Tilokchand Motichand & Ors Vs. H.B. Munshi & ANR [1968] INSC 289 (22 November 1968)
22/11/1968 HIDAYATULLAH, M. (CJ) HIDAYATULLAH, M. (CJ) SIKRI, S.M.
BACHAWAT, R.S.
MITTER, G.K.
HEGDE, K.S.
CITATION: 1970 AIR 898
CITATOR INFO:
D 1973 SC1041 (16) F 1974 SC 259 (9) R 1974 SC 532 (11) F 1974 SC2077 (11) R 1975 SC 511 (10) RF 1975 SC 538 (18) R 1975 SC 813 (13,14,16,17) F 1979 SC1328 (10) RF 1981 SC1082 (15) R 1982 SC 101 (28) R 1988 SC1531 (126) F 1990 SC 313 (26) RF 1990 SC 415 (20) RF 1990 SC 772 (8,32) D 1991 SC1676 (72)
ACT:
Constitution of India, 1950, Art. 32--Laches--Fundamental right-Effect on.
Petition under Art. 226--Contention raised that provision of law is ultra vires as violating fundamental rights--Contention not considered but petition dismissed in limine-Order of High Court if res judicata, in relation to petition under Art. 32.
HEADNOTE:
The sales tax authorities directed that the sum realised as sales tax by the petitioners from their customers and paid over to the State should be refunded to the petitioners on condition that the petitioners passed on the amounts to their customers. Since the petitioners did not fulfil the condition, the sales tax officer 'forfeited the sum under s. 21(4) of .the Bombay Sales Tax Act, 1953, by order dated March 17, 1958. On March 28, the petitioners filed a writ petition in the High Court and contended that s. 21(4) was ultra rites the powers of the State Legislature and was violative of Arts. 19(1)(f) and 265 of the Constitution and hence, they were not liable to repay the amount. The single Judge dismissed the petition on the ground that the petitioners defrauded their customers and so were not entitled to any relief even if there was a violation of fundamental rights. The appellate bench of the High Court dismissed the appeal on the ground that it would not interfere with the discretionary order of the single Judge.
On December 24, 1958, the Collector attached the properties of the petitioners for recovering the amount as arrears of land revenue and the petitioners paid the amount in instalments between August 1959 and August 1960. On September 29, 1967 this Court in Kantilal Babual v. H.C.
Panel, 21 S.T.C. 174 (S.C.) struck down s. 12A(4) of Bombay Sales Tax Act, 1946, corresponding to s. 2'1(4) of the 1953- Act, on the ground that it was violative of Art. 19(1)(f) inasmuch as the power conferred by the section was unguided, uncanalised and uncontrolled and so was not a reasonable restriction on the fundamental right guaranteed under the Article. On the assumption that s. 21(4) of the 1953-Act is also liable to be struck down on the same ground, on February 9, 1968, the petitioners flied a writ petition under Art. 32 claiming a refund of the amount. The petitioners contended that they did not know that the section was ultra vires on the particular ground on which this Court struck it down, that they paid the amounts under coercion or mistake, that the mistake was discovered on September 29, 1967 (the date of the judgment of this Court) and that they were entitled to the refund under s. 72 of the Indian Contract Act, 1872 .
On the questions: (1) Whether the petition is liable to be dismissed on the ground of Inches; and (2) Whether the petition is barred by res judicata in view of the decision of the High Court.
HELD: (Per Hidayatullah, C.J., Bachawat and Mitter, JJ.): (1) The petition must be dismissed on the ground of Inches.
825 Per Hidayatullah C.J.: Article 32 gives the right to move this Court by appropriate proceedings for enforcement of fundamental rights and the State cannot place any hindrance in the way of an aggrieved person. But once the matter has reached this Court, the extent or manner of interference is for this Court to decide. This Court has put itself in restraint in the matter of petitions under Art. 32. For example, this Court refrains from acting under the Article if the party had already moved the High Court under Art. 226 and if the High Court had exercised its parallel jurisdiction. In such a case, this Court would not allow fresh proceedings to be started under Art. 32 but would insist on the decision of the High Court being brought before it on appeal. Similarly, in inquiring into belated and stale claims, this Court should take note of evidence of neglect of the petitioner's own rights. for a long time or of the rights of innocent parties which might have emerged by reason of the delay. The party aggrieved must therefore move this Court at the earliest possible time and explain satisfactorily all semblance of delay. It is not possible for this Court to lay down any specific period as the ultimate limit of action and each case will have to be considered on its own facts. A petition under Art. 32 is neither a suit nor an application to which the Limitation Act applies. Further, putting curbs in the way of enforcement of fundamental rights through such legislative action might be questioned under Art. 13(2). for, if a short period of limitation is prescribed the fundamental right might be frustrated. Therefore, this Court has to exercise its discretion from case to case, and where there is appearance of an avoidable delay and this delay affects the merits of the claim, this Court will consider it, and in a proper case, hold the party disentitled to invoke its extraordinary jurisdiction. [830C, DE. G--H; 831 A--B.
C--E; 832 A--E] In the present case, the petitioners moved unsuccessfully the High Court for relief on the. ground that the recovery from them was unconstitutional, but did not come up in appeal to this Court. There is thus no question of any mistake of law. Having set the machinery of law in motion they cannot abandon it to resume it after a .number of years because another person got the statute declared unconstitutional. They should have known the exact ground of unconstitutionality since everyone is presumed to know the law; and pursued the ground in this Court. Not having done so, and having abandoned his own litigation years ago. this Court will not apply the analogy of the Article in the Limitation Act in cases of mistake of law and give him relief. [832 F--H; 833 A--B, C--E] Per Bachawat, J.: The normal remedy for recovery of money paid to the State under coercion or mistake of law is by suit. The right to move this Court for enforcement of fundamental rights is guaranteed by Art. 32, and no period of limitation is prescribed for such a petition. The writ issues as a matter of course if a breach of a 'fundamental right established, but this does not mean that in giving relief under the Article this Court may ignore all laws of procedure. The extraordinary remedies under Arts. 32 and 226 of the Constitution are not intended to enable a claimant to recover monies the recovery of which by suit is barred by limitation. In the absence any roles of procedure under Art. 145(1)(c) this Court may adopt any reasonable rule. For example. this Court will not allow a petitioner to move this Court under Art. 32 on a petition containing misleading and inaccurate statements. Similarly, the general principles of res judicata are applied where applicable on grounds of public policy. Therefore, where the remedy in a writ application under Art. 32 or Art. 226 corresponds to a 'remedy in an ordinary suit and the latter remedy is subject to the bar of a statute of limitation, the Court imposes on analogy the same limitation on the summary 826 remedy in the writ jurisdiction even though there is no express statutory bar of limitation, on grounds of public policy and on the principle that the laws aid the vigilant and not those who slumber. [842 A--F; 843 A--F] In the present case, the petitioners were not labouring under any mistake of law when they made the payments, because, in their writ petition in the High Court, they contended that the order was invalid and that s. 21(4) of the Bombay Sales Tax Act, 1953, was ultra vires and unconstitutional although they did not know the precise ground upon which this Court subsequently struck down s. 12A(4) of the 1946-ACt. Therefore, when they made the payments in 1959 and 1960 they were made under coercion and not under a mistake of law in thinking that the money was due. Hence the petitioners could not claim any relief on the ground of mistake. They could rely on the ground of coercion but a suit for the recovery of money on the ground of coercion instituted in February 1968, would have been barred by limitation. A suit for recovery of money on the ground of coercion instituted after January 1, 1964 would be governed by Art. 24 of the Limitation Act, 1963, and the period of limitation would be 3 years from the dates in 1959 and 1960 when the amounts were paid. The petitioners could not obtain an extension of the period under s. 30(a) of the Limitation Act, 1963, as Art. 62 of the Limitation Act, 1908, which governs a suit for recovery of tax or other levy illegally collected, prescribed the same period of limitation. [840 F--H; 841 A---C] Shiva Prasad Singh v. Srish Chandra Nandi, (1949) L.R.
