Page 80 - GSTL_23rd July 2020_Vol 38_Part 4

446 GST LAW TIMES [ Vol. 38
State to refund the money alleged to have been illegally col-
lected is not ordinarily maintainable, if the allegation is that
the assessment was without a jurisdiction and the taxes col-
lected was without authority of law and therefore the re-
spondents had no authority to retain the money collected
without any authority of law, the High Court has the power to
direct refund in a writ petition. (Vide Salonah Tea Co. Ltd. v.
Supdt. of Taxes [(1988) 1 SCC 401 : 1988 SCC (Tax) 99 (2)].)
(v) It is one thing to say that the High Court has no power under
Article 226 of the Constitution to issue a writ of mandamus for
making refund of the money illegally collected. It is yet anoth-
er thing to say that such power can be exercised sparingly de-
pending on facts and circumstances of each case. For instance,
where the facts are not in dispute, where the collection of
money was without the authority of law and there was no
case of undue enrichment, there is no good reason to deny a
relief of refund to the citizens. But even in cases where collec-
tion of cess, levy or tax is held to be unconstitutional or inva-
lid, refund is not an automatic consequence but may be re-
fused on several grounds depending on facts and circum-
stances of a given case. (Vide U.P. Pollution Control Board v.
Kanoria Industrial Ltd. [(2001) 2 SCC 549])
(vi) Where the lis has a public law character, or involves a question
arising out of public law functions on the part of the State or
its authorities, access to justice by way of a public law remedy
under Article 226 of the Constitution will not be denied. (Vide
Sanjana M. Wig v. Hindustan Petroleum Corpn. Ltd. [(2005) 8
SCC 242])
We are therefore of the view that reliance upon Suganmal [AIR 1965 SC
1740] was misplaced, to hold that the writ petition filed by the appellant
was not maintainable.”
27. Hence as per above judgment in clause (v), the Court took the view
that where facts are not in dispute and where the collection of money was with-
out authorities of law, a reference may be ordered.
28. Similarly reference may be had to the judgment of the Supreme
Court in the case of U.P. Pollution Control Board & Ors. v. Kanoria Industrial Ltd.
and Anr., (2001) 2 SCC 549 = 2001 (128) E.L.T. 3 (S.C.) where the Supreme Court
held as follows :-
“16. In support of the submission that a writ petition seeking mandamus
for mere refund of money was not maintainable, the decision in Suganmal v.
State of M.P. [AIR 1965 SC 1740 : (1965) 56 ITR 84 : (1965) 16 STC 398] was
cited. In AIR para 6 of the said judgment, it is stated that
“we are of the opinion that though the High Courts have power to
pass any appropriate order in the exercise of the powers conferred
under Article 226 of the Constitution, such a petition solely praying
for the issue of a writ of mandamus directing the State to refund the
money is not ordinarily maintainable for the simple reason that a
claim for such a refund can always be made in a suit against the au-
thority which had illegally collected the money as a tax”.”
29. Hence, normally a writ petition would not lie for recovery of mon-
ey. However, depending on the facts and circumstances of a case, the power to
direct refund can be exercised sparingly. In my opinion the facts of this case war-
rant exercise of this power to direct the respondent to release amounts wrongly
withheld for a non-existing service tax. The petitioner was the lowest bidder at
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