- (1.) The petitioner, a Public Limited Company, has a manufacturing location at Moga. Apart from that, it gets certain food articles manufactured by third party on job work basis. After the job work the material is sent back to the petitioner-company at Moga. As per the petitioner-company the material received from the job worker was primarily designed for re-export outside the City of Moga, (and partly outside the State of Punjab). Thus, it claimed that material was not exigible to octroi. Octroi is leviable under Section 62 of the Punjab Municipal Act, 1911, and defined in Chapter V of the Municipal Account Code, 1930, as follows:- "Octroi means a cess without refunds on the entry into a City or municipality of goods for consumption, use or sale therein". The same chapter also defines the Re-export Pass System in Rule 32-A, relevant portion of which is quoted as follows:- "In a city or municipality in which no trade ware house is maintained and in which octroi (without refunds) is in force a person importing goods intended for temporary retention within octroi limits and eventual re-export may avail himself of the Re-export Pass System".
(2.) On the basis of the claim that the goods from job work were not brought for consumption or use within the municipal limits, Moga, the petitioner made an application for grant of Re-export pass. The same having been declined, the petitioner filed an appeal before the Appellate Authority, claiming re-export pass in the future and refund of octroi it had paid during the interregnum. The appeal was allowed. The respondent-Municipal Committee carried the matter in revision, and the Revisional Authority remanded the matter back to the Collector. Again the Collector allowed the claim and Municipal Committee filed revision. The revision having been allowed the petitioner is before this Court.
(3.) Learned Senior counsel has relied upon Dabur India Limited vs.. State of Punjab and others in CWP No.13599 of 2004 decided on 3.2.2010, wherein the Division Bench has held as follows:- "12. From the judgment of the Apex Court, it is just clear that only sale within the municipal limit does not authorize the municipality to charge octroi on goods. Octroi can only be levied and charged when sale of octroiable goods is made in the octroi area for the purpose of consumption and use within that octroi area. If a person purchases goods to be consumed beyond the octroi area then of course no octroi can be levied. "13. Learned counsel for the petitioner has drawn our attention to the order passed by the Appellate Authority dated 23.4.2004 (Annexure P-11) and argued that octroi was levied and charged on the ground that goods are sold from its godowns which situate within the municipal limit of Zirakpur. Sales tax is also paid within the municipal limit of Zirakpur. Since sale takes place within the municipal limit of Zirakpur, hence octroi is justified. Learned counsel for the petitioner further argued that the Appellate Authority has not appreciated the fact and has not recorded any finding as to whether sale took place within the municipal limit of Zirakpur for consumption and use of the goods within the octroi limit. If goods/products are to be consumed or used beyond the octroi limit then octroi cannot be levied and charged, simply because sale takes place within the municipal limit. "14. We are of the view that in the impugned orders, no finding has been recorded on the question as to whether goods/products sold were to be consumed or used within the municipal limit of Zirakpur. Hence we have no other option except to quash the impugned orders. In view thereof, learned Senior counsel has proposed that this Court should hold that the petitioner is not liable to pay octroi on goods which are not intended for consumption and use in Moga, and thereafter, the petitioner would approach the Municipal Committee, with all the records and wherever the Municipal Committee is satisfied that indeed the material was not sold for consumption and use within the Moga, the refund may be granted. Learned counsel appearing for the Municipal Committee has fairly accepted that as regards the goods not intended for consumption and use in Moga, no octroi would be leviable as held in Dabur India Limited vs.. State of Punjab and others. He has however raised two arguments. His first argument is that the petitioner having sought a Re-export pass now cannot turn around and claim refund of octroi. This argument has only to be noticed to be rejected. At the very outset, the petitioner had moved an application for re-export pass for its business and continued to pay the octroi in anticipation of the grant of such pass. When the Municipal Committee declined it, it moved an appeal, again praying for re-export pass for the future and making a claim that the earlier duty levied upon it should be refunded. In the circumstance, it cannot be held that the petitioner is not entitled to claim refund because it had prayed only for grant of re-export pass. It is not disputed that from the year 2006, octroi has been abolished in the State of Punjab, and therefore, the dispute only survives with regard to the money paid by the petitioner prior thereto. The second argument of learned counsel is that the petitioner is not entitled to any refund because of the doctrine of unjust enrichment. He has relied upon Mafatlal Industries Ltd and others Vs.. Union of India & others, 1997 5 SCC 536 a decision of a Constitution Bench of nine Hon'ble Judges, the relevant portion is as follows:- "(iii) A claim for refund, whether made under the provisions of the Act as contemplated in Proposition (i) above or in a suit or writ petition in the situations contemplated by proposition (ii) above, can succeed only if the petitioner/plaintiff alleges and establishes that he has not passed on the burden of duty to another person/other persons. His refund claim shall be allowed/decreed only when he establishes that he has not passed on the burden of the duty or to the extent he has not so passed on, as the case may be. Whether the claim for restitution is treated as a constitutional imperative or as a statutory requirement, it is neither an absolute right nor an unconditional obligation but is subject to the above requirement, as explained in the body of the judgment. Where the burden of the duty has been passed on, the claimant cannot say that he has suffered any real loss or prejudice. The real loss or prejudice is suffered in such a case by the person who has ultimately borne the burden and it is only that person who can legitimately claim its refund. But where such person does not come forward or where it is not possible to refund the amount to him for one or the other reason, it is just and appropriate that that amount is retained by the State, i.e., by the people. There is no immorality or impropriety involved in such a proposition. The doctrine of unjust enrichment is a just and salutary doctrine. No person can seek to collect the duty from both ends. In other words, he cannot collect the duty from his purchaser at one end and also collect the same duty from the State on the ground that it has been collected form him contrary to law. The power of the Court is not meant to be exercised for unjustly enriching a person. The doctrine of unjust enrichment is, however, inapplicable to the State. State represents the people of the country. No one can speak of the people being unjustly enriched.";