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TMI Blog1988 (12) TMI 324X X X X Extracts X X X X X X X X Extracts X X X X ..... es tax and additional sales tax amounting to Rs. 6,242.26 on 27th March, 1978 because, prior to 31st December, 1977 drugs were exigible to tax at the last point of sale. By Notification No. 66237-CTA 35/77F dated 24th December, 1977 an amendment was brought to the Schedule and a new entry was inserted which was numbered as 93G by which drugs were subjected to tax at the first point in the series of sales with effect from 1st January, 1978. The assessment for the year 1977-78 was completed on 30th September, 1978 by the Sales Tax Officer (opposite party No. 4) in his orders (annexures-3 and 3A) but, he did not allow credit for the amount of Rs. 6,242.26 which had been voluntarily paid by the dealer under mistake of law. Therefore, an applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... party No. 2 to dispose of the revision application as expeditiously as possible and positively within three months from the date of receipt of a copy of the judgment. After the court's judgment, opposite party No. 3 heard the revision application and disposed of the same by the impugned order (annexure-2). 3.. It appears from the impugned order that on the value of the stock of drugs and medicines worth Rs. 84,932.46 on 31st December, 1977, according to the tax schedule then prevailing, the petitioner deposited sales tax and additional sales tax amounting to Rs. 6,242.26 by cheque which was received by opposite party No. 4 on 27th March, 1978. After the amendment was brought to the tax schedule by inserting a new entry numbered as 93G, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ass an order about the adjustment of tax payable." The above observations succinctly indicate the reasons which prompted opposite party No. 3 not to direct refund. 4.. In [1986] 62 STC 327 (SC); AIR 1986 SC 1556 (Commissioner of Sales Tax, U.P. v. Auraiya Chamber of Commerce, Allahabad), sales tax was paid by the dealer in respect of forward contracts for the assessment year 1949-50 under the provisions of the U.P. Sales Tax Act. Reference was made to [1954] 5 STC 193 (SC); AIR 1954 SC 459 (Sales Tax Officer, Pilibhit v. Budh Prakash Jai Prakash), in which the Supreme Court had interpreted section 2(h) of the U.P. Sales Tax Act, 1948 and had held that enlarging the definition of "sale" so as to include forward contracts to that extent was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollary of the constitutional inhibition that should be respected unless it causes injustice or loss in any specific case or violates any specific provision of law. The assessment was made without jurisdiction and tax was collected without authority of law. Therefore, the taxing authority could not retain the money collected without the authority of law and as such it was liable to refund the same. From the aforesaid principle of law enunciated by the Supreme Court it is clear that if tax has been paid and realised under mistaken notion of law, the taxing authority cannot retain the same and is bound to refund the amount to the dealer in accordance with law. 5.. Section 14 of the Act provides for refund of sales tax, if an application ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Sales Tax Officer (opposite party No. 4) to consider the refund application of the petitioner and allow refund of the amount or adjust the same against future liabilities. In case the reassessment proceeding has in the meantime been closed, he shall revive the refund proceeding and pass an identical order. This is how justice can be done to the petitioner who voluntarily paid sales tax under mistake of law in 1978 and for the last ten years is knocking at the doors of the authorities to get the refund of the amount or adjustment thereof. 7.. For the foregoing reasons and subject to the observations made, the writ petition is allowed. The order passed by opposite party No. 4 rejecting the refund application, as well as annexure-2 are q ..... X X X X Extracts X X X X X X X X Extracts X X X X
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