Bombay High Court
Ceat Tyres Of India Limited vs Union Of India And Others on 1 January, 1800
Equivalent citations: 1993(1)BOMCR523, 1980(6)ELT563(BOM)
ORDER
The petitioner is a public limited company carrying on business, inter alia, of manufacturing tyres,tubes and other products in its factory at Bombay. On the tyres manufactured by the petitioner, at all relevant times, excise duty was payable under Item 16 of the tariff to the Central Excises and Salt Act, which provided a higher rate of excise duty on tyres for motor vehicles as compared to what was described therein as "all other tyres". On about 14th June 1971,the petitioner commenced manufacturing tyres for fork-lift trucks which the petitioner supplied to the original equipment manufacturers, such as Voltas Ltd. and Godrej Boyce Manufacturing Co. Ltd. According to the petitioner, under a mistake of law and misapprehension of the correct legal position, the petitioner submitted classification lists showing the tyres for fork-lift trucks as being assessable to duty under Item 16(1) which was applicable to tyres for motor vehicles and under Item 16)3) which was the item applicable to all other tyres, Further according to the petitioner, under the same mistake of law and misapprehension of the correct legal position the petitioner from time to time cleared these tyres and paid excise duty payable thereon under Item 16(1).
On 15th October 1973, Voltas Ltd., to whom the petitioner had sold its tyres for fork-lift trucks, addressed a letter to the petitioner stating that according to Voltas Ltd. the tyres supplied by the petitioner for fork-lift trucks of Voltas Ltd. should be classified under Item 16(3) as the fork-lift trucks were work trucks and could not be described as motor vehicles. By this letter, Voltas Ltd. also informed the petitioner that in the case of Voltas Ltd. a decision to that effect had been given on 21st December1971 by the Appellate Collector of Customs,namely, that fork-lift tyres could not be classified as motor vehicle tyres.
When tax is paid where it is not payable under the law it is regarded as payment made under a mistake as that word is understood in the Contract Act. See, for instance 'The Sales Tax Officer, Banara v. Kanhaiya Lal Mukund Lal Saraf, and State of Madhya Pradesh v. Bhailal Bhai, . The notion of 'mistake' is materially different from that of inadvertence, error or misconstruction. Error is not synonymous with mistake. In Rule 11, it obviously means some clerical or arithmetical error. The word 'misconstruction' also is not be understood in the technical sense of misconstruction or misinterpretation of a provision of law of notification. Occurring as it does in Rule 11 in the context of inadvertence or error it obviously connotes an erroneous building up or compiling and calculating in the arithmetical sense only. It is merely intended to resolve or finalise disputes as to accounting. This Rule is, therefore of no avail to the Department before us."
7. In Sales Tax Officer v. Kanhaiya Lal it was held that the term 'mistake' used in section 72 of the Contract Act has been used without any qualification or limitation whatever and comprises within its scope a mistake of law as well as a mistake of fact. It was further held that there was no warrant for ascribing any limited meaning to the word 'mistake' as as been used therein and that the true principle is that if one party under a mistake. Whether of fact or law, pays to another party money which is not due by contract or otherwise that money must be repaid. The mistake lies in thinking that the money paid was due when in fact it was not due and that mistake, if established, entitles the party paying the money to recover it back form the party receiving it. It was further held that where it is once established that the payment even though it be of a tax, has been made by the party labouring under a mistake of law, the party is entitled to recover the same and the party receiving it is should to repay or return it. No distinction ' can be made in respect of a tax liability and any other liability on a plain reading of the terms of section 72 of the Contract Act. To hold that tax paid by mistake of law to make a law by adding some such words as "otherwise than by way of taxes" after the word "paid".
8. Patel India v. Union of India, was a case under section 40 of the Sea Customs Act, 1878 which provides that no Customs duties or charges which have been paid and of which repayment wholly or in part is claimed in consequence of the same having been paid through inadvertence error or misconstruction shall be returned unless such claim is made within 3 months from the date of such payment. Holding in the facts of that case that it was not a case where excess duty was paid through any of the 3 reasons set out in section 40, and that section 40 did not and could not have applied and could ;not have been relied on by the Customs for refusing to refund the excess duty unlawfully levied, the Supreme Court observed at page 1303-1304 of the Report as under;-
"From the fact the Customs authorities refunded the excess unity an items 22 to 29 and 33035 it follows that the Customs authorities had fully realised that the excess duty had been levied without the authority of law, for otherwise they would not have agreed to refund it and further that they could not lawfully retain it..
