission stage, Mr.Paras Kuhad has put in appearance on behalf of the plaintiff-respondents. Learned counsel for both the parties have been heard at length.

(7). Mr. Kuhad raised four points for consideration :

(1) The Municipal Board has no right to impose octroi. It could be done only by the State Government exercising the power under Section 104 read with Sec.107 sub-section (5) of the Rajasthan Municipalities Act,1959 and once the exemption having been given by the State Government, it was not open to the Municipal Board to realise the same. Its action was wholly without jurisdiction.

(2). Promissory estoppel - The State Government vide its notification dated 3.7,1990 has permitted the plaintiff- respondents to believe a thing to be true and to act upon such belief that no octroi whould be leviable for five years from the date of the production, it shall not be allowed to deny the truth of that declaration in the form of Notification. It was only on this assurance that the plaintiff has set up the industry. The action of the respondents in not honouring the statement made in the notification will be a mockery of the assurance given by the Government. It is expected to act fairly and honestly. All the actions of the State Government are required to meet the test of reasonableness.

(3). The action of the Municipal Board in realising the octroi illegally will undermine the confidence of the public in such bodies as well as in the Government. The element of public interest will ultimately suffer.

(4). The impugned order granting injunction is just and "a correct order. It does not suffer from any illegality.

(8). So far as first three points are concerned, if any finding is recorded by this Court, it will effect the merit of the suit. Mr.

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