1. This special appeal under Section 18 of the Rajasthan High Court Ordinance, 1949 is directed against the Judgment of the learned single Judge of this Court dated August 7, 1989 (in M/s. J.K. Industries Ltd. v. Union of India, S.B. Civil Writ Petition No. 2012 of 1985, published in 1986 RLR at page 831), whereby the learned single Judge has held that the Government is bound by the principles of promissory estoppel and, therefore, he has quashed the notificationNo. 159/85.CE (Annexure-P) dated July 15, 1986 issued by the Government of India.
2. The facts necessary to be noticed for the disposal of this appeal briefly stated are: that the Country felt great shortage of tyres between the years 1974-76. On account of this acute shortage, the tyres were sold in the market at a premium of 140% to 150%. The tyre-production was controlled and confined to only seven old established tyres Com-panics. Four companies belonged to multinational group viz., Dunlop, Firestone, CEAT, and Goodyear India Ltd, the remaining three Companies viz., Madras Rubber Factory (MRF), Premier Tyres Ltd. and In heck Tyres Ltd. had colloboration with well established Companies viz., Mansfield Tyres and Rubber Company, Uni Royal and Foreign Export Corporation of Czechoslovakia. In order to attract new investment for setting up new tyre industries as also to encourage investment in the existing tyre industries, the Govt. of India introduced an integrated excise relief scheme to give incentive to the new industries as also the existing tyre industries. This scheme was given statutory effect vide notification No. 198/ 76 dated I6th June, 1976. As a result of this incentive scheme, four new Companies came into existence Modi Rubber Limited, Appolo Tyres Ltd., Vikrant Tyre Ltd. and M/s. J.K. Tyres Ltd. This scheme was later modified in the year 1978 and that came to an end in the year 1980.
3. However, on the representation made by the newly established Companies, which were set up at a substantially high investment of over Rs. 30 crores per plant, the Central Govt. was approached for providing relief in order to off-set the high cost of investment incurred by them. Keeping in view the representation made by these industries, the Minister of State for Industries made a statement in the Parliament on 24th April, 198J declaring that the Govt. has decided to frame a scheme for excise duty relief to tyres and tubes manufacturing Industries for achieving higher level of production. This new scheme came to be notified vide Notification No. 102/81-CE dated 24th April, 1981which provided that the Excise relief will be available not only to the new Industries which are established under Section 11 of the Industries (Development and Regulation) Act, 1951 (hereinafter referred to as 'the Act') but to those industries also which undertake substantial expansion under Section 13 of the Act. This excise relief was made available to these industrial units if they make their first clearance between 1-4-1960 to31-3-1984. The exemption was to the tune of 25% of the excise duty already payable on tyres and it was made available for five years and was subject to a maximum of 30% of the investment made on plant and machinery by the said Unit.
4. In view of this notification, the petitioner (respondent-company) decided to establish a new factory by way of substantial expansion of its existing unit to augment manufacturing of tyres under Section 13 of the Act. It wrote a letter to the Chairman, Industrial Development Bank of India for financial assistance. It further submitted a statement of projected costs and profitability of new factory to the financial institutions. The financial institution sanctioned the loan. A letter of intent to set up a new factory was also granted to the petitioner by the Central Government.
5. However, this excise relief scheme was modified by the Central Government vide notifidation No. 267/82-CE and 268/82-CE dated 13-11-1982. According to this modification, the excise relief was made available only to the factories which were established under Section 11 of the Act. However, the relief available of the 30% of cost of plant and machinery was raised to 50% of such investment and the period of relief was extended from 5 years to 7 years. According to this modified notification, the new industries set up by way of substantial expansion were not eligible for the relief under the modified scheme.