"But since 40 did not apply to the facts of the case, the respondents could not re the excess duty except upon the authority of same other provision of law. No other provision was pointed out by them which would disentitled the appellant-company to the refund on the ground of its right being time-barred or otherwise. No such provision other than Section 40 which disentitled the appellant-company to the refund having been put forward and the customs authorities not being entitled to retain the excess duty, there was a legal obligation on the part of the respondents to return the excess duty and a corresponding legal right in the appellant company to recover it. Besides except S. 40 the Act contains no other provisions laying down any limitation within which an importer has to apply for refund. The refusal to return the excess duty on the ground that the appellant-company had not applied within time provided by the Act was clearly unsustainable..."
Thus it was held that there was a legal obligation on the part of Government to return the excess duty and corresponding legal right in the appellant to recover it.
9. Coming nearer home is the decision of Deshmukh J. (as then was) in Miscellaneous Petition No. 666 of 1969 (The Paper Products Ltd. v. the Union of India) decided on 6th December 1977. In that case the petitioner claimed a refund of Customs duty paid in excess of 50% upon the importation o Vegetable Parchment Paper and Glassine Paper. The petitioner imported various kinds of paper including the 3 varieties which were a trade name Grease proof Paper, Vegetable Parchment Paper and Glassine Paper and went on paying 100% duty on Glassine Paper as also on the Vegetable Parchment Paper. On Greaseproof Paper the duty charged was only 50%. On the other two papers, the duty charged to the petitioner was 100%. This was because the petitioner was not aware, due to mistake of fact or law or both, that the other two varieties were also entitled to exemption of 50% duty. Accordingly the petitioner presented as many as 17 bills of entry from time to time pertaining to Vegetable Parchment Paper and Glassine Paper between April 1965 and April 1966 and 100% duty was recovered from the petitioner, which was paid. In September 1966, the petitioner received information that for these two varieties of paper only 50% of duty was being charged in the Madras and Calcutta ports. Thereafter an Officer of the Customs Department was contacted by the petitioner to whom this information was given. On 4th OCtober 1966, the petitioner made a written representation and ultimately the Central Board of Excise and Customs decided that Vegetable Parchment Paper and Glassine Paper be treated as Grease-proof Paper for the purpose of the exemption notification. Accordingly an intimation dated 15th June 1967 was sent to the petitioner to the effect that instruction were being issued to the Customs authorities to charge 50% duty. In due course, a tariff ruling was issued in February 1968, which was made effective from 19th June 1967. When the petitioner realised that it had over-paid, it claimed refund by making the requisite refund applications. Some of the application which were in time under section 217 of the Customs Act. 1962 were granted and 50% of of duty was refunded. In respect of some, refund was refused purely on the ground that the applications were beyond time. It was urged on behalf of the petitioner in that case that the petitioner came to know that the two varieties of paper could be taxed at a lesser rate for the first time in September 1966, in other words, the mistake having been discovered of the first time in September 1966 and the petition having been filed within 3 years was within the period of limitation and hence should be allowed. On behalf of the respondents, it was urged in that petition that the petitioner was in the trade for the several years and knew all along that these tow varieties of paper which were charged at 100% could be greaseproof papers and that even so it never raised a dispute, with the result that the Customs authorities charged in due course 100% duty on the footing that these two varieties were not covered by the exemption notification. It was further urged on behalf of the respondents in that petition, that if any refund was to be claimed it had to be within the period of time allowed by section 27. The further defence raised in that petition was that the petitioner should have filed a civil suit and should be directed to do so, in order that the defences of the department, such as limitation could be substantiated by evidence and cross-examination of the petitioner's witnesses. It was further urged that the acquisition of the knowledge of the mistake always depends upon the frame for mind of the party and the information available to him and that prima facie the petition having been filed beyond 3 years, a suit would also be barred by limitation. It was further urged in that petition that where an important defence like limitation is available to the suit because of the delay in filing the petition, the court should not entertain the petition but should refer the party to a substantive suit. On these facts and rival contentions, it was held by Deshmukh J. (as he then was) that the moment the notification wa issued by Government, Greaseproof Paper became a commodity liable to duty at 50% ad valorem and not more and that any demand in excess of 50% was therefore a demand either in excess of jurisdiction o one not backed by any provision of law. It was observed as under:-
"...the word `mistake' used in Section 72 of the Contract Act is used in an unqualified manner and it covers all mistakes whether of fact or law. That has been fairly established by the Judgment of the Supreme Court in Sales Tax Officer vs. Kanhaiya Lal, . Their Lordships quoted with approval a passage from the Judgment of the Privy COuncil in Shiva Prasad Singh v. Shirish Chandra Kandi, A.I.R. 1948 P.C. 297 and agreed that the mistake referred to in Section 72 can be wither mistake of fact or law. The observations of the Privy Council which are quoted with approval are these.
