Mistaken sales tax assessment under one law does not bar a later lawful levy under another applicable statute.

A mistaken assessment under one sales tax law did not, by itself, create estoppel against the successor State or prevent a later levy under a different applicable statute. Estoppel failed because no legally effective representation by the earlier assessing authority and no change of position in reliance on it was shown. The Court also distinguished cases involving successive officers under the same law: an earlier assessment under the Travancore-Cochin Sales Tax Act did not bar assessment under the Madras General Sales Tax Act. The remedy for any wrongful prior collection lay against the earlier assessment, not in defeating the later lawful levy.

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Issues: (i) whether the taxing authorities of the successor State were precluded by estoppel from treating the disputed transactions as having taken place in the Madras area when an earlier assessment had proceeded on the footing that they were within Travancore-Cochin; (ii) whether the earlier assessment under a different sales tax law barred the present assessment under the Madras General Sales Tax Act.

Issue (i): whether the taxing authorities of the successor State were precluded by estoppel from treating the disputed transactions as having taken place in the Madras area when an earlier assessment had proceeded on the footing that they were within Travancore-Cochin.

Analysis: Estoppel was held inapplicable because no representation by the earlier assessing authority, in the legal sense required for an estoppel, was shown. The record did not establish that the petitioners altered their position on the faith of any representation by the taxing officer. A mistaken assessment by one authority did not amount to an enforceable representation binding the successor State.

Conclusion: The plea of estoppel failed, and the successor State was not barred from making the present assessment.

Issue (ii): whether the earlier assessment under a different sales tax law barred the present assessment under the Madras General Sales Tax Act.

Analysis: The Court distinguished the income-tax decisions relied upon, since those concerned successive officers administering the same law. Here, the earlier assessment had been made under the Travancore-Cochin Sales Tax Act, while the present assessment was made under a different enactment. Under section 91 of the States Re-organisation Act, 1956, the benefits and burdens of the erstwhile States devolved on the successor State, but a liability to refund tax wrongly collected under one law did not extinguish the right to levy tax under another applicable law. The proper remedy, if any, lay against the earlier wrong assessment.

Conclusion: The earlier assessment did not bar the present levy, and the assessment under the Madras General Sales Tax Act was upheld.

Final Conclusion: The revision petition was dismissed because neither estoppel nor the prior assessment under a different statute prevented the successor State from sustaining the impugned tax assessment.

Ratio Decidendi: A mistaken assessment under one sales tax law does not, by itself, create an estoppel or bar a lawful assessment under another applicable statute by the successor State; the remedy for wrongful prior collection lies against the earlier assessment, not by defeating the later lawful levy.

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