TaxTMI 
TaxTMI 
1977 (8) TMI 140
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....------------------------------------ The judgment of M. H. BEG, C. J., Y. V. CHANDRACHUD, P. N. BHAG- WATI, V. R. KRISHNA IYER, N. L. UNTWALIA and S. MURTAZA FAZAL ALI, JJ., was delivered by V. R. KRISHNA IYER, J. P. S. KAILASAM, J., delivered a separate judgment. KRISHNA IYER, J.- This bunch of appeals brought by the State of Gujarat by certificate has a pan-Indian impact, as the sales tax project which has been struck down by the High Court may adversely affect cousin provisions in like statutes in the rest of the country. Contradictory verdicts on the constitutionality of a certain pattern of sales tax legislation, calculated to counter consumer victimisation by dealers, have been rendered by different High Courts and what complicates the issue is that reasonings in the prior rulings of this Court on the topic have been pressed into service by both sides. This slippery legal situation makes it necessitous for the Constitution Bench of this Court (numerically expanded, almost to breaking point, by the recent 42nd Constitution Amendment) to declare the law with relative certitude, reviewing, in the process, its previous pronouncements and overruling, if requ....
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....urt) are sections 37(1) and 46 of the Act. The High Court of Maharashtra, however, has taken a diametrically opposite view and other High Courts have ranged themselves on one side or the other in this controversy, while dealing with more or less similar statutes. We confine our judgment to the Act that is before us and do not go into the validity of the other statutes which have been incidentally referred to in the Court. The point involved is so critical, yet delicate, that, even short but significant variations in the scheme of the statute may well spell a result which is opposite. We will now proceed to project preliminarily the factual-legal setting in order to appreciate whether the legicidal blow delivered by the High Court is merited or not. Fortunately, the facts are few and not in dispute and lend themselves to sharp focus on the legal screen. The respondent, a registered dealer under the Act, was, by implication of the provisions, eligible to pass on sales tax leviable from him to the purchaser, but several commodities, especially the necessaries of life, were not liable to tax (section 5). Other situations of non-exigibility also exist. Yet several dealers showed a....
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....iction, a punishment of simple imprisonment (up to 6 months) with or without fine (up to Rs. 2,000). We may excerpt section 63(1)(h) since that may have to be referred to later: "63. (1)(h) Whoever contravenes any of the provisions of section 46, shall, on conviction, be punished with simple imprisonment which may extend to six months or with fine not exceeding two thousand rupees, or with both; and when the offence is a continuing one, with a daily fine not exceeding one hundred rupees during the period of the continuance of the offence." Section 37(1) relates to imposition of penalty departmentally for contravention of section 46. It reads: "37. (1)(a) If any person, not being a dealer liable to pay tax under this Act, collects any sum by way of tax, or being a registered dealer collects any amount by way of tax in excess of the tax payable by him, or otherwise collects tax in contravention of the provisions of section 46, he shall be liable to pay, in addition to any tax for which he may be liable, a penalty as follows: (i) where there has been a contravention referred to in clause (a), a penalty of an amount not exceeding two thousand rupees;.....and, in addition . ....
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.... 37(1)(a) of the Act. Certainly, these illustrations do emphasise that the scope of section 37(1)(a) is not restricted to sums collected along with the price by dealers by way of tax with a touch of turpitude but also innocently on the strength of the actual or anticipated (albeit erroneous) view of the tax officers themselves. Certainly, the fiscal minions of Government, if they blatantly misuse power and overtax to bring discredit to a benignant State, must be publicly punished since respect for the law is not a one-way street. We will bear this in mind when discussing the vires of the challenged provisions, although even here we must mention that a large number of dealers for whom the legislation is made apparently envisage guilty levies under the guise of sales tax. A law has to be adjudged for its constitutionality by the generality of cases it covers, not by the freaks and exceptions it martyrs. In any view, the fact is not disputed that the dealers against whom section 46 and section 37(1)(a) have been applied have collected sums by way of tax which are not exigible as tax. The respondents have all collected from their customers amounts qua sales tax which come within the co....
