DAYABHAI GOKULBHAI PATEL Vs. STATE OF BIHAR

JUDGEMENT

(1.) The petitioner carries on a business in tobacco and bin leaves in the District of Manbhum. For the assessment year 1952-53 there was a dispute between the petitioner and the Sales Tax authorities as to the legality of the inclusion of the sum of Rs. 41,736/- to the taxable turnover of the petitioner. The amount represented the Central Excise duty paid by the customers on account of goods purchased from the petitioner. It appears that the goods sold were non duly paid goods and were in the bonded warehouse. It further appears that the customers paid the excise duty direct into the Treasury, and after obtaining the challan showed it to the Collector of Excise who gave the necessary clearance permit. The petitioner issued cash memos to the customers in which he entered the actual cash price received by himself and not the amount of excise duty paid into the treasury by the customers. The petitioners contended before the Sales Tax Officer that the amount of Rs. 41,736/- should not be included in the taxable turnover as the customers paid the money direct into the Treasury and not to the petitioner. This contention was rejected by the Sales Tax Officer who included the amount in the taxable turnover. The action of the Sales Tax Officer was upheld by the Deputy Commissioner of Sales Tax on appeal. The petitioner took the matter in revision to the Board of Revenue, but the revision application was dismissed on 27-4-1955, Thereafter the petitioner made an application to the Board of Revenue under Section 25 (1) of the Bihar Sales Tax Act for stating a case to the High Court on the question of law. On 13-2-1956, the Board of Revenue rejected the application and refused to refer the question to the High Court. The petitioner did not apply to the High Court under Section 25 (2) of the Bihar Sales Tax Act against the order of the Board of Revenue refusing to make the reference. But on 16-1-1957, the petitioner made the present application to the High Court for grant of a writ under Article 226 of the Constitution in the nature of mandamus directing the respondent, namely, the State of Bihar, to refund to the petitioner the sales tax realised on the aforesaid amount of Rs. 41,736/-. Cause has been shown by the Government pleader en behalf of the respondent the State of Bihar, to whom notice of the rule was ordered to be given.

(2.) The first question raised on behalf of the respondent is that the petitioner had an alternative remedy under Section 25 (2) of the Bihar Sales Tax Act; and since the petitioner did not avail himself of that remedy within the time granted by the statute, the petitioner ought not to be granted a writ in the nature of mandamus under Article 226 of the Constitution. Reference was made in this connection to Section 25 (1) and (2) of the Bihar Sales Tax Act which state:

(3.) I shall however, assume in favour of the petitioner that a writ under Article 226 of the Constitution is the proper remedy in this particular case. On that assumption also I am of the opinion that the petitioner has not made out a case for a refund, of the amount of tax. The submission of the petitioner is that he is not liable to pay sales-tax on the amount of Rs. 41,736/- which is the excise duty on the tobacco sold to customers. It was alleged on behalf of the petitioner that the excise duty was paid direct by the customers into the Treasury and the amount was not received by the petitioner as part of the consideration for the sale. I do not accept the argument of the petitioner as correct.