Maruthi Steels (P) Ltd., Rep. by Its Director Mawsood Khan Vs. Government of A.P., Industries and Commerce Department, Rep. by Its Secretary and ors. - Court Judgment

Excerpt:
- specific relief act, 1963 [c.a. no. 47/1963]. sections 31 & 34: [bilal nazki, v.v.s. rao & g. chandraiah, jj] [per court] cancellation of registered sale deed inherent power of registering authority - fraudulent transfer of property sale taking place by reason of fraud played by transferor and transferee held, it is void. true owner can nullify the sale by executing and registering a cancellation deed without seeking declaration or cancellation of fraudulent transfer deed from court. registering authority is empowered to cancel sale deed earlier registered. registration of document cannot be understood to be an absolute sale divesting vender of its title else it would render sections 31 and 34 of specific relief act, otiose. -- transfer of property act,1882[c.a. no. 4/1882]......orderb.k. somasekhara, j.1. this writ petition has a long back padding of facts and small history which require some useful record. the petitioner is an industry commercially known as 'mini steel plant.' the government of andhra pradesh, viz, the first respondent evolved a scheme whereby some incentives were offered in andhra pradesh for industrial development in backward areas. in that connection g.o.ms. no. 375, industries and commerce department, dated 23-8-1985 was issued whereby the industries which were to be initiated in the three classified backward areas, including anantapur district, were given incentives including the rebate of power tariff to the extent of 25% for the first three years and later on for further two years whereby the apseb was to meet such expenditure for the.....

Judgment:
ORDER

B.K. Somasekhara, J.

1. This Writ Petition has a long back padding of facts and small history which require some useful record. The petitioner is an industry commercially known as 'mini steel plant.' The Government of Andhra Pradesh, viz, the first respondent evolved a scheme whereby some incentives were offered in Andhra Pradesh for industrial development in backward areas. In that connection G.O.Ms. No. 375, Industries and Commerce Department, dated 23-8-1985 was issued whereby the industries which were to be initiated in the three classified backward areas, including Anantapur district, were given incentives including the rebate of power tariff to the extent of 25% for the first three years and later on for further two years whereby the APSEB was to meet such expenditure for the first three years and the Government for the next two years and in all for five years. In response to such an invitation, the petitioner initiated the efforts to establish the industry at 8th KM on Bangalore - Hindupur Road in Anantapur district. Such an invitation is said to have been extended during the month of March, 1985. There were meetings of the entrepreneurs with the authorities thereafter at Hotel Ashoka. The petitioner got eligibility certificate claiming 15% subsidy for industrial units to be set up on 2-7-1985 under the proceedings No. 2607/B2/85 issued by the Industries Department. The land at Kirukeru village, Hindupur taluk was purchased on 27-1-1987. The District Medical and Health Officer, Anantapur gave his approval in his letter No. 1629/42/87 dated 20-5-1987 to the petitioner. The A.P. Pollution Control Board issued 'No objection Certificate' dated 25-6-1987 vide letter No. 190/PB/122/87-77. It appears that the plans were approved by the Inspector of Factories on 4-8-1987. The APSEB issued Feasibility Certificate on 4-9-1987. The SSI provisional registration certificate was issued by the General Manager, Dist. Industries Centre, Anantapur on 12-12-1987 vide Rc. No. D.Dis. 553/B.1/87. The General Manger, Dist. Industries Centre issued eligibility certificate to the petitioner and permission to set up the Steel Ingote Manufacturing unit on 29-12-1987. The load approval was accorded by the Electricity Board in its letter No. CE/SR/CEP/ 211/47/89 dated 7-1-1988. Registration Certificate for eligibility regarding incentives was issued by the Industries Department by letter No. 7167/ A.1/87 dated 11-1-1988. The petitioner claims that the plant and machinery were purchased and installed at the location of the factory on 1-4-1988 to completion as per the list filed by the petitioner* Temporary lighting connection was issued by the APSEB by Temporary Registration No. 42425 dt. 14-3-1988 and the permanent connection receipt of the Electricity Board was issued on 18-4-1988 after collection of Rs. 2 lakhs. The estimate was sanctioned by the Electricity Board on 6-4-1988. Service line charges were paid to the Electricity Board in three equal instalments amounting to Rs. 5,31,900/- on 30-4-1988 and 25-5-1988 respectively. The consumption deposit charges of Rs. 4,06,166/- were allowed to be paid in three instalments in its order dated 30-5-1988. The petitioner claims that the service charges of Rs. 17,500/- were paid to the Board on 5-4-1989. Consumption deposit charges were paid in instalments by 27-3-1989. The Divisional Electrical engineer (Operation), Hindupur in the letter No. DEE/O/HUP/COML/1024/89 dated 14-3-1989 addressed a letter to the Chief Engineer, Government of A.P., intimating that the plant was complete in all respects in ragard to the approval. The Chief Engineer, inspected the petitioner unit initially on 21-3-1989. On 25-3-1989 the same officer certified the fitness of the unit for energisation informing the petitioner that power connection will be provided subject to the fulfilment of certain conditions. The Chief Engineer, Government of A.P., issued permanent certificate for energisation on 5-5-1989 vide letter No. CEIG/HG/ ATD/13/89. It appears that the petitioner has got the sanction of short term and long term loans from the State Bank of India, Industrial Finance Branch on condition of the petitioner getting 25% of the subsidy' on power for five years and 15% central investment subsidy for five years and deferment of sale tax as per the eligibility certificate. The Central Excise licence was issued on 27-9-1989.