76 I.A. 244, 254, Sales Tax Officer v. Mukundlal Saraf [1959] S.C.R. 1350, 1361, 1362, A. Venkata Subba Rao v.
State of Andhra Pradesh [1965] 2 S.C.R. 577, 612--620, State of Madhya Pradesh v. Bhailal Bhai & Ors. [1964] 6 S.C.R. 261 274, Daryao v. State of U.P. [1962] 1 S.C.R. 574, Sobhraj Odharmal v. State of Ralasthan, [1963] Supp. 1 S.C.R. 99, 111 and Her Highness Ruckmaboye v. Lulloobhoy Mottickchund, (185152) 5 M.I.A. 234, 251, referred to.- Per Mitter, J.: The Limitation Act does not in terms apply to proceedings against the State under Art. 32 in respect of violation of fundamental rights. A person complaining of such infraction has. one of three courses open to him. He can file a suit, invoke Art. 226 or Art.
32Suits are governed by the Limitation Act. In the matter of the issue of a writ under Art. 226 also, courts have refused to give relief in cases of long or unreasonable delay, although the Limitation Act does not apply, and the maximum period fixed by the Legislature for filing a suit is ordinarily taken to be a reasonable standard by which delay in seeking the remedy under Art. 226 can be measured.
There is no reason for applying a different test when a party comes to this Court under Art. 32. There is public policy behind all statutes of limitation and a claim based on the infraction of fundamental rights ought not to be entertained if made beyond the period fixed by the Limitation Act for the enforcement of the right by way of suit, that is, although the Limitation Act does not apply, the period fixed by it should be taken to be a true measure of the time within which a person can be allowed to raise a plea successfully under Art. 32. [853 C--H; 854 A--B] The petitioners in this case had not made a mistake in thinking that the money paid was due when in fact it was not due. They not only opposed the claim of the sales tax authorities but filed a writ petition contending that there was a violation of Art. 19(1)(f). They did not accept the decision of the single Judge but filed an appeal raising the same contention. They complained about the violation of their fundamental rights, the illegality of the order of forfeiture and the unreason- 827 able restriction on their fundamental rights under Art.
19(1)(f). They protested against the order of forfeiture not only out of court but in court and only paid the amounts after the issue of legal process. They were never influenced by a mistake of law and never 'failed to 'appreciate the correct position in law. But the payments were made under coercion. The period of limitation for a suit against Government to recover money paid under protest is governed either by Art. 16 or Art. 62 of the Limitation Act, 1908 that is one year or three years. But taking the most favourable view that the period of six years fixed by Art. 120 of Limitation Act, 1908, would apply, that period would have expired in 1966. The position is not different even if the Limitation Act, 1963 is applied. A claim for money paid under coercion would be covered by Art. 113 of the Limitation Act, 1963, giving a period of 3 years from January 1, 1964 the date of commencement of the 1963-Act.
Under s. 30(a) of the Limitation Act, 1963, the period of limitation for a suit which was formerly covered by Art. 120 of the Act of 1908; would be covered by Art. 113 of the 1963-Act. Therefore, the suit in the present case would have to be filed by January 1, 1967. As the petitioners came to this Court in February 1968 long after the date when they could have properly filed a suit, the application under Art. 32 must be rejected. [851 H; 852 A---D, G-H;
853 A--B; 854- B--H;, 855 A-B] Kantilal Babulal & Bros. v.H.C. Patel 2.1 S.T,C. 174, Sri Sri Shiba Prasad Singh, deceased, now represented by Kali Prasad Singha v. Maharaja Srish Chandra Nandi 76 I.A.
244, Sales Tax Officer v. Kanhaiya Lal Mukundlal Saraf, [1959] S.C.R. 1350 at 1363, Sales Tax Officer, Pilibhit v.
Budh Prakash jai Prakash, [1955] 1 S.C.R. 243, State o/ Madhya Pradesh v. Bhailal Bhai [1964] 6 S.C.R. 261, State of Kerala v. Aluminum Industries Ltd. 16 S.T.C. 689, and A. V. Subbarao v. The State of Andhra Pradesh [1965] 2 S.C.R.
577, referred to.
Per Sikri and Hegde, JJ. (dissenting): The petition has to be allowed and the petitioners must be granted the relief prayed for.
Per Sikri, J.: Article 32(2) of the Constitution confers a judicial power on this Court, and like all judicial powers, unless there is an express provision to the contrary, it must be exercised in accordance with fundamental principles of administration of justice, and one such fundamental principle is that stale claims should not be given effect to. [833 F--G] The Limitation Act does not directly apply to a petition under Art. 32 and to invoke the analogy of the Limitation Act is not appropriate when dealing with petitions under Art. 32. If a claim is barred under the Limitation Act, prima facie it is a stale claim but even if it is not so barred, it may not' be entertained by this Court if on the facts of the case there is unreasonable delay. To issue a writ, direction or order in the nature of mandamus certiorari or prohibition after a delay of 12 years or 6 years would, except when there are exceptional circumstances, be strange. It is difficult to lay down a precise period, but a period of one year may be taken as the period beyond which the claim would be a stale claim unless the delay is explained. The time spent in making representations to higher authorities may be taken as a good explanation for any delay. Such a practice would not destroy the guarantee under Art. 32, because, the article nowhere lays down that a petition, however late, should be entertained. [833 G; 835 C-H] In the present case, the petitioners were mistaken in thinking that the money was liable to be paid under a valid law and hence under s. 72 of the Contract Act, the petitioners would be entitled to the relief claimed. The grounds urged before the High Court show that it never struck the petitioners that the provision could be challenged on the ground ulti- 828 mately accepted by this Court. If the petitioners had not moved the High Court but had paid on demand they would have been entitled to maintain the petition in this Court.
