9911796707
TMI Blog1988 (6) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... woollen rags containing more than 50% wool content by weight were importable under the OGL Scheme of the Government of India. 3.In terms of the said provisions of the Import Policy, 1984-85 the petitioner purchased from Messrs Electrometal (India) Private Limited of 3C, Camac Street, Calcutta 320 M/Tons of the said goods as per terms and conditions agreed by the parties. 4.The goods were sent by the foreign seller on C.I.F. basis to Calcutta pursuant to contract being entered into in this regard by the foreign seller with the Indian party from whom the petitioner purchased, as aforesaid, the said goods. The said goods arrived at the Port of Calcutta in five consignments per vessels "Vishwa Yash" and "Betara Dua" respectively in or about January, 1985 and November, 1984. Thereupon the petitioner, through his clearing agents Messrs Sheikh and Pandit of Calcutta, filed bills of entry for home consumption along with the relevant import licence to the Customs authorities in respect of the said five consignments of the said goods seeking clearance thereof against appropriate additional import licences under the OGL Scheme as per the Import Policy of the Government of India for the ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. In respect of the said consignments, the petitioner paid a total sum of Rs. 8,43,995 as purported demurrage charges for the period November 28,1984 to March 25,1985 in respect of vessel "Batara Dua" and for the period January 15, 1985 to March 25, 1985 in respect of vessel "Vishwa Yash". 9.Thereafter, on or about February 3, 1986 the Customs authorities issued another wharf rent exemption certificate for the uncovered period from March 2, 1985 to March 25, 1985 in respect of the said goods. 10.In the premises, by a letter dated 15th February, 1986, the petitioner filed an application before the Financial Adviser and Chief Accounts Officer, Post and Railway Audit Section, Calcutta Port Trust enclosing therewith the bills issued by the Port Trust authorities levying and realising demurrage charges as also the said wharf rent exemption certificates. By the said application the petitioner claimed refund for the sum of Rs. 8,43,995 paid by him under protest as aforesaid as purported demurrage/wharf rent charges. The petitioner drew the attention of the said Financial Adviser and Chief Accounts Officer to the fact that in view of the said Wharf Rent Exemption Certificate the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... should have been preferred within the time prescribed in Section 55 of the said Act. 16.The first question which calls for determination is whether Section 55 of the Major Port Trusts Act, 1963 has any application on the facts and in the circumstances of this case. Section 55 provides as follows : "No person shall be entitled to a refund of an overcharge made by a Board unless his claim to the refund has been preferred in writing by him or on his behalf to the Board within six months from the date of payment duly supported by all relevant documents. Provided that a Board may of its own motion remit overcharges made in its bills at any time." 17.It is contended by the learned counsel for the petitioner that in the instant case there is or can be no "overcharges" being made by the Port Trust Authorities. In the absence of Wharf Rent Exemption Certificate, the Port Trust Authorities had sought to realise Wharf Rent payable in respect of the subject goods. In view of the said Wharf Rent Exemption Certificate no wharf rent is payable by the petitioner and/or realisable by Port Trust Authorities from the petitioner. Thus the entire realisation of wharf rent in respect of the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at 25% of the normal rent for the first sixty days and 50% of the normal rent for another sixty days thereafter. Further rent will be charged at the normal rate after expiry of one hundred and twenty days, provided the detention is certified by the Collector of Customs to be not attributable to any fault or negligence on the part of the importers." 21.Thus, wharf rent is leviable even if wharf rent exemption certificate is issued by the Customs authorities. But it will be at a concessional rate for certain period. Accordingly it cannot be contended that the entire money paid by the petitioner for the period covered by the exemption certificates is refundable to the petitioner. As a matter of fact Mr. Pronab Roy, learned counsel for the petitioner has fairly submitted that the petitioner is not entitled to claim the entire sum of Rs. 8,43,995 as and by way of refund and according to the calculation made in terms of the said notification dated 30th August, 1979 a sum of Rs. 4,07,640 is only refundable. Thus the entire levy of demurrage for the period covered by the exemption certificates cannot be said to be illegal. A part of the levy is illegal having regard to the wharf rent exe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereafter on 15th February, 1986 made refund claim which was rejected on 22nd February, 1986.The only ground on which claim was rejected is that the said claim was barred under Section 55 of the said Act. In my view the claim for refund was not barred by limitation under Section 55 of the said Act. Unless a right to claim refund accrues, limitation cannot run. When the second set of wharf rent exemption certificates was issued on 3rd February, 1986, the original levy on the basis of the first set of wharf rent exemption certificates dated 25th March, 1985 became erroneous and the petitioner became entitled to a refund of the overcharge or unauthorised levy. The wharf rent exemption certificate does not as the name suggests allow exemption of wharf rent in full The extent of exemption or rebate depends on the provisions of Major Port Trusts Act, 1963 and the rules and notifications made and issued thereunder. As I say, in this case the question of refund of the entire amount of demurrages of wharf rent could not arise as under the notification even where the wharf exemption certificate is issued by the Customs authorities, the importer is to pay rent but at a concessional