2. These appear to be not only admitted facts but also supported by the material papers produced in the writ petition. The real trouble started to the petitioner to get the power energisation and to go into the production when the Electricity Board did not oblige to give connection in spite of the preparations made as above and in spite of the requests till the petitioner could get an order from this Court in W.P.MP. No. 13970/89 in W.P. No. 10531/89 dated 31-8-1989. However, with some troubles, the petitioner was able to get the power connection on 22-1-1989 and went into commercial production on 13-11-1989. This is also borne out from the records and the material papers.

3. The matter did not end there. The Petitioner got several benefits by way of incentives as per the Government order supra except the 25% power rebate and therefore W.P. No. 5765/90 was to be filed which came to be allowed on 21-3-1992. In para 3 of the orders of this Court in the said proceedings, it was declared that 'the petitioner herein be and is hereby entitled for 25% tariff concession for the first three years after going into production from the Electricity Board and for the next two years from the Government'. In the said writ petition the State Electricity Board and its officers viz., the Superintending Engineer, and the Senior Accounts Officer were parties and the Government was not a party. The petitioner filed W.P. No. 16385/92 against the APSEB Member Secretary and its officers as respondents 1 to 3 and Government authorities as respondents 4 and 5 questioning the action of respondents 1 to 3 demanding the petitioner to pay the bills in full without deducting 25% rebate from November, 1992. This Court, while referring to the orders in W.P. No. 5765/90 dated 8-11-1991 disposed of the writ petition in the following terms :

'.. I am satisfied on a reading of the orders passed in W.P No. 5765/90 on 21-3-1992, Writ petition No. 8932 of 8-11-1991 and the Memo dated 2-4-1987 dated 9-3-1988 referred to above that respondents 2 and 3 are under no obligation to give the 25% tariff rebate/concession to the petitioner for the fourth and fifth years after the unit has gone into production. It is for the Government to consider extension of that benefit, as per rules, if the petitioner approaches the Government by following the procedure contemplated for this purpose. In similar circumstances, in Writ Petition No. 2142/89, this Court by an order dated 30-9-1992 held that the electricity Board is liable to extend 25% tariff concession/rebate, only for the initial three years period from the date of the unit going into production and not thereafter.'

That decision was carried in appeal by the petitioner before a Division Bench of this Court in W.A. No. 1551/92 against all the respondents. The Appeal was dismissed with the following observations:-

'...We do not find any reason to differ from the Judgment. We need only state that if the appellant makes his claim in the proforma prescribed by the Government, the Industries Department may verify, process and most the claim for reimbursement to the extent allowable as expeditiously as possible. This shall be done atleast once in a quarter of three months. The Writ Appeal is dismissed with the above observations. No costs.'

The learned Counsel for the petitioner, Mr. V. Nagarjuna Babu, submits that after the conclusion of the litigation upto Supreme Court whereby SLP No. 6582-83/94 was disposed of on 21-3-1996, the petitioner got the benefit of 25% tariff rebate for mitial three years. Since the petitioner did not get the same benefit for the remaining two years from the Government, W.P. No. 31264/93 was filed wherein this Court disposed of the said writ petition directing the respondents to dispose of the claim of the petitioner within a period of one month from the date of receipt of a copy of the said order. The petitioner had submitted a representation to the Commissioner, Department of Industries, in regard to such a concession and ultimately the impugned letter No. 335/Desk. 10/C/93 dated 20-11-1993 was issued to the petitioner by the Commissioner of Industries rejecting the claim of such a concession. It is that impugned rejection of the claim which has become the subject matter of this writ petition.

