Case: Shri Vallabh Glass Works Limited and Others Vs. Union of India and Others

had discovered it or could have with reasonable diligence discovered it. In th e instant case the date on which the mistake was discovered by the appellants or the date on which the appellants could with reasonable diligence have discovered it is not clear from the record before us. No efforts also was made in t he course of the arguments urged on behalf of the appellants to establish it. We have, therefore, to assume that on the date each payment of excise duty made by the appellants in excess of the proper duty payable by them, the appellants coul d have discovered with due diligence that the duty claimed from them was excessive. Under Article 113 of the Limitation Act, 1963 which is applicable to this case, a suit for recovery of such excess duty had to be filed within three years from the date of payment to the Department. But the appellants instead of filing a suit, first filed a writ petition in Special Civil Application No. 1365 of 1976 on September 28, 1976 and that petition had to be withdrawn in view of clause (3) of Article 226 of the Constitution as it stood then because the alternative remedy by way of an appeal was available. The appellants could, therefore, file the writ petition out of which the appeal arises only after the disposal of the revision petition by the Government of India as mentioned earlier. It is not disputed that the High Courts have power, for the purpose of enforcement of fundamental rights and statutory rights, to make consequential orders for repayment of money realised by the Government without the authority of law under Article 226 of the Constitution. This is an alternative remedy provided by the Constitution in additional to but not in supersession of the ordinary remedy by way of suit in the absence of any provision which would bar such a suit either expressly or by necessary implication. While there are different periods of limitation prescribed for the institution of different kinds of suits by the limitation Act, 1963, there is no such period prescribed by law in respect of petitions filed under Article 226 of the Constitution. Whether relief should be granted to a . petitioner under Article 226 of the Constitution where the cause of action had arisen in the remote past is a matter of sound judicial discretion governed by the doctrine of laches. Where a petitioner who could have availed of the alternative remedy by way of suit approaches the High Court under Article 226 of the Constitution, i. is appropriate ordinarily to construe that any unexplained delay in the filing of the writ petition after the expiry of the period of limitation prescribed for filing a suit as unreasonable. This rule, however, cannot be a rigid formula. There may be cases where ev en a delay of a shorter period may be considered to be sufficient to refuse relief in a petition under Article 226 of the Constitution. There may also be cases where there may be circumstances which may persuade the court to grant relief even though the petition may have been filed beyond the period of limitation prescribed for a suit. Each case has to judged on its own facts and circumstance touching the conduct of the parties, the change in situation, the prejudice which is likely to be caused to the opposite party or to the general public etc. In the instant case, the appellants had in fact approached the High Court on September 28, 1976 itself by filing Special Civil Application No. 1365 of 1976 for directing repayment of the excess duty paid by them. But no relief could be granted in that petition in view of the provisions of Article 226 of the Constitution as it stood then and the petition had to be withdrawn. Hence even granting that on the date of making each payment of excise duty in excess of the proper duty payable under law, the appellants should be deemed to have discovered the mistake, all such excess payments made on and after September 28, 1973 which would fall within the period of three years prior to t he date on which Special Civil Application No. 1365 of 1976 was filed should have been ordered to be refunded under Article 226 of the Constitution. But the High Court declined to do so on grounds of estoppel and acquiescence. While we do agree that t he appellants should not be granted any relief in respect of payment made between October 1, 1963 and September 27, 1973 which would fall beyond three years from the date of the first writ petition filed in this case we do not find it proper and just to negative the claim of the appellants in respect of excess payments made after September 28, 1973. In the instant case the appellants had made excess payments on being assessed by the Department and such payments cannot be treated as voluntary payments precluding them from recovering them. (See Sales Tax officer, Banaras &Ors. v. Kanhaiya Lal Mukundlal Saraf. We do not also find that the conduct of the appellants is of such a nature as would disentitle them to claim refund of excess payments made in respect of goods other than wired glass.We, therefore, modify the judgment and order passed by the High Court by quashing the assessments of excise duty made in respect of the goods in question other than wi red glass viz. figured glass, coloured figured glass, rolled glass and coolex wired glass for the period between September 28, 1973 and February 20, 1976 also and directing the assessing authority to make a fresh assessment in accordance with law in the light of the decision of the High Court. The respondents are further directed to refund after such fresh determination any excess duty that may be found to have been paid by the appellants. The fresh assessments shall be completed within four months from today. T

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]Since it is convenient to dispose of the second question at this stage, we shall take it up first. A few more facts which are relevant to this issue have to be stated here. As mentioned earlier the goods in respect of which dispute had been raised by the appellants in their application dated February 20, 1976 were figured glass, wired glass, coloured figured glass, rolled glass and coolex wired glass. But it is seen that in respect of wired glass, a dispute had arisen between the Department and the appellants earlier and in that case while the Department claimed that wired glass was subject to payment of duty under tariff Item 23A(4) the appellants pleaded that wired glass was liable to duty under tariff Item 23A(1). The Government of India ultimately by its order dated August 24, 1971 (in order No. 261 of 1971 of the Government of India on Central Excise Revision Application accepted the case of the appellants that wired glass was subject to duty wader tariff Item 23A - (1) and the appellants paid duty on that basis till February 20, 1976. These facts distinguish the case in respect of wired glass from the case in respect of the other goods While the said earlier order may not be a legal bar to the contention raised by the appellants on February 20, 1976 that wired glass was not taxable under tariff Item 23A(1) but under tariff Item 68 after that date, it is certainly a circumstance which disentitles