PRASHANTI MEDICAL SERVICES & RESEARCH FOUNDATIONversusUNION OF INDIA & ORS.

828                       [2019]
               SUPREME COURT     9 S.C.R. 828
                              REPORTS                     [2019] 9 S.C.R.


A            PRASHANTI MEDICAL SERVICES & RESEARCH
                          FOUNDATION
                                       v.
                          UNION OF INDIA & ORS.
B                       (Civil Appeal No. 5849 of 2019)
                                 JULY 25, 2019
      [ABHAY MANOHAR SAPRE AND INDU MALHOTRA, JJ.]
             Income Tax Act, 1961 – Sub-section 7 of s.35AC – Validity of
      – In the year 2014 appellant filed an application u/s. 35AC to the
C
      National Committee for promotion of social and economic welfare
      for grant of approval to their hospital project so as to enable any
      ‘assessee’ to incur expenditure by way of making payment of any
      amount to the appellant for construction of their approved hospital
      project and accordingly claim appropriate deduction of such
D     payment from his total income during the previous year –
      Government approved 28 Projects ‘eligible projects’ including the
      project of appellant u/s. 35AC – Appellant received donations from
      several assessees during the years 2015-2016 and 2016-2017 –
      Assessees claimed deduction for the said financial years – However,
      benefit of deduction was discontinued from the assessment year
E
      2018-2019 by insertion of sub-section 7 of s.35AC – Appellant
      urged that they were not able to receive more amount by way of
      donation for their project in the financial year 2017-2018 – Writ
      petition by appellant challenging the Constitutional validity of sub-
      section 7 of s.35 – High Court repelled the challenge and dismissed
F     the petition – On appeal, held: The real aggrieved parties, which
      should have felt aggrieved by insertion of sub-section (7) in s. 35AC
      of the Act, were those assessees i.e. donors who despite paying the
      donation to the appellant were not allowed to claim deduction of
      the said amount from their total income during the financial year
      2017-2018 (Assessment year 2018-2019) – However, none of the
G
      assessees have complained – Further, neither the appellant nor the
      assessees has any right to set up a plea of promissory estoppel
      against the exercise of legislative power such as the one exercised
      while inserting sub-section 7 in section 35AC of the Act – Also, this
      sub-section was made applicable uniformly to all alike the appellant
H
                                      828
PRASHANTI MEDICAL SERVICES & RESEARCH FOUNDATION v. UNION              829
                        OF INDIA


prospectively – Time to donate the amount to eligible projects for     A
claiming deduction for the year 2017-2018 has also expired – Thus,
no deduction could be allowed to such assessee for period 2017-
2018 – In a tax matter, neither any equity nor hardship has any role
to play while deciding the rights of a taxpayer qua the Revenue –
Therefore, no interference required with the impugned order of the
                                                                       B
High Court.
      Dismissing the appeal, the Court
      HELD : 1. It is not in dispute that 28 projects were
approved by the Committee by notification dated 07.12.2015 but
none of them (27) has come forward to question the constitutional      C
validity of sub-section (7) except the appellant herein. In other
words, out of 28 projects owners whose projects were approved
by the Committee by notification dated 07.12.2015, only the
appellant herein has felt aggrieved and filed the petition in the
High Court. Be that as it may, as rightly argued by the respondent
(Revenue), the real aggrieved parties, which should have felt          D
aggrieved by insertion of sub-section (7) in Section 35AC of the
Act, were those assesses, i.e., Donors who despite paying the
donation to the appellant were not allowed to claim deduction of
the said amount from their total income during the financial year
2017-2018. In other words, one of the main objects for which           E
Section 35AC was enacted was to allow the assessees to claim
deduction of the amount paid by them to the appellant for their
project. [Paras 19, 20, 21] [840-B-E]
      2. As mentioned above, none of the assessees (Donee),
who claimed to have paid amount to any eligible projects came          F
forward complaining that despite their donating the amount to
the appellant for their project, they were denied the benefit of
claiming deduction of such amount from their total income by
virtue of sub-section (7) of Section 35AC of the Act during the
financial year 2017-2018. It is not in dispute that the benefit of
the deduction available under Section 35AC of the Act was duly         G
availed of by all the assessees for two financial years, namely,
2015-2016 and 2016-2017. [Paras 22, 23] [840-E-F]



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830            SUPREME COURT REPORTS                         [2019] 9 S.C.R.


