Customs, Excise and Gold Tribunal - Delhi
General Industrial Society Ltd. vs Collector Of Customs on 21 November, 1985
Equivalent citations: 1985(23)ELT550(TRI-DEL)
ORDER
S. Venkatesan, Sr. Vice-President
1. This appeal relates to the levy of additional duty of customs (popularly referred to as "Countervailing Duty" or "C.V.D."), on a consignment of Viscose Rayon Staple Fibre imported by the appellants.
2. Appearing for the appellants, Miss Anjali Bahl set out the basic facts, which are not in dispute. It would be useful to mention some relevant dates-
5-1-79 Two notifications, viz. Notification No. 6/79 and Notification No. 8/79, both under Section 25(1) of the Customs Act, 1962, were issued on this date. Under Notification No. 6 of 1979 viscose staple fibre (among other articles) was exempted from the whole of the basic duty of Customs under the Customs Tariff Act. Under Notification No. 8/79, viscose staple fibre was exempted from so much of the C.V.D. leviable under Section 3 of the Customs Tariff Act as was in excess of Rs. 1.32 paise per kg.
2.1. Both notifications ended with the sentence, "This notification shall be in force upto and inclusive of the 31st December, 1979".
3-8-79 The appellants opened an irrevocable Letter of Credit in respect of a consignment of viscose rayon staple fibre for which they placed an order with a Japanese supplier.
17-10-79 The suppliers issued their invoice covering shipments of the goods ordered.
30-10-79 Bill of Lading for shipment of the above goods was issued by the steamer agents.
30-10-79 Amending Notification No. 208/79 under Section 25, Customs Act, was issued by the Government of India in the Ministry of Finance, Department of Revenue. This notification amended Notifications No. 6/79 and 8/79 by substituting the date "31st day of December, 1980" for the earlier date "31st December, 1979". The notification also amended Notification No. 8/79 by substituting the words "2.37 paise per kg." for the words "1.32 paise per kg.". In other words, the full exemption from basic duty was extended up to 31-12-1980, where- as the concessional rate of duty (C.V.D.) was modified from Rs. 1.32 per kg. to Rs. 2.37 per kg., this modified rate to be effective up to 31-12-1980.
7-12-79 On import into India, the goods were assessed to C.V.D. at the rate of Rs. 2.37 per kg.
3. Based on these facts, the appellants claimed refund of the duty in excess of Rs. 1.32 per kg., which was the rate specified in Notification No. 8/79 prior to amendment. Their claim was rejected by the Assistant Collector. The rejection was upheld by the Appellate Collector of Customs, Calcutta. Against the Appellate Collector's order a Revision Application to the Central (Government was filed, which is now before us for being treated as an appeal to the Tribunal.
4. Based on the above facts, Miss Anjali Bahl submitted that the orders of the lower authorities were wrong. Her plea was that the principle of promissory estoppel would be applicable to this case and that the concessional rate of duty at Rs. 1.32 per kg. should be deemed to be in force until 31-12-1979, and therefore applicable to the consignment imported by the appellants, on which duty was paid on 7-12-1979.
5. Miss Anjali Bahl fairly drew our attention to certain High Court judgments which were in favour of the Department's stand. One of these was the order of the Andhra Pradesh High Court in the case of Fenoplast Pvt. Ltd. and Anr. v. Union of India and Anr. [1984 (17) E.L.T. 97 A.P.], In that judgment it had been held that a notification in which it was stated that the exemption would be operative up to a particular date could nevertheless have its period of operation cut down in the public interest and that the principle of promissory estoppel would not be applicable to the case. Miss Anjali Bahl submitted that in reaching its decision the Andhra Pradesh High Court had relied on the judgment of the Supreme Court in the case of Jeet Ram Shivkumar v. State of Haryana (AIR 1980 S.C. 1285). However, Hon'ble Supreme Court in its recent judgment in the case of Union of India and Ors. v. Godfrey Philips India Ltd. and Ors. [1985 (22) E.L.T. 306-(S.C.)] (para 7 infra) had overruled the decision in the Jeet Ram case. Miss Anjali Bahl therefore submitted that the judgment in the Feno Plast case would not stand against the ground taken by the appellants.
