PURSHOTTAMDAS DWARKADAS PATEL Vs. STATE OF BOMBAY

JUDGEMENT

(1.) THE main grievance in this case is as regards an application for refund made by the applicants on 1st March, 1953, under Section 13 of the Bombay Sales Tax Act of 1946. That section provides as follows : " The Collector shall, in the prescribed manner, refund to a registered dealer applying in this behalf any amount of tax paid by such dealer in excess of the amount due from him under this Act, either by cash payment or, at the option of the dealer, by deduction of such excess from the amount of tax due in respect of any other period :

(2.) MR . Kabe for the opponent has contended that Section 13 of the Act contemplates that an application for refund should be made at the time of assessment and that the assessment order itself should in the first instance deal with the question of refund. That contention is not supported by the decision of the Madhya Pradesh Board of Revenue in the case of Sheikh Gauhar Sheikh Nazir v. The State [1952] 3 S.T.C. 331. In that case the appellant was assessed to sales tax for the three years 1946 -47, 1947 -48 and 1948 -49, and during every one of the three years the sale price of imported goods sold by the appellant was below Rs. 5,000 and the turnover was below Rs. 25,000. On 28th July, 1951, the appellant applied for refund of the entire tax paid by him for all the three periods, relying on the High Court's judgment in Ayodhyaprasad v. The State [1951] 2 S.T.C. 44 delivered on 12th September, 1950. The Commissioner rejected the application for refund for all the three periods. None of the three orders of assessment formed the subject of appeal, revision, review or reference. The Board of Revenue held that the claim for refund for the two periods was time -barred under Section 13 of the C.P. and Berar Sales Tax Act, 1947, and that the claim lodged for the third period was within time and deserved examination on merits. In this case also a claim for refund was made on the basis of a judgment which became known to the dealers in question after the assessment had been made within the period of limitation allowed for an application for refund. In the Sales Tax Act applicable to this case the period of limitation was one year instead of two years as in the Bombay Sales Tax Act, 1946. In our opinion the view taken by the Additional Collector and pressed by Mr. Kabe is not correct, as Section 13 of the Act makes no mention of any requirement that the claim for refund should be made before the assessment order is passed by the Sales Tax Officer. In a few cases the order of refund may be made by the assessing authorities, but that does not appear to be the general practice; there is no column in Form No. XIX in which the grant of a refund is to be shown. If an application for refund is not made before the assessment is made, it would not ipso facto nullify a claim for refund which can be made within 24 months from the date on which the order of assessment is passed. The very language used in this connection clearly shows that the claim to refund is ordinarily expected to be made after the order of assessment has been made. The order of assessment having been made on 28th December, 1952, by the Sales Tax Officer the claims to refund made on 1st March, 1953, and 5th June, 1953, were clearly within time, and they should have been dealt with on their merits by the Sales Tax Officer and a refund made, if admissible, by modifying the order of assessment already passed. In such a case there could be a separate appeal from the order made by the Sales Tax Officer on the claim to refund and also subsequent revision applications to the Collector and this Tribunal.

(3.) THE form in which an application for refund has to be made under Rule 35 of the Bombay Sales Tax Rules, 1946, is Form XIX and it must clearly specify the ground upon which the refund is claimed. This form has admittedly not been used in the present case, but the ground of the application is clearly stated, viz., that the refund is sought on account of the decision of the Supreme Court regarding inter -State trade. In Form XIX mention has to be made inter alia of the applicant's name, particulars of the amount of refund claimed, the amount of tax already paid, the amount of tax finally assessed and the grounds of refund. Out of these the ground of refund is the most important item, and the omission to use the form in a case of this nature, in our opinion, must be regarded as an irregularity which does not vitiate the claim made or disentitle the Officer in question to inquire further into the matter. In any case, if the application had to be rejected on the ground that it was not made in the necessary form, an order to that effect should have been passed, and an appeal would have been open to the applicants. This was not done, and the authorities below do not appear, at any stage, to have applied their minds to the merits of the claim to refund. It appears to us necessary that the Sales Tax Officer should now apply his mind to the applications making such claims. We, accordingly, set aside the `s of the authorities below so far as the question of refund is concerned, and direct that the applications for refund made by the applicants shall be inquired into and decided by the Sales Tax Officer in accordance with law.