A            3. The dispute is now confined only to third financial year,
      i.e., 2017-2018 because for this year, the assessees were not
      allowed to claim deduction of the amount paid by them to the
      appellant on account of insertion of sub-section(7) in
      Section 35AC of the Act with effect from 01.04.2017. [Para 24]
      [840-G-H]
B
             4. As rightly argued by the respondent (Revenue), a plea
      of promissory estoppel is not available to an assessee against
      the exercise of legislative power and nor any vested right accrues
      to an assessee in the matter of grant of any tax concession to
      him. In other words, neither the appellant nor the assessee has
C     any right to set up a plea of promissory estoppel against the
      exercise of legislative power such as the one exercised while
      inserting sub-section (7) in Section 35AC of the Act (M/s Motilal
      Padampat Sugar Mills Co. Ltd. and other cases relied on by the
      counsel for the respondent-Revenue). It is more so when this
D     Court finds that this sub-section was made applicable uniformly
      to all alike the appellant prospectively. [Para 26] [841-C-D]
             5. It is not in dispute that now time to donate the amount to
      eligible projects for claiming deduction from the total income for
      the year 2017-2018 has expired. It is now no longer available
      due to efflux of time. In this view of the matter, even if the appellant
E     received any amount from any assessee for their project, no
      deduction could be allowed to such assessee either for the period
      2017-2018 or for any subsequent period. [Para 27] [841-E]
             6. It was, however, stated by the appellant that they have
      received 3.84 crores during the year 2017-2018 from various
F     assessees. It was also stated that if sub-section(7) had been held
      not applicable to the appellant’s project then the appellant would
      have received much more amount than Rs.3.84 crores during
      the financial year 2017-2018, which is clear from the amount
      received by the appellant in earlier two years prior to insertion
      of sub-section(7), i.e., Rs. 10.97 crores during the financial year
G
      2015-2016 and Rs. 20.55 crores during the financial year 2016-
      2017. There is no merit in this submission. In a taxing statute, a
      plea based on equity or/and hardship is not legally sustainable.
      The constitutional validity of any provision and especially
      taxing provision cannot be struck down on such reasoning.
H     [Paras 28, 29] [841-F-H; 842-A]
PRASHANTI MEDICAL SERVICES & RESEARCH FOUNDATION v. UNION                831
                        OF INDIA