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....y to impose tax on sales but to ensure that the sales tax law is not misused by the commercial community to fob off pseudo-fiscal burden upon the consumer community. It is elementary economic theory that while the legal burden of sales tax falls upon the dealer, the fiscal impact is eventually on the consumer. A welfare State, with its logos and legend as social justice, has a sacred duty while it exercises its power of taxation to police the operation of the law in such manner as to protect the public from any extra burden thrown on it by merchants under cover of the statute. Bearing in mind the quintessential aspects of the rival contentions, let us stop and take stock. The facts of the case are plain. The professed object of the law is clear. The motive of the legislature is irrelevant to castigate an Act as a colourable device. The interdict on public mischief and the insurance of consumer interests against likely, albeit, unwitting or ex abundanti cautela excesses in the working of a statute are not merely an ancillary power but surely a necessary obligation of a social welfare State. One potent prohibitory process for this consummation is to penalise the trader by casting ....
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....e may condense the legal test that divides the constitutional from the unconstitutional, is that if all that the legislation means to do is to take over, whatever the verbal veils worn, the collections which were ex hypothesi not sales tax but were illegal additives as if sales tax were due, charged along with the price by the dealer, then such an expropriation of the expropriators (putting it in a morally favourable, though exaggerated, light for the State) is beyond entry 54 and, therefore, ultra vires. On the other hand, all real punitive measures, including the dissuasive penalty of confiscating the excess collections, are valid, being within the range of ancillary powers of the legislature competent to exact a sales tax levy. The punitive impost in section 37(1)(a) is, therefore, legitimate and valid. If we accept this test, the appeals must succeed, so far as this point is concerned. Before scanning the decisions to discover the principle laid down therein, we may dispose of the contention which has appealed to the High Court based on "colourable device". Certainly, this is a malignant expression and when flung with fatal effect at a representative instrumentality like the....
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....ut that in pith and substance the impugned legislation does not fall within entry 54 read with entry 64 of List II, that it is not embraced even by the expansive connotation of ancillary powers and that it is not possible to save the law even by reading down some of the wide expressions used. In the present case, the narrow issue is as to whether the forfeiture clause in section 37(1) is bad because of the besetting sin of colourability. If it is a punitive measure to protect public interest in the enforcement of the fiscal legislation, it falls squarely within the area of implied powers. Therefore, the finer point stressed by Shri Kaji is that the expression "forfeiture" is a ritualistic recital to cover up a secret design to snatch from the traders sums which cannot be reached at except by the device of forfeiture. In frank fact, it is not a measure of penalty but an oblique methodology to do an illegitimate thing which is beyond the legislature's legitimate reach. We have, therefore, to examine this short point in the light of the decisions of this Court. Coming to "forfeiture", what is the true character of a "forfeiture". is it punitive in infliction, or merely another ....
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....be regarded as a punishment inflicted for a violation of some duty enjoined upon the party by law; and such, very clearly, is the meaning of the word in the act in question." The same connotation has been imparted by our Court too. A Bench Bankura Municipality v. Laiji Raja & Sons A.I.R. 1953 S.C. 248 at 250., has held: "According to the dictionary meaning of the word 'forfeiture' the loss or the deprivation of goods has got to be in consequence of a crime, offence or breach of engagement or has to be by way of penalty of the transgression or a punishment for an offence. Unless the loss or deprivation of the goods is by way of a penalty or punishment for a crime, offence or breach of engagement it would not come within the definition of forfeiture." This word "forfeiture" must bear the same meaning of a penalty for breach of a prohibitory direction. The fact that there is arithmetical identity, assuming it to be so, between the figures of the illegal collections made by the dealers and the amounts forfeited to the State cannot create a conceptual confusion that what is provided is not punishment but a transference of funds. If this view be correct, and we hold so, ....
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.... which formulates the question and furnishes the answer: "The first question therefore that falls for consideration is whether it was open to the State Legislature under its powers under entry 54 of List II to make a provision to the effect that money collected by way of tax, even though it was not due as a tax under the Act, shall be made over to Government. Now it is clear that the sums so collected by way of tax are not in fact tax exigible under the Act. So it cannot be said that the State Legislature was directly legislating for the imposition of sales or purchase tax under entry 54 of List II when it made such a provision, for on the face of the provision, the amount, though collected by way of tax, was not exigible as tax under the law. The provision however is attempted to be justified on the ground that though it may not be open to a State Legislature to make provision for the recovery of an amount which is not a tax under entry 54 of List II in a law made for that purpose, it would still be open to the legislature to provide for paying over all the amounts collected by way of tax by persons, even though they really are not exigible as tax, as part of the incidental and....
