K. Jayachandra Reddy, J. - (1.) The petitioner-Company is engaged in the business of manufacture of aluminium products and its factory is located at Kalwa in Thane District (Maharashtra). The Company obtains aluminium as raw materials for consumption from another factory of theirs situated in a different State. With effect from 1-10-82 the Company at Kalwa was included in the municipal jurisdiction of Thane. Prior to that date the factory was not within the jurisdiction of Thane Municipality and did not have to pay any octroi on the raw materials brought into its factory at Kalwa. By a Notification dated 23-8-82, the Government of the City of Thane and Kalwa was brought within the jurisdiction of the Thane Municipal Corporation, the respondent herein and all goods imported into the area of the Thane Municipal Corporation were subjected to octroi at the rates mentioned in Schedule 1 to the Maharashtra Municipalities (Octroi) Rules, 1968 ('Rules'for short). Schedule 1 to the said Rules contains description of various goods and articles which were liable to octroi and minimum and maximum rates are prescribed. Item No. 77 in the said Schedule 1 to the said Rules covered non-ferrous metals, including aluminium and the entry provided for the levy of octroi duty on the aluminium and other goods mentioned therein at the minimum rate of 0.5% and at the maxmum of 4%. The respondent Corporation was levying octroi duty on the imports of aluminium raw materials made by the petitioner-Company into Kalwa at the rate of 1.3% from 1-10-19 82 to 14-4-1987. Then with effect from 15-4-87 the respondent-Corporation was levying octroi at the rate of 2%. On 18-5-87 at the Thane Manufacturers' Association made a representation to the respondent-Corporation about the increase in octroi rates pointing out that the increase was having a disastrous effect on their industrial units located within the limits of the Corporation. In reply to the said representation, the respondent-Corporation addressed a letter dated 20-11-1987 in which it was pointed out and clarified inter alia that goods specified in Entry 77 in Schedule 1 to the said Rules, when raw material is imported for use in the manufacture of finished goods it would be subject to the levy of octroi not exceeding 1.25% and not less. On receipt of this letter the petitioner-Company made detailed enquiries and was informed that under Rule 4 of the said Rules the goods mentioned in Part IA of that Schedule which were imported by certain industrial undertakings are liable to be subjected to octroi at a lower rate. The Company also noticed further that Part IA of the Rules provided that the goods specified in Entry 77 when imported by an industrial undertaking for use as a raw material for processing within that undertaking and if a declaration in Form 14 is. filed, the levy of octroi in such cases would not exceed 1.25% and would not be less than 0.25%. The petitioner, however, did not file any such Form 14 duly filled in and according to them they acted under a mistake of law and under the bona fide impression that the octroi levied on and recovered by the Corporation at the rate of 1.3% in respect of the period from 1-10-82 to 14-4-87 and at the rate of 2% from 15-4-87 onwards, represented the correct rate. The petitioner however having later realised by going through the records and the financial accounts and other documents which are duly audited claimed refund of the excess of octroi duty which has been paid by them. On 8-3-88 the petitioner-Company addressed a letter to the respondent-Corporation pointing out that under a mistake of law they paid excess amount and therefore the excess amount so paid should be refunded. The respondentCorporation in their reply dated 16-5-88 stated that the petitioner-Company had not complied with the procedure specified in Part IA of the Schedule 11 to the said Rules for avalling such concessional rates therefore the refund cannot be sanctioned. However, the petitioner-Company by their letter dated 19-4-89 claimed,a refund of total amount of Rs. 13,54, 101.79 The respondent again rejected the claim reiterating that the procedure specified in Part IA of Schedule 11 to the Rules was not complied with. Being aggrieved the Company filed a writ of mandamus seeking refund. A Division Bench of the High Court dismissed the same holding that the concessional rate of octroi duty was available only if the declaration in Form was filed with the octroi authorities. Questioning the said Order, this Special Leave Petition has been filed and it is being disposed of at the admission stage itself after notice.
(2.) Most of the facts in this case are not in dispute. Admittedly the aluminium raw material was imported by the petitioner-Company and octroi duty at the normal rate was paid and no declaration in Form 14 was filed. It is only after the lapse of long time that the Petitioner-Company has made a claim for refund. The learned counsel for the petitioner-Company submitted that a procedural failure should not disentitle the petitionerCompany provided if otherwise the Company could have legitimately claimed. The learend counsel appearing for the respondent Municipal Corporation submitted that the concessional rate would be available only if the raw material was utilised by the Company for manufacturing goods within the industrial undertaking. If a declaration had been filed in proper Form 14 there could have been a scope for verification and in the absence of such a declaration the question of refunding at this distance of time does not arise. It is also his further submission that the concession should have been available at the time when it was available. Having failed to avail the question of claiming the same later does not arise and consequently no refund can be claimed.
(3.) The amended Rules came into force in 1970. Rule 4(2) provides for payment of octroi at a lower rate by certain industrial undertakings in respect of the goods mentioned in Part IA of Schedule 11 to the Rules. Aluminium is at Entry No. 77. Part I-A reads thus: " PART I-A List of goods on which octroi shall be payable at a lower rate by certain industrial undertakings. (1) All goods specified in Entries 6(c), 35, 40 64, 65, 71, 77 and 86 in Schedule 1, and kh'obra mentioned in Entry 25, raw rubber and latex mentioned in Entry 70 in that Schedule, when imported by an industrial undertaking for use as raw material for processing within that undertaking and when declaration in respect thereof is issued by the undertaking in Form 14, shall be subject to octroi by any Council at a rate not exceeding 1.25 per cent and not less than 0.25 per cent. ********** " It can be seen from the above rule that to avail the concession, a declaration in Form 14 has to be made in respect of the raw material imported. Form 14 is as under: " FORM 14 (Parts I-A and II of Schedule II) Declaration to be made by an importer importing dutiable goods as raw material for his industrial undertaking I..........do hereby declare that the goods in respect of which I have separately given a declaration under Rule 14 have been imported by me as raw material to be used in the manufacture of------- in my industrial undertaking, viz. (here give full name and address of the undertaking) ------ and I shall not use them for any other purpose for sale or otherwise dispose them of to any other party for any other purpose, except, having previously paid the difference between the octroi due on such goods at ordinary rates and the octroi paid on concessional rates under Schedule II to the Maharashtra Municipalities (Octroi) Rules, 1968. Date.... Signature of the Importer" The declaration contemplated in Form 14 is to the effect that the goods imported shall not be used for any other purpose for sale or otherwise etc. It can thus be seen that an incentive is sought to be given to such entrepreneurs by such concession if the raw material which is imported is also utilised in the industrial undertaking without selling or disposing of otherwise. That being the object a verification at the relevant time by the octroi authorities becomes very much necessary before a concession can be given. In the absence of filing such a declaration in the' required Form 14, there is no opportunity for the authorities to verify. Therefore, the petitioner-Company has definitely failed to fulfil an important obligation under the law though procedural. The learned counsel, however, submitted that even now the authorities can verify the necessary records which are audited and submitted to the authorities and find out whether the material was used in its own undertaking or not. We do not think we can accede to this contention. Having failed to file the necessary declaration he cannot now turn-around and ask the authorities to make a verification of some records. The verification at the time when the raw material was still there is entirely different from a verification at a belated stage after it has seized to be there. May be that the raw material was used in the industrial undertaking as claimed by the petitioner-Company or it may not be. In any event the failure to file the necessary declaration has necessarily prevented the authorities to have a proper verification.;