6. The other case which was against the appellants was that of Hindustan Spinning and Weaving Mills v. Union of India and Anr. [1984 (17) E.L.T. 281 (Bom.)]. In that judgment the Bombay High Court had occasion to deal with the same notifications which are the subject-matter of the present case. The Hon'ble High Court had held that estoppel could not be pleaded because of the theory that there could be no estoppel against the operation of the statute. The High Court had therefore not accepted that promissory estoppel was attracted to the facts of the case. As regards this judgment Miss Anjali Bahl submitted that it would also stand overruled by the judgment of the Supreme Court in the Godfrey Philips case.
7. Miss Anjali Bahl submitted that the judgment of the Hon'ble Supreme Court in the Godfrey Philips case was strongly in favour of the appellants. That was a case which related to the inclusion of "secondary packing" in the form of Corrugated Fibreboard Containers ("C.F.C.") in the assessable value of cigarettes. In that case the Cigarette Manufacturers' Association had represented that the cost of the C.F.C. would not be includible in the assessable value. This plea was accepted by the Central Board of Excise and Customs by a letter dated 24-5-1976. A reply was given to them that "Instructions have been issued to the Collector of Central Excise that the cost of corrugated fibreboard containers in question does not form part of the value of cigarette for the purposes of excise duty.". However, on 2-11-1982 the Board had addressed a circular letter to all the Collectors of Central Excise to the effect that the cost of packing "whether initial or secondary in which the excisable goods are packed at the time of the removal may form part of the assessable value of such goods" and the earlier advice inconsistent with this position should be treated as cancelled. That manufacturers in that case contended inter alia that the doctrine of promissory estoppel would operate against the Government on the basis of the representation contained in the Board's letter dated 24-5-1976.
8. On the above facts and after an extensive discussion of the law on the subject the Hon'ble Supreme Court held that the Central Government and the Board were clearly bound by promissory estoppel to exclude the cost of the C.F.C. from the assessable value of the goods for the period 24-5-1976 to 2-11-1982. (The Hon'ble Supreme Court further held, by a majority, that the cost of the C.F.C. was in any case not includible in the assessable value.) In the course of the discussion the Hon'ble Supreme Court observed as follows :-
"We have carefully considered both the decisions in Motilal Sugar Mills case and Jeet Ram's case and we are clearly of the view that what has been laid down in Motilal Sugar Mills case represents the correct law in regard to the doctrine of promissory estoppel and we express our disagreement with the observations in Jeet Ram's 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."
9. Miss Anjali Bahl strongly relied on the above judgment and the observations of the Hon'ble Supreme Court and submitted that on the facts of the present case the doctrine of promissory estoppel would be equally applicable against Government and that consequently only the duty in terms of Notification No. 8/79 prior to amendment, i.e. at Rs. 1.32 per kg., should have been recovered from the appellants. She accordingly submitted that the appeal should be allowed and consequential refund directed to be made.
10. The Bench enquired from Miss Anjali Bahl whether any orders were placed by the appellants for the impoitation of viscose staple fibre yarn after they had come to know of the amendment made by Notification No. 208/79 dated 30-10-1979. She replied that they did effect some imports subsequently, but they also made purchases from Indian manufacturers. She submitted that there were disputes with the Customs authorities in regard to the subsequent importations also, and writ petitions relating to those importations were still pending in the Calcutta High Court,
11. Replying on behalf of the Collector, Shri Tripathi submitted that there was no dispute regarding the facts. According to him, the applicable rate of C.V.D. on the goods with effect from 30-10-1979 was Rs. 2.37 per kg. He referred to Section 15 of the Customs Act, which lays down that the rate of duty applicable to any imported goods shall be the rate in force on the date on which a Bill of Entry in respect of such goods is presented under Section 46. Since, in the present case, the Bill of Entry was presented subsequent to 30-10-1979, the provisions of Section 15 clearly required that they should be assessed at the modified rate of C.V.D.