4. Mr. V. Nagarjuna Babu, the learned Counsel for the petitioner has contended that the right of the petitioner to get such a concession in addition to other incentives under the scheme has been settled in several writ proceedings in this Court in addition to the conduct of the respondents in not challenging the same and the only question involved for consideration at the moment is whether the respondents 1 and 2 can avoid the liability to extend such a concession to the petitioner for the two years from 14-11-1992 to 13-11-1994. His primary contention is that the petitioner has right to get such a concession by virtue of clear offer and acceptance forming a contract as such and particularly when a major portion of the concession has been extended under the same circumstances, the Government had no basis to reject the remaining portion of the concession for the period stated above. The respondents have denied such a liability to extend such a benefit or facility to the petitioner on the ground that the Government, having the powers of regulating the policy to extend such benefits when it decided to do it under G.O.Ms No. 375, Industries Department dated 23-8-1985 within its own policy, withdrew such concession from and after the date by issuing G.O.Ms No. 379, dated 20-7-1979 (sic. 1989) according to which the petitioner having been included as one of the mini steel units in the ineligible list, cannot seek such a benefit under G.O.Ms No. 375 which came to be superseded by the subsequent G.O. Mr. Anand Reddy, the learned Government Pleader for Industries has contended that in whatever manner the petitioner is trying to demonstrate its eligibility to get such relief of power tariff to the extent of 25% by virtue of such a scheme etc., by virtue of G.O.Ms. No. 379 dated 20-7-1989, such a right, if any, came to an end. It is also his contention that when the petitioner went into production only after the said G.O. came into force, there was no right or eligibility to get such a concession by way of power rebate. As against this, the learned counsel for the petitioner has contended that without conceding such a contention of the respondents, even assuming that by virtue of such a policy decision of the Government under the G.O., the initial eligibility has come to an end for any reason, the respondents are hit by 'promissory estoppel' to deny such a facility to the petitioner under the rule of equity as per the settled law, according to him. Mr. Anand Reddy, the learned Government Pleader, has contended that there cannot be any estoppel against the Government or its authorities as the policy decision has been taken in accordance with the statutory right vested in the Government by virtue of Section 78 of the Electricity Supply Act and as per law there is no estoppel against the statute or the State acting under its statutory duties. The learned Counsel for the petitioner has contended that the law has been settled in the contrary by various precedents of this Court and the Supreme Court and this is a fit case to extend the equitable relief to the petitioner by applying the doctrine of 'promissory estoppel', as the petitioner has acted in response to the invitation of the respondents in regard to the scheme and the facilities whereby lot of efforts have been expended both in the form of energy, money and time etc. Therefore, in such situation according to him, the respondents cannot be allowed to go back from such a promise regarding which the petitioner has acted suffering itself to lot of consequences which in law should be protected by operating the doctrine of 'promissory estoppel'. Mr. Anand Reddy, the learned Government Pleader, has tried to repel such a contention that judging the matter in any way, no such equity can be extended to the petitioner as the respondents themselves have not acted beyond the equity both in the conduct and the purpose.

5. The right of the petitioner for power rebate of 25% for five years from 13-11-1989 while going into production is conceded and inasmuch as established by virtue of the scheme which is also concluded in view of the decision of this Court confirmed by the Supreme Court when S.L.P. No. 6582-83 of 1994 was disposed of on 21-3-1996. That they got for three years from 13-11-1989 to 13-11-1992 from the APSEB. The claim for remaining two years from 13-11-1992 to 12-11-1994 as against the Government was made and rejected. The contention that it is concluded as against the Government has no force in view of the clear expressions of this Court in W.P No. 5765/90 in the order dated 8-11-1991 which was confirmed in W.A No. 1511/92 on 6-4-1993. Mr. Nagarjuna Babu, the learned Counsel for the petitioner appears to think that by virtue of such decisions in W.P No. 5765/90 and W.A. No. 1151/92, the right of the petitioner to get the power rebate from the Government is also concluded. There is no merit in such a contention. In the first place, the decision in W.P No. 5765/90 did not declare the right of the petitioner for such a relief against the Government inasmuch as the decision in W.P. No. 2142/89 which was clearly clarified in the decision in W.P. No. 5765/90 dated 8-11-1991 that the Government were under no obligation to give rebate to the petitioner for the fourth and fifth years after the unit has gone into production and it was for the Government to extend as per rules if the petitioner approached the Government by following the procedure contemplated for the purpose. Similar was the view taken by the Division Bench of this Court in W.A. No. 1551/92 regulating the manner in which the petitioner should approach the Government for that matter. Significantly, in effect the validity of G.O.Ms No. 379 dated 20-7-1989 was not considered either in W.P No. 2142/89 or W.P No. 5765/90 or W.A No. 1551/92 about the rights and liabilities of the parties and in particular the liability of the Government to concede the power rebate for the fourth and fifth years viz., for two years in spite of G.O.Ms No. 379 having been initiated. It is true that but for G.O.Ms No. 379, the petitioner would have got the benefit of G.O.Ms No. 375 dated 23-8-1985 in regard to the concession for fourth and fifth years also from the Government as has been settled in the consistent expressions of this Court in the previous writ proceedings. Patently, G.O.Ms No. 379 dated 20-7-1989 is upheld as to its validity by the Supreme Court in APSEB v. M/s. Sarada Ferro Alloys Limited, 1993 SC 1521 and also by this Court in V.K. Ferro Alloys Industries Pvt. Limited v. APSEB, : AIR1996AP212 . The law is also settled that G.O.Ms No. 379 is not retrospective and any unit which goes into production prior to 20-7-1989 is entitled to the benefit of G.O.Ms No. 375 as against the Government. Admittedly, the petitioner going into production on 13-11-1989, obviously after G.O.Ms No. 379 coming into force from 20-7-1989, was hit by the said G.O. as a matter of right and in law. The policy of the Government under G.O.Ms. No. 375 to extend such a benefit under the scheme was resiled by a latter policy in G.O.Ms No. 379 within its powers under Section 78-A of the Electricity Supply Act which has been considered in detail and upheld by this Court in V.K. Ferro Alloys Industries Pvt. Limited case (supra).