       7. The appellant urged that this Court may consider               A
appropriate to invoke powers under Article 142 of the
Constitution and allow the appellant to receive donation even for
the third financial year in terms of the notification dated 07.12.2015
from their donors. This submission cannot be accepted for more
than one reason. First, in tax matter, neither any equity nor
                                                                         B
hardship has any role to play while deciding the rights of any
taxpayer qua the Revenue; Second, once the action is held in
accordance with law and especially in tax matters, the question
of invoking powers under Article 142 of the Constitution does
not arise; and third, the appellant’s Donors were admittedly
allowed to claim deduction of the amount paid by them to the             C
appellant under Section 35AC during the two financial years 2015-
2016 and 2016-2017. It is for all these reasons, the matter must
rest there. [Paras 30, 31] [842-B-D]
      S.L. Srinivasa Jute Twine Mills (P) Ltd. v. Union of India
      & Anr., (2006) 2 SCC 740 : [2006] 2 SCR 235 ;                      D
      Sangam Spinners v. Regional Provident Fund
      Commissioner I, (2008) 1 SCC 391 : [ 2007] 12
      SCR 883 ; Commissioner of Income Tax (Central)-I,
      New Delhi v. Vatika Township Pvt. Ltd. (2015) 1 SCC
      1 : [2014] 12 SCR 1037 ; State of Kerala & Anr. v.
      Gwalior Rayon Silk Manufacturing (WVG.) Co. Ltd. Etc.,             E
      (1973) 2 SCC 713 : [ 1974] 1 SCR 671 ; Motilal
      Padampat Sugar Mills Co. Ltd. v. State of U.P. & Ors.,
      (1979) 2 SCC 409 : [1979] 2 SCR 641 ; R.K. Garg v.
      Union of India & Ors., (1981) 4 SCC 675 : [1982] 1
      SCR 947 ; Kasinka Trading & Anr. v. Union of India &               F
      Anr., (1995) 1 SCC 274 : [ 1994] 4 Suppl. SCR 448 ;
      Bannari Amman Sugars Ltd. v. Commercial Tax Officer
      & Ors., (2005) 1 SCC 625 : [2004] 6 Suppl. SCR
      264 ; Shree Sidhbali Steels Ltd. & Ors. v. State of U.P.
      & Ors., (2011) 3 SCC 193 : [2011] 3 SCR 134 ; Bajaj
      Hindustan Ltd. v. Sir Shadi Lal Enterprises Ltd. & Anr.,           G
      (2011) 1 SCC 640 : [2010] 15 SCR 156 ; Kothari
      Industrial Corporation Ltd. v. Tamil Nadu Electricity
      Board & Anr., (2016) 4 SCC 134 : [2016] 1 SCR 564
      – referred to.
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832            SUPREME COURT REPORTS                           [2019] 9 S.C.R.


A                              Case Law Reference
      [2006] 2 SCR 235                  referred to               Para 15
      [2007] 12 SCR 883                 referred to               Para 15
      [2014] 12 SCR 1037                referred to               Para 15
B     [1974] 1 SCR 671                  referred to               Para 16
      [1979] 2 SCR 641                  referred to               Para 16
      [1982] 1 SCR 947                  referred to               Para 16
      [1994] 4 Suppl. SCR 448           referred to               Para 16
C
      [2004] 6 Suppl. SCR 264           referred to               Para 16
      [2011] 3 SCR 134                  referred to               Para 16
      [2010] 15 SCR 156                 referred to               Para 16
      [2016] 1 SCR 564                  referred to               Para 16
D
            CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5849
      of 2019.
            From the Judgment and Order dated 14.09.2017 of the High Court
      of Gujarat at Ahmedabad in SCA No. 7558 of 2017.
E           Arvind Datar, Sr. Adv., Mahesh Agarwal, Rishi Agrawala,
      Ms. Devika Mohan, Nishant Rao, E. C. Agrawala, Advs. for the
      Appellant.
          K. Radhakrishnan, Sr. Adv., Ms. Meenakshi Grover, Parthiv
      Goswami (For Mrs. Anil Katiyar), Advs. for the Respondents.
F           The Judgment of the Court was delivered by
            ABHAY MANOHAR SAPRE, J. 1. Leave granted.
            2. This appeal is filed against the final judgment and order dated
      14.09.2017 passed by the High Court of Gujarat at Ahmedabad in SCA
G     No.7558 of 2017 whereby the High Court dismissed the petition filed by
      the appellant herein.
            3. A few facts need mention hereinbelow for the disposal of this
      appeal, which involves a short point.
             4. The appellant herein is the petitioner and the respondents herein
H     are the respondents in the petition out of which this appeal arises.
PRASHANTI MEDICAL SERVICES & RESEARCH FOUNDATION v. UNION                   833
           OF INDIA [ABHAY MANOHAR SAPRE, J.]