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.... The Court proceeded to refer to an attempt made to justify the provision as providing for a penalty, but found nothing in the text to justify the impugned sub-section (2) of section 11, as a penalty for breach of any prohibition under the Act. On the other hand, in the setting of the statute, the Court came to the contrary conclusion: "Section 11(2) In our opinion has nothing to do with penalties and cannot be Justified as a penalty on the dealer. Actually section 20 makes provision in clause (b) for penalty in the case of breach of section 11(1) and makes the person committing a breach of that provision liable, on conviction by a Magistrate of the first class, to a fine ...... In this connection we may refer to clause (c) of section 20, which provides that any person who fails 'to pay the amounts specified in sub-section (2) of section 11 within the prescribed time' shall, on a conviction by a Magistrate, be liable to fine. It is remarkable that this provision makes the person punishable for his failure to pay the amount which is not authorised as a tax at all under the law, to Government. It does not provide for a penalty for collecting the amount wrongly by way of ta....
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....ion in section 20A went further. While the illegal collections were to be made over to the Government treasury it was further provided that such amounts shall be held by the State Government in trust for the person from whom it was realised by the dealer and the dealer himself on depositing these sums into Government treasury shall be discharged from his obligation to return the sums to the purchasers. There was an incidental direction that, on a claim being made by the aggrieved buyers, these driblets shall be refunded. The scheme of clause (8) of section 20A made it clear that the legislation was in public interest, that while suits against dealers to recover paltry sums by a large number of customers would lead to endless and expensive litigation, a simpler process of returning those sums on application by the relevant purchasers would protect the common buyer while depriving the dealers of their unjust gains. It was manifestly a consumer protection measure, as we see it. Shah, J., speaking for the Court, held that this pro bono publico purpose did not dissolve the constitutional disability and ruled: "The State Legislature may under entry 54, List II, be competent to enact a....
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....hasers from being subjected to an unlawful burden. Social justice clauses, integrally connected with the taxing provisions, cannot be viewed as a mere device or wanting in incidentality. Nor are we impressed with the contention turning on the dealer being an agent (or not) of the State vis-a-vis sales tax; and why should the State suspect when it obligates itself to return the moneys to the purchasers. We do not think it is more feasible for ordinary buyers to recover from the common run of dealers small sums than from Government. We expect a sensitive Government not to bluff but to hand back. So, we largely disagree with Ashoka [1970] 26 S.T.C. 254 at 259 (S.C.); [1970] 3 S.C.R. 455 at 461., while we generally agree with Abdul Quader [1964] 15 S.T.C. 403 (S.C.); [1964] 6 S.C.R. 867. We must mention that the question as to whether an amount which is Illegally collected as sales tax can be forfeited did not arise for consideration in Ashoka [1970] 26 S.T.C. 254 (S.C.); [1970] 3 S.C.R. 455. We may conclude with the thought that Parliament and the State Legislatures will make haste to inaugurate viable public interest litigation procedures cutting costs and delays. After all, th....
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.... perused and reflected over these citations, we have screened them from specific reference In this judgment since these decisions were cited by counsel merely to drive home the significance of some stray thought expressed in these judgments having but marginal meaningfulness. Skilful submissions were made on the construction of the text of section 37(1) of the Act to convince us that the sub-section itself made a distinction between penalty and forfeiture, suggesting that forfeiture was not regarded as a penalty. Side references to a few other sections were made to reinforce this thesis. The identity of the forfeit and the illegal collection was also urged by the assessee as a tell-tale circumstance to contend that it could not be a penalty. Moreover, the express penalty in section 37(1)(a) had a ceiling while the additive forfeit was unlimited. A penny worth of penalty and a pound worth of forfeiture proved that the statute itself meant the latter to be not a penalty. From a verbal, syntactic and structural angle there is something to be said for this submission. But the heart of the matter is that the forfeit in the inartistically worded section is plainly punitive, not nakedl....