`Payment by mistake' in S. 72 must refer to a payment which was not legally due and which could not have been enforced; `mistake' is thinking that the money paid was due when in fact it was not due'."
It was further held in that case that the allegation about discovery of a mistake on o about a certain date, could be agitated before the High Court in a writ petition and that the High COurt could decide that point before dismissing the writ petition. It was further held that the petitioner had never specifically made a representation that the paper fell under the exemption Notification and was liable to pay only 50% duty, with the result that no occasion therefore arose for the decision by the Customs authorities as to whether the paper fell under the exemption Notification or whether it fell under the general categories of Item 44 of the Tariff. It was further held that it was only when the petitioner got some information from Madras and Calcutta regarding the sample testing of the paper for determining whether they were Greaseproof Papers, that the petitioner got an inkling of the whole situation and that thereafter it dawned upon them to collect information which which they did and further that until September 1966 the petitioner never realised that the goods directly fell under exemption Notification. Thus the earlier payments made by the petitioner must therefore be deemed to be payments made under mistake of fact as well as law and th recovery thereof by the department must be deemed to be without any authority of law. It was further held that such a case attracted the application of section 72 of the Indian Contract At. After holding that the pleadings did not disclose any triable issue, the petition was allowed.
10. I have alluded at some length to the decision in The Paper Products case to emphasise the similarity of the facts and contentions in the present case. for that mater it had never even been the case of the respondents , that the petitioner had specifically made a representation that their tyres fell within Item 16(3) or that there was any occasion for the department to make a decision whether the types fell under Item 16(1) or 16(3). It is obvious that the petitioner under an erroneous impression or misconception proceeded on the basis that the tyres fell within Item 16(1) and accordingly paid a higher duty on self-assessment basis. This was on the fact of it a mistake of fact and/or law on the part of the petitioner for no rational person would go out of his way and pay a higher tax or duty then what he would be liable to do. At this stage, the procedure for payment of the duty may briefly be recapitulated, namely the classification list had to be filed (Rule 173-B); thereafter the price list was filed (Rule 173-C); payment of the duty was then made by the petitioner itself after determining its liability for duty and thereafter the petitioner removed such goods on which it had paid duty (Rule 173-F); the petitioner thereafter submitted its monthly returns [Rule 173-G(iii)]; assessment was made on the basis of information furnished by the assessee in his returns subject of course to further enquiries (Rule 173-I). This procedure reveals in no uncertain terms that it was on the assumption and mistake of law and/or fact that its tyres were assessable to duty under Item 16(1) and not under Item 16(3) that the petitioner filed the requisite classification and price lists and paid the duty on self assessment on that basis. No doubt the department did collect such higher duty paid by the petitioner. That does not mean that the department was entitled in law to recover it. Hence it was not entitled to retain it and wa bound to refund it when requested to so. Of this position the department was well aware which is borne out by the fact that it agreed to refund a part of such duty. IF this excess duty had been paid by the petitioner and collected by the department under the provision of law, even this limited refund was unthinkable. Hence the receipt by the department of the excess duty was in excess of jurisdiction. Undoubtedly this excess duty paid by the petitioner was clearly due to mistake of law and/ or of fact, to which the petitioner became alive to for the first time when it received the letter dated 15th October, 1972 from Voltas Ltd. It was then that the petitioner realised for the first time its mistake in paying excess duty under Item 16(1) instead of the duty payable by it and receivable by the department under Item 16(3). It was this letter which started the petitioner on the road making further enquiries which revealed its mistake in paying a higher amount of duty than what it needs or should have paid and what the department could in fact have collected. Thereby in other words, the department received from the petitioner an amount higher than what it was entitled in law to receive and which it would not have received if the petitioner had not committed the bona-fide mistake of paying the higher amount in the first place. It is therefore obvious that the provisions of section 72 the mistake committed by the petitioner in paying a higher amount to the department and the department cannot be allowed to retain any such amount which it would not have received but for the mistake on the part of the petitioner in paying it in the first place.
