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TMI Blog1989 (10) TMI 180X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the powder from the drums to the bottles for the purpose of exporting or taking these out of the city is neither use nor consumption of the Horlicks powder attracting the levy of octroi. Such amounts, therefore, cannot be retained by the respondent-Corporation. There is no dispute as to the quantum in view of the fact that the amount has now been found to be certified to be credited pursuant to the direction of the learned single Judge of the High Court. We see no ground as to why amount should not be refunded. Realisation of tax or money without the authority of law is bad under Article 265 of the Constitution. Octroi cannot be levied or collected in respect of goods which are not used or consumed or sold within the municipal limits. So these amounts become collection without the authority of law. The respondent is a statutory authority in the present case. It has no right to retain the amount, so far and so much. These are refundable within the period of limitation. There is no question of limitation. There is no dispute as to the amount. There is no scope of any possible dispute on the plea of undue enrichment of the petitioners. We are, therefore, of the opinion that the Div ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Learned single Judge of the High Court on 1st February, 1984, allowed the writ petition and directed that the amount of octroi duty collected for the period commencing three years prior to the filing of the writ petition be verified within 3 months and refunded within 45 days thereof. Learned single Judge noted that the case of the petitioners was that it was engaged in the manufacture and sale of a malted milk product marketed under the brand name Horlicks . The petitioner used to manufacture the said product in its two factories situated at Nabha in the State of Punjab and Rajahmundhry in the State of Andhra Pradesh and marketed these throughout the country through its bottling and marketing centres situated in different parts of the country. One such centre was situated in the city of Bangalore to which it brought its said product in bulk, then rebottled the same in small bottles of different capacities like 800 gms. 450 gms and 250 gms. It was the case of petitioners that small portion of the product, rebottled in small bottles, alone was sold within the city of Bangalore to its dealers and the rest was exported to its agents situated in different parts of the State and other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court, Rule 24 aforesaid of the Bye-law 45 was in force. Octroi was, however, abolished with effect from 1st April, 1979. The question that was canvassed before the learned single Judge of the High Court was that when the product was imported in bulk in the city only for rebottling and rebottled in small bottles for the consumer requirements and marketed, there could not be consumption or sale of that product. On the other hand, it was contended that in any event, it is a case of `use to attract levy of octroi. The Horlicks powder remains the same even after packing, as was held by Mittal, J. of the High Court of Punjab in C.W.P. No. 19873 of 1977. In that case, the Horlicks powder in drums was sold direct to bulk consumers. It was held that the Horlicks powder remains the same after packing. It does not become different commodity. It also cannot be held that it acquired distinct commercial utility, according to Mittal, J. Therefore, in that context, Mittal, J. held that the packing of the Horlicks powder in small bottles does not fall within the ambit of the word `use and, therefore, the petitioner in that case was not liable to the charge of octroi for its import within the lim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the judgment of the Division Bench. In the said letter, it was, inter alia, stated that the petitioners were not bringing the goods within the municipal limits for use or consumption therein and as such the imposition of octroi was illegal and unwarranted and that the petitioners had paid under protest the amount and claimed the refund. The petitioners claimed only the octroi paid on the goods which were exported outside the city of Bangalore and not used or consumed within the city. The petitioners further stated, inter alia, as follows : The petitioner is willing to differentiate the goods intended to be used/consumed within the octroi limit of Bangalore and the goods which are exported out of the limits of Bangalore and not used or consumed therein appropriately in order to facilitate movements of goods and avoid difficulties to the octroi in charge. 8. The Corporation turned down the demand. The Division Bench noted that the petition was resisted by the respondent on two grounds : 1. The transferring of Horlicks imported in bulk into the city of Bangalore into bottles amounts to use of the Horlicks within the city of Bangalore notwithstanding the fact that a part o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed to the Commissioner have specifically stated that the goods were subsequently exported outside the city of Bangalore as envisaged by Bye-law 24 of Notification No. N.A.I. (53) of 1952-53 dated 5th April, 1954. Regarding the expression without breaking bulk , the Division Bench of the High Court was unable to accept the contention that the bulk of the goods on which the octroi has been paid was transferred to containers of small sizes and despatched outside the city the bulk was broken. But the question was whether in such a situation, it can be said that it was done without breaking the bulk. The Division Bench was of the view that having regard to the rule and having regard to the fact that it was imported into the city of Bangalore, and was to be despatched outside the city of Bangalore in the same form, i.e., without the same having been used or sold or consumed in the production or manufacture of other goods, the person concerned can only claim refund in accordance with the rules. Therefore, according to the Division Bench, no importance can be attached to the expression without breaking bulk on despatches of the goods. Refund could be claimed only on despatches of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... necessary to constitute larceny or theft by a bailee. It is stated that the cases were very numerous and turned on nice distinctions as to what amounted to breaking bulk". In the Dictionary of English Law by Earl Jowitt breaking bulk has been defined as that at common law there could be no larceny of goods which had originally been lawfully obtained by a person who subsequently wrongfully converted them to his own use, unless such conversion was preceded by some new act of taking. If that is so, we are unable to agree with the construction suggested by the Division Bench. It was contended that the octroi was leviable on the entry of the goods in the municipal limits of the city but the Horlicks powder had not entered into the local limits of Bangalore for the purpose of use or consumption, as understood in the decision of the Burmah Shell s case (supra) and as found both by the learned single Judge and the Division Bench that putting the powder from the drums to the bottles for the purpose of exporting or for taking this out of the city, is neither use nor consumption of the Horlicks powder, attracting the levy of octroi. Certainly, the bulk was broken in the procedure followed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the learned Chief Justice then was, speaking for this Court noted that the respondent therein had contended that the rules framed by the Government regarding the procedure constituted a condition precedent to the exercise of the right to claim refund and recourse to the civil court being conditionally strict, compliance to that procedure was necessary for obtaining any decree in civil court. Allowing the appeal, this Court held that this contention was untenable. Shah, J. observed at p. 555 (of SCR) of the report as under : The rules framed by the Government merely set up the procedure to be followed in preferring an application to the Municipality for obtaining refund of the tax paid. The Municipality is under a statutory obligation, once the procedure followed is fulfilled to grant refund of the toll. The application for refund of the toll must be made within fifteen days from the date of the issue of the certificate and within six months from the date of payment of the toll. It has to be accompanied by the original receipts. If these procedural requirements are not fulfilled, the Municipality may decline to refund the toll and relegate the claimant to a suit. It would then ..... X X X X Extracts X X X X X X X X Extracts X X X X
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