The right of the petitioner for such a benefit ended with G.O.Ms No. 379 and became unenforceable as of right. Particularly in view of M/s. Sarada Ferro Alloys case (supra), the production having gone into fore after the G.O., the petitioner was not entitled to such a concession unless it could come out of such a legal consequence in any manner other than the said G.O. The learned Government Pleader is right in contending that if G.O.Ms No. 379 is taken as the basis to determine the rights of the parties in this case, the petitioner will be out for the purpose of justiceable right in regard to the matters of policy. But the matter has not ended there. We are still to examine whether the petitioner can seek such a concession of power rebate by virtue of pressing into service the doctrine 6t 'promissory estoppel' against the respondents who have pressed it back in view of G.O.Ms. No. 379 which totally shuts out the petitioner in law for Such a benefit under the defunct G.O. Ms. No. 375.

6. The learned Counsel for the petitioner has made a lot of effort to bring home the meaning, concept and the legal purport for the enforcement of the doctrine of 'promissory estoppel'. In view of the catena of precedents comprising this Court and the Apex Court, no more doubts are left in regard to the concept of such a doctrine. In view of the settled law, it cannot be disputed that the doctrine of 'promissory estoppel' not only entered into the legal sphere in India quite a long back but has remained to stay uptil now. The history into the doctrine has been traced both through the case law and the practices leading to precipitation of the right of equity projecting out of such a doctrine popularly called as 'promissory estoppel', the requisite estoppel, quasi-estoppel and new estoppel, as has been styled in Motilal Padampet Sugar Mills Co. Ltd. v. State of U.P., : [1979]118ITR326(SC) . The ingredients of such a doctrine have been dealt with and detailed in the case supra which can be recorded in brief:

'... It is a principle evolved by equity to avoid injustice and though commonly named 'promissory estoppel', 'equitable estoppel', 'quasi-estoppel', and 'new estoppel', it is, as we shall presently point out, neither in the realm of contract nor in the realm of estoppel. The basis of this doctrine is the interposition of equity. Equity has always, true to form, stepped into to mitigate the rigors of strict law. The early cases did not speak of this doctrine as estoppel. They spoke of it as 'raising an equity'... But we do not think any such limitation can justifiably be introduced to curtail the width and amplitude of this doctrine. We fail to see why it should be necessary to the applicability of this doctrine that there should be some contractual relationship between the parties.... It may be pointed out that in England the law has been well settled for a long time, though there is some indication of a contrary trend to be found in recent juristic thinking in that country, that promissory estoppel cannot itself be the basis of an action. It cannot found a cause of action; it can only be a shield and not a sword. This narrow approach to a doctrine which is otherwise full of great potentialities is largely the result of an assumption, encouraged by its rather misleading nomenclature, that the doctrine is a branch of the law of estoppel... The doctrine may afford a defence against the enforcement or otherwise of enforceable rights; it cannot create a cause of action. It is however, necessary to make it clear that though this doctrine has been called in various judgments and text books as promissory estoppel and it has been variously described as 'equitable estoppel,' 'quasi-estoppel', and 'new estoppel', it is not really based on the principle of estoppel, but it is a doctrine evolved by equity in order to prevent injustice where a promise is made by a person knowing that it would be acted on by the person to whom it is made and in fact it is so acted on and it is inequitable to allow the party making the promise to go back upon it........... When we turn to the Indian Law on the subject it is heartening to find that in India not only has the doctrine of promissory estoppel been adopted in its fullness but it has been recognised as affording a cause of action to the person to whom the promise is made. The requirement of consideration has not been allowed to stand in the way of enforcement of such promise. The doctrine of promissory estoppel has also been applied against the Government and the defence based on executive necessity has been categorically negatived. It is remarkable that as far back as 1880, long before the doctrine of promissory estoppel was formulated by Denning, J., in England a Division Bench of two English Judges in the Calcutta High Court applied the doctrine of promissory estoppel and recognised a cause of action founded upon it. The doctrine of promissory estoppel was also applied against the Government in a case subsequently decided by the Bombay High Court in Municipal Corporation of Bombay v. Secretary of State (1905) ILR 29 Bom. 580. ...It was thus laid down that a party who has, acting in reliance on a promise made by the Government, altered his position, it entitled to enforce the promise against the Government, even though the promise is not in the form of a formal contract as required by Article 229 and that Article does not militate against the applicability of the doctrine of promissory estoppel against the Government .........