11. It is futile for Mr. Dalal to urge that the petitioner should have filed a suit so that the question of the date of the petitioner's knowledge of its mistake could be investigated by evidence and by the cross-examination of Voltas Ltd. I see no point or purpose in the petitioner thus being driven from pillar to post. The letter of 15th October 1973 written by Voltas Ltd. has not been challenged in the affidavit-in-reply not has the genuineness or authenticity of that letter been questioned. In the affidavit-in-reply, it is not even the respondents' case that this letter is a sham or bogus letter nor was it rightly so urged by Mr. Dalal . In these circumstances, what point or purpose can there possible be in any witness from Voltas Ltd. being put in the witness Box. Even the present writ petition has been filed within 3 years from the discovery of the mistake, which was discovered on receipt of Voltas' letter dated 15th October 1973. Thereupon after making further investigation, the refund application was made on 19th April 1974. On 24th May 1975, the impugned order was passed by the 2nd respondent, and on 17th March 1976 by the 3rd respondent and the petition was filed on 15th September 1976. These dated establish that the refund application was made within 3 years from the earliest date of payment and that the present petition was filed with-in 3 years from the discovery of the mistake and within six months from the date of the appellate order. Therefore, looked at from any angle, the the present petition has been filed within 3years from the discovery of the mistake. There is also no merit in Mr. Dalal's contention that the petitioner could have discovered its mistake earlier, if it had shown due diligence or contacted other tyre manufacturers. This contention of Mr. Dalal does not take into account that this particular kind of tyres are manufactured only by the petitioner and Dunlop (India) and that until the petitioner received the letter from Voltas Ltd., there was no cause or reason for the petitioner to suspect that it had been over-paying duty to the department. It is only when the petitioner received Voltas letter of 15th October 1973, wherein Voltas gave a gist of the order passed by the Appellate Collector and called upon the petitioner to refund to Voltas Ltd. the difference between the higher incidence of excise duty which the petitioner had been charging and collecting from Voltas, that the petitioner was alerted to the fact that excess duty had been mistakenly paid by the petitioner to the department. This was therefore the starting point of the discovery by the petitioner of the mistake committed by it. Thus whether a suit or a petition had been filed,m it would not make the slightest difference as far as the question of limitation was concerned. The affidavit- in-reply discloses nothing which can be said to raise a triable issue. A mere denial for its own sake or putting the petitioner to strict proof, does not constitute a triable issue. What also is not without its own significance is that if the petitioner had instead of filing this petition, filed a suit, the defence might well have been that a suit did not lie. Now that the petitioner has filed the present petition, it is sought to be driven to a suit. To what end and purpose, except to raise some technical defence in an attempt to retain what the department is not entitled to do, having received the excess amounts without authority of law and which it would not have received but for the mistake of fact and/or law on the part of the petitioner. In Durga Shabkar Industries v. Government of India, 1979 E.L.T. (J 227), it was held by the Division Bench of the Madras HIgh Court that no tax shall be levied or collected except by authority of law, it was refundable irrespective of the time limit laid down in section 27 of the Customs At. It was further held that the time limit laid down in section 27 will not inhibit the HIgh Court from granting the necessary relief by way of mandamus by directing the authority to refund the duty collected without the authority of law.
