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The State of Andhra Pradesh Vs. Appanna Satyanarayana Murthi and Raja Rao and Co. and ors. - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtAndhra Pradesh High Court
Decided On
Case NumberOriginal Suit Nos. 49, 50 of 1961, 19, 33, 49 and 62 of 1963 and Appeals Nos. 369, 370, 371 of 1964,
Judge
Reported in[1970]26STC190(AP)
AppellantThe State of Andhra Pradesh
RespondentAppanna Satyanarayana Murthi and Raja Rao and Co. and ors.
Appellant AdvocateD.V. Sastry, Adv. for ;Principal Government Pleader
Respondent AdvocateP. Suryanarayana, ;P. Kameswara Rao and ;C.V. Kanyaka Prasad, Advs.
DispositionAppeal dismissed
Excerpt:
- all india services act, 1951. sections 32(c) (as amended by section 3 of amendment act, 2005] & 10 & general clauses act, 1897, section 6: [g.s. singhvi, cj, dr.g. yethirajulu, ramesh ranganathan, g.bhavani prasad, c.v. nagarjuna reddy, jj] exemption of building from applicability of provisions of act held, (per majority) section 32(c) of the act provides that the provisions of the act shall not apply to any building the rent of which as on the date of the commencement of the a.p. buildings ( lease, rent and eviction) control (amendment) act 2005 exceeds rs.3,500/- per month in the areas covered by the municipal corporations in the state and rs.2,000/- per month in other areas. there is nothing in the provisions of the amendment act which either expressly or by necessary implication.....parthasarathi, j.1. all these appeals raise identical questions and arise out of suits by certain dealers in copra for refund of moneys specified in their respective plaints. the case that is put forward by the plaintiffs is that they are dealers registered under the andhra pradesh general sales tax act and carry on business in copra. they had been assessed on the turnover of purchases relating to copra for the year 1957-58 as also for the subsequent years. at the time of the assessment, the provisions of the act provided for separate levy of sales tax on coconuts and copra as two distinct commodities. subsequently, the provisions of the act had been amended by act 26 of 1961 by deleting copra from out of the commodities that are assessable under the third schedule. the amending act.....
Judgment:

Parthasarathi, J.

1. All these appeals raise identical questions and arise out of suits by certain dealers in copra for refund of moneys specified in their respective plaints. The case that is put forward by the plaintiffs is that they are dealers registered under the Andhra Pradesh General Sales Tax Act and carry on business in copra. They had been assessed on the turnover of purchases relating to copra for the year 1957-58 as also for the subsequent years. At the time of the assessment, the provisions of the Act provided for separate levy of sales tax on coconuts and copra as two distinct commodities. Subsequently, the provisions of the Act had been amended by Act 26 of 1961 by deleting copra from out of the commodities that are assessable under the Third Schedule. The amending Act introduced an explanation providing for an inclusive definition of the word 'coconut' so as to comprehend copra as well. This provision of the amending Act was made retrospective with effect from 15th June, 1957. The claim set out in the plaints is that as a result of the amending legislation, the levy of the tax and its collection had become illegal and that they are consequently entitled to a refund of the amount paid by them under coercion.

2. The suits were resisted by the State Government. It pleaded, inter alia, that the levy and collection of the purchase tax in question is neither illegal nor without jurisdiction and that the plaintiffs are not entitled to the refund claimed by them. The assessment, when made, was according to law and the amounts were voluntarily paid. The levy was legal and cannot be deemed to have been made under a mistake of law or of fact. Nor can the payment be said to be vitiated by a mistake of law or by coercion. It was further pleaded that the assessments were finalised before the commencement of the amending Act.

3. As the pleadings and the contentions in the several suits were almost identical, the issues that had been settled for trial were likewise similar in all the suits. The learned Subordinate Judge upheld the claim of the plaintiffs and granted the prayer for refund in each of the suits. He held that consequent on the explanation inserted in the amending Act, the word 'coconut' includes copra and copra cannot be separately taxed. He was of opinion that the amending Act was applicable to assessments finalised prior to its commencement. The learned trial Judge negatived the objection taken by the defendant to the maintainability of the suit. He held that the claim in the suits did not pertain to the merits or propriety of the assessment and that the jurisdiction of the civil court to entertain the suit is not barred. A plea of limitation was also taken by the defendant and it was overruled.

