Refund of excess tax deposits after remand reassessment, with interest and costs, where retention would amount to unjust enrichment.

Tax amounts deposited as a condition for stay during appeal had to be adjusted against the demand finally assessed after remand, and the excess was refundable. Where the reassessment substantially reduced the liability, continued retention of the larger deposits was impermissible and amounted to unjust enrichment and unlawful exaction. The court also directed payment of interest on the refundable excess and costs, reflecting that the taxpayer was entitled to restitution of amounts collected beyond the final tax demand.

---

---

Issues: Whether the petitioner was entitled to refund of the tax amounts deposited during appellate proceedings, after the demand stood substantially reduced in the remand assessment, together with interest and costs.

Analysis: The amounts were deposited only as a condition for stay of recovery during the appeal. After remand, the assessing authority substantially reduced the tax liability, leaving only a small balance due. Retaining the larger sums deposited earlier, without adjusting them against the final demand and refunding the excess, was held to be impermissible and amounting to unjust enrichment. The continued retention of the excess was also found inconsistent with the constitutional guarantee against unlawful exaction.

Conclusion: The petitioner was entitled to refund of the excess amounts after adjustment against the tax finally assessed post remand, together with interest at 9% per annum and costs of Rs. 2,00,000.

---