The defence of executive necessity was thus clearly negatived by this Court and it was pointed out that it did not release the Government from its obligation to honour the promise made by it, if the citizen, acting in reliance on the promise, had altered his position. The doctrine of promissory estoppel was in such a case applicable against the Government and it could not be defeated by invoking the defence of executive necessity.... It was laid down by this Court that the Government cannot claim to be immune from the applicability of the rule of promissory estoppel and repudiate a promise made by it on the ground that such promise may fetter its future executive action. If the Government does not want its freedom of executive action to be hampered or restricted, the Government 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 Government makes such a promise and the promisee acts in reliance upon it and alter his position, there is no reason why the Government should not be compelled to make good such promise like any other private individual. .. But it is necessary to point out that since the doctrine of promissory estoppel is 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 the Government. The doctrine of promissory estoppel would be displaced in such a case because, on the facts, equity would not require that the Government should be held bound by the promise made by it. When the Government is able to show that in view of the facts which have transpired since the making of the promise, public interest would be prejudiced if the Government were required to carry out the promise, the Court would have to balance the public interest in the Government carrying out a promise made to a citizen which has induced the citizen to act upon it and alter his position and the public interest likely to suffer if the promise were required to be carried out by the Government and determine which way the equity lies. It would not be enough for the Government just to say that public interest requires that the Government should not be . compelled to carry out the promise or that the public would suffer if the Government were required to honour it. The Government cannot claim to be exempt from the liability to carryout the promise on some indefinite and undisclosed ground of necessity or expediency, nor can the Government claim to be the sole judge of its liability and repudiate it on an ex parte appraisement of the circumstances.....While it is said that equitable estoppel will be invoked against the State when justified by the facts, clearly the doctrine of estoppel should not be lightly invoked against the State. ...Where the Government owes a duty to the public to act in a particular manner, and here obviously duty means a course of conduct enjoined by law, the doctrine of promissory estoppel cannot be invoked for preventing the Government from acting in discharge of its duty under the law. The doctrine of promissory estoppel cannot be applied in teeth of an obligation or liability imposed by law. It may also be pointed out that promissory estoppel cannot be invoked to compel the Government or even a private party to do an act prohibited by law. There can be no promissory estoppel against the exercise of legislative power. ... We do not think that in order to invoke the doctrine of promissory estoppel, it is necessary for the promisee to show that he suffered detriment as a result of acting in reliance on the promise. But we may make it clear that 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.' (Paras 7,8,9,10,19,24,28, and 33)

Notably, such a view of the Apex Court has been followed by all the subsequent precedents of the Supreme Court upto the latest one in Kasinaka Trading and Anr. v. Union of India and Anr., : 1994ECR637(SC) While reviewing the entire case law on the question uptil the date of this precedent and referring to that in para 12, the pith and core of the concept has been reiterated and recorded as hereunder:

'The doctrine of promissory estoppel or equitable estoppel is well established in the administrative law of the country. To put it simply, the doctrine represents a principle evolved by equity to avoid injustice. The basis of the doctrine is that where any party has by his word or conduct made to the other party an unequivocal promise or representation by word or conduct, which is intended to create legal relations or effect a legal relationship to arise in the future, knowing as well as intending that the representation, assurance of the promise would be acted upon by the other party to whom it has been made and in fact been so acted upon by the other party, the promisee, assurance or representation should be binding on the party making it and that party should not be permitted to go back upon it, if it would be inequitable to allow him to do so, having regard to the dealings, which have taken place or are intended to take place between the parties.'

It is also pointed out therein that it has been settled by the Supreme Court that the doctrine of 'promissory estoppel' is applicable against the Government also particularly where it is necessary to prevent fraud or manifest injustice, however, subject to exceptions including the result of fraud or misconduct of the parties involved in seeking the remedy of equity Court. It has been observed in this case that the ambit, scope and amplitude of promissory estoppel has been evolved in this country over the last quarter of a century through successive decisions of the Supreme Court with special reference to Union of India v. Godfrey Philips India Ltd., : [1986]158ITR574(SC) . It was observed at para 14 as follows:-

'We may also pointout 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 or Public authority having regard to the facts as they have transpired, it would be inequitable to hold the Government or public authority to the promise or representation made by it, the Court would not raise an equity in favour of the person to whom the promise or representation is made and enforce the promise or representation against the Government or public authority. The doctrine of promissory estoppel would be displaced in such a case, because on facts, equity would not be require that the Government or public authority should be bound by the promise or representation made by it.'

