Prospective withdrawal of turnover tax levy does not create a refund right for liability already crystallized before repeal.

A prospective withdrawal of the turnover tax levy did not extinguish liability that had already crystallized for the disputed period under Section 3-G of the U.P. Trade Tax Act, 1948. Because the tax liability arose before the ordinance withdrawal took effect, the later deposit date did not change the operative liability, and the administrative communication could not authorise refund of amounts already recovered. The claim for refund was therefore not maintainable, and the principle of unjust enrichment did not alter that result.

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Issues: Refund of turnover tax deposited after withdrawal of the ordinance imposing the levy, and the effect of the subsequent administrative communication on liability already crystallized.

Analysis: The assessee had deposited turnover tax under Section 3-G of the U.P. Trade Tax Act, 1948 pursuant to a demand notice, but the levy had been withdrawn prospectively by the U.P. Trade Tax (Amendment) Ordinance 2005. The Court held that the relevant liability for the disputed period had crystallized before the withdrawal took effect, and the later deposit date did not alter the date when the tax liability arose. The principle of unjust enrichment did not assist the assessee, but the decisive factor was that the withdrawal was only prospective and did not extinguish an already crystallized liability. The administrative communication also did not permit refund in cases where recovery had already been made.

Conclusion: The refund claim was not maintainable either under the existing law or under the administrative decision, and the answer was against the assessee.

Ratio Decidendi: Where a tax liability has already crystallized before a prospective withdrawal of the levy, subsequent deposit or administrative instructions not to make fresh recoveries do not create a right to refund of amounts already recovered.

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