WILLIAM JACKS CO Vs. STATE OF ORISSA

JUDGEMENT

(1.) THIS is an application under Article 226 of the Constitution requesting this court for the issue, of an order to the sales tax authorities, directing them to refund certain amounts paid voluntarily by the petitioner by way of sales tax for the two quarters ending 30-6-53 and 30-9-53. The payments were actually made on 20-454 and 27. 5. 54. At the time of payment of the said taxes, the principle laid down by the Supreme Court in the United Motors Case, reported in State of Bombay v. United Motors (India) Ltd. , AIR 1953 S. C. 252 was the law of the land. There is no dispute that the transactions of sale of the petitioner would come within the expression "explanation Sales" used by their Lordships of the Supreme Court themselves as a compendious expression while describing the sales covered by the aforesaid decision. The taxes were therefore lawfully payable at that time. Subsequently, however, the Supreme Court reversed that decision, when they delivered their judgment in the Bengal Immunity case reported in Bengal immunity Co. Ltd. v. State of Bihar (S) AIR 1955 S C 661 on 6-9-1955. In view of this later judgment the levy and collection of sales tax on these "explanation sales" became invalid--though subsequently, Parliament by passing the Sales Tax laws Validation Act, 1955 (which was brought into force on 21-3-1956) took away the effect of the judgment of the Supreme Court in the Bengal Immunity case. The petitioner, however, contended that the aforesaid Validation Act will not apply to the facts of the present case, but we do not wish to express any opinion on this question now.

(2.) IT is admitted that no assessment order was formally made against the petitioner in respect of the two quarters in question by the sales-tax authorities, but when he subsequently applied for refund, his application was rejected by the sales tax authorities on the ground that the claim was barred by limitation and was therefore not maintainable.

(3.) WE are thus asked, in this application, to direct the refund of certain sums of money paid as sales tax some time in 1954. A preliminary objection was raised by mr. S. C. Mohapatra for the Department to the effect that this claim for refund is barred by limitation and that in any case the petitioner should file a regular civil suit.