The position could not be worse became they exercised their right under Art. 226. When a petitioner approaches a High Court and fails, it could not be said that payments made by him thereafter were not under a mistake of law, even if the point on which this Court ultimately strikes down the provision under which the payments were made was never raised in the High Court. The petitioners discovered, like all assessees their mistake when this Court struck down s.
12A(4) of the 1946-Act and they came to this Court within 6 months of that date and hence there was no delay. [837 G--H; 839 B---E] Daryao v. State of U.P. [1962] 1 S.C.R. 574, Amalgamated Coalfields Ltd. v. Janapada Sabha, Chindwara, A.I.R. 1964 S.C. 1013, 1018, Sales Tax Officer v. Kanhaiyalal, [1959] S.C.R. 1350 and Kantilal Babulal v. H.C. Patel, Sales Tax Officer, 21 S.T.C. 174, referred to.
Per Hegde, J.: In view of the decision of this Court in Kantilal Babulal v.H.C. Patel, 21 S.T.C. 174 which struck down s. 12A(4) or the 1946-Act, the impugned collection under s. 21(4) of the 1953-Act was without the authority of law and consequently the exaction infringed the fundamental right of the petitioners under Art. 19(1)(f).
Hence the petitioners have a fundamental right to approach this' Court under Art. 32 for relief and this Court has a duty to afford them the appropriate relief. Since the right given to the petitioners under Art. 32 is itself a fundamental right and does not depend on the discretionary powers of this Court, as in 1be case of Art. 226, it is inappropriate to equate the duty imposed on this Court to the powers of Chancery Court in England or the equitable jurisdiction of Courts in the United States. The fact that the petitioners have no equity in their favour is an irrelevant circumstance in deciding the nature of the right available to an aggrieved party under Art. 32. This Court is charged by the Constitution with the special responsibility of protecting and enforcing the fundamental rights, and hence leaches on the part of an aggrieved party cannot deprive him of his right to get relief under Art. 32.
In fact, law reports do not show a single instance of this Court refusing to grant relief on the ground of delay. If this Court could refuse relief on the ground of delay, the power of the Court under Art. 32 would be a discretionary power and the right would cease to be a fundamental right.
The provisions contained in the Limitation Act do not apply to proceedings under Arts. 226 and 32 and if these provisions of the Limitation Act are brought in indirectly to control the remedies conferred by the ConstitUtion, it would be a case of Parliament indirectly abridging the fundamental rights which this Court, in Golaknath's case, [1967] 2 S.C.R. 762, held that Parliament cannot do. The 'fear. that forgotten claims and discarded rights against Government may be sought to be enforced after the lapse of a number of years if fundamental rights are held to be enforceable without any time limit, is an exaggerated one, for, after all, a petitioner can only enforce an existing right. [856 D. F--H; 857 A, B, D, G-H;
858 A, D--E, F--H; 859 H] In this case the petitioners have an existing right even if their remedy under the ordinary law is barred. This Court struck down s. 12A(4) of the 1946-Act on a ground not put forward by the petitioners in the High Court but on a wholly different ground. A mere impression of a party that a provision of law may be ultra vires cannot be equated to knowledge that the provision is invalid. and the fact, that, after a futile attempt to get the provision in question declared invalid the petitioners gave up their fight and submitted to the law which was apparently valid is no proof of the fact that they knew that the provision in question was 829 invalid. There is no reason for rejecting the plea of the petitioners that they became aware of the invalidity of the provision only after the decision of this Court in Kantilal's case, and since the petition was filed very soon thereafter, the petitioners were entitled to relief. [860 C--G] State of M.P.v. Bhailal Bhai, [1964] 6 S.C.R. 261, referred to.
(2) (By Full Court): The petition is not barred by res judicata.
Per Hidayatullah, C.J. Where the order of the High Court under Art. 22% is not a speaking order or the matter has been disposed of on some ground other than on merits, at the threshold, this Courtmay entertain the application under Art. 32. [831 B] Daryao v. State of U.P. [1962] 1 S.C.R. 574, explained.
Per Sikri, Bachawat and Mitter, JJ.: When a petition under Art. 226 is dismissed not on the merits but because of the laches on the party applying for ,the writ or because an alternative remedy was available to him, such dismissal is not a bar to a subsequent petition under Art. 32, except in cases when the facts found by the High Court might themselves be relevant under Art. 32. [833 E--F; 839 F--G; 855 C--D,F-G] Daryao's case, [1962] 1 S.C.R. 574 and Joseph v. State of Kerala, A.I.R. 1965 S.C. 1514, referred to.
Per Hegde. J.: It is only when the right claimed by the petitioner in his petition under Art. 32 had been claimed in the High Court under Art. 226 and negatived by the High Court and that decision had become final as it was not appealed against, that the petitioner would not be able to agitate the right over again in this Court under Art. 32.
[856 B--C] Daryao's case, [1962] 1 S.C.R. 574, explained.
ORIGINAL JURISDICTION: Writ Petition No. 53 of 1968.
Petition under Art. 32 of the Constitution of India for enforcement of the fundamental rights.
H.K. Shah, B. Datta and J.B. Dadachanji for the petitioners.
C.K. Daphtary, Attorney-General, R. Gopalakrishnan, R.H. Dhebar and S.P. Nayar, for the respondents.
HIDAYATULLAH, C.J., BACHAWAT and MITTER, JJ., delivered segarate judgments dismissing the petition. SIKRI and HEGDE, JJ. delivered separate dissenting opinions allowing the petition.
Hidayatullah, C.J. This petition has led to a sharp division of opinion among my 'brethren: Sikri and Hegde, JJ.
would allow the petition and Bachawat and Mitter, JJ. would dismiss it. They have differed on the question whether the petition deserves to be dismissed on the ground of delay. I agree in the result reached by Bachawat and Mitter, JJ. and would also dismiss if I wish briefly to state my reasons.
At the threshold it appears to me that as there is no.
law which prescribes a period of limitation for such petitions, each of my brethren has really given expression to the practice he follows or intends to follow. I can do no more than state the views 1 830 hold on this subject and then give my decision on the merits of the petition in the light of those views.
The problem divides itself into two. The first part is a general question to be considered in two aspects: (a) whether any limit of time at all can be imposed on petitions under Art. 32, and (b) whether this Court would apply by analogy an article of the Indian Limitation Act appropriate to the facts of the case or any other limit ? The second is what is to be done in this case ? I shall begin by stating my views on the first question.