rate. If t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egally entitled to a refund, solely on the ground of limitation. The Customs authorities acted illegally in not issuing the wharf rent exemption certificates on 25th March, 1985 for the entire period of detention from 28.11.1984 to 25.3.1985. The failure on the part of the Customs authority compelled the petitioner to make payment as demanded by the Port Trust, a part of which was not at all payable by the petitioner. The delay in release of goods was not attributable to the petitioner. The Customs authority took time to complete the examination and release of the goods. They failed to issue certificate for the entire period of detention until 3rd February, 1986. Because of the laches and default on the part of an authority of the Government, another authority controlled by the same government ought not to reject the claim, which is otherwise sustainable, solely on the ground of limitation. Such conduct on the part of the public authority has been deprecated by the Supreme Court. 24.Reliance has been placed in the case of Madras Port Trust v. Hymanshu International reported in 1979 E.L.T. (J 396) = AIR 1979 SC 1144. In that case claim of the respondent for refund of the amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a vast and widening public sector and inevitably gets involved in disputes with private individuals. But it must be remembered that the State is no ordinary party trying to win a case against one of its own citizens by hook or by crook; for the State's interest is to meet honest claims, vindicate a substantial defence and never to score a technical point or overreach a weaker party to avoid a just liability or secure an unfair advantage simply because legal devices provide such an opportunity. The State is a virtuous litigant and looks with unconcern on immoral forensic successes so that if on the merits the case is weak, Government shows a willingness to settle the dispute regardless of prestige and the other lesser motivations which move private parties to fight in Court. The lay out on litigation costs and executive time by the State and its agencies is so staggering these days because of the large amount of litigation in which it is involved that a positive and wholesome policy of cutting back on the volume of law suits by the twin methods of not being tempted into forensic showdowns where a reasonable adjustment is feasible and ever offering to extinguish a pending proceeding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . It appears thus that the High Court was in error in coming to the conclusion that it was possible for the appellant to know about the legality of the tax sought to be imposed as early as 1963 when the Act in question was declared ultra vires as mentioned hereinbefore. Thereafter the taxes were paid in 1968. Therefore, the claim in November, 1973 was belated. We are unable to agree with this conclusion. As mentioned hereinbefore the question that arises in this case is whether the Court should direct refund of the amount in question. Courts have made a distinction between those cases where a claimant approaches a High Court seeking relief of obtaining refund only and those where refund is sought as a consequential relief after striking down the order of assessment etc. Normally speaking in a society governed by rule of law taxes should be paid by citizens as soon as they are due in accordance with law. Equally as a corollary of the said statement of law it follows that taxes collected without the authority of law as in this case from a citizen should be refunded because no State has the right to receive or to retain taxes or monies realised from citizens without the authority of l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e view of the High Court in this matter cannot be sustained." "Similarly it appears to us that this was a tax realised in breach of the section, the refund being of the money realised without the authority of law. The realisation is bad and there is a concomitant duty to refund the realisation as a corollary 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." 29.Thus in a case where tax or money has been realised without the authority of law, there is a concomitant duty to refund the realisation as a corollary of the constitutional inhibitions that should be respected unless it causes injustice or loss in any specific case or violates specific provisions of law. If the money has been collected without jurisdiction or without authority of law, the concerned authority had no right to retain the said money collected and was liable to refund the same and the staturory provision of limitation for filing a refund claim can have no application whatsoever in such a case. In such cases, the High Court, in its writ jurisdiction under Article 226 of the Constitution of India, is compe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in it for remission of a part of the rent or charges as leviable. Apart from the exemption certificates, the Board had the discretionery power to remit in a case where the importer is not liable at all for any delay in taking delivery of the goods. The Board failed to exercise the discretion vested in it. 32.For the reasons aforesaid, this application is allowed. The petitioner is entitled to refund of a part of the rent and demurrage charges paid by the petitioner for the period from 28th November, 1984 to 25th March, 1985, but the petitioner is not entitled to the sum of Rs. 8,43,995 as claimed in the petition. Accordingly, the respondent No. 4, the Financial Adviser Chief Accounts Officer, Post and Railway Audit Section, Calcutta Port Trust, is directed to determine the amount refundable to the petitioner on the basis of the wharf rent exemption certificates issued on 25th March, 1985 and 3rd February, 1986 covering the entire period of detention of the subject goods from 28th November, 1984 to 25th march, 1985. The respondents shall, within two weeks from the date of communication of this order, refund the amount due to the petitioner to be determined in terms of this order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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