4. These appeals are preferred by the State of Andhra Pradesh against the decrees made in these several suits. In the memoranda of appeals, the appellant repeated practically all the objections that were urged in the court below; but the argument before us was restricted in its scope and we have to deal only with the contentions that were urged by the learned Government Pleader before us. The main question that was debated before us related to the jurisdiction of civil courts to entertain suits of this description. It was also urged that the claim for the refund is unsustainable, because the assessment itself has not been modified or set aside. Another point that was argued by the learned counsel for the appellant is that the award of interest is in any case unjustified.

5. The argument about the jurisdiction of the civil courts to entertain the suit and decide it, was sought to be presented on a twofold basis. Firstly, learned counsel submitted that the suits are barred by reason of the preclusive provision of Section 36 of the Andhra Pradesh General Sales Tax Act, which, inter alia, is to the effect that no court shall entertain a suit or other proceeding to set aside, modify or question the validity of the assessment order or decision made under the Act by an officer or authority in respect of any matter falling within its or his scope. It was also contended that the claim for refund is not cognizable by the civil court because the decision to direct a refund can be arrived at only by a process of reassessment or scrutiny of the assessment and this function is clearly outside the jurisdiction of the civil court. How could the court grant the prayer for recovery of the tax unless it be by undertaking a reassessment of the tax and by a determination of the precise amount said to have been illegally levied Therefore, counsel urged that quite apart from the bar of jurisdiction enacted by Section 36, the suit was beyond the competence of a civil court, inasmuch as the court was necessarily compelled in its inquiry into the merits of the claim, to entrench on the exclusive jurisdiction of the statutory tribunals.

6. At the outset, it may be pointed out that the second aspect of the argument was pressed by counsel apparently on a misapprehension of the true position. Our attention was invited to paragraph (8) of the judgment of the lower court in O.S. No. 49 of 1963 (A.S. No. 121 of 1965) wherein reference was made to the interrogatories served on the defendant and the answers thereto, submitted by the latter under exhibit A-5. It is clear from the answers given by the defendant that there was an admission on the part of the defendant that the purchases of copra in respect of which the levy in dispute was made, were proved to have been made from licensed dealers who had admittedly paid tax on their entire turnover. The position, therefore, is that before the sales of copra were effected to each of the plaintiffs in these cases, the vendors paid tax on the coconuts from out of which the copra was extracted. It follows that the single point tax having been paid on the coconuts from out of which copra was extracted, the plaintiffs cannot be denied relief on the ground that a de novo inquiry into facts is necessary to sustain their claim. If the plaintiffs succeed on the question of the jurisdiction of the court to entertain the suits, there can be no further controversy as to the admissibility of the claim for refund. This is the effect of the answers to the interrogatories submitted by the defendant. In all these cases the position is stated to be similar, though the answers had not been marked as exhibits in some cases. It is apparently for this reason that in the memoranda of the grounds of appeals in these appeals, no point has been taken relative to the second ground urged by the learned Government Pleader. Our attention was also drawn to the evidence adduced by the plaintiffs in this regard. We hold, therefore, that there is no need for the court to examine the validity of the assessments previously made or to ascertain the refundable sums by any scrutiny of the former assessments. Nothing is required to be done in these suits which pertains to the exclusive domain of the tax tribunals. In support of his main contention, learned Government Pleader urged that the provision under which the assessments had taken place was neither unconstitutional nor ultra vires the competence of the Legislature. His major premise is that the civil court's jurisdiction, if any, is limited only to cases where the levy is disputedj.on grounds that it was made on foot of an unconstitutional provision or that it was made pursuant to a law which is ultra vires. The instant case is not of the category in regard to which it can be said that there is a saving of the jurisdiction of the courts. If there is an exception to the bar of a civil court's jurisdiction, it is in respect of cases where the law on which levy was based is shown to be ultra vires or unconstitutional. The present case, according to his submission, comes within the ambit of the preclusive provision Under Section 36. It is not within the exception, which preserves the jurisdiction of civil courts in a limited sphere,

