1964 (4) TMI 104 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Statutory force and binding nature of press notes under section 7 of the Orissa Sales Tax Act.
2. Legality of assessments during the interim period between press notes.
3. Entitlement to refund of tax paid before assessment.
4. Limitation on assessment for the quarter ending 31st December 1953.
5. Restriction of assessments to actual collections due to involuntary payment under threat and coercion.

Issue-wise Detailed Analysis:

1. Statutory Force and Binding Nature of Press Notes:
The primary issue was whether the press notes dated 2nd November 1955 and 31st December 1956 had statutory force under section 7 of the Orissa Sales Tax Act and whether they were binding on the State Government. The court concluded that these press notes could not be deemed to have been issued under section 7 of the Orissa Sales Tax Act and, as such, had no statutory force. They were administratively binding but could not exempt the legal liability to pay tax in view of the Sales Tax Laws Validation Act.

2. Legality of Assessments During Interim Period:
The second issue concerned the legality of assessments made during the interim period between the press notes. The court held that the assessments made after the Sales Tax Laws Validation Act came into force were valid, even though the second press note was still in effect at the time of assessment. The press note did not affect the validity of the assessment orders made after the Validation Act.

3. Entitlement to Refund of Tax Paid Before Assessment:
The third issue was whether the petitioner was entitled to a refund of the tax paid before assessment in excess of collections actually made from purchasers. The court answered this in the negative, stating that the petitioner was not entitled to a refund as the tax was lawfully payable.

4. Limitation on Assessment for Quarter Ending 31st December 1953:
The fourth issue addressed whether any valid assessment for the quarter ending 31st December 1953 was barred by limitation. The court found that the assessment for this quarter was not barred by limitation as it was made within thirty-six months from the relevant date.

5. Restriction of Assessments to Actual Collections Due to Involuntary Payment:
The final issue was whether assessments should be restricted to actual collections due to involuntary payment under threat and coercion. The court noted that there was no finding by the Member, Sales Tax Tribunal, that the tax was paid under threat or coercion. Additionally, since the tax was lawfully payable and actually paid, the petitioner could not claim a refund in view of condition (3) of the third press note. The answer to this question was also in the negative.

Conclusion:
The court answered all the questions in the negative, affirming the validity of the assessment orders and denying the petitioner's claims for refund and exemption based on the press notes. The petitioner was ordered to pay a consolidated hearing fee of Rs. 200 to the opposite party.