Limitation for refund of tax paid under mistake of law runs from discovery of the mistake, and both claims were time-barred.

Refund claims for tax paid under a mistake of law were subject to a three-year limitation period, and time began only when the mistake was discovered or could reasonably have been discovered. The publication of the earlier Tribunal decision in a law journal was treated as the discovery date for the claim based on the Bengal Finance (Sales Tax) Act, 1941, but the refund application filed in August 1999 was still beyond three years from that date. In the other matter, tax payments made under the 1941 Act before 1 May 1995 and the application filed in January 2000 were also held time-barred. The later Tribunal decision concerning the 1994 Act did not affect these refund claims.

---

---

Issues: Whether the claims for refund of tax paid under a mistake of law were barred by limitation.

Analysis: The applicants had paid tax under section 4C(1) of the Bengal Finance (Sales Tax) Act, 1941, and sought refund after the Tribunal had earlier declared the relevant levy invalid. A claim for money paid under mistake of law is governed by the three-year limitation period applicable to refund claims, and time does not run until the mistake is discovered or could reasonably have been discovered. For the applicant who relied on the 1941 Act, the date of publication of the earlier Tribunal decision in a law journal was treated as the date of discovery of the mistake. On that basis, the refund application filed in August 1999 was beyond three years from discovery. In the other matter, the payments were also made under the 1941 Act before 1 May 1995, and the application filed in January 2000 was likewise beyond limitation. The later Tribunal decision dealing with the 1994 Act had no bearing on these claims.

Conclusion: The refund claims were barred by limitation.

---