Supreme Court’s view on State’s right to withdraw the tax exemption vis-à-vis Industry’s legally enforceable right[1]
Shubham Budhiraja [2] State of Maharashtra in exercise of the statutory power under Section5A granted exemption to certain industries from electricity duty in 1994. Later on, such exemptions were withdrawn on ground of budget deficit. The withdrawal of notification was challenged. The Hon’ble High Court set aside the notification for being arbitrary for making classification between different industries. The Hon’ble Supreme Court held that notification is valid. The Respondent had no legal enforceable or vested right to claim exemption for indefinite time. In any case, state decision is in public interest. 1. An exemption is by definition a freedom from an obligation which the exemptee is otherwise liable to discharge. It is a privilege granting an advantage not available to others. 2. The recipient of a concession has no legally enforceable right against the Government to grant of a concession...