the appellants to claim refund of excess duty paid by them in a petition under Article 226 of the Constitution on a ground contrary to their earlier stand. The claim for refund of excess duty paid on wired glass during the period prior to February 20, 1976 is liable to be rejected. The appeal of the appellants to that extent should, therefore, fall.In regard to the relief of refund of excess duty paid in respect of the other goods, the case stands on an entirely different footing. This is a case where the Department had assessed the duty payable by the appellants under a wrong provision. The appellants were obliged to pay the duty so assessed. They did not, no doubt, question the assessments by taking a specific stand as they had done earlier in the case of wired glass. The appellants, however, questioned the validity of the levy only on February 20, 1976 on the ground that tariff Item 23A (1) of the First Schedule to the Act under which the duty has been levied was not applicable to tile goods. While the Department refused to accept the said plea, the High Court has upheld it. In view of the decision of the High Court, the fact that the appellant had paid duty in excess of what they were bound in P law to pay should be now taken as having been established. It is. not disputed that if the appellants had filed a suit within the period of limitation the excess amount would have become refundable by virtue of section 72 of the Indian Contract Act. Section 17(1)(c) of -the Limitation Act, 1963provides that where in the case of any suit or application for which a period of limitation is prescribed u nder that Act, the suit or application is for relief from the consequence of a mistake, the period of limitation shall not begin to run until the plaintiff or applicant had discovered it or could have with reasonable diligence discovered it. In th e instant case the date on which the mistake was discovered by the appellants or the date on which the appellants could with reasonable diligence have discovered it is not clear from the record before us. No efforts also was made in t he course of the arguments urged on behalf of the appellants to establish it. We have, therefore, to assume that on the date each payment of excise duty made by the appellants in excess of the proper duty payable by them, the appellants coul d have discovered with due diligence that the duty claimed from them was excessive. Under Article 113 ofthe Limitation Act, 1963which is applicable to this case, a suit for recovery of such excess duty had to be filed within three years from the date of payment to the Department. But the appellants instead of filing a suit, first filed a writ petition in Special Civil Application No. 1365 of 1976 on September 28, 1976 and that petition had to be withdrawn in view of clause (3) of Article 226 of the Constitution as it stood then because the alternative remedy by way of an appeal was available. The appellants could, therefore, file the writ petition out of which the appeal arises only after the disposal of the revision petition by the Government of India as mentioned earlier. It is not disputed that the High Courts have power, for the purpose of enforcement of fundamental rights and statutory rights, to make consequential orders for repayment of money realised by the Government without the authority of law under Article 226 of the Constitution. This is an alternative remedy provided by the Constitution in additional to but not in supersession of the ordinary remedy by way of suit in the absence of any provision which would bar such a suit either expressly or by necessary implication. While there are different periods of limitation prescribed for the institution of different kinds of suits by the limitation Act, 1963, there is no such period prescribed by law in respect of petitions filed under Article 226 of the Constitution. Whether relief should be granted to a . petitioner under Article 226 of the Constitution where the cause of action had arisen in the remote past is a matter of sound judicial discretion governed by the doctrine of laches. Where a petitioner who could have availed of the alternative remedy by way of suit approaches the High Court under Article 226 of the Constitution, i. is appropriate ordinarily to construe that any unexplained delay in the filing of the writ petition after the expiry of the period of limitation prescribed for filing a suit as unreasonable. This rule, however, cannot be a rigid formula. There may be cases where ev en a delay of a shorter period may be considered to be sufficient to refuse relief in a petition under Article 226 of the Constitution. There may also be cases where there may be circumstances which may persuade the court to grant relief even though the petition may have been filed beyond the period of limitation prescribed for a suit. Each case has to judged on its own facts and circumstance touching the conduct of the parties, the change in situation, the prejudice which is likely to be caused to the opposite party or to the general public etc. In the instant case, the appellants had in fact approached the High Court on September 28, 1976 itself by filing Special Civil Application No. 1365 of 1976 for directing repayment of the excess duty paid by them. But no relief could be granted in that petition in view of the provisions of Article 226 of the Constitution as it stood then and the petition had to be withdrawn. Hence even granting that on the date of making each payment of excise duty in excess of the proper duty payable under law, the appellants should be deemed to have discovered the mistake, all such excess payments made on and after September 28, 1973 which would fall within the period of three years prior to t he date on which Special Civil Application No. 1365 of 1976 was filed should have been ordered to be refunded under Article 226 of the Constitution. But the High Court declined to do so on grounds of estoppel and acquiescence. While we do agree that t he appellants should not be granted any relief in respect of payment made between October 1, 1963 and September 27, 1973 which would fall beyond three years from the date of the first writ petition filed in this case we do not find it proper and just to negative the claim of the appellants in respect of excess payments made after September 28, 1973. In the instant case the appellants had made excess payments on being assessed by the Department and such payments cannot be treated as voluntary payments precluding them from recovering them. (See Sales Tax officer, Banaras &Ors. v. Kanhaiya Lal Mukundlal Saraf. We do not also find that the conduct of the appellants is of such a nature as would disentitle them to claim refund of excess payments made in respect of goods other than wired glass.We, therefore, modify the judgment and order passed by the High Court by quashing the assessments of excise duty made in respect of the goods in question other than wi red glass viz. figured glass, coloured figured glass, rolled glass and coolex wired glass for the period between September 28, 1973 and February 20, 1976 also and directing the assessing authority to make a fresh assessment in accordance with law in the light of the decision of the High Court.