Retrospective validating amendment cannot reopen a lawful sales tax refund received under a binding appellate order.

A retrospective validating amendment to sales tax law did not, by itself, authorise recovery of a refund that had been lawfully granted and received under a binding appellate order. The amendment in section 17 of Madras Act XV of 1956 validated tax already levied or collected under the amended charging provision, but it did not convert a completed, lawful refund into an unlawful payment made under mistake of law. In the absence of clear statutory authority to reopen and recover that completed refund, the demand notices were unsustainable and had to be quashed.

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Issues: Whether the retrospective amendment to the sales tax law validated the earlier levy so as to justify a demand requiring repayment of a refund already lawfully received under a binding appellate order.

Analysis: The amendment in section 17 of Madras Act XV of 1956 validated tax already levied or collected under the amended charging provision, but the refund in question had been made when the appellate order reducing the rate was in force and when the amount was lawfully due to the assessee. The subsequent retrospective amendment did not convert that lawful refund into an unlawful payment or a payment made under mistake of law. The validating provision could not be used to reopen a completed refund and compel repayment in these circumstances.

Conclusion: The demand for repayment was not sustainable. It was held in favour of the assessee that the notices of demand had to be quashed.

Ratio Decidendi: A retrospective validating amendment does not, by itself, render unlawful a refund that was lawfully made and received under an operative appellate order, unless the statute clearly authorises recovery of such completed refund.

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