There appears to be some confusion about the scope of Article 32. That Article gives the fight to move the Supreme Court by appropriate proceedings for enforcement of the rights conferred by Part III of the Constitution. The provision merely keeps open the doors of this Court, in much the same way, as it used to be said, the doors of the Chancery Court were always open. The State cannot place any hindrance in the way of an aggrieved person seeking to approach this Court. This is logical enough for it is against State action that Fundamental Rights are claimed.
But the guarantee goes no further at least on the terms of Art. 32. Having reached this Court, the extent or manner of interference is for the Court to decide. It is clear that every case does not merit interference. That must always depend upon the facts of the case. In dealing with cases which have come before it, this Court has ,already settled many principles on which it acts. A few of them may be mentioned here.
This Court does not take action in cases covered' by the ordinary jurisdiction of the civil courts, that is to say, it does not convert civil and criminal actions into proceedings for the obtainment of writs. Although there is no rule or provision of law to prohibit the exercise of its extraordinary jurisdiction this Court has always insisted upon recourse to ordinary remedies or the exhaustion of other remedies. It is in rare cases, where the ordinary process of law appears to be inefficacious, that this Court interferes even where other remedies are available. This attitude arises from the acceptance of 'a salutary principle that extraordinary remedies should not take the place of ordinary remedies.
Then again this Court refrains from acting under Art. 32 if the party has already moved the High Court under Art.
226. This constitutes a comity between the Supreme Court and the High Court. Similarly, when a party had already moved the High Court with a similar complaint and for the same relief and failed, this Court insists on an appeal to be brought before it and does not allow fresh proceedings to be started. In this connection the principle of res judicata has been applied, although the expression is somewhat inapt and unfortunate. The reason of the rule no 831 doubt is public. policy which Coke summarised as "interest re-public as res judicates non rescindi" but the motivating factor is the existence of another parallel jurisdiction in another Court and that Court having been moved, this Court insists on bringing its decision 'before this Court for review. Again this Court distinguishes between cases in which a speaking order on merits has been passed. Where the order is not speaking or the matter has been disposed of on some other ground at the threshold, this Court in a suitable case entertains the application before itself. Another restraint which this Court puts on itself is that it does not allow a new ground to be taken in appeal.
In the same way, this Court has refrained from taking action when a better remedy is to move the High Court under Art.
226 which can go into the controversy more comprehensively than this Court can under Art. 32.
It follows, therefore, that this Court puts itself in restraint in the matter of petition under Art. 32 and this practice has now become inveterate. The question is whether this Court will inquire into belated and stale claims or take note of evidence of neglect of one's own rights for a long time? I am of opinion that not only it would but also that it should. The party claiming Fundamental Rights must move the Court before other rights come into existence. The action of courts cannot harm innocent parties if their rights emerge by reason of delay on the part of the person moving the Court. This principle is well-recognised and has been applied by Courts in England 'and America.
The English and American practice has been outlined in Halsbury's Laws of England and Corpus Juris Secundum. It has been mentioned by my brethren in their opinions and I need not traverse the same ground again except to say this that Courts of Common Law in England were bound by the Law of Limitation but not the Courts of Chancery. Even so the Chancery Courts insisted on expedition. It is trite learning to refer to the maxim "delay defeats equity" or the Latin of it that the Courts help those who .are vigilant and do not slumber over their rights. The Courts of Chancery, therefore, frequently applied to suits in equity the analogy of the law of Limitation applicable to actions at law and equally frequently put a special limitation of their own if they thought that the suit was unduly delayed. This was independently of the analogy of law relating to limitation.
The same practice has been followed in the United States.
In India we have the Limitation Act which prescribes different periods of limitation for suits, petitions or applications. There are also residuary articles which prescribes limitation in those cases where no express period is provided. If it were a matter of a suit or application, either an appropriate article or the residuary article L6Sup.C.I./69--2 832 would have applied. But a petition under Art. 32 is not a suit and it is also not a petition or an application to which the Limitation Act applies. To put curbs in the way of enforcement of Fundamental Rights through legislative action might well be questioned under Art. 13(2). The reason is also quite clear. If a short period of limitation were prescribed the Fundamental Right might well be frustrated. Prescribing too long a period might enable stale claims to be made to the detriment of other rights which might emerge.
If then there is no period prescribed what is the standard for this Court to follow ? I should say that utmost expedition is the sine qua non for such claims. The party aggrieved must move the Court at the earliest possible time and explain satisfactorily all semblance of delay. I am not indicating any period which may be regarded as the ultimate limit of action for that would be taking upon myself legislative functions. In England a period of 6 months has been provided statutorily, but that could be because there is no guaranteed remedy and the matter is one entirely of discretion. In India I will only say that each case will have to be considered on its own facts. Where there is appearance of avoidable delay and this delay affects the merits of the claim, this Court will consider it and in a proper case hold the party disentitled to invoke the extraordinary jurisdiction.
Therefore, the question is one of discretion for this Court to follow from case to case. There is no lower limit and there is no upper limit. A case may be brought within Limitation Act by reason of some Article but this Court need not necessarily give the total time to the litigant to move this Court under Art. 32. Similarly in a suitable case this Court may entertain such a petition even after a lapse of time. It will all depend on what the breach of the Fundamental Right and the remedy claimed ,are and how the delay arose.
Applying these principles to the present case what do I find ? The petitioner moved the High Court for relief on the ground that the recovery from him was unconstitutional. He set out a number of grounds but did not set out the ground on which ultimately in another case recovery was struck down by this Court. That ground was that the provisions of the Act were unconstitutional. The question is: can the petitioner in this case take advantage, after a lapse of a number of years, of the decision of this Court ? He moved the High Court but did not come up in appeal to this Court.
His contention is that the ground on which his petition was dismissed was different and the ground on which the statute was struck down was not within his knowledge and therefore he did not know of it and pursue it in this Court. To that I answer that law will presume that he knew the exact ground of unconstitutionality. Everybody is presumed to know the law. It was his duty to have brought the matter before this Court for consideration. In any event, having set the machinery of law in motion he cannot abandon it to resume it after a number of years, because another person more adventurous than he in his turn got the statute declared unconstitutional, and got a favorable decision. If I were to hold otherwise, then the decision of the High Court in any case once adjudicated upon and acquiesced it may be questioned in a fresh litigation revived only with the 'argument, that the correct position was not known to the petitioner at the time when he abandoned his own litigation. I ,agree with the opinion of my brethren Bachawat and Mitter, JJ. that there is no question here of a mistake of law entitling the petitioner to invoke analogy of the Article in the Limitation Act.