       5. The appellant is a Charitable Trust registered under the          A
provisions of the Bombay Public Trust Act, 1950. The appellant has set
up a Heart Hospital in Ahmadabad. The commencement of the project
of the appellant’s hospital began in the year 2014 (05.05.2014).
       6. On 27.09.2014, the appellant filed an application under Section
35AC of the Income Tax Act, 1961 (hereinafter referred to as “the Act)      B
to the National Committee for Promotion of Social and Economic
Welfare, Department of Revenue, North Block, New Delhi (hereinafter
referred to as “the Committee”) for grant of approval to their hospital
project as specified in Section 35AC of the Act so as to enable any
“assessee” to incur expenditure by way of making payment of any amount
to the appellant for construction of their approved hospital project and    C
accordingly claim appropriate deduction of such payment from his total
income during the previous year. Like the appellant, several persons, as
specified in Section 35AC of the Act, also made applications to the
Committee for grant of approval to their hospital projects.
      7. A notification was issued by the Government of India on            D
07.12.2015 mentioning therein that the Committee has approved 28
projects as “eligible projects” under Section 35AC of the Act. The
name of the appellant appears at serial No. 10 in the notification dated
07.12.2015. It reads as under:
 S.No.        Name of the         Project    or      Maximum                E
              Institution         scheme and         amount         of
                                  estimated          cos t to      be
                                  cost thereof       allowed       as
                                                     deduction
                                                     under Section
                                                     35AC        and
                                                     period        of
                                                     approval
 10.          Prashanti           Prashanti          The                    F
              Medical             Medical            Committee
              Research            Services &         recommended
              Foundation,         Reasearch          approval     for
              Sri Satya Sai       Foundation,        the proje ct at
              Heart               Ahme dabad         the estimated
              Hospital,           RS.250.00          cos t          of
              Kashindra           Crore              Rs.25 0.00
              Village,                               crore        for       G
              Ahmedabad-                             three financial
              Dholka                                 years
              Road(G ujarat)                         commencing
                                                     with financial
                                                     year,     2015-
                                                     16,i.e ., 2015-
                                                     16, 2016-17
                                                     and 2 017-18
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834             SUPREME COURT REPORTS                            [2019] 9 S.C.R.


A            8. According to the appellant, they received amount by way of
      donation from several assesses during the years 2015-2016 and 2016-
      2017. These assesses then claimed deduction of the amount, which
      they had donated to the appellant for their hospital project, from their
      total income. As per the appellant, they received donations in three
      financial years from several assesses for their hospital project as detailed
B
      below:
                  Financial          Rs.
                  year
                  2015-16            10.97 crores
                  2016-17            20.55 crores
                  2017-18            3.84 crores
C
            9. The benefit of claiming deduction was, however, discontinued
      from the assessment year 2018-2019 by insertion of sub-section(7) in
      Section 35AC of the Act by the Finance Act, 2016 with effect from
      01.04.2017.

D            10. It is this insertion of sub-section(7) in Section 35AC of the
      Act, which gave rise to filing of the petition by the appellant in the Gujarat
      High Court. The appellant in the petition questioned the constitutional
      validity of sub-section(7) of Section 35AC of the Act inter alia on the
      ground that once the Committee granted an approval to the appellant’s
      hospital project for a period of three financial years, the same could not
E     be withdrawn qua the appellant on the strength of insertion of sub-
      section (7) in Section 35AC of the Act. In other words, the challenge
      was on the ground that sub-section (7) of Section 35AC is essentially
      prospective in nature and, therefore, it will have no application to those
      projects which were approved by the Committee prior to insertion of
F     sub-section(7), i.e., 01.04.2017. The challenge was also on the ground
      that the Revenue cannot apply sub-section (7) retrospectively and
      withdraw the benefits, whether fully or partially, which were approved
      to the appellant. It was, therefore, contended that the appellant and the
      assessees should be held entitled to avail of the full benefit for the three
      financial years in terms of the notification dated 07.12.2015.
G
             11. The respondent (Revenue) supported insertion of sub-section
      (7) in Section 35AC and inter alia contended that, firstly, insertion of
      sub-section (7) is prospective in nature; secondly, it operates qua every
      person alike the appellant irrespective of the approval granted by the
      Committee; Thirdly, sub-section (7), in clear terms, provides
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PRASHANTI MEDICAL SERVICES & RESEARCH FOUNDATION v. UNION                        835
           OF INDIA [ABHAY MANOHAR SAPRE, J.]


