TMI Blog1986 (4) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... ce and used to pay duty on the said goods processed by it under Item No. 17(1) of the First Schedule to the said Act. As the said goods were processed from duty paid printing and writing paper at the initial stage, the petitioner allegedly mentioned the words "under protest" on the gate passes. The said protest, according to the petitioner, was discontinued as the petitioner was informed by the Departmental Officers that the said goods were liable to duty. 2. By a trade notice bearing No. 93/Paper-4/1977 dated May 28 1977 issued by the Deputy Collector of Central Excise, Calcutta, it was clarified that teleprinter paper rolls and tapes after being cut to sizes and/or inter-leaved with carbon paper would not attract any further excise duty, if they are made from printing and writing papers which have already borne duty under Item No. 17(1) of the First Schedule to the said Act. The case of the petitioner is that from the said trade notice the petitioner came to learn that collection of duty on the said goods was without authority of law. On December 15, 1977 the petitioner filed two claims for refund of duty paid for Rs. 1,56,774.24 and Rs. 30,288.57 for the period February 25, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. 5. After affidavits had been completed this application has come for hearing. It is contended by Mr. Bhattacharjee, learned Advocate appearing for the respondents that section 11B of the Act and/or Rule 11 of the said Rules would govern the cases of refund of duty in the instant case. Under the provisions of Section 11B or Rule 11 the period of limitation of six months for claiming refund can be extended where the duty has been paid under protest. In the instant case no proof of payment alleged to have been made when the Teleprinter paper Rolls and Tapes have been removed from the factory under protest has been produced by the petitioners. It is also contended that no proof of payment of duty at base paper stage out of which the teleprinter paper rolls or tapes have been manufactured has also been produced by the petitioners. In other words, the contention of the respondents is that the question of extension of the period of limitation does not and cannot arise. No refund can be made because no proof of payment of duty either at the base level or at the level of clearing the manufactured goods of teleprinter paper rolls or tapes was adduced, only on satisfactory proof of those ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epartmental adjudication proceedings regarding payment of duty on base paper or in the affidavit filed in this proceeding. The contention of the respondents, therefore, must fail. 7. It is then contended by Mr. Bhattacharjee, learned Advocate that delay in filing the application for refund cannot and should not be condoned. It is contended that if the statute does not provide for the condonation of delay such delay can be condoned by the Court. He has relied on the provisions of Section 66(l) of the Indian Income-tax Act, 1922 and three decisions under the Income Tax Act. The decisions are in (1) Commissioner of Income-tax, Gujarat-III V. Western India Engineering Co. Ltd., reported in (1978) 77 ITR 165, (2) Commisioner of Income-tax V. P.C. Vereodkutty reported in (1971) 81 ITR 206 and (3) Commissioner of Income-tax (Central), Calcutta V. Assam Oil Co. Ltd. reported in (1972) 83 ITR 456. These decisions, however, have no application to the facts of this case. In those cases the question before the Courts was whether section 5 of the Limitation Act is applicable to the proceedings under section 66(1) of the Indian Income-tax Act, 1922. Under section 66(1) of the Indian Income-tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x even if the person who paid it has collected it from his customers and has no subsisting liability or intention to refund it to them, or, for any reason, it is impracticable to do so". "In the U.S.A., it is generally held that in the absence of a statute to the contrary taxes voluntarily paid under a mistake of law with full knowledge of facts cannot be recovered back while taxes paid under a mistake of fact may ordinarily be recovered back (see Corpus Juris Secundum, Vol. 84 P. 637). Although Section 72 of the Contract Act has been held to cover cases of payment of money under a mistake of law, as the State stands in a peculiar position in respect of taxes paid to it, there are perhaps practical reasons for the law according a different treatment both in the matter of the heads under which they could be recovered and the period of limitation for the recovery". 8. In I.T.C. Limited V. M.K. Chipkar reported in 1985 (22) ELT 334 Bombay High Court held that Rule 11 of the Central Excise Rules applies to the cases where duties have been paid through inadvertence, error or misconstruction where refund application has to be made within three months from the date of such payment. Bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und of the Excise Duty paid by them for the period 17.3.1972 to 17.6.1976 in relation to their products namely Coca Cola and Fenta." The case of the petitioner is that it was somewhere in December 1976, that the Bombay High Court took the view that the essence is a different from concentrate and therefore, petitioner was liable to pay the Exicse Duty at a much lower rate than at the rate at which they had paid. It was admitted case of petitioners that during the prescribed time, the petitioners never applied for refund. The petitioners appear to have become wiser after judgment of Bombay High Court and in the light of that Judgment, they have been able to get certain orders favourable to them for the period 1976-77, when they applied for the refund on the basis of the said judgment. It will be noticed for the relevant years the petitioners had already collected lakh lakh of rupees from the customers. They are at no loss whatsoever. They cannot now apply for refund." 13. The Delhi High Court has not given any reasons nor considered any of the decisions either of the Supreme court or other High Courts where consistently the view has been taken that if the collection is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty wrongly paid under the mistake of law cannot be denied by the Government on the principle of unjust enrichment. The Madras High Court was of the view that the law declared by the Supreme Court in D. Cawasji Co. (supra) holds the field and acordingly the contention of the respondents was rejected. 15. The Division Bench of this Court in the case of Khardah Company Ltd. (supra) also considered the contention of the respondents as regards unjust enrichment and observed as follows: "If the liability imposed is of the assessee alone and if the assessee is liable to pay irrespective of whether he can pass on the liability to his customers, for the very same reason he can demand refund of all unauthorised levy irrespective of whether he had actually borne the burden himself or not, unless the statute provides it otherwise. The answer to the objection raised by Mr. Banerjee is to be found in the observations of the Supreme court in the case of (11) D. Cawasji Company V. State of Mysore, AIR 1975 S.C., 813 = 1978 ELT (J154) (S.C.) relied on by the Bombay High Court in its later decision, which though obiter appeared to enunciate the true legal principle which follows from their ..... 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