1965 (10) TMI 12 - SC - VAT and Sales Tax

Whether section 13 of of the Bombay Sales Tax Act, 1946 impliedly bars the suit? Held that - Section 13 of the Act does not create an implied bar and the High Court is right in holding that the suit was competent. The only point that remains it regarding the date of the knowledge of the plaintiff. Both courts below have found that the plaintiff came to know of the mistake on December 22, 1952, the date of the promulgation of the Governor s Ordinance. This is a concurrent finding of fact and the learned Solicitor-General has not shown us any good ground for disturbing this concurrent finding of fact. Appeal dismissed.

Issues:
1. Whether the suit was barred by statutory provisions of the Bombay Sales Tax Act, 1946.
2. Whether the suit was barred by limitation.
3. Whether the suits were barred by the provisions of section 20 or section 13 of the Bombay Sales Tax Act, 1946.
4. Whether the suits were barred by the law of limitation.

Analysis:

The case involved two appeals on certificates granted by the High Court of Bombay, both raising questions of law. The facts of Civil Appeal No. 219 of 1964 involved a registered dealer under the Bombay Sales Tax Act, 1946, seeking recovery of advance sales tax paid under a mistake of law. The State of Bombay raised objections including that the suit was barred by statutory provisions and limitation. The trial court ruled in favor of the plaintiff, awarding a sum with future interest. The State of Bombay appealed to the High Court, arguing that the Act was a complete code and relied on precedents. The High Court varied the decree but affirmed it, holding the suit competent and within the limitation period. The State of Bombay then appealed to the Supreme Court.

The Supreme Court analyzed the arguments raised by the learned Solicitor-General on behalf of the appellant. It was contended that the suit was either expressly or impliedly barred by sections 13 and 20 of the Bombay Sales Tax Act, 1946, and that it was barred by limitation. The Court found that section 20 did not expressly bar the suit as no assessment had been made under the Act. The Court also rejected the argument that section 13 impliedly barred the suit, holding that it did not provide for objections regarding the constitutional validity of payments made. The Court referred to previous judgments to support its reasoning.

Regarding the law of limitation, the Court held that the suit was not barred as it was filed within the period prescribed by the Limitation Act. The Court also addressed the date of knowledge of the plaintiff, affirming the findings of the lower courts. Ultimately, the appeals were dismissed with costs, agreeing with the High Court's decision that the suits were not barred by statutory provisions or limitation.

In a separate judgment by another judge, it was noted that the suits were filed by the respondents seeking recovery of advance sales tax paid under a mistake of law. The Court agreed with the analysis and conclusions of the main judgment, holding that the suits were not barred by statutory provisions or limitation. The Court also clarified the scope of objections that could be raised before taxing authorities, emphasizing that in this case, the taxpayers sought refund under a mistake of law and were not challenging any assessment orders.

In conclusion, both judgments dismissed the appeals, affirming the decisions of the lower courts that the suits were not barred by statutory provisions or limitation, and providing detailed legal analysis to support their conclusions.

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