6. On account of this withdrawal, the petitioner (respondent Company) submitted a representation to the Government of India and held discussion with its Officers at various levels. Meanwhile, the letter of intent issued by the Central Government to thepetitioner company was coverted into an industrial licence and it took all possible steps to complete the project and to commence production and clearnces before 31-3-1984, which was the date postulated for eligibility of relief under the original scheme. The Central Government again modified the scheme vide notification No. 87/84-CE and 88/84-CE dated 6-4-1984 and made the exemption available to the new factories which were set up under Section 13 of the Act. This notification was withdrawn by the impugned notification No. 159/5-CE dated 15-7-1985 and hence his writ petition was filed on the ground that the withdrawal of this scheme vide notification No. 159/85-CEdated 15-7-1985 is totally illegal and contrary to law and the Government is estopped from doing so under the doctrine of promissory estoppel. This withdrawal was also alleged to be ultra vires of Article 19(l)(g) of the Constitution. This plea was however, not pursued either before the learned single Judge or before us.
7. A dispute also arose between the petitioner Company and the Union of India as to whether the period of 7 years provided by notification No. 88/84-CE has already expired as regards the petitioner company and, therefore, the notification No. 88/84-CE has no application to the petitioner company. The contention of the petitioner Company is that the notifications that have been issued by the Central Govt. from time to time form part of one integrated scheme which was framed in the year 1976 and later modified in the year 1978. This scheme was motified on the basis of the policy statement made by the Minister of State for Industries in the Parliament on 24-4-1981 and notification No. 107/81-CE dated 24-4-1981 incorporating the new policy came to be issued. However, the rescision of this initial notification in the year 1982 and revival of the old concessions granted in 1981 and again in the year 1984 form part of the one integrated scheme. They cannot be looked into isolation and the Government cannot withdraw that scheme unilaterally.
8. From the side of the Union of India, detailed return was filed. According to the petitioner Union of India, the period of yearsprovided in notification No. 88/84-CE dated 6-4-1984 has already expired so far as the petitioner is concerned and, therefore, the petitioner is not entitled to any excise relief in pursuance of the notification No. 88/84-CE dated 6-4-1984. It was further contended that the Government of India after taking various factors into account have rescinded notification No. 88/84-CE dated 6-4-1984. This was in exercise of the power conferred on the Central Government under Section 8(l) of the Central Excise Rules, 1944, which rule was enacted under Section 37 of the Central Excises and Salt Act, 1944. It was submitted that from information made available from the records in the Ministry of Finance, the Government while reviewing the benefit availed of by different tyre companies under the notification No. 88/ 84-CE came to the conclusion that the tyre companies have actually availed benefit of sums far in excess of the sums which were originally intended by the Government to be availed as excise duty relief under-the various schemes announced by the Government from time to time. It was felt that the revenue interests are greatly prejudiced by continuing the exemption granted under notification No. 88/84-CE and hence, the rescinding of the notification No. 88/84-CE was considered by the Government as most desirable in the larger public interest. It was also contended that the petitioner was not entitled to any exemption during the period 13-11-1982 to 5-4-1984 and the petitioner could not have anticipated or contemplated in 1981 that an exemption notification will be issued in 1984 and, therefore, the withdrawal of notification No. 88/84-CE in any case cannot act prejudicial to the interest of the petitioner nor the decision taken by them to expand the factory in the year 1981 can be adversely affected by ' the aforesaid withdrawal of the notification No. 88/84-CE. It was submitted that the principle or promissory estoppel cannot be pressed into service against the Government.
9. After hearing both the parties, the learned single Judge came to the conclusion that this notification No. 159/85-CE dated 15-7-1985 is bad and the Government cannot unilaterally withdraw this concession on account of the applicability of the principle ofpromissory estoppel. As regards the question as to whether the notification No. 159/ 85-CE will have a retrospective operation or not was left open. It was submitted by both the learned counsel for the parties that about this matter, a writ petition is pending in Delhi High Court and so, that matter may be kept open so that it may be decided by Delhi High Court in that writ petition. Thus, the question regarding retrospective applicability of notification No. 88/84-CE to the petitioner company was not decided by the learned single Judge. However, the appellant has preferred to raise a challenge about this aspect of the matter in this appeal.
