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TMI Blog2007 (8) TMI 671X X X X Extracts X X X X X X X X Extracts X X X X ..... 9-2000 Rs. 2,44,18,153 and for the year 2000-01 Rs. 20,67,387.68 were paid in excess. The petitioner has approached this Tribunal with these three applications asking for directions to refund the said excess amounts of tax. These excess amounts had been generated due to the fact that the petitioner realised full amount of tax from its purchasers at the time of sales as those purchasers could not supply declaration forms in time and some of them could obtain eligibility certificates afterwards with retrospective effect. Mr. Mookerji, learned Advocate for the petitioner has also pointed out that because of ad hoc calculation, the petitioner had deposited higher amount of tax in excess of what was actually realised from the purchasers. Mr. T.N. Banerjee, learned State Representative, points out that the amounts which the petitioner-company realised from the customers and deposited with the State Government, cannot be refunded to the petitioner-company. According to him, only the customers from whom tax had been realised, are entitled to apply under section 37(3) of the West Bengal Sales Tax Act, 1994 before the Commissioner for such refund. Mr. G.C. Mookerji, learned advocate, has r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot refund the said excess octroi duty but transferred it to the Consumer Welfare Fund in accordance with the provisions of the Central Excise Act, 1944. On behalf of the excise authorities it was contended therein that as the petitioner therein passed on the octroi amount to the customers, the petitioner was not entitled to claim refund in view of the provisions of sub-section (2) of section 11B of the Central Excise Act and even if section 11B had no application, on general principle the petitioner had no right to claim such amount as it would result in unjust enrichment. Dealing with the aforesaid contention the Supreme Court discussed and held: "(29) Finally, it was submitted that the doctrine of 'unjust enrichment' has no application. The said doctrine, therefore, could not have been invoked by the authorities for denying the benefit of exemption from payment of excise duty and in refusing to pay the amount to which the appellant was held entitled by diverting it to the Consumer Welfare Fund set up by the Government. 30.. We are not impressed by that argument also. In our view, the submission is not well founded and cannot be accepted. 31.. Stated simply, 'u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as such excise duty is passed on to consumers/customers. In view of specific finding, in our opinion, the conclusion is inescapable that the appellantMandal is not entitled to claim any amount. Allowing exemption or refund of amount would result in 'unjust enrichment' by the appellant which cannot be permitted. In our opinion, therefore, even on that count, orders passed by the authorities and refusal to grant benefit cannot be held arbitrary, unreasonable or inequitable. The said ground also, therefore, has to be rejected." In Sahakari Khand Udyog Mandal Ltd. [2005] 4 RC 567; [2005] 3 SCC 738 the Supreme Court referred to several earlier decisions of the Supreme Court on the said question, viz. (i) Orient Paper Mills Ltd. v. State of Orissa [1961] 12 STC 357 (SC); AIR 1961 SC 1438. (ii) Shiv Shanker Dal Mills v. State of Haryana [1980] 2 SCC 437. (iii) Godfrey Phillips India Ltd. v. State of U. P. [2005] 139 STC 537 (SC); [2005] 4 RC 186; [2005] 2 SCC 515. It is thus clear from the judgment of the Supreme Court in Sahakari Khand Udyog Mandal Ltd. [2005] 4 RC 567; [2005] 3 SCC 738 that even if there is no restriction or prohibition in the statute, no private pers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Commissioner. Although section 37 is not strictly applicable those buyers from whom tax has been collected but have been ultimately found to be exempted from paying tax cannot be left without remedy. State cannot retain money not legally payable by a person as same will amount to realisation of tax without authority of law and State is under an obligation to refund/return such money to the person who has actually paid the amount if such person demands refund. So long as the realised tax does not become unlawful realisation and refundable no occasion to apply for refund arises. In case of buyers who had to pay tax to the seller as they could not submit the declaration forms or did not get the eligibility certificate at the time of purchase, taxes cannot be said to be unduly realised until necessary declaration forms are obtained and cause of action for applying for refund does not arise until required declaration forms are made available. In such situations the buyers may approach the Commissioner with request for refund within the prescribed time, if any, commencing from the date of obtaining declaration forms. If approached the Commissioner himself or his delegatee shou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e buyers it may not be easy for the assessing authority to find out who has actually paid the excess or non-payable tax. Even if assessing authority makes determination and records his finding the buyers who have actually paid the amount, may not be aware of such decision and may not be able to claim refund. Procedure requires suitable modification for effective application of the doctrine of unjust enrichment while granting adjustment or refund and ensuring prompt decisions and expeditious refund wherever necessary. So long as appropriate Rules facilitating application of the doctrine of unjust enrichment are not framed, the concerned authorities should follow suitable procedure as suggested in this order. According to us, under section 60 of the 1994 Act, the Commissioner or the appropriate assessing authority is under a legal obligation to refund the excess amount of tax in the manner indicated therein to the dealer or to the buyer/customer of the dealer, as the case may be, and doctrine of unjust enrichment is applicable in appropriate cases even for refund under section 60 of the 1994 Act. It is for the appropriate assessing authority to decide whether doctrine of unjust en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avour of the assessee in the manner indicated in section 60 of the 1994 Act. (viii) Upon receipt of the copy of the assessment order the buyers/ customers who have actually paid the tax may apply before the Commissioner of Commercial Taxes for refund with supporting materials and if such application is made, the Commissioner or an officer duly authorised by him, after being satisfied that such applicant is entitled to get the refund under the assessment order, will refund the amount refundable to such applicants. In the present case the assessing authority has already determined the tax liability of the petitioner and has found that the petitioner has paid tax in excess. The assessing authority has also mentioned the reasons for such excess payment but the assessing authority has not clearly stated whether the entire excess amount was realised by the petitioner from its buyers or customers or not. Mr. Mookerji, learned Advocate for the petitioner, has submitted that a part of the excess amount was paid by the assessee itself. In such circumstances we are of the view that the assessing authority should re-hear the assessment proceeding on the limited question of ascertaining whet ..... X X X X Extracts X X X X X X X X Extracts X X X X
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