TATA IRON AND STEEL CO. LTD. versus UNION OF INDIA AND ORS.

Citation: [2000] SUPP. 5 S.C.R. 228 · Decided: 30-11-2000 · Supreme Court of India · Bench: M. JAGANNADHA RAO · Disposal: Dismissed

Judgment (excerpt)

A 
°TATA IRON AND STEEL CO. LTD. 
v. 
UNION OF INDIA AND ORS. 
NOVEMBER 30, 2000 
B 
[M. JAGANNADHA RAO AND U.C. BANERJEE, JJ.] 
Constitution of India, 1950: Article 226 and 136. 
International Price Reimbursement Scheme (!PRS)-Applicability of-
C IPRS introduced to curb the ascending trend for demand of imported steel 
due to higher price of domestic steel-IP RS aimed at protecting exporters of 
engineering goods, who, by use of domestic steel, were exposed to additional 
expenditure and suffered loss due to price difference-IP RS also provided for 
reimbursement of the price difference between domestic and international 
D prices-Manufacturer exported engineering goods by using its own 
111anufactured steel without involving the price elements declared by Joint 
Plant Committee (JPC)-Engineering Export Promotion Council (EEPC) 
refused to recognic manufacturer's entitlement to avail benefit of IPRS-
Therefore, EEPC demanded refund of excess IPRS payment made to the 
manufacturer-Validity of-Held: On a true reading of the IPRS, the 
E manufacturer is not entitled to any reimbursement as it has not paid various 
levies declared by JPC. 
Evidence Act, 1872: Section JJ5. 
F 
Estoppel-Estoppel by conduct-Doctrine-Invoking of-Amount 
erroneously paid or paid in excess-Undertaking to refund excess amount 
existed-Held: Under such circumstance question of applying doctrine of 
estoppel by conduct does not arise. 
G 
H 
Words and Phrases: 
'"Reimbursement"-Meaning of-In the context of International Price 
Reimb11rsement Scheme. 
Doctrines: 
Doctrine of Estopped by conduct. 
228 
TATA IRON AND STEEL CO. LTD. v. U.0.1. 
229 
The respondent introduced a Scheme known as International Price A 
Reimbursement Scheme (IPRS) to curb the ascending trend for demand of 
imported steel ilue to higher domestic price structure of indigenous steel. 
The domestic price structure as fixed by the Joint Plant Committee (JPC) 
included a number of levies resulting in JPC pricing being higher than the 
International pricing. The IPRS was aimed at protecting exporters of B 
engineering goods, why, by use of domestic steel were exposed to additional 
expenditure and thus suffered a loss due to the price difference. The IPRS 
also provided for reimbursement of the difference between the domestic and 
international prices. 
The appellant exported engineering goods by using its own C 
manufactured steel without involvement of any of the price elements as 
declared by JPC. It is on this score that the Engineering Export Promotion 
Council in 1992 refused to recognize the appellant's entitlement to avail of 
the benefit of the IPRS and demanded refund of a certain amount with interest, 
which was paid in excess under a bona fide mistake. There was a specific 
undertaking by the appellant to refund any amount erroneously paid or paid D 
in excess. The High Court dismissed the appellant's writ petition challenging 
the aforesaid demand. Hence this appeal. 
On behalf of the appellant it was contended that the IPRS did not require 
actual payment of domestic price; that the appellant was entitled to the price 
difference between the domestic and international prices; and that by E 
conferment of the benefit in terms of IPRS the conduct of the respondent was 
hit by the doctrine of estoppel by conduct. 
Dismissing the appeal, the Court 
HELD : I. The International Price Reimbursement Scheme (JPRS) F 
without dc.·~bt stands attracted for reimbursements only. The issue, therefore, 
arises having regard to the meaning attributed to the word 'reimbursement' 
as to whether there is any entitlement for the appellant It needs to be adverted 
that the appellant in fact has been receiving the money in the past and the 
entitlement thereof is challenged only since 1992 and this payment has been 
effected by mistake and immediately on detection thereof and, in order to G 
rectify the mistak~, a notice was sent as regards the excess payment on 
account of price difference between the domestic and international prices. 
(238-G-Hl 
2.1. In common acceptation the word 'reimburse' means and implies 'to 
. pay back or refund'. It denotes restoration of something paid in excess; as H 
230 
SUPREME COURT REPORTS [2000] SUPP. 5 S.C.R. 
A regards the respondent it cannot but mean to indemnify having regard to the 
common grammatical meaning of the word 'reimbursement' Reimbursement 
has to mean and imply restoration of an equivalent of something paid or 
expended. Reimbursement

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