7. The learned Counsel for the petitioner has usefully referred to a Full Bench pronouncement of this Court in M/s. Rayalaseema Alkalies and Allied Chemicals Limited v. Government of Andhra Pradesh, : AIR1993AP278 (F.B.). which has referred to the Padampet Sugar Mills case (supra) to further elaborate the matter and the concept and ingredients of promissory estoppel in its own summary as follows:-

'... 'promissory estoppel' is an equitable relief and the same can be invoked against a person who unequivocally promised to do something by his words or conduct made to another and that another acting upon the same alters his position to his detriment, then the promise made by him will be enforced. However, it is subject to the following:-

1. being an equitable relief, it is open to the party who made the promise to establish on facts that it is inequitable to enforce the promise;

2. the doctrine of 'promissory estoppel' cannot be applied in the teeth of an obligation or liability imposed by law.

3. The Government or even a private party cannot be compelled by invoking the principles of promissory estoppel to do an act prohibited by law.

4. The legislature can never be precluded by invoking the principles of 'promissory estoppel' from exercising its legislative functions.'

Therefore, the doctrine of promissory estoppel has found its deep root within the rule of law which is not inconsistent with the rule of equity and vice-versa. Within such parameters as above, it may be ultimately a question of fact to be determined in each case whether a particular party seeking the relief of equity can be afforded such a relief and the party against whom such a relief is sought to be enforced can be relieved of it having due regard to the facts and circumstances of each case. In view of the consistency in the precedents as above dealing with the doctrine, the confusion or wrong understanding of the implications of the doctrine within the rule of estoppel under Section 115 of the Evidence Act can no longer exist. To conclude on the question, the doctrine of promissory estoppel is a product of equity to be considered and enforced by a Court exercising its discretion in equity, notwithstanding the legal barriers unless the rule itself is legislated out by means of a statute. The contention of Mr. Anand Reddy, the learned Government Pleader, that such a rule of promissory estoppel cannot operate against the Government or the State is against the settled Law. His reliance in support of his contentions on the pronouncements of the Supreme Court in M/s. JIT Ram Shivkumar v. State of Haryana and Anr., : [1980]3SCR689 , N. Ramanatha Pillai v. State of Kerala and Anr., : (1973)IILLJ409SC , Excise Commissioner, U.P., Allahabad v. Ramkumar, : AIR1976SC2237 has no basis in view of M/s. Sarada Ferro Alloys case (supra) having been overruled in Union of India and Ors. v. Godfrey Philips India Limited, : [1986]158ITR574(SC) and the latest pronouncement of the Supreme Court detailed supra, having taken a different view of the matter as above. The only distinguishing feature of the question in the doctrine is that like any other estoppel if promissory estoppel is one of such species, it cannot operate against any statute or piece of legislation overriding such an equity either retrospectively or prospectively as has been clarified in Rayalaseema Alkalies and Allied Chemicals case (supra) by the Full Bench of our Court.

8. The learned Counsel for the petitioner has justifiably relied upon several precedents uptil now to show that such concession as in the present case have been enforced by pressing into service the rule of promissory estoppel against the Government time and again. In Asst. Commissioner of Commercial Taxes v. Dharmendra Trading Company, : [1988]172ITR395(SC) promissory estoppel was held to be good law in view of the pronouncement of the Supreme Court in State of Bihar v. Usha Martin Industries Limited, , where in a scheme the concession of Sale Tax was conceded by enforcing the rule of promissory estoppel against the Government. In this Padampet Sugar Mills case (supra) is made a reference. In Godfrey Philips India Limited case (supra) while overruling Ram Shiv Kumar's case (supra), the doctrine of promissory estoppel was made applicable against the Government in the exercise of its governmental duty or executive functions and the doctrine of 'executive necessity' or 'freedom of future executive action' is sought to be invoked to defeat the applicability of the doctrine of promissory estoppel. The rule of equity by enforcing the promissory estoppel was accepted in that case as claimed by the petitioner. It is true that in Ferro Alloys India Pvt. Limited case (supra) while upholding the powers of the Government in issuing G.O.Ms. No. 379, it did not deal with the question of promissory estoppel arising out of such a situation, as rightly pointed out by the learned Counsel for the petitioner, even in regard to the similarly placed facts as in the present case. While deciding the right of a party to such a concession under the relevant scheme for power rebate, enforceable only against the State Electricity Board, and not against the Government without impleading as party conceded the concession for three years as against the Government. As already pointed out in W.P No. 5765/90, 16385/92 and W.A. No. 1551/92, the right of the petitioner to seek such a right as against the Government was kept open, which it could not successfully achieve. Even there, there was no occasion to deal with the question of promissory estoppel. The contention of the learned Government Pleader that issue of G.O.Ms No. 379 being a legally executive action by the Government, there cannot be any promissory estoppel to be considered, is against the law settled by the Supreme Court in various pronouncements including the latest pronouncement in Kasinaka Trading case (supra ). He has relied upon M/s. Sarada Ferro Alloys Limited case (supra) in support of such a contention in view of the expressions made by the Supreme Court in para 11 as follows:

