INDIAN ALUMINIUM COMPANY LIMITED versus THANE MUNICIPAL CORPORATION

Citation: [1991] SUPP. 1 S.C.R. 208 · Decided: 25-09-1991 · Supreme Court of India · Bench: S. RATNAVEL PANDIAN · Disposal: Dismissed

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Judgment (excerpt)

A 
INDIAN ALUMINIUM COMPANY LIMITED 
v. 
THANE MUNICIPAL CORPORATION 
~ 
SEPTEMBER 25, 1991 
B 
(S. RATNAVEL PANDIAN AND K. JAYACHANDRA REDDY, JJ.) 
Maharashtra Munieipalities (Octroi) Rules, 1968-Schedule I, Entry 
No.77 read with Schedule II, Part IA, Rule 4, Form 14 -Octroi-- Pay-
ment-E:xcess from 1.10.1982 to 14.4.1987-Failure to submit Form 14 
,..4._ 
c -Claim of refund of octroi made on 8.3.1988 ~gality of. 
The petitionei'·Company was engaged in the business of 
manufa~ure of aluminium products and its factory was located at Kalwa 
in Thane District, obtaining aluminium as raw materials from its another 
factory, situated in a different State. 
D 
With effect from 1.10.82 the Company at Kalwa was included In the 
municipal jurisdiction of Thane, and prior to that date, the Company did 
not have to pay any octroi on the raw materials brought into its factory at 
r 
Kalwa. 
E 
The respondent • Corporation was levying octroi duty on the imports 
of aluminium raw materials made by the petitioner·Company at the rate of 
1.3% from 1.10.1982 to 14.4.1987 and from 15.4.87 at the rate of 2% • 
On 18.S.87 the Thane Manufacturer's Association made a 
representation to the respondent-Corporation about the increase in octroi 
F 
rates. 
The respondent-Corporation in its letter dated 20.11.1987 pointed 
out that when raw material specified in Entry 77 in Schedule I to the 
Maharashtra Municipalities (Octrol) Rules imported for use in the 
G 
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 
enquiiies and was informed that under Rule 4 of the Rules the goods 
mentioned in Part IA of the Schedule II, which were imported, were liable 
H to be subjected to octroi at a lower rate. The Company also noticed further 
208 
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t:.':!lm 
I • 
... 
ALUMINIUM CO. v. MUNICIPAL CORPN. 
209 
that Part IA of the Rules provided that the goods specified in Entry 77, A 
7( 
when imported by an industrial undertaking for use as a raw material for 
processing within that undertaking and if a declaration in Form 14 was 
filed, the levy of octroi in such cases would not exceed 1.25% and would not 
be less than 0.25'7'c. 
The petitioner, however, had not filed any·Fonn 14 duly filled in and B 
according to it, it acted under a mistake of law and under the bonafide 
_,.l_ 
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. 
.. 
On 8.3.1988 the petitioner-Company In its letter to the c 
respondent-Corporation stated that under a mistake of law it paid excess 
I 
amount and same should be refunded. 
On 16.5.1988, the respondent-Corporation replied that as the 
.. 
petitioner-Company had not complied with the procedure specified in Part D 
~ 
IA of the Schedule II to the Rules for availing such concessional rates and 
therefore the refund could not be sanctioned. 
On 19.4.1989 the petitioner-Company claimed a refund of total 
amount of Rs. 13,54,101.79 p. The respondent rejected the claim, against E 
which the Company flied a writ petition In the High Court, seeking refund. 
A Division Bench of the High Court dismissed the writ petition 
~~ 
holding that the concessional rate of octroi duty was available only if the 
declaration in Form 14 was tilled with the octroi authorities. 
F 
Questioning the High Court's Order, this Special Leave Petition was 
filed. 
The petitioner-Company contended that a procedural failure should 
not disentitle the petitioner-Company, provided, if otherwise the Company G 
~-;--
could have legitimately claimed. 
The respondent-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; that if a 
declaration had been tiled in proper Form 14 there could have been a H 
210 
SUPREME COURT REPORTS 
[1991) SUPP. 1 S.C.R. 
A scope for verification and in the absence of such a declaration the question 
of refunding at this distance of time did not arise; and that the concession 
should have been availed at the time when it was available, and having 
failed to avail, the question of claiming the same later did not arise. 
B 
Dismissing the petition, this Court, 
HELD: 1. A verification at the relevant time by the octroi authorit

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