7. Learned counsel has addressed his argument mainly with reference to the recent decision of the Supreme Court in Dhulabhai v. State of Madhya Pradesh A.I.R. 1969 S.C. 78. There was an elaborate review of all the leading authorities and the principles have been formulated in that case in several propositions, summing up the effect of all the diverse pronouncements on the subject. There were four suits launched by the appellants to recover the sales tax alleged to have been illegally realised from them. The illegality arose because the levy was made on sales in the State of Madhya Bharat on imports, in a manner offensive to Article 301 of the Constitution, inasmuch as an equal tax was not levied on similar goods produced within the taxing State. The notification under which the levy was made was held to be not constitutional by the Supreme Court in State of Madhya Pradesh v. Bhailal Bhair A.I.R. 1964 S.C. 1006. The decision was followed by the institution of the suits which were decided by the Supreme Court in the case referred to above. The actions failed in the High Court but the claim for recovery of the tax was upheld by their Lordships of the Supreme Court. His Lordship the Chief Justice, who spoke for the court, observed in the last paragraph :

No doubt the Madhya Bharat Sales Tax Act contained provisions for appeal, revision, rectification and reference to the High Court. The notification being declared void the party could take advantage of the fact that the tax was levied without a complete charging section. This affected the jurisdiction of the tax authorities because they could not even proceed to assess the party.

8. Then it was pointed out that the question was one falling in categories Nos. 3 and 4, rather than category No. 2, of the propositions enumerated in a previous paragraph. The third category relates to challenges to the provisions of the particular Act as ultra vires. Such challenges cannot be effective before the special tribunals constituted by the particular enactment or even before the High Court on revision or reference. Category No. 4 is described inter alia in the following words :

When a provision is already declared unconstitutional or the constitutionality of any provision is to be challenged, a suit is open.

9. These two categories were considered by the court in juxtaposition with the class of cases described in paragraph 3. In the latter category, the effect of the express bar of the jurisdiction of the civil courts was considered and it was indicated that when an express bar of jurisdiction is found, the sufficiency of the remedies provided by the relevant statute and its scheme are to be examined. The; adequacy of the remedies afforded by the special enactment may not of itself be the decisive factor. In such a context, it is necessary to see whether the statute creates a special right or liability and provides for the determination thereon and further lays down that all questions relating to such rights or liabilities shall be determined by the tribunals so constituted. It is important also to bear in mind whether the remedies normally associated with actions in civil courts are preserved by the said statute or not.

10. We have, therefore, to consider whether the case on hand is more appropriately governed by the propositions 3 and 4 or whether it belongs to the category, the right of civil action can be said to be preserved in only exceptional cases where the remedies normally incidental to civil actions are not available or where the jurisdiction of the special tribunals does not extend over the entire field which is occupied by the normal jurisdictions.

11. We have set out the gist of the propositions laid down by the Supreme Court, which define the extent or content of the jurisdiction of civil courts in cases of this description. The counsel on either side have presented their respective points of view in the light of the said propositions of law.

12. The indisputable facts which gave rise to these appeals are that under the Sales Tax Act, as the provisions then stood, coconuts and copra were separately assessable to a single point tax at the date of the assessment. The levy that is challenged related to turnover of first purchases of copra commencing from 15th June, 1957 and ending with 31st March, 1958. By Section 15-A of the amending Act 26 of 1961, the commodity 'copra' was eliminated from the list of articles assessable under Schedule III. An explanation was inserted and it was to the effect that the word 'coconut' includes copra. The definition of 'coconut' as inclusive of copra was given retrospective operation with effect from 15th June, 1957. The result, therefore, was that from 15th June, 1957, if the single point tax on coconuts had been paid, there was no legal basis for a separate levy on the purchases of copra, provided the copra in question was the produce of the coconuts which were subjected to levy. In these appeals, the answers to the interrogatories and also the evidence on record conclusively make out that the assessed copra represented the produce extracted from coconuts on which the vendor of the copra had already paid the single point tax.

13. The respondents urge that their claim is indistinguishable from the claims urged by the plaintiffs in the cases that were decided by the Supreme Court. The levy in those cases were pronounced to have been made on a provision of law which was held to be unconstitutional. In the cases on hand, the levy was rendered equally untenable by reason of the retrospective effect given to the amending legislation. The notification was declared void in the former case, the effect of which, in the words used by the Supreme Court, was that 'tax was levied without a complete charging section.' The situation in the instant case is that the levy is equally bereft of the supporting base of the charging section. The essence of the matter is this : Can the levy of the tax and the retention of the tax and the retention of the collections made pursuant to that levy, be said to rest on a legal basis which is subsisting The levy itself may be pronounced to have been made on foot of a charging provision that is declared' by courts to be void or the levy may cease to have legal base or content by reason of retroactive legislation. The test, therefore, is whether the validity of the levy is capable of being sustained on foot of a subsisting provision of law, which is usually described as a charging provision. We are of opinion that it is this test that is indicated by the Supreme Court in paragraphs 3 and 4 of the propositions that are set out by them in the decision referred to above.