12. Shri Tripathi then referred to the argument based on the principle of promissory estoppel. He submitted that the same plea had been advanced by appellants in other cases but had not been accepted by the courts. One of these cases was that of Jain Shudh Vanaspati Ltd. and Anr. v. Union of India and Ors. (1983 E.L.T. 1688 Del.). In that judgment the Delhi High Court had referred with approval to a previous decision of the same High Court that the issue of a notification under Section 25(1) of the Customs Act was an exercise of legislative power and no estoppel could be pleaded against a statute.
13. Similar observations had been made in the case of Prakash Cotton Mills (P) Ltd. v. B. Sen and Others [1979 Cenccs S.C. 193D] and Synthetics and Chemicals Ltd. v. S.C. Coutinho and Ors. (1981 E.L.T. 414 (Bom.).
14. He pointed out that in the judgment of the Bombay High Court in the case of Hindustan Spinning and Weaving Mills, which had been mentioned by the learned Advocate for the appellants doctrine of promissory estoppel had not been found applicable.
15. Shri Tripathi further submitted that promissory estoppel was essentially a rule of equity, which necessarily had to be subject to the rule of law. Where the provisions of law, as contained in Section 15 Customs Act, required, the principle of promissory estoppel could not be invoked to apply the rate prior to modification.
16. Shri Tripathi was asked what he had to state with respect to the judgment of the Hon'ble Supreme Court in the Godfrey Philips case. He submitted that the observations in paragraph 13 of that judgment would justify the stand of revenue. The modification of the concessional rate of C.V.D. had been effected by Government in exercise of its powers under Section 25 Customs Act. This had been done in the larger public interest after considering such factors as the ruling prices of the goods, financial considerations, etc. Such a legislative act of the Government could not be challenged on the grounds of promissory estoppel. He submitted that the constitutional validity of Section 25, Customs Act, had been upheld by the Supreme Court in the case of Orient Weaving Mills v. Union of India (AIR 1963 S.C. 1).
17. For these reasons Shri Tripathi submitted that the appeal should be rejected.
18. Miss Anjali Bahl made a brief reply in which she submitted that the modification of the concessional rate of C.V.D. could not be justified on the ground of public interest. This modification had been made on 30-10-1979, when the original notification had only two more months to run. According to her, there could not be any acceptable reason for not allowing the notification to run its due course.
19. We have given our careful consideration to the arguments advanced in this case, which raises an interesting and important question as regards the doctrine of promissory estoppel and the extent to which it can find application in an order passed by the Tribunal. As was very fairly pointed out by the learned Advocate for the appellants, there are two High Court decisions which would be relevant to this case and are against the appellants. We first take up the judgment of the Andhra Pradesh High Court in the case of Feno-Plast Pvt. Ltd. (vide para 5 above). That case related to P.V.C. resins. In that case also there was an exemption notification in which it was stated that "This notification shall be in force up to and inclusive of the 31st August, 1979". This date was subsequently extended to the 31st March, 1981. However, on 16-10-1980 a further notification was issued by which the exempted rate of duty was modified from nil to 40%. Therefore, the situation was quite similar to that in the present case. There also it was argued that Government were estopped from giving effect to the amending notification on the principle of promissory estoppel. The decisions of the Hon'ble Supreme Court in the cases of M.P. Sugar Mills and Jeet Ram Shivkumar were cited. Ultimately the Hon'ble High Court rejected the arguments based on promissory estoppel. The reasons given for the decision are reproduced below :
"Firstly, the exemption notification having been issued under section 25(1) of the Customs Act, it is implicit and understood that it can be rescinded or modified at any time if the public interest so demands. The very public interest which demanded a total exemption, may demand that the exemption must be withdrawn either totally, or partially. Accepting the argument of the petitioners would mean that the Government will not be entitled to act even where the Central Government is obliged, in public interest, to withdraw an exemption already granted, either wholly or partially, it will be unable to do so. According to the principle of the decisions of the Supreme Court, no estoppel can be pleaded in such a case. It must also be noticed that the exemption notification issued initially was valid only upto 31-3-1979, and the said date was being extended from time to time. Just as the period of operation from the exemption can be extended, it can also be cut down, in public interest. As I have stated earlier, it is not urged before me that the impugned notification is not warranted by public interest, contemplated in Section 25(1) of the Act. The facts of the present cases cannot be held to be analogous to the facts in Union of India v. Anglo Afghan Agencies-A.I.R. 1968 S.C. 718, or M.P. Sugar Mills v. State of U. P.