12. Mr. Dalal relied on the decision of the Division Bench of this Court in Ogale Glass Works v. Union of India, 79 Bom. L.R. 37 1979 E.L.T. (J. 468). In that case the petitioner were manufacturers of glass and glassware. According to the price list approved by the excise authorities the petitioner had from 1962 to 1972 paid whatever moneys were demanded from time to time by the excise authorities. In this manner the petitioner had paid a sum of over Rs. 12 lakhs. Part of the moneys paid represented legitimate excise duty on the excisable goods, namely glass and glassware but the amounts so paid also included moneys purporting to be excise duty on the cost of packing and packing materials. On 10th September 1971, the Mysore High COurt held in the case of Alemic Glass Industries Ltd. that the value of packing materials or packing charges was not chargeable to excise duty. In December 1972, the petitioner made a representation to the excise authorities that revise price lists should be approved in accordance with the law by excluding the packing charges. the excise authorities refused to comply with the petitioners' request who thereupon filed a petition for appropriate direction to the excise authorities to repay the excess illegal recoveries on such packing to the excise authorities to repay the excess illegal recoveries on sub packing charges between 1962 and 1972 contending that the authorities had collected duty on packing charges and the petitioners had paid the same under a common mistake since the inception. It was observed by Mukhi J. that if one party under a mistake of fact or law pays to another party money which is not due by contact or otherwise, that money must be repaid under section 72 of the Contract Act and that it is a misconception that the amounts in excess of what could be legitimately revered as excise duty are or can be labeled as "excise duty". Such amounts are not excise duties at all but are imposts without the backing o authority of law and they are completely illegal. It was further observed by Mukhi J. that in order to enable a petitioner to obtain relief from the Court in a writ petition, it is not sufficient that he should make out some statutory right or show that an order passed against him is illegal; he must in addition show that justice lies on his side and that by making an order which is sought from the Court, the Court will be doing justice. However, Mr. Dalal relied on the observation s made by Dishpans. J. in that case, appearing at pages 55 and 56 of the Report as under:-
"...My learned brother has, however, found that (a) such impugned assessments were not under the Act, and (b) that the petitioner paid such excess duties nude mistake of law, and (c) that limitation under R. 11 is not relevant, and (d) that there are no latches and no unreasonable delay in claiming such refund in this writ petition with respect, I do not find myself in agreement with any of these findings.
bear in mind the distinction between, the money a mistake of law; and the money paid under valid order of Court , or any other competent statutory authority, including assessments, discovered to have been based, on any such mistake of law, Section 72 of the Contract ACt affords a remedy for refund in the former case, while it had no application whatsoever in the latter case; it being merely a question of getting such mistakes or errors corrected by recourse to th remedies provided in the stature within the period of limitation prescribed therefor. Such orders also are subject to writ jurisdiction under Art. 226 of the Constitution, if invoked directly against the same within a reasonable time, if not within forty five days thereof . There is also a distraction between the order, that ar void and nulitites for reasons known to law and the order s act so void. Section 72 of the Contra fact Act can be availed of in the former case ion a civil suit based on the composite cause of action of (1) the order being void and (2) payment having been made under the mistake of law of its being valid. But the order falling under the latter category, even if discovered to be patently erroneous, would continue to be final and binding on the parties, if not corrected , in spire of the remedies, and the question of claiming refund of money paid the under, on discovery of mistake of law in such an order, at any later stage, can never arise. `Mistake of Law', can have no relevance whatsoever in such cases excepting for extension of limitation for availing of the remedies provided the concerned statute admits of such extension. Rights and liabilities of the person so bound by such final valid but erroneous orders get settled down in thereof permanently and mere subsequent discovery of any eros f law therein cannot unsettle the same, even if recovery of money thunder by the State turns out to be without any authority of law. The fact that State happens to be the beneficiary of such erroneous orders does not make any difference to this well settled legal position. Substantive rights thus get modified and settled once for all under such procedural laws which are as such based on public policy and practical considerations of justice, ad the substantive law itself . Such finality and immunity from further interference is part of the rule of the law. The contention that, on subsequent discovery of lack of legal authority, such orders cease to be effective and final, in disregard of procedural limitations, because of being violative of fundamental rights has been firmly rejected by the Constitution Bench of the Supreme COurt in Ujjam Ravi v, State of Uttar Pradesh (AIR 1962 SC 1621). this view is affixed by it in the case of Naresh v. State of Maharashtra . Such contention in this case is also liable to be rejected."