The grounds on which he moved the Court might well have impressed this Court which might have also have decided the question of the unconstitutionality of the Act as was done in the subsequent litigation by another party. The present petitioner should have taken the right ground in the High Court and taken it in appeal to this Court after the High Court decided against it. Not having done so and having abandoned his own litigation years ago, I do not think that this Court should apply the analogy of the Article in the Limitation Act and give him the relief now. The petition, therefore, fails and is dismissed with costs.
Sikri, J. I have had the advantage of reading the drafts of the judgments prepared by Mitter, J., and Bachawat, J. I agree with Mitter, J. in his conclusion that the rule laid down in Daryao v. State of U.P.(1) is inapplicable to the facts of the case, but for the reasons I will presently give, in my opinion the petition should be allowed.
Art. 32(2) of the Constitution confers 'a judicial power on the Court. Like all judicial powers, unless there is an express provision to the contrary, it must be exercised in accordance with fundamental principles of administration of justice. General principles of res judicata were accordingly applied by this Court in Daryao v. State of U.P.(1), and Amalgamated Coalfields Ltd. v. Janapada Sabha, Chindwara(2). I understand that one of the fundamental principles of administration of justice is that, apart from express provisions to the contrary, stale claims should not be given effect to But what is a stale claim ? It is not denied that the Indian Limitation Act does not directly apply to a petition under Art. 32. Both the English Courts and the American Courts were confronted with a similar problem. In the United States the Federal Courts of Equity solved the problem thus:
(1) [1962] 1 S.C.R. 574. (2) A.I.R. 1964 S.C.
1013, 1018.
834 "Except, perhaps, where the-statute by its express terms applies to suits in equity as well as to actions at law, or where the jurisdiction of law and equity is concurrent, the rule appears to be that Federal courts sitting in equity are not bound by state statutes of limitation. Nevertheless, except where unusual conditions or extraOrdinary circumstances render it equitable to do so, the Federal courts usually act in analogy to the state statutes of limitation applicable to cases of like character." (Vol 34, American Jurisprudence, Limitation of Actions, s 54.") In Courts of Admiralty, where the statutes of limitation do not control proceedings, the analogy of such statutes is ordinarily followed unless there is something exceptional in the case. (ibid) Story on Equity Jurisprudence states the legal position thus:
"It was, too, a most material ground, in all bills for an account, to ascertain whether they were brought to open and correct 'errors in the account recenti facto; or whether the 'application was made after a great lapse of time. In cases of this sort, where the demand was strictly of a legal nature, or might be cognizable at law, courts of equity governed themselves by the same limitations as to entertain such suits as were prescribed by the' Statute of Limitations in regard to suits in courts of common law in matters of account. If, therefore, the ordinary limitation of such suits at law was six years, courts of equity would follow the same period of limitation. In so doing, they did not act, in cases of this sort (that is, in matter of concurrent jurisdiction) so much upon the ground of analogy to the Statute of Limitations, as positively in obedience to such statute. But where the demand was not of a legal nature, but was purely equitable; or where the bar of the statute was inapplicable;
courts of equity had another rule, rounded sometimes upon the analogies of the law, where such analogy existed, and sometimes upon its own inherent doctrine, not to entertain stale or antiquated demands, and not to encourage laches and negligence. Hence, in matters of account, although not barred by the Statute of Limitations, courts of equity refused. to interfere after a considerable lapse of time.
from considerations of public policy, from the difficulty of doing entire justice, when, the original transactions had become obscure by time, and the evidence might have been lost, and from the consciousness that the repose of' titles and the security of property are mainly promoted by a full en- 835 forcement of the maxim, Vigilantibus, non dormientibus jura subveniunt. Under peculiar circumstances, however, excusing or justifying the delay, courts of equity would not refuse their aid in furtherance of the rights of the party; since in such cases there was no presence to insist upon laches or negligence, as a ground for dismissal of the suit; and in one case carried back the account over a period of fifty years." (Third Edition, page 224, $529) In England, as pointed out by Bachawat, J., the Court of Chancery acted on the analogy of Statute of Limitation (vide Halsbury, Vol. 14, p. 647, Art. 1190).
It seems to me, however, that the above solution is not quite appropriate for petitions under Art. 32. A delay of 12 years or 6 years would make a strange bed-fellow with a direction or order or writ in the nature of mandamus, certiorari and prohibition. Beating in mind the history of these writs I cannot believe that the Constituent Assembly had the intention that five Judges of this Court should sit together to enforce a fundamental right at the instance of a person, who had without any reasonable explanation slept over his rights for 6 or 12 years. The history of these writs both in England and the U.S.A. convinces me that the underlying idea of the Constitution was to provide an expeditious and authoritative remedy against the inroads of the State. If a claim is barred under the Limitation Act, unless there are exceptional circumstances, prima facie it is a stale claim and should not be entertained by this Court. But even if it is not barred under the/radian Limitation Act, it may not be entertained by this Court if on the facts of the case there is unreasonable delay. For instance, if the State had taken possession of property under a law alleged to be void, and if a petitioner comes to this Court 11 years after the possession was taken by the State, I would dismiss the petition on the ground of delay, unless there is some reasonable explanation. The fact that a suit for possession of land would still be in time would not be relevant at all.
It is difficult to lay down a precise period beyond which delay should be explained. I favour one year because this Court should not be approached lightly, and competent legal 'advice should be taken and pros and cons carefully weighed before coming to this Court. It is common knowledge that appeals and representations to the higher authorities take time; time spent in pursuing these remedies may not be excluded under the Limitation Act, but it may ordinarily be taken as a good explanation for the delay.
It is said that if this was the practice the guarantee of Art. 32 would be destroyed. But the article nowhere says that a petition, howsoever late, should be entertained and a writ or order or 836 direction granted, howsoever remote the date of infringement of the fundamental right. In practice this Court has not been entertaining stale claims by persons who have slept over their rights. There is no need to depart from this practice ,and tie our hands completely with the shackles imposed by the Indian Limitation Act. In the case of applications under Art. 226 this Court observed in State of Madhya Pradesh v. Bhailal Bhai(1):
"It may however be stated as a general rule that if there has been unreasonable delay the Court ought not ordinarily to lend its aid to a party by this extraordinary remedy of mandamus. Again, where even if there is no such delay the Government or the statutory authority against whom the consequential relief is prayed for raises a prima facie triable issue as regards the availability of such relief on the merits on grounds like limitation, the Court should ordinarily refuse to issue the writ of mandamus for such payment. In both these kinds of cases it will be sound use of discretion to leave the party to seek his remedy by the ordinary mode of action in a civil court and to refuse to exercise in his favour the extraordinary remedy under Art. 226 of the Constitution." In State of Kerala v.. Aluminium Industries(2) Wanchoo, J., speaking on behalf of a large Bench of this Court, observed:
"There is no doubt in view of the decision of this Court in Sales Tax Officer v. Kanhaiyalal(3) that money paid under a mistake of law comes within the word 'mistake' in section 72 of the Contract Act and there is no question of estopped when the mistake of law is common to both the parties, which was the case here inasmuch as the respondent did not raise the question relating to Article 286 of the Constitution and the Sales Tax Officer had no occasion to consider it. In such a case where tax is levied by mistake of law it is ordinarily the duty of the State subject to any provision in the law relating to sales tax (and no such provision has been brought to our notice) to refund the tax. If refund is not made, remedy through court is open subject to the same restrictions and also to the period of limitation (see Article 96 of the Limitation Act, 1908), namely, three years from the date when the mistake becomes known to the person who has made the payment by mistake [see State of Madhya Pradesh v.
