The Supreme Court has made it clear that an individual’s legal rights cannot be based on an executive action that the state legislature later modifies for the greater public good.
The ruling emphasized that neither the doctrine of legitimate expectation nor promissory estoppel applies when legislative actions supersede previous executive decisions. Essentially, if the legislature changes or withdraws an executive decision in the public interest, the initial promise does not become enforceable.
Justices Vikram Nath and Ahsanuddin Amanullah noted, “Authorities are not barred from retracting their promises, as such expectations do not grant enforceable rights.”
Furthermore, the Court stated that a prior executive decision does not inhibit the state legislature from implementing laws or policies that contradict previous executive actions if done for the larger public interest. This principle stands, regardless of any earlier differing executive view.
Supporting this stance, the Court referenced the recent Hero Motocorp Ltd vs Union of India judgment, which upheld that the doctrine of promissory estoppel does not constrain legislative powers.
The Court clarified that legitimate expectation or promissory estoppel doctrines are applicable when both decisions—initial and subsequent—are made by the same or similarly positioned authorities. However, these doctrines do not hold when legislative changes are involved.
In the case at hand, the appellant, involved in a road construction project, challenged the imposition of stamp duty based on prior executive assurances of exemption. Despite these assurances, the subsequent legislative policy required the payment of stamp duty. The Court ruled against the appellant, stating that the state’s legislative reversal of the executive decision in public interest justified the levy of stamp duty.
This decision reaffirms that legislative authority can override previous executive promises when public interest dictates.