13. I find myself in the unenviable situation of being confronted by a judgment of Division Bench where the two leaned Judges have taken diametrically opposite views. Be that as it may, the observations relied on by by Mr. Dalal do not apply to the facts and circumstances of the matter before me. While in the Ogale Glass case, moneys were paid by the petitioners as demanded from time to time by the excise authorities, in the matter before me, it cannot be said that the petitioner paid excess duty under any valid order of any statutory authority but as a result of a mistake of fact and/or law which resulted in the petitioner paid excess duty under any valid order of any statutory authority but as a result in the petitioner filing erroneous classification lists. this mistake on the part of the petitioner was the starting point to all that followed thereafter. thus all the acts flowing from this mistake on the part of the petitioner initially making the excess payments on the basis of its erroneous classification lists, resulted in the department collecting more duty that it was entitled to under the authority of law. While the observations of Despond J. in Ogale Glass case are on the basis of an error or mistake on the part of the authority, in the matter before me the excess payments made by the petitioner were the result of the mistake on the part of the petitioner itself in filing erroneous classification lists and making excess payments on the basis whereof the department collected excess duty without the authority of law, and which otherwise it would not have received. the department cannot collect amounts without the authority of law and then be heard to say, it will not refund them . Thus these observations relied on by Mr. Dalal can avail the respondents noting in the facts and circumstances of this case.
14. Mr. Dalal next relied on the decision in Ujjam Rai v. State of Uttar Pradesh, A.I.R. 1962 Supreme Court 1621, where it was held that the characteristic attribute of judicial act or decision is that it binds, whether it be right or wrong. An error of law or fact committed by a judicial or quasi-judicial body cannot in general be impeached otherwise that on appeal unless the erroneous determination relates to a matter on which the jurisdiction of that body depends. Mr. Dalal also relied on the decision in Bata Shoe Co. v. Jabalpur Municipality, , where it was held that the provisions of C.P. & Berar Municipalities Act 1922 showed that the defendants indubitably possess the right and the power to assess and recover octroi duty and double duty on goods which are brought within the municipal limits for ask, consumption or use. It was further held that, circumstance that the defendants might have acted in excess of or irregularly in the exercise of that power cannot support the conclusion that the assessment or recovery of the tax is without jurisdictions. It was further held that if the appropriate authority while exercising its jurisdiction and powers under the elegant provisions of the ACt, holds erroneously that an assessment already made can be corrected or that an assessee is liable to pay double duty, when Rule 14 (b) in fact does not justify such an imposition, it cannot be said that the decision of the authority is without jurisdiction. Mr. Dalal also relied on the decision in Kamala Mills v, State of Bombay, A.I.R. 1955 Supreme COurt 1942, where it was held that for the purpose of section 20 of the Bombay Sales Tax Act, an assessment based on an erroneous finding about the chapter of the transaction, cannot be held to be an assessment made without jurisdiction and as such outside the purview of section 20 which protects assessments made under the Sales Tax Act and the Rules thereunder by appropriate authorities.
15. These decisions can be of no assistance to the respondents, inasmuch as they pertain to an error committed by a judicial or quasijudicial body, neither of which is the petitioner before me. It is not that the department made an error in demanding excess duty fro the petitioner . It is the petitioner which made the mistake of paying it and which the department received from the petition without the authority of law. Therein lies the difference. If it is manifest, as tin the present case it is, that the mistake was on the part of the petitioner in filling erroneous classification lists and paying additional duty on the basis thereof , the question of thee concerned authority receiving the amount on the footing of the petitioner's mistake cannot elevate the recipe of such amounts to the dignity of a judicial or quasi-judicial order under which such amount were paid. there was no question of any erroneous finding by the department, in the sense that the department has not on its own levied any duty on the petitioner but received excess duty from the petitioner on the basis of the mistaken classification lists filed by the petitioner.