-A.I.R. 1979 S.C. 621. In the first case, the Government had evolved an export promotion scheme in exercise of its executive power which, inter alia, stated that exporters will be entitled to import raw materials of the total amount equal to 100% of the F.O.B. value of the exports. The petitioners therein acting upon the said scheme, exported goods hoping that they would be entitled to import licences in terms thereof. It was, therefore, held that the Textile Commissioner who enunciated the scheme, was bound by the terms thereof and obliged to carry put the promise made thereunder. In the present case, neither the notification is of an executive character, nor did it represent a scheme designed to achieve a particular purpose. It was a notification issued in public interest and again withdrawn in the same public interest. So far as the decision in M.P. Sugar Mills v. State of U.P.- A.I.R. 1979 S.C. 621 is concerned, the relevant facts are totally different. There was a good amount of correspondence between the State and the petitioners therein, and a clear promise was made that for a particular number of initial years, the industry will be exempted from sales-tax. But, when the State sought to levy the sales-tax, it was held by the Supreme Court that, in view of the categorical representation made by the State to the petitioners therein it was precluded from doing so and that, it was bound to exempt the petitioners from the provisions of the Sales-tax Act, in accordance with the representation made by it."
20. Miss Anjali Bahl had argued that the above decision was based on the judgment of the Supreme Court in the Jeet Ram Shivkumar case which has been subsequently overruled in the Godfrey Philips case. We do not think the terms of the High Court judgment justify this view. The Hon'ble High Court had taken note of both the above-mentioned decisions as also the earlier decision of the Supreme Court in Union of India v. Anglo Afghan Agencies (A.I.R. 1968 S.C. 718). In paragraph 3 of its judgment the High Court had quoted at length from the judgment in the M.P. Sugar Mills case and referred to the judgment in the Jeet Ram Shivkumar case as having affirmed the statement of law set out in the M.P. Sugar Mills case. The judgment also refers to the exceptions to the rule of promissory estoppel which were recognised in both the decisions (emphasis ours). Now the four exceptions which have been listed by the Hon'ble Andhra Pradesh High Court are, with some variation in wording, the same as those set out at paragraph 13 in the recent judgment of the Hon'ble Supreme Court in the Godfrey Philips case, drawing upon the M.P. Sugar Mills case. We reproduce below these important observations in the Godfrey Philips judgment :
"13. Of course we must make it clear, and that is also laid down in Motilal Sugar Mills case (supra), that there can be no promissory estoppel against the legislation in the exercise of its legislative functions nor can the Government or public authority be debarred by promissory estoppel from enforcing a statutory prohibition. It is equally true that 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 or which was outside the authority or power of the officer of the Government or of the public authority to make. We may also point out 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 that 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 the facts, equity would not require that the Government or public authority should be held bound by the promise or representation made by it. This aspect has been dealt with fully in Motilal Sugar Mills case (supra) and we find ourselves wholly in agreement with what has been said in that decision on this point."
21. The findings of the Hon'ble Andhra Pradesh High Court to which reference has been made in paragraph 19 above are quite consistent with the latest and most authoritative statement of the law by the Hon'ble Supreme Court in the Godfrey Philips case. We, therefore, do not think that the weight of the judgment of the Hon'ble Andhra Pradesh High Court as a precedent is affected merely because reference was also made in that judgment to the decision in the case of Jeet Ram Shivkumar.
22. The second case to which Miss Anjali Bahl drew our attention was that of Hindustan Spinning and Weaving Mills vide paragraph 6 above). As pointed out earlier, in that case the Hon'ble Bombay High Court was concerned with the very notifications which are before us in the present case. In this judgment reliance was placed on the decision of the Hon'ble Delhi High Court in the case of Jain Shudh Vanaspati Ltd., which in turn relied on earlier decisions of the same High Court. In this case no reference was made to the judgment of the Hon'ble Supreme Court in the case of Jeet Ram Shivkumar and therefore it could not be argued that the Hon'ble High Court had relied on a judgment which was subsequently overruled. On the other hand, the view taken in this judgment is quite consistent with the considerations set out in paragraph 13 of the judgment of the Hon'ble Supreme Court in the Godfrey Philips case to which reference has already been made.
