No Promissory estoppel against State altering/modifying the benefit of concessional tariff: Supreme Court


Supreme Court on Friday, has held that State would not be estopped from altering/modifying the benefit of concessional tariff.

Three Judge Bench of Apex Court comprising of Justices Ranjan Gogoi, Arun Mishra and Prafulla C. Pant made this observation in M/s. Kothari Industrial Corporation Ltd. vs. Tamil Nadu Electricity Board.

The Appeal was against the Order of High Court which had dismissed the plea of company that the State had promised concessional tariff for a period of five years starting from the date of commencement of commercial production and it could not have been revisited by any contrary action.

The Court referring to its decision in Shree Sidhbali Steels Limited vs. State of Uttar Pradesh & Ors said that there can be no estoppel against the statute. The Court answering the reference before it, holding that the principle of promissory estoppel would have no application to this case so as to entitle the company any right to the continuation of the concessional tariff earlier granted.

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