discontinuance of deduction only from the assessment year 2018-2019              A
onwards; Fourthly, this intention of the legislature is clear from the perusal
of the budget speech of the Minister of Finance, notes on clauses and
memorandum explaining the amended provisions in the Finance Bill, 2016;
Fifthly, the appellant not being an assessee under Section 35AC of the
Act has no locus to raise the issue in question and nor they are, in any
                                                                                 B
way, affected due to insertion of sub-section (7); Sixthly, the appellant
neither has any vested right in such matters nor has any right to set up a
plea of promissory estoppel against the exercise of any legislative power
such as the one exercised by the Parliament while inserting sub-section(7);
and lastly, the appellant has already received substantial donations from
several assessees for their hospital project during the two financial years      C
(2015-2016 and 2016-2017) and, therefore, there is neither any hardship
nor any prejudice caused to the appellant due to insertion of sub-section
(7) in Section 35AC of the Act.
       12. The High Court, in the impugned order, repelled the challenge
and while upholding the pleas raised by the respondent(Revenue) dismissed        D
the appellant’s petition, which has given rise to filing of this appeal by the
appellant after obtaining special leave from this Court.
      13. Heard Mr. Arvind Datar, learned senior counsel for the
appellant and Mr. K. Radhakrishnan, learned senior counsel for the
respondents.                                                                     E
       14. Mr. Arvind Datar, learned senior counsel appearing for the
appellant reiterated the aforementioned submissions, which were urged
in High Court, and while elaborating contended that the appellant so also
the assesses, who made payment to the appellant in the financial year
2017-2018 should have been allowed to claim deduction during the                 F
financial year 2017-2018 (Assessment Year 2018-2019) also
notwithstanding insertion of sub-section (7) in Section 35AC of the Act
with effect from 01.04.2017.
      15. In support of his submissions, learned counsel placed reliance
on the decisions of this Court in S.L. Srinivasa Jute Twine Mills (P)            G
Ltd. vs. Union of India & Anr., (2006) 2 SCC 740, Sangam Spinners
vs. Regional Provident Fund Commissioner I, (2008) 1 SCC 391
and Commissioner of Income Tax(Central)-I, New Delhi vs. Vatika
Township Pvt. Ltd., (2015) 1 SCC 1.

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836            SUPREME COURT REPORTS                          [2019] 9 S.C.R.


A           16. In reply, learned counsel for the respondent (Revenue)
      supported the reasoning and the conclusion arrived at by the High Court
      and prayed for dismissal of the appeal. Learned counsel placed reliance
      on the decisions in State of Kerala & Anr. vs. Gwalior Rayon Silk
      Manufacturing (WVG.) Co. Ltd. Etc., (1973) 2 SCC 713, Motilal
      Padampat Sugar Mills Co. Ltd. vs. State of U.P. & Ors., (1979) 2
B
      SCC 409, R.K. Garg vs. Union of India & Ors., (1981) 4 SCC 675,
      Kasinka Trading & Anr. vs. Union of India & Anr., (1995) 1 SCC
      274, Bannari Amman Sugars Ltd. vs. Commercial Tax Officer &
      Ors., (2005) 1 SCC 625, Shree Sidhbali Steels Ltd. & Ors. vs. State
      of U.P. & Ors., (2011) 3 SCC 193, Bajaj Hindustan Ltd. vs. Sir
C     Shadi Lal Enterprises Ltd. & Anr., (2011) 1 SCC 640 and Kothari
      Industrial Corporation Ltd. vs. Tamil Nadu Electricity Board &
      Anr., (2016) 4 SCC 134.
            17. Having heard the learned counsel for the parties and on perusal
      of the record of the case, we are not inclined to interfere with the
D     impugned order of the High Court.
            18. Section 35AC was inserted in the Act with effect from
      01.04.1992 whereas sub-section (7), which is subject matter of this
      appeal, was inserted in Section 35AC with effect from 01.04.2017, which
      reads as under:
E           “35AC. (1) Where an assessee incurs any expenditure by
            way of payment of any sum to a public sector company or a
            local authority or to an association or institution approved
            by the National Committee for carrying out any eligible
            project or scheme, the assessee shall, subject to the
F           provisions of this section, be allowed a deduction of the
            amount of such expenditure incurred during the previous
            year :
            Provided that a company may, for claiming the deduction
            under this sub-section, incur expenditure either by way of
G           payment of any sum as aforesaid or directly on the eligible
            project or scheme.
            (2) The deduction under sub-section (1) shall not be allowed
            unless the assessee furnishes along with his return of
            income a certificate—
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PRASHANTI MEDICAL SERVICES & RESEARCH FOUNDATION v. UNION              837
           OF INDIA [ABHAY MANOHAR SAPRE, J.]