'We are of the view that the promise or representation made by the Board in its letter dated July 13, 1976, if any, was directly linked with the date of commencement of production by the company. It is not disputed that the respondent-company commenced production on commercial scale on August 11, 1990. The incentive was withdrawn by the Board on December 8, 1987 and by the Government on July 27, 1989. Whichever date is taken into account the company was not entitled to the incentive as it had not commenced production on or before either of these dates. Even if it is assumed that a promise or representation was made by the Board in its letter dated July 13, 1976, the doctrine of promissory estoppel is not attracted in this case as the company failed to act upon the said representation. We do not agree with the assumption entertained by the High Court that once the company started the process of setting up an industry and had incurred expenditure, the Board was bound to keep its incentive open for the company till it started production. We are of the view that only those industries were entitled to the benefit of the incentive who fulfilled the requirements during the period of incentive was operative.'

It is true that this is almost a direct case on the question having the implications of promissory estoppel based upon G.O.Ms No. 379. But whether the petitioner should be put of such an equitable relief in the equity of promissory estoppel by virtue of such a decision is yet to be considered. Patently this case had no occasion to deal with the implications of promissory estoppel underlined and approved in all previous precedents starting from Padampet Sugar Mills case (supra). In view of the latest pronouncement of the Supreme Court in Kasinaka Trading Company case (supra) and in the absence of any expression in M/s. Sarada Ferro Alloys case (supra) contrary to that, the law cannot be taken to have put a party out of the relief under promissory estoppel equity and even assuming that M/s. Sarada Ferro Alloys case (supra) has nothing to do with negativing such a relief (which is not so), in view of Kasinaka Trading case (supra) being the latest, no such operation of the rule of precedent against the petitioner can be adopted in law. However, as rightly pointed out by the learned Government Pleader, the facts of this case and the facts of M/s. Sarada Ferro Alloys case (supra) are to be examined to know whether the petitioner is entitled to such a relief and whether the Government can be relieved of such an operation of oppression of such an equity rule under promissory estoppel.

9. Under the circumstances, now the question has become a question of fact, whether the facts and circumstances of this case can make the petitioner an entitled entity to Seek and get the relief in equity viz., by means of promissory estoppel and at the same time whether the facts and circumstances of this case are insufficient or (sic. to) relieve the respondent or the Government to suffer the consequence of such an equity rule.

10. As already pointed out, the factual situations noted show that it was at the invitation of the Government and its authorities, the petitioner decided to establish the industry in the backward area of Anantapur district. He took all the steps as detailed above to apply, to make preparation, to acquire the land, invest the money, seek the necessary permission or licence from all the concerned including the 'no objection certificate' both from the State Electricity Board and also the Government. Significantly, such an exercise commenced from March '85 and ended with 27-8-1989 when the Central Excise Department issued licence to manufacture the excisable goods. Notably, the petitioner had completed all the formalities and had complied with all the conditions of both the Electricity Board and also the Government by 25-3-1989, when by then not only the authorities of the Electricity Board (on 14-3-1989) were satisfied and certified that the petitioner had completed in all respects requesting approval, but also the Government had certified the fitness of the unit for energisation. The Member-Secretary of the State Electricity Board also issued approval to provide power connection subject to concurrence of certain procedures on 29-3-1989. The Government issued permanent certificate of energisation on 5-5-1989. But it was only due to the reticent attitude on the part of the Electricity Board, the petitioner could not go into production. The Government has neither pleaded nor established that there was any laches on the part of the petitioner, after 25-3-1989 and before G.O.Ms No. 379 was issued, in regard to the commencement of production the industry, but for the conduct of the Electricity Board and which was to be energised by itself by means of the interim order of this Court dated 31-8-1989 in W.P. MP. No. 13970/89 in W.P. No. 10531/89, when all the efforts failed and the petitioner was able to go into production only on 13-11-1989 within 2 1/2 months of the order, possibly after undergoing some inevitable formalities to get electric connection and to commence the production. There is nothing to indicate in the counter filed on behalf of the Government that within this long active period, there was any lach on the part of the petitioner either in regard to the preparation or completion of the same and be ready to commence the production, but for the conduct of the Electricity Board. Particularly, there was no such conduct on the part of the petitioner in between 25-3-1989 when the Government certified fitness of the unit till G.O.Ms No. 379 was issued in July 1989. The petitioner is able to demonstrate very well that it was ready to commence the production in the month of March 1989 only and was prevented from doing so due to the conduct of the Electricity Board in not energising the unit. Apart from this, the Government is not able to plead or demonstrate that the petitioner is guilty of any misconduct to seek equity or to call that it has not come to Court with clean hands. It is also demonstrated that based on such a promise or assurance by the Government under the scheme, the petitioner has gone into loans with State Bank of India, Industrial Finance Branch, Bangalore for short-term and long term loans subject to getting 25% subsidy for five years as per the eligibility certificate issued by the Dist. Industries Centre. Therefore, on facts, it is found that the petitioner has performed all necessary functions and complied with all the conditions of the Electricity Board and Government in addition to investing its own fund and something more as above and was ready to commence the production well long prior to G.O.Ms No. 379 having been issued. Therefore the facts and circumstances of this case are sufficient to fulfil the ingredients of promissory estoppel to be pleaded to get the affordal by the petitioner as against the Government.