10. During the pendency of this appeal, it was contended by the learned counsel for the parties that two questions arise for decision in this appeal:
(1) Whether the Central Government could not have issued notification No. 159 of 1985 dated 16-7-1985 withdrawing the concession granted to the Company on account of promissory estoppel; and
(2) Whether the notification No. 88/84-CE was at alt applicable to the petitioner Company since after 11-1-1985 because the period of seven years has expired by that date.
The first question was decided in favour of the petitioner respondent by the learned single Judge but on the second question, it was submitted by both the parties that it will be decided by the Delhi High Court in a pending writ petition. However, both the learned counsel agreed on that date that this question may also be decided by this Court without awaiting the decision of the Delhi High Court and they will file the relevant material by way of additional affidavits and counter-affidavits relating to the second question. This Court also felt that this question may also be decided by this Court. However, the parties did not take any steps on this aspect of the matter and when the appeal was argued before us, it was submitted that only the question of promissory estoppel may be decided and the other question may be left open to be decided by the Delhi High Court.
11. We have heard Mr. J. P. Joshi, the learned counsel for the appellant and Mr. A. K. Desai, the learned counsel for the petitioner-respondent. We have considered the rival submissions made at the bar.
12. Learned counsel appearing for the parties confined their arguments to the question of applicability of promissory estoppel only. We now propose to deal with this question.
13. Mr. J. P. Joshi, the learned counsel appearing for the appellant has based his arguments on three counts: (1) that the principle of promissory estoppel cannot be pressed into service against the Government in exercise of its legislative functions or powers; (2) that the petitioner-respondent has not altered the position after the issuance of notification No. 88/ 84 dated 6-4-1984 to their detriment and, therefore when nothing consequential has been done by them to their detriment after the issuance of this notification, they cannot avail, the benefit of the principle of promissory estoppel against the Govt. and (3) that the principle of promissory estoppel is not applicable in cases of policy change by the Govt. in larger public interest.
14. On the first count, Mr. J. P. Joshi, the learned counsel appearing for the appellant has submitted that the powers conferred on the Govt. under Rule 8(1) of the Central Excise Rules, 1944 are legislative in character because this rule been framed under Section 37 of the Central Excises and Salt Act, 1944. As per Mr. Joshi, when the Govt. exercises' any legislative powers as a delegates of the Parliament or legislature concerned, that act is legislative in character and, therefore, the principle of promissory estoppel is not applicable in such cases. Reliance in this connection was placed on a decision of their Lordships of the Supreme Court in M/s. Jitram Shiv Kumar v. State of Haryana (AIR 1980 SC 1285), wherein it has been held that the principle of estoppel was not available against the Government in exercise of legislative, sovereign of executive power. There can be no promissory estoppel against the exercise of legislative power of the State. So also the doctrine cannot be invoked for preventing theGovernment from acting in discharge of its duty under the law. Mr. Joshi has submitted that the ratio of this decision has not been relied on by their Lordships of the Supreme Court in Union of India v. Godfrey Philips India Ltd., (1985) 4 SCC 369 : (AIR 1986 SC 806), wherein their Lordships held that what has been laid down in Motilal Sugar Mills v. State of U.P., (1979) 2 SCC 409 : (AIR 1979 SC 621) in this regard is the correct law. Mr. Joshi then referred to the decision of their Lordships of the Supreme Court in Motilal Sugar Mill case (supra), wherein it has been observed:--
'The doctrine of promissory estoppel has also been applied against the Govt. and the defence based on executive necessity has been categorically negatived. Where the Govt. makes a promise knowing or intending that it would be acted on by the promisee and, in fact, the promisee acting in reliance on it, alters his position, the Govt. would be held bound by the promise and the promise would be enforceable against the Government at the instance of the promisee, notwithstanding that there is no consideration for the promise I and the promise is not recorded in the form of a formal contract as required by Article 299 of the Constitution. It is elementary that in a republic governed by the rule of law, no case, howsoever high or low, is above the law. Every one is subject to the law as fully and completely as any other and the Government is no exception. It is indeed the pride of constitutional democracy and rule of law that the Government stands on the same footing as a private individual so far as the obligation of the law is concerned, the former is equally bound as the latter.'
