Adarsh Kumar Goel, J. - (1.) THIS petition seeks quashing of order dated September 26, 2007 passed by the Lower Level Screening Committee (LLSC), constituted under the provisions of Rule 28A of the Haryana General Sales Tax Rules, 1975 (for short, "the Rules"), as affirmed by the Higher Level Screening Committee (HLSC) vide order dated July 4, 2008.
(2.) CASE of the petitioner is that it is a company under the Companies Act, 1956. The State of Haryana declared its Industrial Policy and framed Rule 28A of the Rules, which, inter alia, provides for exemption from sales tax to the extent of specified quantum on conditions specified therein. The operative period mentioned in the Rules is from April 1, 1988 to July 1997. The petitioner was making investment prior to 1996. One of the conditions of eligibility is that the product to be manufactured should not be in the negative list, i.e., should not be in Schedule III appended to the Rules. On December 16, 1996, notification was issued including the solvent extraction plant in the negative list and on that basis, the petitioner was sought to be declared ineligible on the ground that eligibility is to be seen on the date of commencement of commercial production or on the date of application. The date of application and commercial production in the case of the petitioner is in the year 1997. The petitioner filed writ petition in this Court, which was dismissed and thereafter filed C. A. No. 1635 of 2006 in the honourable Supreme Court, which was allowed vide order dated March 10, 2006 (the judgment is Mahabir Vegetable Oils Pvt. Ltd. v. State of Haryana reported in : [2006] 145 STC 350 : [2006] 3 SCC 620). The honourable Supreme Court held that on the day the petitioner started making investment, Rule 28A was operative. The said rule amounted to representation, on which the petitioner acted. The relevant observations are as under : (page 383 of STC) The promises/representations made by way of a statute, therefore, continued to operate in the field. It may be true that the appellants altered their position only from August, 1996, but it has neither been denied nor disputed that during the relevant period, namely, August, 1996 to December 16, 1996 not only they have invested huge amounts but also the authorities of the State sanctioned benefits, granted permissions. Parties had also taken other steps which could be taken only for the purpose of setting up of a new industrial unit. An entrepreneur who sets up an industry in a backward area, unless otherwise prohibited, is entitled to alter his position pursuant to or in furtherance of the promises or representations made by the State. The State accepted that equity operated in favour of the entrepreneurs by issuing Note 2 to the notification dated December 16, 1996 whereby and whereunder solvent extraction plant was for the first time inserted in Schedule III, i.e., in the negative list. Both the provisions contained in Schedule III and the Note 2 formed part of subordinate legislation. By reason of the said note, the State did not deviate from its professed object. It was in conformity with the purport for which original Rule 28A was enacted. We, in this case, are not concerned with the quantum of exemption to which the appellants may be entitled to, but only with the interpretation of the relevant provisions which arise for consideration before us. We may at this stage consider the effect of omission of the said note. It is beyond any cavil that a subordinate legislation can be given a retrospective effect and retroactive operation, if any power in this behalf is contained in the main Act. Rule -making power is a species of delegated legislation. A delegatee therefore can make rules only within the four corners thereof. It is a fundamental rule of law that no statute shall be construed to have a retrospective operation unless such a construction appears very clearly in the terms of the Act, or arises by necessary and distinct implication. (See West v. Gwynne, [1911] 2 Ch. 1. A retrospective effect to an amendment by way of a delegated legislation could be given, thus, only after coming into force of Sub -section (2A) of Section 64 of the Act and not prior thereto. By reason of Note 2, certain rights were conferred. Although there lies a distinction between vested rights and accrued rights as by reason of a delegated legislation, a right cannot be taken away. The amendments carried out in 1996 as also the subsequent amendments made prior to 2001, could not, thus, have taken away the rights of the appellant with retrospective effect.
(3.) WITH the above observations, the matter was remanded to the Director of Industries, to consider it afresh.;