Tax collection bar cannot be avoided by relabelling recovery as recoupment under the Madras Sales Tax Act.

Section 22 of the Madras Sales Tax Act was construed as imposing a clear and comprehensive bar on a dealer collecting from buyers, in any form, amounts paid to the seller by way of tax. The court held that the word "collect" extends to collection by recoupment, recovery, or any other nomenclature, and that allowing such relabelling would defeat the statutory object. The contrary view in Metal Sales Corporation was overruled, and the High Court's construction of section 22 was upheld.

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Issues: Whether section 22 of the Madras Sales Tax Act prohibits a dealer from collecting from buyers, under the guise of recoupment or recovery, amounts paid to the seller by way of tax.

Analysis: The prohibition in section 22 was held to be clear and comprehensive. The word "collect" was construed to include collection in any form, and a dealer could not avoid the statutory bar by describing the transfer as recoupment or recovery. Accepting a different nomenclature would defeat the object of the provision and render section 22 nugatory.

Conclusion: The collection sought to be justified as recoupment or recovery was held to be barred by section 22, and the contrary view in Metal Sales Corporation was overruled.

Final Conclusion: The petitions failed, and the High Court's view was upheld on the construction of section 22.

Ratio Decidendi: Where a statute prohibits collection of tax, the prohibition cannot be avoided by relabelling the same recovery as recoupment or by any other different nomenclature.

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