It has been further observed as follows :--
'If the Govt. does not want its freedom of executive action to be hampered or restricted the Govt. need not make a promise knowing or intending that it would be acted on by the promisee and the promisee would alter his position relying upon it. But if the Govt. makes such a promise and the promisee acts in reliance upon it and alters his position, there is no reason why the Govt. should not be compelled to make good such promise like any other private individual.'
In Motilat Sugar Mills case (supra), it has been laid down that there can also be no promissory estoppel against the legislature in exercise of legislative power. The legislature can never be precluded from exercising its legislative function by resort to the doctrine of promissory estoppel.
15. This is a case of exercise of subordinate legislation as the delegatee of the Parliament. It is not a case where the Parliament in exercise of its legislative powers has enacted any law overriding the earlier concessions granted by the Govt. Thus, this authority fully supports the case of the respondent.
16. Mr. A.K. Desai, the learned counsel appearing for the petitioner-respondent has placed reliance on a decision of their Lordships of the Supreme Court in Pournami Oils Mills v. State of Kerala (AIR 1987 SC 590), wherein it has been observed :-
'It is a well-settled principle of law that where the authority making an order has power conferred upon it by statute to make an order made by it and an order is made without indicating the provision under which it is made, the order would be deemed to have been made under the provision enabling the making of it.'
On the basis of the above observations, their Lordships further observed that the ratio of M. P. Sugar Mills case (supra) directly applies and the plea of estoppel is unanswerable. This was a case where Kerala Govt. had the power under Section 10 of the Kerala General Sales Tax Act, 1963 to grant certain exemption from tax. The Govt. issued notification granting package of concessions to new Small Scale Industries in order to boost industrialisation in State. Some time later, the Govt. curtailed the concessions by a subsequent notification. In those circumstances, it was held that the small scale units set up in response to the first order and before passing of the subsequent order are entitled to plead estoppel and such units would be entitled to get all concessions granted by the first order. In that case, their Lordships further considered the case of Bakul Cashew Co. v. Sales Tax Officer, Quilon, (1986) 2 SCC 365 : (AIR 1987 SC2239) which has been relied on by Mr. J. P. Joshi, the learned counsel for the appellant, wherein it has been observed:
'that there was no clear material to show any definite or certain promise had been made by the Minister to the concerned persons and there was no clear material also in support of the stand that the parties had altered their position by acting upon the representations and suffered any prejudice. On facts, therefore, case for raising the plea of estoppel has been made out.'
Here, there is no such thing. Rule 8(1) of the Central Excise Rules, 1944 authorises the Central Government to grant certain exemptions and it has done so in exercise of those powers. There is no vagueness in the concession that have been granted and, therefore Bakul Cashew Co.'s (supra) has no application to the facts of the present case and actually, Motilal Sugar Mills case (supra) directly applies to the facts of the present case.
17. Reliance was also placed by Mr. Desai on decision of their Lordships of the Supreme Court in Vij Resins Pvt. Ltd. v. State of J. & K, (1989) 3 SCC 115 : (AIR 1989 SC 1629), wherein their Lordships of the Supreme Court observed;
'that it is true that there is no estoppel against the legislature and the vires of the Act cannot be tested by invoking the plea but so far as the State Government is concerned, the rule of estoppel does apply and the precedents of this Court are clear.'