11. As against what the petitioner had done above, the counter affidavit filed by the Government has only attempted to justify its action and the power by virtue of G.O.Ms No. 379 basing it to reject the claim of the petitioner for rebate under the scheme and pleading that it was done in public interest. There is no explanation for that. The expression 'public interest' is too wide a term to understand to import in the absence of materials. It is not explained as to how the public interest would suffer by merely considering the claim of one industry viz., the petitioner, in regard to power rebate only for two years when all other remaining benefits under the scheme are already extended to the petitioner notwithstanding such G.O. coming into force subsequently. It is not explained as to how the public interest would suffer when whole scheme was for the benefit of the public only to develop the backward area in Anantapur district., It cannot be forgotten that industrialisation is part of social development. The social development is always part of public interest. Public interest vis-a-vis interest of the petitioner are not weighed by the Government in considering the claim for rebate which was rejected. From the counter affidavit of the Government. This Court is not able to Judge as to how the Government can be relieved of the operation of the equity rule of promissory estoppel. If public interest as had been contended by the learned Government Pleader is only to save so much of amount which may go in concession to the petitioner, that may not serve the purpose of examining the balance in equity between the parties as has been explained by the Supreme Court in the precedents supra. Therefore, on the face of it, the respondent-Government cannot escape the effect of promissory estoppel operating against them in the present case.

12. Now coming back to M/s. Sarada Ferro Alloys case (supra), it may be useful to state the facts of the case. In pursuance of the same scheme extending certain benefits of concession including 25% power tariff which was withdrawn under G.O.379, one Sarada Ferro Alloys company decided to establish an industry to produce ferrochrome. It obtained a SSI certificate on 5-9-1986. It obtained NOC from A.P. Pollution Board on 12-11-1986. It purchased Ac.4-01 of land between September'86 and May'89. It deposited certain amount with the APSEB on its demand. The company entered into an agreement with the Board on 21-8-1989 for supply of electricity and it commenced production on regular basis on 11-8-1990. Under such circumstances, the Supreme Court in para II as extracted above, pointed out that the doctrine of promissory estoppel is not established in that case as the company failed to act upon such representation. It had not done anything more than what is stated above and had not commenced production in between the dates when the Board withdrew the concession and when the Government withdrew the concession. Therefore, it was a clear case decided on the facts saying that barring certain preparation, the industry was not ready to commence the production and actually it commenced the production after a long time in between certain material dates stated above. In such a situation, there could not have been any conduct and the representation of either the Government or the Electricity Board to be acted upon by the industry which remained in a slumber for a long period unmindful of the G.O. 379 having come into force and it was only due to the conduct of the industry therein, it could not avail the benefits of such concession by operating the equity rule of promissory estoppel. As against that, in the present case, for all purposes the petitioner was ready to start the production almost four months prior to the G.O. 379 coming into force and as already pointed out,-it was prevented from doing it due to the conduct of the Electricity Board and even the Government had clearly represented quite a long back that it was prepared to offer and concede the rebate by certifying the fitness in the month of March'89 only, meaning thereby that it had the knowledge that the petitioner was ready to commence production. Under such circumstances, this is a case on facts to operate the equity rule of 'promissory estoppel'. It is also to be noted that in spite of such a conduct, the petitioner had to run from pillar to post and had to initiate half a dozen writs and other proceedings to get one relief or the other. This Court is not convinced that the Government has considered the claim of the petitioner in its true situation and equity which the petitioner deserves and with a technical interpretation of G.O. 379 such a claim has been rejected unjustifiably. The contention of the learned Government Pleader has been vociferred in the counter affidavit that if such a claim is allowed, it will open up harness nest in meeting such large claims, is no answer to the demand of equity.

13. In the result, the Writ Petition is allowed. It is declared that the petitioner is entitled to the power rebate of 25% for the period from 13-11-1992 to 12-11-1994 from the Government regarding which a decision shall be taken to afford the result within one month from the date of receipt of a copy of this order. In the peculiar circumstances of this case, there shall be no order as to costs.