Refund of excise duty paid under mistake of law was allowed despite delay after timely discovery and pursuit of remedies

Refund of excise duty paid under a mistake of law was held not to be defeated by delay where the claim was raised within a reasonable time after discovery of the mistake and the claimant had diligently pursued departmental remedies. The court applied the principle that money paid under a legal mistake can be reclaimed within a reasonable period from discovery, and found that repeated representations before invoking writ jurisdiction supported the exercise of writ discretion. Relief was granted, and the petitioner was entitled to refund of the duty wrongly collected.

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Issues: Whether the writ petition for refund of excise duty paid under a mistake of law was barred by delay or limitation, and whether the petitioner was entitled to refund.

Analysis: The claim for refund arose after the petitioner learnt that the manufacture from steel ingots was not liable to excise duty. The petitioner had approached the departmental authorities repeatedly before invoking writ jurisdiction, and the period of payment in dispute had been specifically challenged on the footing that the duty was wrongly collected. In such circumstances, the delay could not be treated as fatal. The governing principle applied was that refund of money paid under a mistake of law may be sought within a reasonable time from the date of discovery of the mistake, and writ relief may be granted where the facts justify exercise of discretion.

Conclusion: The petition was not barred by delay or limitation, and the petitioner was entitled to refund of the excise duty paid by mistake.

Ratio Decidendi: A writ petition seeking refund of duty paid under a mistake of law is maintainable if filed within a reasonable time after discovery of the mistake, and delay does not bar relief where the claimant has diligently pursued departmental remedies.

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