Statutory pre-deposit against assessed liability is treated as fee payment, while penalty deposit was held refundable.

A statutory pre-deposit made as a condition for filing an appeal against an assessed market fee was treated as payment towards the existing liability, not a mere security deposit, so it was non-refundable when the assessment remained undisturbed. The prospective protection in the earlier ruling applied only to amounts not yet collected and did not affect sums already deposited before that decision. By contrast, the 10% amount deposited towards penalty was refundable because the basis for retaining that penalty did not survive once future recovery of the underlying levy was excluded. The stated ratio is that a fixed statutory pre-deposit against an assessed liability is payment in discharge of that liability, not a refundable deposit.

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Issues: (i) Whether the amount deposited by the sugar mills as a statutory pre-condition for filing appeals under section 27B of the Bihar Agricultural Produce Markets Act, 1960 was a payment of market fee so as to be non-refundable. (ii) Whether the 10% amount deposited towards penalty was liable to be retained after the later prospective ruling that future levy of market fee on such transactions would not apply.

Issue (i): Whether the amount deposited by the sugar mills as a statutory pre-condition for filing appeals under section 27B of the Bihar Agricultural Produce Markets Act, 1960 was a payment of market fee so as to be non-refundable.

Analysis: The statutory scheme required deposit with the market committee of one-third of the fee assessed as due before an appeal could be entertained. The amount was therefore part of the ascertained liability already fixed by assessment and was paid towards discharge of that liability, though subject to the result of the appeal. It was not a mere security deposit or an amount lying with the appellate authority. Since the appeals were dismissed and the assessment remained undisturbed, the amount already deposited retained the character of fee paid and could not be refunded. The prospective direction in the earlier ruling protected only amounts not yet collected, not amounts already paid before that judgment.

Conclusion: The pre-appeal deposit represented payment towards assessed fee and was not refundable.

Issue (ii): Whether the 10% amount deposited towards penalty was liable to be retained after the later prospective ruling that future levy of market fee on such transactions would not apply.

Analysis: The penalty was imposed only because of the assessed fee liability. Once the later ruling made the levy prospective and protected the unpaid past balance from recovery, the foundation for retaining penalty on the disputed past liability did not survive in the same manner. Retaining penalty while the major unpaid portion of fee itself was not recoverable would create an anomalous result. The amount deposited as penalty was therefore not justified for retention.

Conclusion: The 10% amount deposited towards penalty was refundable.

Final Conclusion: The assessments were not reopened, the pre-appeal fee deposits were sustained, the balance unpaid fee could not be recovered, and the penalty deposits had to be returned.

Ratio Decidendi: A statutory pre-deposit of a fixed proportion of an assessed tax or fee, made as a condition for maintaining an appeal and paid to the authority against whom the liability stands assessed, is a payment towards discharge of that assessed liability and not a mere security deposit.

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