14. At this stage, it is necessary to consider a suggestion rather faintly made by the learned Government Pleader, that the plaintiffs have got adequate or efficacious remedies under the Act. He has endeavoured to maintain that it is open to the respective plaintiffs to prefer appeals against the assessments in question by seeking to have the delay in the presentation of the appeals condoned. It is said that there is thus an adequate machinery to obtain redress from the statutory tribunal and, therefore, the jurisdiction of the civil court is barred. There is no merit in this contention which ignores the basic position that the plaintiffs seek restitution on the allegation that the levy itself has become illegal, or inoperative. It cannot be doubted and, in fact, it was admitted before us by the learned Government Pleader, that there is no specific provision in the Act providing for restitution or the rectification of an assessment under circumstances analogous to the instant case. We consider that no remedy is available to the plaintiffs under the special enactment.

15. Firstly, an appeal at this distance of time cannot be resorted to as a matter of right. It is on account of a supervening event that has occurred after a considerable lapse of time that the claim for refund has become admissible. Time prescribed for presentation of an appeal has expired before the right to claim the refund has arisen. In the circumstances, the assessee has no unqualified right to have a fresh examination before the appellate forum, because, for the exercise of the jurisdiction by the Appellate Tribunal, the preliminary step of the condonation of the delay is a necessary condition. This is entirely a matter within the discretion of that Tribunal. Consequently, it cannot be said that there is an unfailing remedy which can be resorted to as a matter of right.

16. Secondly, it is clear that the appellate forum, being a creature of the Act and constituted for the purpose of administering the Act, cannot effectively deal with the question whether the retention of the moneys collected under the earlier levy is ultra vires the provisions of the enactment. We are alive to the distinction between the case on hand and the lineiof cases that have held that challenge to the provisions of a particular Act is ultra vires, cannot be brought before tribunals constituted under that Act. It is, no doubt, true that in this case, the claim for refund does not arise by reason of a provision being unconstitutional or ultra vires. Nevertheless, we are concerned with a position which is substantially parallel, because the appellate forum, if approached for the refund of the amount, would have to consider the vires of the retention of the tax that is collected in consonance with statutory provisions. We are of opinion that even if it is open to the Appellate Tribunal under the Act to consider the vires of the collections previously made, the remedy is so obviously inadequate that civil court's jurisdiction cannot be said to be barred. No adequate machinery exists under the special enactment.

17. The third reason against the contention of the appellant is that there is no provision in the enactment for directing refund of collections in cases like the present and, therefore, the Appellate Tribunal is obviously under a handicap in granting the appropriate relief. Even if it comes to the conclusion that the retention of the amount is illegal, the appellate remedy is inefficacious, because of the disability arising from the lacuna in the Act. The Tribunal has no inherent jurisdiction to direct a refund in the absence of a specific provision in the Act conferring power in that behalf. Its jurisdiction is limited to the powers specifically conferred on it and it cannot travel beyond its defined jurisdiction. Its limitations are incapable of being remedied because the Tribunal is a statutory body devoid of any inherent jurisdiction except what it derives from the statute or the rules. Even if it finds the levy is illegal the disability to act remains. For the above reasonsz, we hold that there is no right of appeal or an alternative remedy, under the Act.

18. The proposition formulated as the fifth one by their Lordships of the Supreme Court envisages a situation comparable to the one indicated by us in the previous paragraph. Their Lordships said:

Where the particular Act contains no machinery for refund of tax collected in excess of constitutional limits or illegally collected a suit lies.

19. The cases on hand, in our opinion, attract the principle thus stated as the fifth proposition in the formulation made by the Supreme Court. It is clear that the remedy of suit is not restricted only to cases where restitution arises by reason of an unconstitutional law. The remedy can be resorted to by the subjects also in cases where there is a retention by the authority of an illegally collected tax, provided the relevant statute contains no machinery for directing a refund. The plaintiffs are, therefore, acting in conformity with this principle in invoking the jurisdiction of civil courts for obtaining restitution for which no provision is made in the statute.

