Appeal No 626 of 1986 etc
From the Judgment and Order dated the 7th June 1984 of the Kerala High Court in OP No 6642 of 1982 Soli J Sorabji GV lyer AS Nambiar section Kumar EMS Anam and RN Keswani for the Appellants
TSK Iyer VJ Francis and NM PopIi for the Respond ents
The Judgment of the Court was delivered by RANGANATH MISRA J
All these appeals are by special leave and are directed against judgments rendered by the Kerala High Court in Writ Petitions filed before it
The High Court in each case refused to grant relief
656 Two NotificationsOrders issued by the State Government are relevant
The first one is dated 114
1979 and the second is
dated 2991980 which was published in the State Gazette on 21101980
For convenience the texts of the two NotificationsOrders are extracted below Order dated 1141979 The incentives now given to the industries in the State are too meagre and inadequate to attract industries to this State when compared to the incentives available for the industries in many other States
Further there are cer tain inherent disincentives
also peculiar to this State such as high wage rates minimum wages for certain sections lack of availabil ity of raw materials etc
The question of offering some incentives by the State to attract new industries has been under consid eration of the Government
The question whether any additional incentive can be given to the industrial concern the State plans to consider in detail and it was felt that the question of strength ening the traditional industries which are labour intensive rehabilitation of sick units and the promotional activities for the growth of new industries should be examined in depth for indentifying the problems and adoption of various measures necessary to promote indus trial growth in the State
A Committee con sisting of the following officers was there fore set up to study the various problems and submit report        The Committee finalised its report on 20th March 1979
The Government has considered the recommendations and sugges tions of the Committee in detail and they are pleased to approve the following package of measures for promoting industrial development in Kerala SMALL SCALE INDUSTRIES Sales Tax Concessions New industrial Units under small scale industries set up after 141979 will be exempted from the payment of sales tax for a period of five years from the date of pro duction      657 The relevant portion of the second notification reads thus In exercise of the power conferred by section 10 of the Kerala General Sales Tax Act  15 of 1963 the Government of Kerala have considered it necessary in the public interest so to do hereby make an exemption in respect of the tax payable under the said Act on the turnover of the sale of goods produced and sold by the new industrial units under the small scale indus tries for a period of five years from the date of commencement of sale of such goods by the said units subject to the conditions that if the tax collected by any such units by way of tax on their sales shall be paid over to Government and that the sales tax if any already paid by such units to Government shall not be refunded
Provided that such units shall pro duce proceedings of the General Manager District Industries Centre declaring the eligibility of the units for claiming exemp tion from sales tax
Provided further that the cumulative sales tax concessions granted to a unit at any point of time within this period shall not exceed 90 per cent of the cumulative gross fixed capital investment of the unit
EXPLANATION For the purpose of this notifi cation new industrial unit under the Small Scale Industries shall mean undertakings set up on or after1st April 1979 and registered with the Department of Industries and Commerce as a small scale industrial unit
This notification shall be deemed to have come into force with effect from 1st April 1979
Section 10 of the Kerala General Sales Tax Act at the time the two orders were made ran thus Power of Government to grant exemption and reduction in rate of tax 1 The Government may if they consider it necessary in the public interest by noti fication in the Gazette make an exemption or reduction in rate either pros 658 pectively or retrospectively in respect of any tax payable under this Act i on the sale or purchase of any specified goods or class of goods at all points or at a specified point or points in the series of sales or purchases by successive dealers
or ii by any specified class of persons in regard to the whole or any part of their turnover
2 Any exemption from tax or reduction in the rate of tax notified under sub section 1 a may extend to the whole State or to any specified area or areas therein b may be subject to such restrictions and conditions as may be specified in the notifi cation 3 The Government may by notification in the Gazette cancel or vary any notifica tion issued under sub section 1
 It may be possible to contend with plausibility that in the absence of an enabling provision in the statute the State Government would not have the power to give up a part of the tax due to the State and there can be no estoppel against statute
But that question does not arise here because we have Section 10 empowering the State Government to grant exemption from tax
During the heating of the appeals it has been contended that the notifications in question were not in exercise of the powers under section 10 of the Act
The High Court has proceeded  on the footing that the first order dated 114
1979 was not made in exercise of statutory powers while the second order was issued in exercise of powers under section 10
Having read the two orders and the contents we are of the view that both the orders are covered by the provisions of section 10 of the Act though in the earlier order there is no reference to section 10
It is a well settled princi ple of law that where the authority making an order has power conferred upon it by statute to make an order made by it and an order is made without indicating the provision under which it is made the order would be deemed to have been made under the provision enabling the making of it We accordingly hold that both the orders are under section 10 of the Act