16. Mr. Dalal further urged that the petitioner should have filed its present petition within the period of one year from the discovery of the mistake. this contention of Mr. Dalal cannot be entertained. If section 72 of the Contract Act is attracted, which it is, it would be open to the petitioner to file a petition within 3 years from the discovery of the mistake. That the petitioner has done. Mr. Dalal urged that even assuming that the period for filing a writ petition is 3 years, the Court should not exercise its discretion in the petitioner's favour. In support of this contention, Mr. Dalal relied on the decision in State of Madhya Pradesh v. Bhailal Bhai, . In that case the norms which should prevail for relegating a party to a suit have been set out. The relevant observations are to be found in para 17 at page 1011 of th Report as under:-
``....We cannot lose sight of the fact that the special remedy provided in Art. 226 is not intended to supersede completely the modes of obtaining relief by an action in a Civil COurt or to deny defence legitimately open in such actions..the power to give relief under Art. 226 is a discretionary power. This is specially true in the case of power to issue writs in the nature of mandamus. Among the several matters which the High COurt rightly take into consideration in the exercise of that discretion is the delay made by the aggrieved party in seeking this special remedy and what excuse there is for it. Another is the nature of controversy of facts are law that may have to be decided as regards the absolutely of consequential relief. thus , where, as in these cases, a person comes to the COurt for relief under Art. 226 on the allegation that he has been assessed to tax under a void provision of law, and the payment was made by mistake, is still not bound to exercise its discretion directing repayment. Whether repayment should be ordered in the exercise of this discretion will depend in each case on its own facts and circumstances. It is not easy nor is it desirable to lay down any rule for universal application. It may however be stated as a general rule that if there has been unreasonable delay the Court ought not ordinarily to lend its aid to party by this extraordinary remedy of mandamus. Again, where even if there is no such delay the Government or the statutory authority against whom the consequential relief is prayed for raises a prima face triable issue as regards the availability of such relief on the merits on the grounds like limitation the Court should ordinarily refuse to issue the writ of mandamus for such payment. In both these kinds of cases it will be sound use of discretion to leave the party to seek his remedy by the ordinary mode extraordinary remedy under Art. 226 of the Constitution." (The underlining is main) Applying the every norms laid down by the Supreme Court to the present matter, it cannot be said by any stretch of imagination that there has been any unreasonable delay on the part of the petitioner in filing this petition. On the contrary as stated earlier, the petitioner in if has moved as expeditiously as it could under the circumstances, inasmuch as after coming to know of its mistake by reason of Voltas' letter dated 15th October 1973, the petitioner made further investigation and applied for the requisite refund on 19th April 1974. the refund application was filed within 3 years from the earliest date of payment and the petition within 3 years from the date of discovery of the mistake and within 6 months from the dated of the impugned appellate order. If the petitioner had , instead of first moving the department for refund, straight way filed this petition, no doubt the department would have taken its standard defence, that the petitioner had not exhausted its remedy of first moving the department and the standard query would have been raised as to why the petition should assume it would not get relief from the department itself. Now that the petitioner moved the department and failing to get satisfactory redress, has filed this petition within 6 months from the dated of the appellate order, the department alleges delay on the part of the petitioner and it should have moved the Court first and filed a suit. Surely the department cannot have it both ways. On the fact of it, the question of limitation, be it in the present petition, or in the suit, had on been filed by the petitioner, did not arise. Furthermore, one has only to ask onself . What is the triable issue raised by the respondents in this case? The answer is one word NOne. In view of these circumstances, applying the very norms laid down by the Supreme Court, it would be harsh, inequitable and unjust to refuse relief to the petitioner on the ground of so-called delay or now to drone the petitioner to a substantive suit, when the result would be no different that granting the very same relief to the petitioner by way of the present petition. Mr. Dalal also relied on the decision in Dhanyalakshmi Rice Mills v. Commissioner of Civil Supplies, , where it was held that the relief of mandamus shall not be granted where there is can alternative remedy which is equally convenient, beneficial and effectual. That decision can be of no assistance to the respondents in the facts and circumstances of the matte before me. In Dhanyalakshmi's case, the relief was refused on the ground of delay and insufficient of particulars and pleadings and voluntary payments, coupled with disputed questions of fact whether there was really any mistake or whether it was a case of voluntary payment pursuant to contractual rights and obligations the plea of mistake being limited in the petition merely to a bare averment. Furthermore, the payments also did not disclose the circumstances under which the alleged mistake occurred and the circumstances in which the legal position became known to the appellants in that case. Furthermore, the respondents in that case had contradicted the plea of mistake by urging voluntary payments under contractual rights and obligations, with the result that a triable issue had arise as to whether there was art. ll any mistake on th pat of the appellants in paying the amounts and when exactly the mistake occurred and under what circumstances. No such infirmities which existed in Dhanyalakshmi's case exist in the matter before me. The averment in the petitions pertaining t the mistake made by the petitioner are clear and unambiguous. A bald denial does not make for the triable issue. In these circumstances, the reliance by Mr. Dalal on Dhanyalakshmi's case can be of no assistance to the respondents.