18. A similar view has been expressed by a Division Bench of the Bombay High Court in Bharat Commerce and Industries Ltd. v. U.O.I., 1987 (32) ELT 40 (Bom), wherein it has been observed (at page 49) :
'that it is true that the doctrine of promissory estoppel is not available against the legislature in exercise of its legislative functions. But, here one is concerned with a situation where Government exercises powers conferred upon it by statute or the powers of subordinate legislation in acting contrary to the terms of a representation it had earlier made. The doctrine of promissory estoppel isthat he who makes the representation is estopped from going back upon it provided he has the authority or power to make the representation good. In the M.P. Sugar Mills and the Godfrey Philips cases the representations were made by a circular and letter respectively. The Supreme Court found that the Government had the power to make the representations good and that power was conferred upon Government under a statute. It was held that the Government was estopped from going back on the representation that it had made. That the Government had attempted to resile from the representations by further circulars or letters is not relevant upon the ratio of the judgments; Government could clearly not have resiled from the representation even by exercising the power statutorily conferred upon it. Therefore, the doctrine of promissory estoppel was available against Government when it was exercising powers conferred upon it by statute or powers of subordinate legislation.'
It was further observed as follows:
'As the Supreme Court has pointed out, the Government is under no obligation to make a representation.
If, then, it does, it must be held to it. If the legislature disapproves, it can enact legislation nullifying the representation.'
Their Lordships held that it is not enough that legislative functions are being carried out; it is only if the legislative functions are being carried out by the legislature itself that the doctrine is not available. It is true that the promissory estoppel is not available against a statute does not mean that promissory estoppel is not available when Government or some public authority does something in the: exercise of powers conferred on it by statute.
19. This is a case where the Government had exercised powers conferred upon it by Statute i.e. Rule 8(1) of the Central Excise Rules, 1944, which was enacted in exercise of the powers conferred on the Government under Section 37 of the Central Excises and Salt Act, 1944. It is well-settled that any Government in exercise of its powers conferred on it by a Statute or the powers of subordinatelegislation cannot act contrary to the terms of representation it had earlier made. It can only do so in the following well-recognised exceptional cases:
(1) that there can be no promissory estoppel against the Legislature in the exercise of its legislative functions.
(2) that the Government or public authority cannot be debarred by promissory estoppel from enforcing a statutory prohibition.
(3) that the doctrine of promissory estoppel cannot be used to compel the Government or a public authority to carry out a representation or promise which is contrary to law;
(4) that the doctrine of promissory estoppel is not applicable in cases where the authority or power of the Officer of the Government or of the public authority is outside the authority or the power to make that; and
(5) that the doctrine of promissory estoppel being an equitable doctrine, it must yield when the equity so requires. If it can be shown by the Government that having regard to the facts as they have subsequently transpired it would be inequitable to hold the Government to the promise made by it, the Court would not raise an equity in favour of the promisee and enforce the promise against jthe Government.
Except these exceptions, the Law is now well-settled that the doctrine of promissory estoppel is applicable against the Government in exercise of its govermental, public or executive functions.
20. Lord Denning, J. in his famous case Roberts on v. Minister of Pensions (1949) 1 KB 227 : ((1948) 2 All ER 767) said :
'the Crown cannot escape by praying in aid the doctrine of executive necessity, that is, the doctrine that the Crown cannot bind itself so as to fetter its future executive action ..... the defence of the executive necessity is of limited scope. It only avails the Crown where there is an implied term to that effect or that is thetrue meaning of the contract. (See Indo-Afgan Agencies Case, AIR 1968 SC 718).
These observations were relied on by their. Lordships of the Supreme Court in Union of India v. Indo-Afghan Agencies case (AIR 1968 SC718). Union of India v. Indo-Afghan Agencies case (supra) was followed by their Lordships of the Supreme Court in Century Spg. and Mfg. Co. Ltd. v. Ulhasanagar Municipal Council (AIR 1971 SC 102), wherein it was held that the Government is not exempt from the equity arising out of the acts done by citizens to their prejudice relying upon the representations as to its future conduct made by the Government. It was also pointed by the learned Judge that in Indo-Afghan Agencies case, this Court approved of the observations made by Denning J. in Robertson v. Minister of Pensions (1949) 1 KB 227 rejecting the doctrine of executive necessity and held them to be applicable- in India. Their Lordships concluded by saying in: words pregnant in the hope and meaning for democracy:
'If our nascent democracy is to thrive different standards of conduct for the people and the public bodies cannot ordinarily be permitted. A public body is, in our judgment, not exempt from liability to carry out its obligation arising out of representations made by it relying upon which a citizen has altered his position to his prejudice.