659 Under the order dated 1141979 new small scale units were invited to set up their industries in the State of Kerala and with a view to boosting of industrialisation exemption from sales tax and purchase tax for a period of five years was extended as a concession and the five year period was to run from the date of commencement of produc tion
If in response to such an order and in consideration of the concession made available promoters of any small scale concern have set up their industries within the State of Kerala they would certainly be entitled to plead the rule of estoppel in their favour when the State of Kerala purports to act differently
Several decisions of this Court were cited in support of the stand of the appellants that in similar circumstances the plea of estoppel can be and has been applied and the leading authority on this point in the case of MP Sugar Mills vs State of UP  On the other hand reliance has been placed on behalf of the State on a judgment of this Court in Bakul Cashew Co vs Sales Tax Officer Quilon 1986 2 SCC 365
In Bakul Compa ny s supra case this Court found That there was no clear material to show any definite or certain promise had been made by the Minister to the concerned persons and there was no clear material also in support of the stand that the parties had altered their position by acting upon the representations and suffered any prejudice
On facts there fore no case for raising the plea of estoppel has been made out This Court proceeded on the footing that the notification granting exemption retrospectively was not in accordance with section 10 of the State Sales Tax Act as it then stood as there was no power to grant exemption retrospectively
By an amendment that power has been subsequently conferred
In these appeals there is no question of retrospective exemp tion
We also find that no reference was made by the High Court to the decision in MP Sugar Mills  case Supra
In our view to the facts of the present case the ratio of MP Sugar Mills  case directly applies and the plea of estoppel is unanswerable
It is not disputed that the first Order namely the one dated 114
1979 gave more of tax exemption than the second one
The second notification withdrew the exemption relating to purchase tax and confined the exemption from sales tax to the limit specified in the proviso of the Notification
All parties before us who in response to the Order of April 11 1979 set up their industries prior to 21101980 within the State of Kerala would thus be entitled to the exemption 660 extended andor promised under that Order
Such exemption would continue for the full period of five years from the date they started production
New industries set up after 2110
1980 obviously would not be entitled to that benefit as they had noticed of the curtailment in the exemption before they came to set up their industries
In the course of hearing and in the written submissions furnished on behalf of the State it was contended that the question as to which of the appellants are entitled to the benefit should be left to the Sales Tax Authorities to decide
We are of the view that once the law is settled that part of the decision may be left to the Departmental authorities and they may decide the question on merits in appropriate proceeding in accordance with the law laid down in this judgment
Each of the appeals is allowed
Parties are directed to bear their own costs throughout
PSS Appeal allowed


Summary:
Section 10 of the Kerala General Sales Tax Act 1963 empowers the Government in public interest to make an exemp tion or reduction in rates either prospectively or retro spectively in respect of any tax payable under the Act
The State Government with a view to boost industrialisa tion by an order dated 11th April 1979 offered incentive to Small Scale industries to be set up thereafter in form of exemption from sales tax and purchase tax for a period of five years from the date of commencement of production
By a second order dated 29th September 1980 published in the Gazette on 21st October 1980 purported to be made under section 10 of the Act the Government withdrew the exemption relat ing to purchase tax and confined the exemption from sales tax to the limit specified
The appellants who set up their industries after April 11 1979 including those who did it after 21st October 1980 claimed benefit of exemption from purchase tax and sales tax in terms of the first order
They pleaded the rule of estoppel against the State Government in making the second order
The High Court in dismissing their Writ Peti tions proceeded on the footing that the first order was not made in exercise of statutory power while the second order was issued under I0 of the Act
Allowing the appeals by Special Leave the Court HELD I Where the authority making an order has power conferred upon it by statute to that effect such an order if made without 655 indicating the section under which it is made it would be deemed to have been made under the enabling provision
In the instant case therefore both the orders are covered by section 10 though in the earlier order there was no reference to the statutory provision
658G H 2
The appellants who in response to the first order dated April 11 1979 set up their industries prior to 21st October 1980 would be entitled to exemption extended andor promised under that order
Such exemption would continue for the full period of five years from the date they started production
New industries set up after 21st October 1980 would not be entitled to that benefit as they had noticed of the curtailment in the exemption before they came to set up their industries
They would be entitled to exemption from sales tax only to the limit specified in the second order
659G 600A 3
If in response to an order made by the Government and in consideration of the concession made available therein the promoters of any small scale concern set up their indus tries within the State they would certainly be entitled to plead the rule of estoppel in their favour when the State purports to act differently
In the facts of the present case however the plea of estoppel is unanswerable
659B F Motilal Padampat Sugar Mills Co Ltd vs State of UP   Bakul Cashew Co vs Sales Tax Officer Quilon 1986 2 SCC 365 referred to