Markandey Katju, J.— These appeals have been filed against the common judgment and order of the Madras High Court dated 6-12-2001 in Writ Appeals Nos. 421 and 488 of 1985, etc. The facts have been stated out in great detail in the impugned judgment of the High Court in which the points contended by the parties herein have been dealt with. Hence we are not repeating the same here.
2. The appellants have set up new industries in which a major raw material is said to be power (electricity). It is alleged by the appellants that due to large consumption of power, the economic viability of their project is very sensitive to power tariffs. It is further alleged that the appellants were attracted by the tariff concessions given under the Tamil Nadu Revision of Tariff Rates on Supply of Electrical Energy Act, 1978 (Act 1 of 1979). In the Schedule to the said Act, new industries were to be given the benefit of concessional tariffs for the first five years of production. It is alleged that on the basis of the said promise the appellants proceeded in setting up their projects and established their industrial units which commenced production. The appellants were sanctioned the power supply by the respondents and started production.
3. Subsequently, by the Notification dated 30-4-1982 the respondents by revising the tariff introduced a new condition to the tariff concession, namely, that the said concession was not to apply from the year when the industry starts earning profits. On the basis of the above notification, the appellants were asked by the respondents to give an undertaking, which they gave, fearing disconnection of their power supply.
4. It is alleged by M/s Kothari Industrial Corporation Limited, which is one of the appellants before us, that in the year 1982-1983 they disclosed a net profit of Rs 7,07,572 which under the Income Tax Act, 1961 was available for set-off against carry-forward losses which amounted to Rs 45,20,611. Hence it was alleged that in fact the said appellant incurred losses. The appellant has been served notice to pay Rs 2,09,433 to avoid disconnection of power supply.
5. The appellants have relied on the decisions of this Court in Pawan Alloys & Casting (P) Ltd. v. U.P SEB (1997) 7 SCC 251, Southern Petrochemical Industries Co. Ltd. v. Electricity Inspector & ETIO (2007) 5 SCC 447 and Shri Bakul Oil Industries v. State of Gujarat (1987) 1 SCC 31, etc. On the basis of the aforesaid decisions the appellants relied on the doctrine of promissory estoppel and legitimate expectation.
6. On the other hand, the respondents have alleged that there is no estoppel against the statute, and the amendment to the Schedule by which the concession was restricted was a legislative act. They have relied on the decisions of this Court in Union of India v. Godfrey Philips India Ltd. (1985) 4 SCC 369, State of T.N v. K. Sabanayagam (1998) 1 SCC 318 and Jalan Trading Co. (P) Ltd. v. Mill Mazdoor Union AIR 1967 SC 691, (1967) 1 SCR 15.
7. The respondents have also alleged that since the appellants have given a specific undertaking to abide by the G.O dated 30-4-1982 they are estopped from challenging the same vide Kasinka Trading v. Union of India (1995) 1 SCC 274 and Shrijee Sales Corpn. v. Union of India (1997) 3 SCC 398. The respondents have also alleged that Section 4 of the 1978 Act empowered the Government to amend the Schedule to the Act vide T.N Electricity Board v. Status Spg. Mills Ltd. (2008) 7 SCC 353
8. We are of the opinion that there seems to be some difference of opinion in the various decisions by different Benches of this Court. Hence the matter needs to be decided by a larger Bench of this Court, on the issue as to whether the principles of promissory estoppel and legitimate expectation are applicable in this case. The larger Bench may also consider whether the undertaking given by the appellants acts as an estoppel against them.
9. Let the papers of this case be placed before the Hon'ble the Chief Justice of India for constitution of a larger Bench.