M/S MOTILAL PADAMPAT SUGAR MILLS CO. (P.) LTD. versus STATE OF UTTAR PRADESH AND ORS .

Citation: [1979] 2 S.C.R. 641 · Decided: 12-12-1978 · Supreme Court of India · Bench: P.N. BHAGWATI · Disposal: Appeal(s) allowed

Cited by 26 judgment(s) · cites 7 · see the full citation network in Lexace

Judgment (excerpt)

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6 41 
M/s MOTILAL PADAMPAT SUGAR MILLS CO. (P.) LTD. 
A 
v. 
STATE OF UTTAR PRADESH AND ORS . 
December 12, 1978. -. · 
[P. N. BHAGWATI AND V. D. TULZAPURKAR, JJ.J 
Waiver, doctrine of-Waiver is a question of fact and it must be properly 
p(~aded and proved. 
Public luw-Doctrine of Pro111issory Estoppel, its contours and para1neters, 
explnined. 
Estoppel-Estoppel in pais-Promissory 
Estoppel-Applicability of the 
doctri11e against th~ Governn1ent and extent thereof-Doctrine of executive 
necessity, whether could be a valid defence and if so under what circumstanc-
"· 
Representations de futuro by a public body, if enforceable ex-contractu by 
a person who acts upon such representation or promise intended to be acted 
on-Burden of proof-Degree of standard of proof in such cases. 
The appellant is a limited company which is primarily 
engaged 
in 
the 
bpsiness of manufacture and sale of suglar and it has a cold 
storage plant 
and a steel foundry. With reference to a news item dated 10th October 1968 
in the National Herald in which it was stated that the State of Uttar Pradesh 
had decided to give exemption from 001.es tax for a period of three ~ years 
under section 4A of the U .P. Sales Tax Act to all new industrial units in the 
State with a view to enabling them "to come on firm footing in developing 
stage", the appellant addressed a letter dated !Ith October 1968 to the 
Director of Industries stating that in view of the sales tax holiday announced 
by the Government the appellant intended to set up a Hydrogenation plant 
for manufacture of Vanaspati and sought for confirmation that this industrial 
unit which it proposed to set up, would be entitled to sales tax holiday' for 
a period of three years from the date it commenced production. The Director 
of Industries by his letter dated 14th October 1968, confirmed that 
"there 
will be no sales tax for three years on the finished product of your proposed 
Vanaspati factory from the date it gets power connection for commencing 
production". Thereafter 
when the 
appellant's 
representative 
met the 
4th 
respondent, who was at that time the Chief Secretary to the Government as 
also Advisor to the Governor and apprised the latter that the appellant was 
setting up the Vanaspati factory solely on the basis of the assurance given 
on behalf of the Government thet the appellant would be entitled to exemp-
tion from sales tax for a pe'riod of three years from the date of commence-
ment of commercial production at the factory, the 4th respondent reiterated the 
assurance made. Again the appellant, by its letter dated 13th December 1968, 
requested the 4th respondent "to please confirm that we shall be allowed sales 
tax holiday for a period of three years on the sale of Vanaspati from the date 
we start production". The 4th respondent replied on 22nd December 1968 that 
"the State Government will be willing to consider your request for grant of 
exemption from U.P. Sales Tax for a period of three years from the date of 
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642 
SUPREME COURT REPORTS 
[ J 979] 2 S.C.R. 
A 
production" and asked the appellant to obtain the requisite application 
form 
and subn1it a formal application to the Secretary to the Government in the 
Industries department, nnd in the meanwhile "to go ahead with the arrange-
ments for setting up the factory". 
The appellant ill the meantime had sub-
mitted an application dated 21st December 1968 for a formal order granting 
exemption from sales tax under section 4A of the U.P. Sales Tax Act. The 
appellant v,1.1•3 also subsequently inforn1ed by the letter dated 23rd 
January 
B 
1969 of the 4th respondent categorically that the proposed Vanaspati factory 
of the appellant "will be entilled to exemption fro1n U.P. Sales Tax 
for 
a 
period of three years from the date of going into production and that this 
\Vill apply to all Vanaspati sold during that period in Uttar Pradesh itself". 
The appellant, on the basis of these unequivocal assurances, \Vent ahead with 
the setting of the Vanaspati factory and made much progress. 
c 
By the middle of May 1969, the State Government started having second 
thoughts on the question of exemption nnd the appellant \Vas 
requested to 
attend a n1eeting "to discuss the question of giving concession in Sales Tax 
on Vanaspati products". 
The appellant immediately by its letter dated 19th 
May 1969 pointed out to the 5th respondent that so far as the appellant was 
concerned, the Stat

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