Bhailal(1)]. In this view of the matter it was the duty of the State to (1) [1964] 6 S.C.R. 261,271-72.
(2) 16 S.T.C. 689, 692, (3) [1959] S.C.R. 1350.
837 investigate the facts when the mistake was brought to its notice and to make a refund if mistake was proved and the claim was made within the period of limitation." But these cases cannot directly apply to petitions under Art. 32 because they proceed from the premise that the remedy is discretionary under Art. 226.
Coming to the facts of this case, which have been stated in detail by Mitter, J., it seems to me that the delay in coming to this Court has been adequately explained. In brief, the facts are these: The Sales Tax Officer, by his order dated March 17, 1958, forfeited a sum of Rs. 26,563.50 under s. 21 (4) of the Bombay Sales Tax Act (Bombay Act III of 1953), which provision is similar to s. 12A(4) of the Bombay Sales Tax Act, 1946. The petitioner promptly filed a writ petition in the Bombay High Court challenging this order. His petition was dismissed on November 28, 1958. He also failed in appeal before the Division Bench on July 7, 1959. An order of attachment followed. The petitioner paid the sum of Rs. 26,563.50 in various installments from October 3, 1959, to August 8, 1960. By letter dated January 9, 1962, the petitioner was called upon to pay a penalty amounting to Rs. 12,517/68 on account of late payment of sales tax dues but this order of penalty was ultimately cancelled.
The Gujarat High Court (Shelat, C.J., and Bhagwati, J.) in Kantilal Babulal v.H.C. Patel, Sales Tax Officer(x) held on December 2, 1963, that s. 12A(4) of the Bombay Sales Tax Act, 1946, was valid and did not violate Art. 19(1) (f) as it was saved by Art. 19(5). On September 29, 1967, this Court, on appeal, in Kantilal Babulal v.H.C. Patel Sales Tax Officer(2) struck down this provision as it infringed Art.
19(1)(f). On February 9, 1968, four petitioners--hereinafter compendiously referred to as the petitioner filed this petition praying that the order dated March 17, 1958, and the notice and order dated December 18, 1958, and December 24, 1958, be quashed.
There is no doubt that under s. 72 of the Contract Act the petitioner would be entitled to the relief claimed and the refund of the amount if he paid the money under mistake of law. I find it difficult to appreciate why the payment was not made under a mistake of law. In my opinion the petitioner was mistaken in thinking that the money was liable to be refunded under a valid law. Nobody has urged before us that the grounds which he had raised before the High Court were sound.
The petitioner had 'attempted to raise before the Bombay High Court the following grounds:
(1) 16 S.T.C. 973. (2) 21 S.T.C. 174.
838
1. Inasmuch as the sum of Rs. 26,563.50 was paid by way of refund under the Bombay Sales Tax Act 1946, the taxing authorities had exceeded their power under s. 21 (4) of the Act of 1953, in forfeiting the said sum of money.
2. Assuming that the respondent had power to forfeit the sum under the Act of 1953, it was strictly limited to taxes payable trader the provisions of the Act .and as no tax was payable on outside sale the authorities had no power to forfeit the sum of Rs. 26,563.50.
3.
4. Even assuming while denying that the respondent had power to forfeit the sum of Rs.
26,563.50, the power to forfeit an amount as a tax presupposes a power to impose a tax and inasmuch as on a proper construction of the relevant provisions of the Constitution no State Legislature had at any time a power to impose tax on the aforesaid transactions, the power to forfeit tax in respect of those transactions is ultra vires the State Legislature." The learned Single Judge held:
"This appears to me to be a gross case where even if I was of the opinion that the order is invalid and involved violation of fundamental rights would not in my discretion interfere by way of issuing a writ. I 'am not depriving the petitioner of any other appropriate remedy. I have, therefore, decided to dismiss this petition on that single ground." The Division Bench, on appeal, decided on the limited ground that "Mr. Justice K.K. Desai having exercised his discretion no Case is made out for interference with the exercise of that discretion." The petitioner rightly did not file an appeal to this Court for he would have had little chance of succeeding.
Suppose a petitioner challenges a provision of the Sales Tax Act before the High Court on the ground that it does not fall within List II or List III of the Seventh Schedule. He fails and pays the tax and does not appeal to the Supreme Court. Ultimately, in another petition, the provision is struck down under Art. 14 or Art. 19, a point which he and his lawyers never thought of All assessees who had paid tax without challenging the provision would be entitled to approach this Court under Art. 32 and claim a refund (see Sales Tax Officer, Benaras v. Kanhaiya Lal Mukundlal Saraf) (1). But why not the assessee who applied to (1) [1959] S.C.R. 1350.
839 the High Court ? The answer given is that he had thought at one time that the law was bad, though on wrong grounds. If a law were framed sanctioning the above discrimination, I believe, it would be difficult to sustain it under Art. 14, but yet this is the discrimination which the respondent wants me to sanction.
The grounds extracted above show that it never struck the petitioner that the provision could be challenged on the ground ultimately accepted by this Court. If the petitioner had not thought of going to the Bombay High Court on the points he did, and had paid on demand, as most of the assessees do, he would, I imagine, have been entitled to maintain this petition. But it is now said that the petitioner's position is worse because he exercised his right to approach the High Court under Art. 226. The contention seems to be that when a petitioner approaches a High Court and fails, he can no longer suffer from any mistake of law even if the point on which this Court ultimately strikes down the provision, never struck him or his lawyer or the Court. I cannot uphold this contention.
In my opinion the petitioner was under a mistake of law, when he paid up, the mistake being that he thought that s.
12A (4) was a valid provision in spite of its imposing unreasonable restrictions. This mistake he discovered like 'all assessees when this Court struck down s. 12A(4) of the Bombay Sales Tax Act. He has come to this Court within six months of that day and there is no delay.
The petition is accordingly allowed and the impugned order dated March 17, 1958, quashed and the respondent directed to refund the amount. Under the circumstances there will be no order as to costs.
Bachawat, J. I have had the advantage of reading the judgment prepared by G.K. Mitter, J. For the reasons given in this judgment, 1. agree with the order proposed by him.