23. Coming to the facts of the present case, we find that they are clearly distinguishable from the facts in the M.P. Sugar Mills case and in the Godfrey Philips case. In both those cases there was correspondence between the Government and the assessees and what could be considered an express assurance to the assessees. As pointed out by the Hon'ble Andhra Pradesh High Court in the Feno Plast judgment, there was in the M.P. Sugar Mills case a good amount of correspondence between the State and the petitioner and a clear promise was made that for a particular number of initial years the industry would be exempted from sales-tax. It was on that basis that the petitioners set up their sugar mill. In other words, they had altered their position as a result of the representation made by Government. In the Godfrey Philips case there was correspondence between the Central Board of Excise and Customs and the Cigarette Manufacturers' Association, and a specific assurance from the Board to that association (vide paragraph 7 above). It was in the light of this factual position that the Hon'ble Supreme Court made the following observations :-
"We may now turn to examine the facts in the light of the law discussed by us. Here a representation was undoubtedly made by the Central Board of Excise and Customs and approved and accepted by the Central Government, that the cost of corrugated fibre boards containers would not be includible in the value of the cigarettes for the purpose of assessment to excise duty. The respondents acted upon this representation and continued the use of corrugated fibre board containers for packing the cartons/outers of cigarettes and did not recover from the wholesale dealers the amount of excise duty attributable to the cost of such corrugated fibre board containers during the period 24th May, 1976 to 2nd November, 1982. It would be most inequitable to allow the Excise Authorities to assess excise duty on the basis that the value of the cigarettes manufactured by the respondents should include the cost of corrugated fibre board containers. When it was clearly represented by the Central Board of Excise and Customs in response to the submission made by the Cigarette Manufacturers' Association-and this representation was approved and accepted by the Central Government-that the cost of corrugated fibre board containers would not be includible in the value of the cigarettes for the purpose of assessment of excise duty."
Here also the assessees had followed a particular practice in the light of a specific representation or assurance from the Government. Several years later, Government took a different view and sought to recover the duty foregone during the earlier period.
24. The facts of the present case are materially different. The only "representation" in this case was that contained in the date, namely 31-12-1979, specified in Notification No. 208/79. It has not been shown to us that there was any correspondence between the Government and the importers or their Association as in the M.P. Sugar Mills case, or in the Godfrey Philips case. We also do not find that as a result of the so-called "representation", the appellants had altered their position to their disadvantage. On the other hand, all the indications are that the appellants, who are using the imported staple fibre as a raw material, had been importing it even before Notifications No. 6 of 1979 and No 8 of 1979 were issued, and continued importing it after Notification No. 208/79 was issued. As already pointed out the facts here strongly resemble the facts in the Feno Plast case and the Hindustan Spinning and Weaving Mills case. In the former case, Hon'ble Andhra Pradesh High Court had made the following observations, which are equally applicable to the present case :
"But the question in this case is, whether the earlier notification granting the exemption does amount to a 'representation' or 'promise', made by the Central Government, intended to be acted upon by the petitioners and other similarly situated persons, and whether the rule of estoppel can be founded upon such promise or representation. I am of the opinion that it is not. It was not a notification designed or intended to induce the petitioners to import P.V. resins, nor was it intended to encourage the import of the said goods. It was one conceived in a larger interest, viz., public interest. May be, it also benefited the petitioners; but that was not the intendment or the objective of the notification. The petitioners, therefore, cannot say that it was meant to be, or can be treated as a representation, much less a promise, made to them. A reading of Section 25 of the Act makes it clear that it is the public interest that is the dominant factor. If the public interest demands, the Central Government shall have to issue a notification exempting the specified goods from whole or part of the Customs duty. Similarly, if the public interest demands, the same can be lifted or modified, as the case may be. The power to exempt though not a delegated power and termed as 'conditional legislation' (see Jalan's Case-A.I.R. 1967, Supreme Court, 691), yet it is statutory power conferred upon the Government to be exercised in accordance with the demands of public interest. The petitioners do not challenge the impugned notification on the ground that it was not called for in public interest. Though a faint suggestion to this effect is made in some of the writ petitions, no such argument is addressed before me. The petitioners, it must be noticed did not start the industry because of, or in the light of the said exemption. They are manufacturers of certain products requiring P.V. resins as partly imported from abroad. It is not the case of the petitioners that only because of the exemption notification they placed orders abroad and that, but for the said notification, they would have purchased it in the home-market at a lesser price. I am, therefore, of the opinion that the exemption notification cannot be made a basis for founding a promissory or equitable estoppel, and the Government should not be bound by its notifications once issued, and that it should be left free to modify or rescind them as and when the public interest so demands. This power of exemption is granted to the Government with a view to enable it to regulate, control and promote the industries and industrial production in the country."
