First-point sales tax refund is limited to tax actually collected and proved; interest arises only after ascertainment.

Refund under a sales tax exemption linked to the first point of sale was confined to the tax actually collected at that point and proved to have been borne on the raw materials used by the claimant. A buyer could not base the refund on the price paid to later sellers; the assessee had to establish the exact first-point tax paid and compliance with the prescribed refund procedure. Interest was not available on an unascertained refund claim because the refundable amount had not yet been legally determined. The matter required fresh verification of the refund amount on proper proof, with no present entitlement to interest.

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Issues: (i) Whether refund under the sales tax law and the exemption policy had to be computed with reference to the tax actually collected at the first point of sale, and whether the assessee could claim refund on the price paid by subsequent purchasers; (ii) Whether the assessee was entitled to interest on the claimed refund amount without first establishing the exact refundable tax and compliance with the prescribed refund procedure.

Issue (i): Whether refund under the sales tax law and the exemption policy had to be computed with reference to the tax actually collected at the first point of sale, and whether the assessee could claim refund on the price paid by subsequent purchasers.

Analysis: The exemption operated in relation to the tax component actually borne at the first taxable sale of the raw material, because sales tax is attracted by the transaction of sale and the refund can extend only to tax that was in fact collected under the Act. The assessee therefore had to establish both the quantum of tax paid at the first point of sale and that the goods purchased were used as raw material in the manufacturing process. A claim based merely on the price paid by the assessee to later sellers could not fix the refund amount.

Conclusion: The assessee was not automatically entitled to refund on the basis claimed; the refund had to be worked out only on proof of the actual first-point tax collected.

Issue (ii): Whether the assessee was entitled to interest on the claimed refund amount without first establishing the exact refundable tax and compliance with the prescribed refund procedure.

Analysis: Since the refundable amount itself was yet to be determined and the claim required fresh verification by the assessing authority, interest could not be granted on an unascertained sum. The assessee was required to pursue the refund in the prescribed form and place the necessary evidence before the authority.

Conclusion: The assessee was not entitled to interest at that stage.

Final Conclusion: The matter was sent back for fresh determination of the refundable amount on proper proof, while denying any present claim to interest; the appeals were allowed only to that extent.

Ratio Decidendi: In a refund claim linked to a tax exemption at the first point of sale, refund can be granted only to the extent of tax actually collected at that point and proved to have been borne on the goods used by the claimant, and interest does not arise until the refundable amount is legally ascertained.

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