As the earlier petition filed in the High Court was not dismissed on the merits, the present petition is not barred by res judicata or principle analogous thereto.
The petitioners realised Rs. 26,563.50 P from their customers outside Bombay on account of sales tax. The Sales Tax Officer by his order dated March 17, 1958 forfeited this sum under s. 21 (4) of the Bombay Sales Tax Act 3 of 1953. On March 28, 1958 the petitioners filed a writ petition' in the Bombay High Court seeking to restrain the Sales Tax Officer from recovering the amount. They pleaded that they were not liable to pay the amount, that s. 21 (4) was ultra vires the powers of the State legislature and that the order of forfeiture was violative of Arts. 19(1) (f) and 265 of the Constitution and was invalid. On November 28, 1958, K.K. Desai, J. dismissed the petition.
He held that the petitioners having defrauded other persons were not 840 entitled to any relief. The petitioners filed an appeal against the order. In the memorandum of appeal, they pleaded that the threatened levy was in violation of Arts.
19(1)(f) and 31 of the Constitution. The appeal was dismissed on July 13, 1959. In the meantime on December 24, 1958 the Collector of Bombay attached the petitioners' properties. Between August 3, 1959 and August 8, 1960 the petitioners paid the sum of Rs. 26,563.50 P to the Collector of Bombay. In Civil Appeal No. 126 of 1966, Kantilal Bapulal & Bros. v.H.C. Patel decided on September 29, 1967 this Court struck down s. 12(A)(4) of the Bombay Sales Tax Act, 1946 as unconstitutional and violative of Art. 19 ( 1 ) (f). The arguments in the present 'appeal proceeded on the assumption that s. 21 (4) of the Bombay Sales Tax Act, 1953 is liable to be struck down on the same ground. On February 9, 1968 the petitioners filed the present writ petition under Art. 32 of the Constitution claiming refund of Rs.
26,563.50 P under s. 72 of the Indian Contract Act 1872.
They alleged that they paid this sum to the Collector under coercion and/or mistake of law, and that they discovered the mistake on September 29, 1967.
Two points arise for decision in this writ petition: (1 ) Would the claim be barred by limitation if it were the subject-matter of a suit in February 1968 and (2) if so, are the petitioners entitled to any relief in this petition under Art. 32 of the Constitution.
Subject to questions of limitation, waiver and estoppel, money paid under mistake or coercion may be recovered under s. 72 of the Indian Contract Act . The fight to relief under s. 72 extends to money paid under mistake of law, i.e., "mistake in thinking that the money paid was due when, in fact, it was not due." Shiva' Prasad Singh v. Srish Chandra Nandi ( 1 ), Sates Tax Officer v. Mukundlal Saraf(2).
In my opinion, the petitioners were' not labouring under any mistake of law when they made the payments. As early as March 1958 they filed a wait petition for restraining the levy under the order dated March 17, 1958 claiming that the order was invalid and that s. 21 (4) of the Bombay Sales Tax Act, 1953 was ultra vires and unconstitutional. They might not have then known the precise ground upon which the Court subsequently struck down a similar provision of law, but they had discovered presumably under legal advice that they were not legally bound to make any payment. After the writ petition was dismissed their properties were attached and they made the payments under coercion in 1959 and 1960. The payments were not made under a mistake of law or as pointed out in Shiva Prasad Singh's Case(1) under a mistake in thinking that the money was due. They cannot claim any relief on the ground of mistake.
(1) [1949] L.R. 76 I.A. 244, 254. (2) [1959] S.C.R.
1350, 1361, 1362.
841 As we are assuming in favour of the petitioners that s. 21 (4) of the Bombay Sales Tax Act 1953 as invalid, we must hold that they made the payments under coercion. A suit for the recovery of the money on this ground instituted on January 1, 1964 would be governed by Article 24 of the Limitation Act, 1963 and the period of limitation would be three years from the dates in 1959 and 1960 when the money was received by fife respondents. The petitioners cannot obtain an extension of fife period under s. 30(a) of the Limitation Act, 1963 as Art. 62 of the Indian Limitation Act, 1908 prescribed fife same period of limitation. A suit for recovery of tax or other levy illegally collected was governed by Art. 62 and not by Art. 120, see A1. Venkata Subba Rao v. State Andhra Pradesh(1). Accordingly a suit for the recovery of money instituted in February 1968 would be barred by limitation.
If the petitioners could claim relief on the ground of mistake the suit would be governed by Art. 96 of fife Indian Limitation Act, 1908 and time would begin to run from the date when the mistake becomes known to the plaintiff. In State of Madhya pradesh v. Bhailal Bhai & Ors.(2), and State of Kerala v. Aluminium Industries Ltd.(3) it was held that Art. 96 applied to a suit for recovery of money paid under a mistake of law. Section 17(1)(c) of the Limitation Act 1963 now provides that in the case of a suit for relief from the consequences of a mistake the period of limitation does not begin to run until the plaintiff has discovered the mistake or could with reasonable diligence have discovered it. Section 17(1)(c) corresponds to s. 26(c) of the Limitation Act, 1939 (2 & 3 Geo. 6, c. 21). It was held in Re Diplock(4) that sec. 26(c) applied by analogy to a suit for recovery of money paid under mistake of law. On appeal, the House of Lords said that the section presented many problems and refrained from saying more about it, see Ministry of Health v. Simpson(5). In some American States, it has been held that a mistake of law cannot be regarded as a mistake within a similar statute and time ran from the date of the accrual of the cause of action, see Corpus Juris Secundum, vol. 54, Limitation of Actions, Article 198, page 202, Morgan v. Jasper County(6), and the cases referred to therein. It is not necessary to pursue the matter any further as the petitioners cannot claim relief on the ground of mistake. Accordingly, I express no opinion on the scope of s. 17(c) of the Limitation Act, 1963, For the reasons already stated a suit for the recovery of the money instituted in February 1968 would be barred by limitation.
(1) [1965] 2 S.C.R. 577, 612-620. (2) [1964] 6 S.C.R.
261, 274.
(3) [1965] 16 S.T.C. 689, 692. (4) [1948] Ch. 465, 515-516.
(5) [1951] A.C. 251,277. (6) 11 A.L.R.
634:274 N.W. 310.
842 The next and the more fundamental question is whether in the circumstances the Court should give relief in a writ petition under Art. 32 of the Constitution. No period of limitation is prescribed for such a petition. The right to move this Court for enforcement of fundamental rights is guaranteed by Art. 32. The writ under Art. 32 issues as a matter of course if a breach of a fundamental right is established. Technical rules applicable to suits like the provisions of s. 80 of the Code of Civil Procedure are not -applicable to a proceeding, under Art. 32. But this does not mean that in giving relief under Art. 32 the Court must ignore and trample under foot all laws of procedure, evidence, limitation, res judicata and the like. Under Art.