In the latter case the Hon'ble High Court had referred to the following observations of the Hon'ble Delhi High Court in the case of Jain Shudh Vanaspati Ltd. which are equally applicable to the present case :
"These arguments proceed on misunderstanding of the role "of importance of import and export policies of a State. In the matter of import and export no party can claim any vested right to compel the Government or the legislature to refrain from making any changes during the financial year. This is because the position of foreign exchange varies so much and the requirement and the considerations of national economy are so urgent that it would be trespassing on the legislative and administrative field if courts were to hold that a rate of duty or tax was immutable for any particular period."
To repeat, the facts of the present case are very similar to those in the Feno Plast and Hindustan Spinning and Weaving Mills case. They are clearly distinguishable from those in the M.P. Sugar Mills case and the Godfrey Philips case, on which the learned Advocate for the appellants has, sought to place reliance because in those cases, as pointed out, there was correspondence between the Government and the assessees, and it was held that Government had made what amounted to a definite representation.
25. If the exceptions to the rule of promissory estoppel which have been re-stated in paragraph 13 of the Godfre Philips judgment (vide paragraph 20 above) are studied, the obstacles to accepting the plea of the appellants in this case would be obvious. As observed therein, there could be no promissory estoppel against the legislature in the exercise of its legislative functions. In this context, the issue of an exemption notification under Section 25(1) of the Customs Act is to be considered a legislative function, although delegated to Government. This has been made clear in the following terms by the Hon'ble Supreme Court in its judgment in the case of Narinder Chand Hem Raj and Ors. v. Lt. Governor, Administrator, Union Territory, Himachal Pradesh and Ors. (A.I.R. 1971 S.C. 2399), which was a case relating to Sales Tax law :
"The power to impose a tax is undoubtedly a legislative power. That power can be exercised by the legislature directly or subject to certain conditions, the legislature may delegate that power to some other authority. But the exercise of that power, whether by the legislature or by its delegate is an exercise of a legislative power. The fact that the power was delegated to the executive does not convert that power into an executive or administrative power. No court can issue a mandate to a legislature to enact a particular law. Similarly, no court can direct a subordinate legislative body to enact or not to enact a law which it may be competent to enact. The relief as framed by the appellant in his writ petition does not bring out the real issue calling for determination. In reality he wants this Court to direct the Government to delete the entry in question from Schedule A and include the same in Schedule B. Article 265 of the Constitution lays down that no tax can be levied and collected except by authority of law. Hence the levy of a tax can only be done by the authority of law and not by any executive order. Unless the executive is specifically empowered by law to give any exemption, it cannot say that it will not enforce the law as against a particular person. No court can give a direction to a Government to refrain from enforcing a provision of law. Under these circumstances, we must hold that the relief asked for by the appellant cannot be granted."
Again, it has been clarified that Government cannot be debarred by promissory estoppel from enforcing a statutory prohibition, nor can Government be compelled to carry out a representation which was contrary to law.