21. There can, therefore, be no doubt that the doctrine of promissory estoppel is applicable against the Government in exercise of its govermental, public or executive functions and the doctrine of executive necessity or freedom of future executive action cannot be invoked to defeat the applicability of the docrrine of promissory estoppel. Of course, in Jit Ram v. State of Haryana (AIR 1980 SC 1285), their Lordships of Supreme Court took a slightly different view and held that the doctrine of promissory estoppel is not available against the exercise of executive functions of the State and the State cannot be prevented from exercising its functions under the law. Jitram's case (supra) also expresses its disagreement with the observations made in Motilal Sugar Mills case (supra) that the doctrine of promissory estoppel cannot bedefeated by invoking the defence of executive necessity, suggesting by necessary implication that the doctrine of executive necessity is available to the Government to escape its obligation under the doctrine of promissery estoppel. In Union of India v. Godfrey Philips India Ltd., (1985) 4 SCC 369 : (AIR 1986 SC 806), presided over by a three-Judge Bench, it was observed that we find it difficult to understand how a Bench of two Judges in Jitraro case (supra) could possibly overturn or disagree with what was said by another Bench of two Judges in Motilal Sugar Mills case (supra). Jf the Bench of two Judges in Jit Ram case (supra) found themselves unable to agree with the lay laid down in Motilal Sugar Mills case (supra), they could have referred Jitram case (supra) to larger Bench but we do not think it was right on their part to express their disagreement with the enunciation of the law by a co-ordinate Bench of the same Court in Motilal Sugar Mills case (supra). Their Lordships of the Supreme Court further observed as follows:
'We have carefully considered both the decisions in Motilal Sugar Mills case and Jit Ram case and we are clearly of the view that what has been laid down in Motilal Sugar Milts case represents the correct law in regard to the doctrine of promissory estoppel and we express our disagreement with the observations in Jit Ram case to the extent that they conflict with the statement of the law in Motilal Sugar Mills case and introduce reservations cutting down the full width and amplitude of the propositions of law laid down in that case.'
We are therefore, inclined to hold that the Government while discharging his legislative functions is bound by the promissory istoppel. It is only very exceptional cases cited above that the Government can wriggle out of the promise made by it otherwise it is very much bound by it. Therefore, we are unable to agree with Mr. Joshi that issuance of the notification No. 88/84 CE and its revocation by notification No. 159/85CE by the Government exercising its powers under Section 8(1) of the Central Excise Rules, 1944 is a Legislative Act and, therefore, the Government is not bound by any promissory estoppelin respect thereof.
22. It was next contended by Mr. Joshi that nothing detrimental has been done by the petitioner-respondent after 6-4-1984 and before 15-7-1985 and, therefore, when no Act has been done detrimental to itself by the petitioner-respondent in pursuance of the alleged promise made by the Government, the doctrine of estoppel cannot be pressed into service. In this respect, reliance was placed on a decision of their Lordships of Supreme Court in Bakul Cashew Co. v. S.T.O., (1986) 2 SCC 365 ; (AIR 1987 SC 2239), wherein it was observed:--
'It was also not shown that relying upon the notification during the period between October 2, 1973 and November 9, 1973, the appellants had done any Act which attracted the rule of estoppel. The authority which can issue a notification may cancel it also.'