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....ns and the purchasers can demand back the very same sums. There is injustice here. Without holding that article 19(5) is violated, we think the ends of justice can be met by reading down the forfeiture clause interpretatively. Section 37(1) does say that "any sum collected by the person by way of tax ... shall be forfeited.....". Literally read, the whole sum goes to the State. Let us suppose the dealer has returned the whole or part of the collections to the customers. Should the whole amount, regardless of such repayment, be forfeited. We think not. Section 37(1) uses the expressions, in relation to forfeiture, "any sum collected by the person ... shall be forfeited". What does "collected" mean here? Words cannot be construed effectively without reference to their context. The setting colours the sense of the word. The spirit of the provision lends force to the construction that "collected " means "collected and kept as his" by the trader. If the dealer merely gathered the sum by way of tax and kept It in suspense account because of dispute about taxability or was ready to return it if eventually it was not taxable, it was not collected. "Collected", in an Australian Custom....
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....g "shall be liable to be forfeited". This signification of "forfeiture" as "liability to forfeiture " saves the equity of the statute. The Commissioner must have regard to all the circumstances of the case, including the fact that amounts illegally collected have been returned to the purchasers to whom they belong before passing the final order. We are clear in our minds that the forfeiture should operate only to the extent, and not in excess of, the total collections less what has been returned to the purchasers. We may go a step further to hold that it is fair and reasonable for the Commissioner to consider any undertaking given by the dealer that he will return the amounts collected from purchasers to them. The humanism of a provision may bear upon its constitutionalism. Counsel have argued, is it not unreasonable to forfeit huge sums and still to expose the dealer to several actions. Is it not discriminatory to make the departmental punishment disproportionately onerous vis-a-vis criminal inflictions under section 64(1)(h). Blessed are they who are prosecuted, for the criminal law is benign ! These possibilities only underscore the necessity, even on conviction, of deprivati....
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....is forfeited to the State, there is no obligation to make it over to the purchaser, but in the welfare orientation of our State and certain constitutional emanations we leave unexplored, such an obligation should be voluntarily undertaken. A fairly exhaustive survey of case-law has been made, consuming considerable industry of counsel and presenting a sky-view and groundview of judicial mentation in this branch of sales tax law, bedrocked on constitutional law. While we are edified by the immense project undertaken, in these crowded days of explosive docket backlog, the fine art of miniaturization, without traumatization, may well be a creative Darwinian mutation in forensic submissions for the survival of the great judicial institution. Moreover, small can be beautiful, both in judgments and arguments. But we must append our appreciation of the thoroughness, thoughtfulness, perspicacity and persuasiveness of Sarvashri Kaji, B. Sen, S.T. Desai and F.S. Nariman (for the intervener), the plurality of counsel presenting each a separate facet geared to the same goal of enlightening the Court. For the reasons set out above we allow the appeals, but, in the circumstances, without c....
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....)(ii) or (ii-a) or clause (b), a penalty of an amount not exceeding two thousand rupees, and in addition, any sum collected by the person by way of tax in contravention of sub-section (2) of section 15A-I or section 46 shall be forfeited to the State Government. When any order of forfeiture Is made, the Commissioner shall publish or cause to be published a notice thereof for the information of the persons concerned giving such details and in such manner as may be prescribed." Section 46(1) prohibits collection of tax in certain cases by providing that no person shall collect any sum by way of tax in respect of sales of any goods on which by virtue of section 5 no tax is payable. Sub- section (2) which is held to be ultra vires runs: "46. (2) No person, who is not a registered dealer and liable to pay tax in respect of any sale or purchase, shall collect on the sale of any goods any sum by way of tax from any other person and no registered dealer shall collect any amount by way of tax in excess of the amount of tax payable by him under the provisions of this Act: Provided that, this sub-section shall not apply where a person is required to collect such amount of the tax sep....
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.... by the person by way of tax in contravention of sub-section (2) of section 15A-I or section 46 shall be forfeited to the State Government. The rest of the section prescribes the procedure for levy of penalty or forfeiture. It is thus provided that a contravention would incur levy of a penalty of an amount not exceeding two thousand rupees in addition to the sum collected by way of tax being forfeited to the State Government. If the forfeiture is levied for the purpose of enforcement of the enactment, it would be valid but if the forfeiture is for the purpose of collecting' the amount which is wrongly collected by the assessee, the use of the word "forfeiture" would be merely a device to get at the sum which had been collected in contravention of the provisions of the Act, and beyond the power of the State Legislature as the intention of the State is to secure the sum which has been collected by the assessee which is not exigible as a tax. While the contention of the State is that it is within the competence of the State Legislature under List II, entry 54, to impose any penalty including forfeiture of the sum unauthorisedly collected by the assessee for the purpose of pr....