145 (1 ) (c) rules may be framed for regulating the practice and procedure in proceedings under Art. 32. In the absence of such rules the Court may adopt any reasonable rule of procedure. Thus a petitioner has no right to move this Court under Art. 32 for enforcement of his fundamental right on 'a petition containing misleading and inaccurate statements and if he files such a petition the Court will dismiss it, see W.P. No. 183 of 1966, Indian Sugar and Refineries Ltd. v. Union of India decided on March 12, 1968. On grounds of public policy it would be intolerable if the Court were to entertain such a petition. Likewise the Court held in Daryao v. The State of U.P.(1) that the general principles of res judicata applied to a writ petition 'under Art. 32. Similarly, this Court has summarily dismissed innumerable writ petitions on the ground that it was presented after unreasonable delay.
The normal remedy for recovery of money paid to the State under coercion or mistake of law is by suit. Articles 32 and 226 of the Constitution provide concurrent remedy in respect of the same claim. The extraordinary remedies under the Constitution are not intended to enable the claimant to recover monies, the recovery of which by suit is barred by limitation. Where the remedy in a writ application under Art. 32 or Art. 226 corresponds to a remedy in an ordinary suit and the latter remedy is subject to the bar of a statute of limitation, the Court in its writ jurisdiction acts by analogy to the statue adopts the statute as its own rule of procedure and in the absence of special circumstances imposes the same limitation on the summary remedy in the writ jurisdiction. 'On similar grounds the Court of Chancery acted on the analogy of the statutes of limitation in disposing of stale claims though the proceeding in a Chancery was not subject to any express statutory bar, see Halsbury's Laws of England, vol. 14, page 647, Art. 1190, Knox v. Gye(2). Likewise the High Court acts on the analogy of the statute of limitation in a proceeding under Art. 226 though the statute does not expressly apply to the proceeding. The Court will almost always refuse to give relief under Art. 226 if the [1962] 1 S.C.R. 574. C2) L.R. 5 H.L. 656, 674.
843 delay is more than the statutory period of limitation, see Stale of. Madhya Pradesh v. Bhailal Bhai(1).
Similarly this Court acts on the analogy of the statute of limitation in respect of a claim under Art. 32 of the Constitution though such claim is not the subject of any express statutory bar of limitation. If the right to a property is extinguished by prescription under s. 27 of the Limitation Act, 1963 the petitioner has no subsisting right which can be enforced under Art. 32 (see Sobhraj Odharmal v. Slate of Rajasthan(2). In other cases where the remedy only and not the right is extinguished by limitation, it is on grounds of public policy that the Court refuses to entertain stale claims under Art. 32. The statutes of limitation are rounded on sound principles of public policy. As observed in Whitley Stoke's Anglo-Indian Codes, Vol. 11 p. '940: "The law is rounded on public policy, its aim being to secure the quiet of the community, to suppress fraud and perjury, to quicken diligence, and to prevent oppression." In Her Highness Ruckmaboye v. Lulloobhoy Mottickchund(a) the Privy Council observed that the object of the statutes of limitation was to give effect to the maxim, "interest reipublicae ut sit finis litium" (Co Litt 303)--the interest of the State requires that there should be a limit to litigation. The rule of res judicata is rounded upon the same rule of public policy, see Daryao v. State of U.P.(4) at page 584. The other ground of public policy upon which the statutes of limitation are rounded is expressed in the maxim "vigilantibus non dormientibus jura subveniunt" (2 Co. Inst. 690)--the laws aid the vigilant and not those who slumber. On grounds of public policy the Court' applies the principles of res judicata to writ petitions under Art.
32. On like grounds the Court acts on the analogy of the statutes of limitation in the exercise of its jurisdiction under Art. 32. It follows that the present petition must be dismissed.
Miller, J. The facts leading up to the filing of the petition under Art. 32 of the Constitution are as follows.
The first petitioner before us is a registered partnership firm (hereinafter referred to as 'the firm') carrying on business in Bombay and the other petitioners are partners of the said firm. The firm has been carrying on business as a dealer in and a trader of textiles and art silk etc. It was registered as a dealer 'and has held registration certificates under the various sales tax laws prevailing in the State of Bombay from 1946 onwards including the Bombay Sales Tax Act 5 of 1946, the Bombay Sales Tax Act 3 of 1953 and the Bombay Sales Tax Act 51 of 1959.
In the course of assessment for the assessment period commencing on April 1, 1949 and ending on 31st October 1952 the [1964] S.C.R. 261. 273-74. (2) [1963] Supp. 1 S.C.R.
99, 111.
[1851-52] 5 M.I.A., 234. 251. (4) [1962] 1 S.C.R.
574.
844 firm contended that its sales of the value of Rs. 13,42,165- 15-6 were not liable to be taxed under the provisions of the Bombay Sales Tax Act then in force as the goods were delivered as a direct result of such sales for purposes of consumption outside the State of Bombay. The firm claimed that it was entitled to a refund of the amount which it had collected from its customers and paid on account of the aforesaid sales at the time of submitting the returns of its turnover. The Sales Tax Officer did not accept this contention but on appeal the Assistant Collector of Sales Tax upheld the firm's contention after examining the details submitted by it and found that sales involving the sum of Rs. 26,563-8-0 realised by way of tax were protected under Art. 286 of the Constitution. He therefore directed that the said sum be refunded to the firm on a proper application.
This appellate order was passed on November 7, 1956. The firm preferred an application for refund of Rs. 26,563.50 on November 13, 1956 whereupon the Assistant Collector (the appellate authority) simultaneously with the issue of 'a cheque for the above amount by way of refund wrote a letter dated May 11, 1957 to the effect that the petitioner should produce before him within one month of the date of the cheque receipts totaling Rs. 26,563.50 from its customers outside Bombay State to show that the refund had been passed on to them. It appears that the petitioner did not fulfil this condition and a notice dated 28th January 1958 was issued calling upon the firm to show cause why the said sum of Rs. 26,563.50 should not be forfeited under s. 21(4) of the Bombay Sales Tax Act, 1953. In reply thereto, the firm stated by letter dated February 7, 1958 that it had collected from its customers outside the State of Bombay the said sum of money and "under an honest mistake of law had paid the same to the sales tax authorities." The firm went on to add that the order for refund had been made only when the authorities were satisfied that 'it was not liable to pay the said sum but the latter had insisted upon a condition that the firm should in its turn refund the said amount to its customers from whom the collection had been made. The letter records that the firm "had agreed to that condition under coercion even though in ,law the authorities were bound to refund the said ,amount without any such condition." Further the firm's case in that letter was that the