Bakul Cashew Co. case (supra) was noticed in Pournami Oil Mills v. State of Kerala, 1986 (Supp) SCC 728 : (AIR 1987 SC 2239) and in that case, their Lordships of the Supreme Court held that actually M. P. Sugar Mills case (supra) lays down the correct law on the subject. We may gainfully refer to certain observations made by their Lordships of the Supreme Court in M.P. Sugar Mills case (supra):
'It is not necessary in order to attract the applicability of the doctrine of promissory estoppel that the promisee acting in reliance on the promise should suffer any detriment. What is necessary is only that the promisee should have altered his position in reliance on the promise. But if by detriment we mean injustice to the promisee which would result if the promisor were to recede from his promise, then detriment would certainly come in as a necessary ingredient. The detriment in such a case is not some prejudice suffered by the promisee by acting on the promise, but the prejudice which would be caused to the promisee, if the promisor were allowed to go back on the promise.'
A somewhat similar view has been expressed by their Lordships of the Supreme Court in Delhi Cloth and General Mills Ltd. v. Unionof India (1988) 1 SCC 86 : (AIR 1987 SC 2414), wherein it has been observed (at page 95 of (1988)1 SCC):
'For invoking the doctrine of promissory estoppel what is required is that the party asserting the estoppel must have acted upon the assurance given to him or must have relied upon the representation made to him. It means, the party has changed or altered the position by relying on the assurance or the representation. The alteration of position by the party is the only indispensable requirement of the doctrine. It is not necessary to prove further any damage, detriment or prejudice to the party asserting the estoppel. It is not the question of detriment but whether it appears unjust, unreasonable or inequitable that the promisor should be allowed to resile from his assurance or representation, having regard to what the promisee has done or refrained from doing in reliance on the assurance or representation. The entire doctrine proceeds on the premise that it is reliance based and nothing more. The Court would compel the opposite party to adhere to the representation acted upon or abstained from acting.'
In this case, the entire scheme of the grant of execise concessions is an integrated scheme initiated by the Government to tide over the difficulty felt in supply of tyres and it was because of this that in the year 1976, certain concessions were granted as regards the recovery of excise duty. A slight change was made in those concessions came in 1978 and those concessions came to an end in the year 1980 and, thereafter, a policy statement was made by the Minister of State for Industry in the Parliament on 24-4-1981 that a new policy is being framed and consequently, the notification No. 107/81-CE was issued on that very day. Of course, that notification was withdrawn on 13-11-1982 but on the representations made by the producers, the notification No. 88/84-CE dated 6-4-1984 was issued. Thus, these notifications cannot be dealt with in isolation. They are part of the integrated scheme and the petitioner respondent decided to set up a new factory to expand its existing unit as regards production oftyres in pursuance of the notification No. 107/81-CE issued in compliance of the policy statement that has been made by the Minister of State for Industry in the Parliament. The petitioner-respondent applied for grant of letter of intent and made application for grant of loan. Loans were sanctioned and the letter of intent was issued and on account of certain discussions and negotiations with the Government wherein some assurances must have been made, it has completed its project before 31-3-1984, and the first clearance was made on 29-3-1984. These facts are not controverted by the appellant and, therefore, it is clear that the petitioner-respondent has altered its position.
23. Lord Denning the author of the Doctrine of Promissory Estoppel in his treatise 'The Discipline of Law' has stated at page 215:
'The Judge rejected this doctrine because he said there is no evidence of the buyers having acted to their detriment. I know that it has been suggested in some quarters that there must be detriment. But I can find no support for it in the authorities cited by the Judge ..... If you study the cases in which the doctrine has been applied, you will see that all that is required is that the one should have acted on the belief induced by the other party. That is how Lord Cohen put it in the Tool Metal case (1955) 1 WLR 761, 799 and that is how I would put it myself.'
In this view of the matter, we are unable to accept the second contention raised by Mr. Joshi that nothing detrimental has been done by the petitioner-respondent in pursuance of the alleged promise made by the appellant. We are definitely of the view that the petitioner-respondent has actually acted upon these assurances and has altered its position in pursuance of those assurances and the question of detriment is beside the point. What is material is that the party must have acted upon the assurance so as to alter its position and that has been amply proved by the petitioner-respondent in this case.