20. It would be superfluous for us to examine in detail the ratio decidendi of the several decisions elaborately considered by the Supreme Court in the recent decision. The learned Government Pleader sought to impress on us that these cases on hand are governed by the ruling in Kamala Mills case [1965] 16 S.T.C. 613. We cannot agree with his contention. That decision turned on the principle that an authority vested with jurisdiction and powers under the relevant Act has the competence to determine whether a particular transaction was an outside sale and even if the authority commits an error, it is nevertheless an error within its jurisdiction and is capable of being corrected by the appellate forum. The error is one within jurisdiction and n,o fundamental departure from the statutory provisions is made so as to permit a review by a civil court. We think. that there is no warrant for the application of that rule in the cases on hand.

21. The main aspect stressed by the respondents before us is the principle emerging from Bharat Kala Bhandar case [1966] 59 I.T.R. 73, where the Supreme Court pointed out that:

A suit by an assessee to recover the amount paid by him in excess of the constitutional limit would not be in respect of a matter 'purported to be done under the Act' and the provisions of Section 48 of the Act would not, therefore, apply to it. Where a power exists to assess and recover a tax upto a particular limit and the assessment or recovery of anything above that amount is prohibited, the assessment or recovery of an amount in excess is wholly without jurisdiction and nothing else. To such a case, the enactment under which action was purported to be taken cannot afford any protection.

22. At page 86 of the decision in Dhulabhai v. State of Madhya Pradesh [1968] 22 S.T.C. 416; another passage from the same was cited with approval by the Supreme Court. It is to the effect that :.one of the corollaries flowing from the principle that the Constitution is the fundamental law of the land is that the normal remedy of a suit will be available for obtaining redress against the violation of a constitutional provision. The court must, therefore, lean in favour of construing a law in such a way as not to take away this right and render illusory the protection afforded by the Constitution.

23. There has been considerable argument on the basis of certain observations in State of Kerala v. Ramaswami Iyer & Sons A.I.R. 1966 S.C. 1738. It was pointed out by the learned counsel that the validity of the rule in Basappa's case A.I.R. 1964 S.C. 1873 was considerably shaken by the observations in State of Kerala v. Ramaswami Iyer & Sons A.I.R. 1966 S.C. 1738. In Basappa's case A.I.R. 1964 S.C. 1873, it was held that:

Where an assessment of tax includes certain items of taxes which were not taxable by the State and are thus illegal, the separation of the illegal portion is possible only in those cases where the assessment of many matters resulting in amounts of tax which though parts of the whole assessment, stand completely separate. There the court can declare the 'separate, dissected and earmarked' items illegal and excise them from the levy. In doing so, the court does not arrogate to itself the functions of the taxing authorities....

24. It was pressed on us by the learned Government Pleader at one stage of the argument that no relief could be granted to the plaintiffs in these cases, because the assessment was a composite one and it was not possible to separate the good part from the bad except by the court arrogating to itself a jurisdiction which it does not have. But, this argument is not valid as pointed out by us earlier. The rule in Basappa's case A.I.R. 1964 S.C. 1873, was pressed into service by the learned counsel for the respondents ; and they contended that notwithstanding the observations in the later case in State of Kerala v. Ramaswatni Iyer & Sons A.I.R. 1966 S.C. 1738, the ruling in the earlier case must be deemed to be unaffected because of certain dicta of the Supreme Court in the latest case. We are of opinion that the rule in Basappa's case A.I.R. 1964 S.C. 1873; is left intact especially because the Supreme Court observed in the latest decision that the doubt cast on the rule in Basappa's case A.I.R. 1964 S.C. 1873; in a later decision was open to serious question.

25. On a review of the several cases, we are of opinion that the suits in the cases on hand are maintainable, because the Sales Tax Act contains no machinery for refund of tax and also because there is no adequate or efficacious remedy under the said enactment. In our opinion the cases on hand attract the principle adumbrated by the Supreme Court in propositions 3, 4 and 5 formulated by it.