     (a) where the payment is to a public sector company or a          A
     local authority or an association or institution referred to
     in sub-section (1), from such public sector company or local
     authority or, as the case may be, association or institution;
     (b) in any other case, from an accountant, as defined in
     the Explanation below sub-section (2) of section 288, in          B
     such form, manner and containing such particulars
     (including particulars relating to the progress in the work
     relating to the eligible project or scheme during the
     previous year) as may be prescribed.
     Explanation.—The deduction, to which the assessee is              C
     entitled in respect of any sum paid to a public sector
     company or a local authority or to an association or
     institution for carrying out the eligible project or scheme
     referred to in this section applies, shall not be denied merely
     on the ground that subsequent to the payment of such sum
     by the assessee,—                                                 D

     (a) the approval granted to such association or institution
     has been withdrawn; or
     (b) the notification notifying the eligible project or scheme
     carried out by the public sector company or local authority       E
     or association or institution has been withdrawn.
     (3) Where a deduction under this section is claimed and
     allowed for any assessment year in respect of any
     expenditure referred to in sub-section (1), deduction shall
     not be allowed in respect of such expenditure under any           F
     other provision of this Act for the same or any other
     assessment year.
     (4) Where an association or institution is approved by the
     National Committee under sub-section (1), and
     subsequently—
                                                                       G
     (i) that Committee is satisfied that the project or the scheme
     is not being carried on in accordance with all or any of the
     conditions subject to which approval was granted; or


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838     SUPREME COURT REPORTS                       [2019] 9 S.C.R.


A     (ii) such association or institution, to which approval has
      been granted, has not furnished to the National Committee,
      after the end of each financial year, a report in such form
      and setting forth such particulars and within such time as
      may be prescribed,
B     the National Committee may, at any time, after giving a
      reasonable opportunity of showing cause against the
      proposed withdrawal to the concerned association or
      institution, withdraw the approval:
            Provided that a copy of the order withdrawing the
C     approval shall be forwarded by the National Committee to
      the Assessing Officer having jurisdiction over the concerned
      association or institution.
      (5) Where any project or scheme has been notified as an
      eligible project or scheme under clause (b) of
D     the Explanation, and subsequently—
      (i) the National Committee is satisfied that the project or
      the scheme is not being carried on in accordance with all
      or any of the conditions subject to which such project or
      scheme was notified; or
E     (ii) a report in respect of such eligible project or scheme
      has not been furnished after the end of each financial year,
      in such form and setting forth such particulars and within
      such time as may be prescribed,
      such notification may be withdrawn in the same manner in
F     which it was issued:
             Provided that a reasonable opportunity of showing
      cause against the proposed withdrawal shall be given by
      the National Committee to the concerned association,
      institution, public sector company or local authority, as the
G     case may be:
            Provided further that a copy of the notification by which
      the notification of the eligible project or scheme is withdrawn
      shall be forw arded to the Assessing Officer having
      jurisdiction over the concerned association, institution,
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PRASHANTI MEDICAL SERVICES & RESEARCH FOUNDATION v. UNION               839
           OF INDIA [ABHAY MANOHAR SAPRE, J.]


