Exclusive statutory remedy bars refund suits; commission agent exemption fails without prescribed licence and compliance.

A taxing statute that provides a complete appeal and revision mechanism makes that statutory remedy exclusive, so a civil suit framed as a refund claim is barred if it would require the court to examine the legality of the assessment. The same document also states that a commission agent can claim exemption from tax only by obtaining the prescribed licence and complying with its conditions; absent a licence and compliant commission business records, the disputed turnover remains taxable. On the stated facts, the refund suit was barred and the exemption claim failed.

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Issues: (i) Whether a civil suit for refund of sales tax allegedly collected illegally was barred by section 18-A of the Madras General Sales Tax Act, 1939; (ii) whether a commission agent who had not obtained the statutory licence under section 8 could claim exemption from tax on the disputed turnover.

Issue (i): Whether a civil suit for refund of sales tax allegedly collected illegally was barred by section 18-A of the Madras General Sales Tax Act, 1939.

Analysis: Section 18-A prohibited any suit or other proceeding to set aside or modify an assessment made under the Act except as expressly provided therein. The provision was held to extend not only to direct challenges to assessment but also to suits framed as claims for refund, because any refund claim necessarily involved examination of the legality of the assessment. The Act provided a complete hierarchy of remedies by appeal and revision, and the use of the statutory machinery was treated as exclusive.

Conclusion: The suit for refund was barred. The finding was in favour of Revenue.

Issue (ii): Whether a commission agent who had not obtained the statutory licence under section 8 could claim exemption from tax on the disputed turnover.

Analysis: The definition of dealer included a commission agent carrying on business on behalf of principals, and section 8 afforded exemption only where the agent obtained the prescribed licence and acted in accordance with its conditions. On the facts, the firm had not obtained any licence and its accounts did not disclose compliant commission business. The disputed transactions were treated as taxable turnover, and the plea of exemption failed.

Conclusion: The assessee was liable to tax on the disputed turnover and could not claim exemption. The finding was in favour of Revenue.

Final Conclusion: The statutory remedy under the Sales Tax Act was exclusive, and the disputed turnover remained taxable, so the challenge failed in entirety.

Ratio Decidendi: Where a taxing statute provides a complete appellate and revisional mechanism, a civil suit which in substance challenges the legality of the assessment or seeks refund of tax collected under it is barred; and a commission agent is taxable unless he satisfies the statutory conditions for exemption.

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