26. In this context, it would be useful to consider what is the relief which the appellants are seeking, and what would be the consequence of our granting that relief. As pointed out by Shri Tripathi, Section 15 of the Customs Act lays down that the rate of duty applicable to imported goods entered for home consumption under Section 46 shall be the rate on the date on which a Bill of Entry in respect of such goods is presented under that section. Clearly it is not open to us, deciding the matter before us in accordance with law, to pass any order which would be contrary to the above specific provision of law. Since on the date on which the Bill of Entry for the goods was presented (namely, on or about 7-12-1979) the amending Notification No. 208/79 had already been issued, the presumption would be that the rate of duty to be applied in terms of Section 15 would be the rate of duty under Notification No. 8 of 1979, as amended by Notification No. 208/79, i.e. the modified or enhanced rate of concessional duty. This was the rate applied by the Customs authorities. However, according to the appellants, who are relying on the doctrine of promissory estoppel, the rate to be applied was the rate under Notification No. 8/79 without taking into account the amendment by Notification No. 208/79. In essence, what we are asked to do is to hold that the amending Notification No. 208/79 dated 30-10-1979, issued by the Government of India under Section 25(1) of the Customs Act, was of no effect. In other words, we are being asked to strike down that notification. Viewed from this angle, there would appear to be a formidable difficulty in our accepting the prayer of the appellants, since we have held more than once that the Tribunal would not seek to strike down a provision of law, whether made by Parliament or by Government under legislative powers delegated to it.
27. Would the Tribunal be in a position to direct a departure from the provision in law on the ground of promissory estoppel ? To answer this question, we would refer to the weighty observations of the Hon'ble Supreme Court in paragraph 9 of the Godfrey Philips judgment, setting out the essence of that doctrine :
"Now the doctrine of promissory estoppel is well-established in the administrative law of India. It represents a principle evolved by equity to avoid injustice and, though commonly named promissory estoppel, it is neither in the realm of contract nor in the realm of estoppel. The basis of this doctrine is the interposition of equity which has always, true to its form, stepped in to mitigate the rigour of strict law."
28. In their path-breaking judgment in the M.P. Sugar Mills case, the Hon'ble Supreme Court had thus recognized the pioneering role of Lord Penning in evolving the doctrine of promissory estoppel :
"There can be no doubt that the decision of Lord Denning in the High Trees case represented a bold attempt to escape from the limitation imposed by the House of Lords in Jorden v. Money (supra) and it rediscovered an equity which was long embedded beneath the crust of the old decisions...and brought about a remarkable development in the law with a view to ensuring its approximation with justice, an ideal for which the law has been constantly driving."
Lord Denning himself, in Crabb v. Arun DC ([1976) 1 Ch 179] has this to say about the doctrine :
"The basis of this proprietary estoppel-as indeed of promissory estoppel- is the interposition of equity. Equity comes in, true to form, to mitigate the rigours of strict law. The early cases did not speak of it as "estoppel". They spoke of it as "raising an equity". If I may expand what Lord Cairns LC said in Hughes v. Metropolitan Railway Co. "It is the first principle upon which all courts of equity proceed", that it will prevent a person from insisting on his strict legal rights-whether arising under a contract, or on his title deeds, or by statute-when it would be inequitable for him to do so having regard to the dealings which have taken place between the parties."
29. We can now answer the question posed above (paragraph 28). It is not open to the Tribunal to strike down Notification No. 208/79. To require the Customs authorities in the present case to apply a rate of duty in a manner contrary to the operation of Section 15 Customs Act, would be to request them to act contrary to law, which would be hit by the exceptions recognized by the Supreme Court and re-affirmed in the Godfrey Philips judgment. Further, the Tribunal cannot be equated to a court of equity. In any event, on grounds of equity the present case cannot be compared with the M.P. Sugar Mills case and the Godfrey Philips case, because there was no specific representation to the appellants or to their association, as in those cases. It can be further distinguished from the Godfrey Philips case, because unlike that case, where duty was sought to be collected on goods which had been manufactured and sold years earlier, here duty was levied on raw material for goods still to be manufactured. A rule of equity cannot be invoked in these circumstances.
30. In the result our conclusion is that the plea of promissory estoppel is of no avail to the appellants in the present case. Additional duty of customs was correctly levied by the Customs authorities in the light of the notifications as in force at the relevant time. We accordingly confirm the order of the Appellate Collector and reject this appeal.