Promissory Estoppel in exemption notifications :
Power to issue exemption implies power to amend the exemption or withdraw exemption. Thus, exemption granted by notification can be withdrawn or modified. However, some notifications grant exemption for a prescribed period e.g. new cement plants may be granted exemption for prescribed number of years. Some manufacturer may set up a plant based on such notification. In such cases, can the exemption be withdrawn before the prescribed period ? Such withdrawal can be done only in exceptional circumstances. Otherwise, Government is bound by the promise, as per theory of ‘Promissory estoppel’.
Government cannot resile from its promise simply on the ground of loss of revenue.