LexU.P. POLLUTION CONTROL BOARD AND ORS. versus KANORIA INDUSTRIAL LTD. AND ANR.
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~ U.P. POLLUTION CONTROL BOARD AND ORS. A v. KANORIA INDUSTRIAL LTD. AND ANR. -~ JANUARY 24, 2001 [S. RAJENDRA BABU AND SHIVARAJ V. PATIL, JJ.] B -~- Constitution of India, 1950: Article 226. Writ petition-Mandamus-Issue of-For refund of money- Maintainability of-Sugar industry and distillery-Water cess-Demand of- c Water cess paid under protest-But Supreme Court held sugar industries not . ~ ;..- liable to pay water cess-No action taken by assessing authority Of! the claim for refund of money-Writ petition for refund of money allowed by High Court-Correctness of-lf.eld: Collection of money as water cess is illegal and without authority of ldw-There is no reason to deny relief of refund on· D principles of public interest and equity-Hence, writ petition demanding refund of money maintainable and rightly allowed by High Court-Water (Prevention and Control of Pollution) Cess Act, 1977, Entry No. 15 Sch. I. ..... Writ Petition-Delay and /aches-Writ petition for refund of money filed after delay of 4 to 5 years-Maintainability of-Held : Claims for E refund of money made within a reasonable time after judgment a/Supreme Court-No rights are created in third parties-Hence, no question of delay and !aches-Writ petition maintainable. ~ Article 141-Supreme Court's judgment-Binding nature of-Held: ls binding not only on the parties before the Supreme Court but also on those F in respect of whom no appeal is filed. The respondents were owners of industrial units manufacturing sugar from sugarcane and liquor/alcohol from molasses. The petitioner demanded water cess from the respondents under Water (Prevention and Control of Pollution) Cess Act, 1977. The respondents paid the water cess under protest G ~· and filed writ petitions before the High Court challenging the demand on the ground that sugar industries and distillery were not industries covered under Entry No. 15 of Schedule I of the Act. These writ petitions were dismissed and the respondents did not challenge their dismissal. But this Court in Saraswati Sugar Mills· case reversed the decision of the High H 559 560 SUPREME COURT REPORTS [200 I] I S.C.R. A Court and held that sugar-manufacturing industries did not fall within Entry No. 15 of Schedule I of the Act. The respondents filed applications for refund of the amounts realised illegally and without authority as water cess. But no action was taken on these applications. The respondents, therefore, filed writ petitions before the B High Court seeking a mandamus to the petitioners to refund the amount collected as water cess. The High Court directed refund of the amount realised as water cess. Hence this Special Leave Petition. On behalf of the petitioners it. was contended that writ petition for refund of money was not maintainable; that the respondents having failed in C the earlier writ petitions challenging the very levy of cess before the High Court and having not challenged the order of the High Court further could not make a claim for refund on the basis of the subsequent judgment of this Court; and that the High Court could not have entertained the writ petitions after an inordinate delay of about 4 to 5 years. D On behalf of the respondents it was contended that the water cess was paid under protest and that it was not passed on to the consumers. Dismissing the petition, the Court HELD : 1.1. It is one thing to say that the High Court has no power E under Article 226 of the Constitution to issue a writ of mandamus for F making refund of the money illegally collected. It is yet another thing to say that such power can be exercised sparingly depending on facts and circumstances of each case. In the present case, collection of money as cess was itself without the authority of law; no case of undue enrichment was made out and the amount of cess was paid under protest; the writ petitions were filed within a reasonable time from the date of the declaration that the law under which tax/cess was collected was unconstitutional. There is no good reason to deny a relief of refund to the citizens in such cases on the principles of public interest and equity. However, it must not be understood ,, that in all cases where collection of cess, levy or tax is held to be G unconstitutional or invalid, the refund should necessarily follow. Even in cases where collection of cess, levy or tax is held to be unconstitutional or -t/ - invalid, refund is not an
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