     public sector company or local authority, as the case may          A
     be, carrying on such eligible project or scheme.
     (6) Notwithstanding anything contained in any other
     provision of this Act, where—
     (i) the approval of the National Committee, granted to an
     association or institution, is withdrawn under sub-section         B
     (4) or the notification in respect of eligible project or scheme
     is withdrawn in the case of a public sector company or local
     authority or an association or institution under sub-section
     (5); or
     (ii) a company has claimed deduction under the proviso to          C
     sub-section (1) in respect of any expenditure incurred
     directly on the eligible project or scheme and the approval
     for such project or scheme is withdrawn by the National
     Committee under sub-section (5),
     the total amount of the payment received by the public             D
     sector company or the local authority or the association or
     the institution, as the case may be, in respect of which such
     company or authority or association or institution has
     furnished a certificate referred to in clause (a) of sub-section
     (2) or the deduction claimed by a company under the proviso        E
     to sub-section (1) shall be deemed to be the income of such
     company or authority or association or institution, as the
     case may be, for the previous year in which such approval
     or notification is withdrawn and tax shall be charged on such
     income at the maximum marginal rate in force for that year.
                                                                        F
     (7) No deduction under this section shall be allowed in
     respect of any assessment year commencing on or after
     the 1st day of April, 2018.
     Explanation.—For the purposes of this section,—
     (a) “National Committee” means the Committee                       G
     constituted by the Central Government, from amongst
     persons of eminence in public life, in accordance with the
     rules made under this Act;


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840            SUPREME COURT REPORTS                          [2019] 9 S.C.R.


A           (b) “eligible project or scheme” means such project or
            scheme for promoting the social and economic welfare of,
            or the uplift of, the public as the Central Government may,
            by notification in the Official Gazette, specify in this behalf
            on the recommendations of the National Committee.”
B            19. It is not in dispute that 28 projects were approved by the
      Committee by notification dated 07.12.2015 but none of them (27) has
      come forward to question the constitutional validity of sub-section (7)
      except the appellant herein. In other words, out of 28 projects owners
      whose projects were approved by the Committee by notification dated
      07.12.2015, only the appellant herein has felt aggrieved and filed the
C     petition in the High Court.
             20. Be that as it may, as rightly argued by the learned counsel for
      the respondent (Revenue), the real aggrieved parties, which should have
      felt aggrieved by insertion of sub-section (7) in Section 35AC of the Act,
      were those assesses, i.e., Donors who despite paying the donation to
D     the appellant were not allowed to claim deduction of the said amount
      from their total income during the financial year 2017-2018.
           21. In other words, one of the main objects for which Section
      35AC was enacted was to allow the assessees to claim deduction of the
      amount paid by them to the appellant for their project.
E
             22. As mentioned above, none of the assessees (Donee), who
      claimed to have paid amount to any eligible projects came forward
      complaining that despite their donating the amount to the appellant for
      their project, they were denied the benefit of claiming deduction of such
      amount from their total income by virtue of sub-section (7) of Section
F     35AC of the Act during the financial year 2017-2018.
            23. It is not in dispute that the benefit of the deduction available
      under Section 35AC of the Act was duly availed of by all the assessees
      for two financial years, namely, 2015-2016 and 2016-2017.
             24. The dispute is now confined only to third financial year, i.e.,
G
      2017-2018 because for this year, the assessees were not allowed to
      claim deduction of the amount paid by them to the appellant on account
      of insertion of sub-section(7) in Section 35AC of the Act with effect
      from 01.04.2017.

