1. The petitioners are a Public Limited Company and, inter-alia, engaged in the manufacture of various textile fabrics. In the course of their business, the petitioners import fibres, such as, viscose staple fibre, viscose tow and polynosic staple fibre for the purpose of using the said materials for the manufacture.
2. The goods imported by the petitioners are liable for payment of Customs Duty and Countervailing Duty. The Government of India, in exercise of powers conferred by sub-section (1) of Section 25 of the Customs Act, exempted viscose staple fibre and viscose tow from so much of that portion of the additional duty (countervailing duty) as is in the excess of Rs. 1.32 per kg. The notification recites that it will remain in force upto and inclusive of December 31, 1979. the Government of India issued Notification No. 208 of 1979 on October 30, 1979 amending the Notification dated January 5, 1979 and providing that the exemption of additional duty is in excess of duty of Rs. 2.37 per kg. instead of Rs. 1.32 per kg. The period of Notification was extended from December 31, 1979 to December 31, 1980.
3. The petitioners claim that in pursuance of the Notification dated January 5, 1979, which granted exemption of payment of additional duty in excess of Rs. 1.32 per kg., the petitioners booked order with the foreign buyers and received the confirmation on September 14, 1979. The order was booked for import of 50 metric tonnes of Viscose Staple Fibre. The petitioners opened an irrevocable Letter of Credit in favour of the foreign party on September 25, 1979 and the goods were shipped on October 31, 1979 and reached the Bombay Port in the first week of December 1979. The petitioners complain that the Notification dated October 30, 1979 provided that the exemption from payment of countervailing duty would be as is in excess of Rs. 2.37 per kg. and the result of this notification is that the petitioners were compelled to pay additional amount of countervailing duty. The petitioners filed the present petition in this Court on December 20, 1979 under Article 226 of the Constitution of India to challenge the validity of Notification dated October 30, 1979.
4. Shri Joshi, learned counsel appearing on behalf of the petitioners, submitted that the earlier Notification dated January 5, 1979 contained an assurance that the additional duty would not be increased till December 31, 1979 as the exemption Notification was to remain in operation till that date. The learned counsel urged that the petitioners planned their imports on the said assurance and great prejudice as caused to the petitioners by the change contained in the Notification dated October 30, 1979. The learned counsel urged that the doctrine of promissory estoppel would be attracted to the facts of the case and the respondents should be prevented from giving effect to the Notification dated October 30, 1979 till December 31, 1979. It is not possible to accept the submission of the learned counsel. The doctrine of promissory estoppel has no application to the legislative exercise of the powers by the Central Government under sub-section (1) of Section 25 of the Customs Act. Shri Dalal, learned counsel appearing on behalf of the respondents, relied upon the decision of the Division Bench of the Delhi High Court in the case of Jain Shudh Vanaspati Ltd. and another v. Union of India and others reported in 1983 E.L.T. 1688 in this connection and the judgment undoubtedly supports Shri Dalal. The Division Bench of the Delhi High Court quoted the observations of the earlier Division Bench to the following effect with approval :
'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.'
The Division Bench also referred to the earlier Full Bench Judgment of the Delhi High Court and concluded that that estoppel cannot be pleaded because of the theory that against the operation of the statute, there can be no estoppel. I am in respectful agreement with the view of the Delhi High Court and the submission of Shri Joshi that the promissory estoppel is attracted to the facts of the case cannot be accepted.
5. Shri Joshi then submitted that on the true construction of the Notification and its amendment on October 30, 1979, it should be held that the import of the goods upto December 31, 1979 would attract duty at the rate of Rs. 1.32 per kg. and the amended rate could be levied only in respect of the import from January 1, 1980 onwards. It is impossible to accept the submission of the learned counsel. The power to grant exemption flows from the provisions under sub-section (1) of Section 25 of the Customs Act and the power to grant exemption includes the power to withdraw the same at any stage. Shri Joshi did not dispute that the Government could have rescinded the exemption Notification at any stage prior to December 31, 1979 but urged that as the operation of the exemption Notification was extended upto December 31, 1980, it is not open for the Government to amend the rate of duty and the amended rate can be made applicable only prospectively. There is no merit whatsoever in this submission. If the larger power of rescinding Notification is available, then surely the power to amend the rate is always available to the Government. It is open for the Government to vary the rate of duty and the mere fact that the quantum of exemption is reduced would not lead to the conclusion that the powers exercised by the Government are arbitrary. The submission that the amended rate can be made applicable only with effect from January 1, 1980 is also without any substance. The liability to pay additional duty arises only when the goods arrived in the Port and there is no vested right that the exemption must be granted only at a certain rate and that rate cannot be disturbed for a certain duration. In my judgment, there is no merit whatsoever in the petition and the same deserves to be dismissed.
6. Accordingly, the rule is discharged. Normally, I would have awarded costs to the respondents, but the respondents filed their return only when the matter was called out for hearing and on that ground, I am depriving the respondents of the costs of the petition.