17. Mr. Dalal invited me to dismiss the petition on the ground that the petitioner had only challenged the impugned orders of the 2nd and 3rd respondents, and not the earlier assessment orders. An identical contention had been urged before Deshmukh J. (as he then was) in The Paper Products case (supra). In repelling that contention, I can do not better that to reproduce the observations made in that case as under:-
"...It is true that in so many words the petitioner have not asked for quashing the assessment orders. Mr. Rana argued that if such plea was taken earlier either in the pleading or in the several exhaustive hearing before the various judges of this court when the matter was referred to reconsider the assessment, the petitioner would have complied with the technical requirements if need be by amending the petition, HOwever , apart from the mere technical approach what I find is that the legality or otherwise of this tax has not been yet decided. The petitioners pleaded specifically in the body of the petition that the recovery of the dues by the Customs Authorities is without the authority of law and wholly illegal. that has been the theme of paragraph 10 and the whole petition narrated how the two kinds of paper fall within the exempted category and are outside the purview of Entry 44 which generally deal with 100% levy on paper. I am, of the view that this technical approach should not come in the way of the petitioners if they are otherwise entitled to the refund. The petition read as a whole does acquire this court to hold in the first instance that the recovery is illegal and if such a inclusion could be arrived at the refund is to the directed as a relief flowing from that." (The underlining is mine.) These observation with which I respectfully agree, apply with equal force to the matter before me.
18. Before parting with this judgment may be recalled the observations of the Supreme Court in Union of India v. A. V. Narasimhlu, as under:-
``The jurisdiction of the civil Court to entertain a suit challenging the validity of the imposition of the duty of customs being excluded, the plaintiff's suit must fail. But it must be observed that the present is a fair illustration of the administration not making a serious attempt to avoid futile litigation for small claims. There was a judgment of the High Court of Madras on the identical question which fell to be determined. It the plaintiff had moved the High Court in exercise of its jurisdiction under Article 226, the Union had practically no defence. The Union could with out loss of face accede to the request of the plaintiff to refund the amount collected. This was essentially a cases in which when notice was served, the Central Government should instead of relying upon technicalities have refund the amount collected. We trust that the Administrative authorities will act in a manner consistent not with technicalities but with a broader concept of justice if a felling is to be court in the minds of the citizens that the Government is by and for the people."
19. Nearer home may be recalled the observations made by the Division Bench of this COurt in State of Maharashtra and others v. Glaxo Laboratories (India) Pvt. and another, 1979 E.L.T. (J 286) at page 296 as under:-
"We would like to express our distress at this wasteful and futile litigation. There was almost nothing to be said by the Appellants and the Union of India so far as the merits of the case were concerned..no arguments have been attempted to be advanced to justify the orders of the authorities. The arguments in this Court al also in the trial Court mostly centered around the technical defence of maintain ability of the suit. We may well ask, `To what purpose, assuming for the sake of argument that the Court were to hold that the suit was not maintainable, was this waste of public time and money? Had the plaintiffs failed in the suit on this point, they could have immediately filed a writ petition under Article 226 of the Constitution or the same relief. The being no answer on the merits, they would have been granted the relief prayed for. From our experience of litigation of this type, we of course, can contemplate some technical defences which would have been raised in that writ petition . One of them would have been that of deny, but the answer to that defence would have been that of delay, but the answer to that defence would have been furnished by the period taken up by the pendency of this case. Another technical defence very likely would have been that th respondents' proper remedy was to file a suit. We are not saying this in a facetious vein, because in thievery suit from which this Appeal arises, in the Written Statement filed by the Union of India a defence has been taken that the suit is barred by limitation, and immediately thereafter another defence is taken that the suit is premature. this we may well expect from a private litigant who seeks to postpone the evil day, but these are Thus there was no real object in raising these technical defences because , as we have pointed out above , if not by way of suit by way of a writ petition the plaintiffs would have succeeded. The only object, thereof , cloud have been to drive the plaintiffs from pillar to post..
Regretfully, these observations of the Supreme COurt and the Division Bench have in this case fallen on deaf ears of th department.
20. In the result, the impugned order are set aside and the respondents shall refund to the petitioner the amount of Rs. 2,38,48124 within a period of eight weeks from today. This is fit case where costs should follow the event. The respondents shall pay to the petitioner the costs of this petition. Rule is made absolute accordingly.