24. It was lastly contended by Mr. Joshi that the principle of estoppel does not operateat the level of Government policy. In this respect, he has placed on a decision of their Lordships of the Supreme Court in Express Newspaper Pvt. Ltd. v. Union of India, (1986) 1 SCC 133: (AIR 1986 SC 872), wherein it has been observed:
'In public law, the most obvious limitation and doctrine of estoppel is that it cannot be evoked so as to give an overriding power which it does not in law possess. In other words, no estoppel can legitimate action which is ultra vires. Another limitation is that the principle of estoppel does not operate at the level of Government policy.'
The learned Author H.W.R. Wade in hisTreatise Administrative Law has stated at page 263:
'Another limitation is that the principle of estoppel does not operate at the level of Government policy.'
Mr. Joshi has, therefore, submitted that the withdrawal of notification No. 88/84CE dated 6-4-1984 vide notification No. 159/85-CE dated 15-7-1985 is the result of the change in Government policy and, therefore, the principle of promissory estoppel does not operate at the level of Government policy in this case. Actually, Express Newspaper Pvt. Ltd. case does not dilate on the subject as to in what conditions, the principle of estoppel will not operate at the level of the Government policy. This matter directly came up for consideration before their Lordships of the Supreme Court in M.P. Sugar Mills case (supra), wherein it had been observed:
'Mere claim of change of policy would not be sufficient to exonerate the Government from the liability; the Government would have to show what precisely is the changed policy and also its reason and justification so that the Court can Judge for itself which way the public interest lies and what the equity of the case demands. It is only if the Court is satisfied, on proper and adequate material placed by the Government, that overriding public interest requires that the Government should not be held bound by the promise but should be free to act unfettered by it, that the Court would refuse to enforce the promiseagainst the Government. The Court would not act on the mere ipse dixit of the Government, for it is the Court which has to decide and not the Government whether the Government should be held exempt from liability. This is the essence of the rule of law. The burden would be upon the Government to show that the public interest lies in the Government acting otherwise than in accordance with the promise is so overwhelming that it would be inequitable to hold the Government bound by the promise and the Court would insist on a highly rigorous standard of proof in the discharge of this burden.'
Thus, the mere change in the policy ipse dixit is not sufficient and the burden lies on the Government to show that there is overriding public interest which compelled it to change its policy and to prove that contention the courts are required to insist on a highly rigorous standard of proof in the discharge of this burden. In this case, except that there is an allegation that industries were taking undue advantage of the concessions, there is nothing else which has been mentioned in the reply and no affidavit of any concerned Officer from Finance Secretariat has been filed to show that how the Industrialists were taking undue advantage of this concession and, therefore, merely by alleging that there is a change in the policy as some Industrialists were taking undue advantage of this concession will not suffice to allow the Government to withdraw the concession which it has granted by notification No. 88/84-CE.
25. Mr. A. K. Desai, the learned counsel appearing for the petitioner-respondent has drawn our attention to a decision of their Lordships of the Supreme Court in Asstt. C.C.T. v. Dharmendra Trading Co., (1988) 3 SCC 570: (AIR 1988 SC 1247), wherein it has been observed:
'If the Government wants to resile from a promise or an assurance given by it on the ground that undue advantage was being taken or misuse was being made of the concessions granted, the Court may permit the Government to do so but before allowing the Government to resile from the promise or goback on the assurance the Court would have to be satisfied that allegations by the Government about misuse being made or undue advantage being taken of the concessions given by it were reasonably well established.'
26. In this view of the matter, we are definitely of the view that the principle of promissory estoppel is applicable in this case and the appellant cannot unilaterally revoke the benefits which have been granted by notification No. 88/84-CE. Therefore, the Notification No. 159/85-CE is bad and it cannot be allowed to stand in view of the doctrine of promissory estoppel and consequently, it has been rightly quashed by the learned single Judge. However, the question as to whether the concessions granted vide notification No. 88/84-CE is still available to the petitioner-respondent or not is left open.
27. In the result, we uphold the judgment of the learned single Judge and this special appeal is consequently, dismissed. The parties are left to bear their own costs.