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TMI Blog1961 (3) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... of 1960) and appellants (in C. As. Nos. 275 to 277 of 1960). -------------------------------------------------- The Judgment of the Court was delivered by SHAH, J.-The Orient Paper Mills Ltd.-hereinafter called the assessees-are a public limited company having their registered office at Brajrajnagar in the district of Sambalpur, Orissa State. The assessees are manufacturers of paper and paper-boards and are registered as dealers under the Orissa Sales Tax Act, 1947-hereinafter referred to as the Act. The assessees used to collect tax from the purchasers on all sales effected by them including sales to dealers in other States. For the quarters ending March 31, 1950, June 30, 1950, September 30, 1950, December 31, 1950 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o to that section, transactions in question not being liable to tax as they were inter-State transactions, the tax collected must be refunded on applications submitted within the period prescribed. The High Court then proceeded to hold that the recovery of tax paid for the first two quarters was barred by limitation but not recovery of tax paid for the remaining three quarters, and issued an order in the nature of mandamus directing refund of tax in respect of the last three quarters. The State of Orissa and the assessees have appealed with special leave against the judgment of the High Court by these five appeals. Counsel for the State of Orissa contends that no refund could be granted because the orders of assessment had become fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch the dealer was not liable to pay can only be claimed by the person from whom the dealer has actually realised it whether as sales tax or other- wise. The section therefore deprives the assessees of the common law right to claim refund of the amounts paid as tax under an error of law that it was recoverable by the taxing authority. Counsel for the assessees does not dispute that by the amending provision, the right to obtain refund of tax is denied to him by the Legislature. He contends that the Act is beyond the competence of the State Legislature and in any event, it is void because it imposes an unreasonable restriction upon the assessees' fundamental right guaranteed under Article 19(1)(f) of the Constitution. By item 54 of li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ose of property; but the right is by clause (5) subject to the operation of any law, existing or prospective, in so far as it imposes reasonable restrictions on the exercise of that right in the interest of the general public. Assuming that by enacting that refund of tax shall only be made to the purchasers from whom the tax has been collected by the dealers and not to the dealers who have paid the tax the fundamental right under Article 19(1)(f) is restricted, we are unable to hold that the restriction imposed by section 14A of the Act is not in the interest of the general public. The Legislature by section 9B(1) of the Act authorised registered dealers to collect tax from the purchasers which they may have to pay on their turnover. The am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontended that they stood in danger of being compelled at the instance of the purchasers to repay the amount collected as tax even after it is deposited with or paid by them to the State Government, and a statutory provision which deprives them of their right to claim refund amounts to an unreasonable restriction, because they are under an obligation to pay the amount to purchasers but they cannot reimburse themselves by recourse to the State which holds the amounts. But by section 9B, the assessees were liable to deposit the amount in excess of what was lawfully recoverable from the purchasers as tax. When under the orders of assessment they paid amounts to the State, requirements of section 9B were complied with and the amount remained wit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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