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PRASHANTI MEDICAL SERVICES & RESEARCH FOUNDATION v. UNION                        841
           OF INDIA [ABHAY MANOHAR SAPRE, J.]


      25. We are of the view that sub-section (7) is prospective in its          A
operation and, therefore, all the assessees were rightly allowed to claim
deduction of the amount paid by them to eligible projects from their total
income during two financial years, namely, 2015-2016 and 2016-2017. If
sub-section (7) had been retrospective in its operation then the deduction
for 2015-2016 and 2016-2017 too would have been disallowed.
                                                                                 B
Admittedly, such is not the case here.
       26. As rightly argued by the learned counsel for the respondent
(Revenue), a plea of promissory estoppel is not available to an assessee
against the exercise of legislative power and nor any vested right accrues
to an assessee in the matter of grant of any tax concession to him. In
other words, neither the appellant nor the assessee has any right to set         C
up a plea of promissory estoppel against the exercise of legislative power
such as the one exercised while inserting sub-section (7) in Section 35AC
of the Act (see-M/s Motilal Padampat Sugar Mills Co. Ltd.(supra)
and other cases relied on by the learned counsel for the respondent-
Revenue). It is more so when we find that this sub-section was made              D
applicable uniformly to all alike the appellant prospectively.
       27. It is not in dispute that now time to donate the amount to
eligible projects for claiming deduction from the total income for the
year 2017-2018 has expired. It is now no longer available due to efflux
of time. In this view of the matter, even if the appellant received any          E
amount from any assessee for their project, no deduction could be allowed
to such assessee either for the period 2017-2018 or for any subsequent
period.
       28. It was, however, stated by the learned counsel for the appellant
that the appellant has received 3.84 crores during the year 2017-2018            F
from various assessees. It was also stated that if sub-section(7) had
been held not applicable to the appellant’s project then the appellant
would have received much more amount than Rs.3.84 crores during the
financial year 2017-2018, which is clear from the amount received by
the appellant in earlier two years prior to insertion of sub-section(7), i.e.,
Rs. 10.97 crores during the financial year 2015-2016 and Rs. 20.55 crores        G
during the financial year 2016-2017.
      29. We find no merit in this submission. In a taxing statute, a plea
based on equity or/and hardship is not legally sustainable. The constitutional

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842                SUPREME COURT REPORTS                       [2019] 9 S.C.R.


A     validity of any provision and especially taxing provision cannot be struck
      down on such reasoning.
             30. Learned counsel for the appellant then urged that having regard
      to the fact that the appellant has set up a charitable hospital and that
      they were not able to receive more amount by way of donation for their
B     project in the third financial year 2017-2018, this Court may consider
      appropriate to invoke powers under Article 142 of the Constitution and
      allow the appellant to receive donation even for the third financial year
      in terms of the notification dated 07.12.2015 from their donors.
            31. We are afraid, we cannot accept this submission for more
C     than one reason. First, as held above, in tax matter, neither any equity
      nor hardship has any role to play while deciding the rights of any taxpayer
      qua the Revenue; Second, once the action is held in accordance with
      law and especially in tax matters, the question of invoking powers under
      Article 142 of the Constitution does not arise; and third, the appellant’s
      Donors were admittedly allowed to claim deduction of the amount paid
D     by them to the appellant under Section 35AC during the two financial
      years 2015-2016 and 2016-2017. It is for all these reasons, the matter
      must rest there.
            32. Learned counsel for the appellant placed reliance on the
      decision of S.L. Srinivasa Jute Twine Mills (P) Ltd. (supra), Sangam
E     Spinners (supra) and CIT vs. Vatika Township Pvt. Ltd., (supra).
      In our view, in the light of the foregoing discussion and the findings
      recorded, the arguments based on the principle laid down in these decisions
      cannot be accepted. We, therefore, need not deal with this issue any
      more.
F           33. In view of the foregoing discussion, we find no merit in the
      appeal. It is accordingly dismissed.


      Ankit Gyan                                                  Appeal dismissed.

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