TMI Blog1987 (12) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... on on ethics of undue enrichment. 2. Narration of facts is unnecessary. Suffice it to mention that the Assistant Collector Central Excise while exercising power under Section 11B of Central Excises and Salt Act of 1944 accepted the claim of petitioner, a Rice Mill Plant, that it being registered as small scale industry was entitled for exemption from whole of excise duty leviable under Tariff Item No. 68 of First Schedule in respect of first clearance, for home consumption; therefore, the payment of excise duty at 10% during financial years 1983-84 and 1984-85 was made under mistake of law. But the claim was held to be admissible for the period six months prior to 27th September, 1984, the date on which refund application was made as refu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 04, (1965) 16 S.T.C. 689). In Trilok Chand v. R.B. Munshi A.I.R. 1970 S.C. 898 Chief Justice Hidayatullah while cautioning the courts against entertaining stale claims preferred to rule that discretion of the court should be the guiding factor. But the ratio which has held the field on period of limitation during which refund should be directed is stated thus in D. Cawasji v. State of Mysore A.I.R. 1975, S.C., 813 ; "Therefore, where a suit will lie to recover moneys paid under a mistake of law, a writ petition for refund of tax within 3 years of the knowledge of the mistake would also lie." 5. But the fundamental issue is if the remedy of approaching this court in its extraordinary jurisdiction after addition of sub-section (5) to Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... since the remedy of approaching any other court has been taken away the limitation provided for applying for refund under Section 72 of Contract Act should be taken to have been substituted by shorter period of limitation under the Act on principle of specific excludes general. Urged learned counsel that if limitation for filing suit within three years from discovery of mistake was not available then the ratio laid down by Hon'ble Supreme Court in various authorities mentioned earlier automatically become inapplicable. The argument is attractive no doubt. But analysed closely if falls apart. As already stated sub-section (1) empowers any person to make an application for refund of any duty of excise. Obviously because the duty was erroneou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the date of payment. It does not destroy the remedy available under general law to apply for refund within three years from the date of knowledge. The expression, 'no court shall have any jurisdiction in respect of such claim' has to be confined to situations visualised by it. And not to realisation which are void without jurisdiction or against constitutional constraint. Limitation under statute only bars the remedy. It does not annihilate the right. If on the same cause of action a person has two remedies then the other is not excluded because the period of limitation for one is shorter. Principle of specific excluding general is not available as the remedy under statute is from date of payment and not from date of knowledge. One of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irtue of returning what was wrongly recovered. There is thus no dearth of authority that tax or duty collected illegally is liable to be refunded for which direction can be issued under Article 226 even if the claim is barred by rule of limitation under the statute. 6. Undue enrichment is often advanced to resist acceptance of claim for refund. Roots of this plea is embedded in morality the very foundation of our social structure. All actions individual or State must conform to honesty and fairness. Levy of tax or duty illegally robs the consumer. Refund to him, however, is illusory. Therefore, undue enrichment is there either of the manufacturer or dealer or trader or the State. Amongst two who is more morally justified? That can be reso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) held that the claim for refund should not be normally entertained after three years as the tax is intended for immediate expenditure. But the Hon'ble Court did not countenance the view that the claim should be refused because of lack of intention to refund it to consumer and observed, 'Nor is there any provision under which the court could deny refund of tax even if the person who paid it has collected if from his customers and has not subsisting liability or intention to refund it to them or for any reason it is impracticable to do so. 7. Interest on refund illegally disallowed is claimed on strength of Dulichand Shree Lal v. Collector of Central Excise and others 1986 (26) E.L.T. 298 (Cal.), Radheshyam Tulsiram v. Collector of Customs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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