OLIVIA LAYARAJ Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) The question that arises in this batch of Criminal Petitions is, whether the doctrine of promissory estoppel could be invoked against the State for actions resultant of legislative obligations so as to get over the prosecutions in a proceedings under Section 482 Cr.P.C. during the course of administra tion of Criminal Justice.

(2.) The facts that gave rise to this question are : In 1984 when the petitioner started the school, by name H. Rosetle English Medium School, Section 16 of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (hereinafter referred to as 'the Act') exempted application of its provisions to establishments employing 20 to 50 persons until expiry of five years from the date of setting up of the establishment. However, in June 1988 the said section underwent an amendment by Act 33 of 1988 whereby the period of exemption was reduced from 'five years' to 'three years'. In view of this amendment, soon after expiry of the three years the provisions of the Act had their operation rendering the petitioner liable to comply with certain provisions of the Act. Since the petitioner was found to have not complied with the same, the State launched prosecutions against the petitioner. The said prosecutions are challenged in these petitions mainly by invoking the doctrine of promissory estoppel stating that the provisions of the Act cannot be made applicable to the petitioner's establishment until expiry of five years inasmuch as Sec. 16 as it stood at the time of starting of the school exempted the said application for a period of five years from the date of starting of the establishment. In this background of the facts, the contention of the learned counsel, Sri T. Bali Reddy, is that the amended Sec. 16 of the Act cannot be given effect to as against the petitioner since it is hit by the doctrine of promissory estoppel. In support of this contention, Mr. Bali Reddy sought to place reliance upon a few decisions of the Supreme Court and also of this Court.

(3.) In M.P. Sugar Mills vs. State of U.P. based upon a statement made by the Secretary of the Industries Department a news item appeared in the National Herald that the State of Uttar Pradesh had decided to give exemption from the sales tax for a period of three years under Section 4-A of the U.P. Sales Tax Act to all new units in the State with a view to enabling them 'to come on firm footing in developing stage". The appellant on the basis of this announcement addressed the Chief Secretary of the State and had also a reply dated 23rd January, '69 confirming that the proposed Vanaspathi factory of the appellant' will be entitled to exemption from U.P. Sales Tax for a period of three years from the date of going into production.' In view of this assurance, which obviously is by virtue of the power available to the Government under the statute to accord exemption, the appellant went ahead with the project. However, on 20th January, '70 the appellant was addressed a letter going back upon the earlier assurance and consequently when tax was sought to be levied on the sales to the appellant, that action was challenged by invoking the doctrine of promissory estoppel. In those circumstances, the Supreme Court held that the facts necessary for invoking the doctrine of promissory estoppel were present and that the Government was bound to carry out the representations and exempt the appellant from sales-tax for a period of three years from the date of commencement of production. However, the Supreme Court made it clear in unambiguous terms :