26. It is necessary to take notice of an aspect peculiar to these cases. The claim for restitution arises by reason of a supervening event. Where the claim for restitution arises because of such event and the retention of the tax previously collected is challenged as an 'illegal act', the cause of action rests on facts or actions of authorities that are impugned, which are de hors the statute under which the levy and collection had been made. It appears to us that in the circumstances like the present, the test whether the statute bars the action in a civil court is obviously inappropriate. The remedy that is sought in civil courts is for the redress of a wrong done not under a colour of taxing statute but because of something extraneous to it. The action is in essence in respect of something done or omitted to be done, not under the said enactment but outside the purview of the jurisdiction or power conferred by the said enactment. Therefore, the question as to whether the remedy by a resort to civil court is barred in these cases on hand by reason of the preclusive provisions of the special law, does not arise at all. The act complained of is an illegal retention of the amount and the illegal retention of the amount is an act not directly attributable to any power conferred by the special enactment. Nor does the special enactment provide any machinery for challenging the illegal retention of the tax that was collected.

27. The learned counsel for the respondents drew our attention to a case in Poulose Bros. v. State of Kerala [1963] 14 S.T.C. 40, where the Kerala High Court had to deal with a case in which a provision in the Sales Tax Act in pari materia was considered. The decision there turned on an amendment similar to the one that has been effected by Act 26 of 1961. The expression 'coconut' was, by an amending Act, made to include copra also and the effect of that amendment was considered by the Kerala High Court. It was decided that the assessment on the turnover relating to the last purchase of copra was not legal. It may be noted that that case did not arise from out of an action for the refund of the moneys but it was brought up before the High Court by way of revision against the decision of the Tribunal. Learned counsel relied upon it only to support their stand that as a result of the amendment, copra has ceased to be a distinct taxable commodity.

28. Learned counsel for Government placed reliance on the decision in State of Madhya Pradesh v. Haji Hasan Dada [1966] 17 S.T.C. 343. In that case, the assessee paid the amount of tax assessed on the turnover from his business in yarn and then applied to the officer Under Section 13 of the C.P. and Berar Sales Tax Act, 1947, for refunding the amount on the plea that in the turnover dyeing charges had been included and that to that extent the turnover was not taxable. The Supreme Court held that the authority to whom the application was made has no power to review his decision and that he was not authorised to ignore his previous order and to make an order of refund inconsistent with the previous order which remained undisturbed and has become final. We are of opinion that this case is of no help to the appellants. The question there turned on the scope of the power or the jurisdiction Under Section 13 of the relevant enactment and the decision does not lay down any principle relevant for the determination of the main question debated before us.

29. It was contended on the strength of the authority in Mothey Gangaraju v. State of Andhra Pradesh [1965] 16 S.T.C. 205; that the award of interest is without jurisdiction. A Division Bench of the Andhra Pradesh High Court held in that case that the State was not liable to pay interest from the date of the collection of the tax which levy was subsequently declared illegal by the court. The Division Bench held that the tax was levied in exercise of sovereign power of the State and that the claim for interest could not be upheld on general equitable grounds and could not also be awarded by way of damages.

30. On an examination of the pleadings in this case we find that the claim for interest is made with effect from the date of the refusal of the authorities to render restitution. As typical of the facts of these cases, we may refer to the averments in the plaint in A.S. No. 369 of 1964. The plaintiff served a notice Under Section 80, Civil Procedure Code, on 31st March, 1962 and in the notice, a claim was made to refund the amount with interest. In the plaint, the relief as to interest was sought only from the 1st of November, 1962, i.e., from a date subsequent to the refusal of the authorities to comply with the demand for restitution. In the written statement, no specific objection is taken to the claim for interest except a general averment that the plaintiff is not entitled to the refund or to claim interest on the said amount. It is clear that the claim for interest that is included in the amount specified in the plaint relates only to a short period prior to the institution of the suit. The award of interest during the pendency of the suit is a matter within the discretion of the court and the claim for the interest prior to the suit that is made in the plaint relates to a very short period. We are of opinion that no valid ground or principle has been made out by the appellant to persuade us not to award interest during the pendency of the suit or for the short period for which it is claimed prior to the institution of the suit. No exception can be taken to the principle that restitution implies the payment of interest at a reasonable rate in order to put the person entitled to restitution in the position which he would have occupied but for the illegal retention of the money. We are of opinion that the decision in Mothey Gangaraju v. State of Andhra Pradesh [1965] 16 S.T.C. 205 cited by the learned Government Pleader rests upon the special of that case and does not establish any principle justifying the disallowance of interest in the present case.

31. For the reasons set out above, we are of opinion that the appeals fail and they are accordingly dismissed with costs.


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