Full Judgment Text
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CASE NO.:
Appeal (civil) 5341 of 1996
PETITIONER:
Maharashtra Distilleries Ltd.
RESPONDENT:
Municipal Corporation of Aurangabad & Anr.
DATE OF JUDGMENT: 17/12/2004
BENCH:
N. Santosh Hegde, B.P. Singh & S.B. Sinha
JUDGMENT:
J U D G M E N T
INTERLOCUTORY APPLICATION NO.2
IN
CIVIL APPEAL NO.5341 OF 1996
SANTOSH HEGDE,J.
In CA 5341/1996 a dispute had arisen between the applicant
herein and Municipal Corporation, Aurangabad in regard to the
rate of octroi that could be charged on rectified spirit imported into
the municipal limits by the applicant-appellant for its distillery to
manufacture potable alcohol. A 3-Judge Bench of this Court in the
said appeal held that the rectified spirit fell under residuary Entry
86 of Clause IX of the Schedule attracting octroi duty at 2% and
not at the rate at which it was being levied and collected from the
applicant-appellant. In the said appeal the court gave the following
direction :
"Given the facts and reasons stated above,
we allow this appeal, set aside the impugned
judgment and order and hold that the appellant
was liable to pay octroi duty at 2% on the rectified
spirit imported. The respondent (sic) is entitled to
recover the difference of octroi duty. No costs."
The use of the word ’respondent’ therein is a typographical
error and there is dispute that the entitlement to recover the
differential duty is that of the applicant-appellant herein.
In the present application seeking clarification the applicant
has complained that inspite of the aforesaid directions the
respondent Municipality is not repaying the excess amount
collected by it as directed by this Court. Therefore it has sought for
the following reliefs :
(a) clarify the order dated 17.4.2002 and direct the Respondent to
refund the excess octroi of Rs.3,51,94,471/- along with interest
@ 12% ; and/or
(b) alternatively direct the Respondent to set off the above amount
against Appellant’s future liabilities of Octroi; and
(c) pass such other further order(s) which this Hon’ble Court may
deem fit and proper in the interest of justice.
In reply to the same the respondent-Municipality has
contended that the applicant is not entitled to claim refund in view
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of the fact that the applicant has passed on the excess octroi
collected by the Municipality to the ultimate users of the potable
alcohol therefore demand for refund of the excess octroi claimed
by the applicant would amount to unjust enrichment and relying on
the judgment of this Court in the case of M/s. McDowell & Co.
Ltd. v. Commercial Tax Officer (1985 3 SCC 230) the
Municipality has pleaded that the burden of proof that such an
octroi has not been passed on to the purchaser of its product rests
on the applicant which burden it has not discharged therefore the
applicant is not entitled to the refund.
Noticing the above objection of the respondent on 5.4.2004
this Court directed the applicant to produce materials to show that
during the relevant period i.e. from 1983 to 1986 it did not pass on
the additional octroi to the consumers.
Pursuant to the said directions issued by this Court, the
applicant has filed a detailed statement supported by the auditor’s
report and certificate of the chartered accountant which the
Municipality has not controverted by any counter affidavit or other
material in spite of the opportunity granted to it. The material
produced by the applicant clearly shows that the applicant has not
passed on the additional octroi collected from it to its consumers.
Even that apart as stated hereinabove in the 3-Judge judgment from
which this application has arisen it is in very clear terms stated that
the applicant is entitled to recover the difference of octroi duty and
from the material on record it is clear that there is no dispute that
excess duty was in fact collected by the Municipality; the argument
of unjust enrichment is being raised for the first time before this
Court in opposition to this application and we find no merit in the
same.
For the reasons stated above we allow this application and
direct the respondent Municipal Corporation of Aurangabad to
refund the excess octroi amount which has been computed at
Rs. 3,51,94,471/- with interest at 6%. Since the principal amount
and the interest comes to a substantial sum and in view of the fact
that the respondent Municipality has pleaded that the amount
collected by them has been used for public benefit we think it
appropriate that the said sum should be refunded to the applicant in
24 equal monthly instalments ; first of which to be paid on or
before 1.2.2005. The application is allowed.