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....h the power of the State under entry 54, List II, it held: "The Legislature of the Orissa State was therefore competent to exercise power in respect of the subsidiary or ancillary matter of granting refund of tax improperly or illegally collected, and the competence of the legislature in this behalf is not canvassed by counsel for the assessees." It was further held that if the legislature was competent to legislate for granting refund of the sales tax improperly collected, there is no reason why the power to declare that refund shall be claimable only by the person from whom the dealer has actually realised the amounts by way of sales tax or otherwise, should be excluded. It was thus found that the State Legislature is competent in granting refund of tax unauthorisedly collected and to declare that refund is claimable only by the person from whom the dealer realised the amount. In fact, the competence to legislate for granting the refund of the sales tax improperly collected was not questioned. This decision did not consider the question whether a direction by the Government directing the assessee to pay the amount to the Government is within the legislative competence. This....
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....at the State Legislature was directly legislating for the Imposition of sales or purchase tax under entry 54 of List II. As what was collected was not tax exigible under the Act, though collected as a tax, this Court held that the amount collected cannot be recovered as tax. The position is explained thus: "We do not think that the ambit of ancillary or incidental power goes to the extent of permitting the legislature to provide that though the amount collected-may be wrongly-by way of tax is not exigible under the law as made under the relevant taxing entry, it shall still be paid over to Government, as if it were a tax." Referring to Orient Paper Mills Ltd. v. State of Orissa [1961] 12 S.T.C. 357 (S.C.); [1962] 1 S.C.R. 549., the Court held that the decision had no application to the facts of the case before them on the ground that the matter dealt with the question of refund and observed that "it cannot be doubted that refund of the tax collected is always a matter covered by incidental and ancillary powers relating to the levy and collection of tax". An attempt to justify the provisions of section 11(2) on the ground that It was by way of penalty was not accepted as....
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....act or any judgment, decree or order of any tribunal, court or authority, if the prescribed authority has reason to believe that any dealer has or had, at any time, whether before or after the commencement of this Act, collected any such amount, in a case in which or to an extent to which the said dealer was or is not liable to pay such amount, it shall serve on such dealer a notice in the prescribed manner requiring him on a date and at a time and place to be specified therein, either to attend in person or through an authorised representative to show cause why he should not deposit into the Government treasury the amount so collected by him. (b) .............................. (4) Where any amount so collected by the dealer and deposited by him into the Government treasury has already been refunded to the dealer in pursuance of or as a result of any judgment, decree or order of any tribunal, court or authority, but the dealer has not refunded the amount to the person from whom he had collected it, the prescribed authority shall, notwithstanding such refund to the dealer, proceed to take action in accordance with the provisions of sub-section (3) for securing deposit of such ....
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....s' case [1961] 12 S.T.C. 357 (S.C.); [1962] 1 S.C.R. 549. Shah, J., speaking for the Court held that Orient Paper Mills' case [1961] 12 S.T.C. 357 (S.C.); [1962] 1 S.C.R. 549., had no bearing on the question whether the State was competent to enact section 20A of the Bihar Sales Tax Act as the case does not support the plea that the State Legislature is competent to legislate for demanding payment or for retaining amounts recovered by a registered dealer but which are not due as sales tax to the State. In Orient Paper Mills' case [1961] 12 S.T.C. 357 (S.C.); [1962] 1 S.C.R. 549., tax was collected on sales outside the State of Orissa and when refund was demanded by the assessees in consequence of the decision in State of Bombay v. United Motors (India) Ltd. [1953] 4 S.T.C. 133 (S.C.); [1953] S.C.R. 1069., which held that sales outside the State concerned were not taxable, the legislature intervened providing that the refund could be claimed only by a person from whom the dealer had realised the amount by way of sales tax. In Ashoka Marketing case [1970] 26 S.T.C. 254 (S.C.); [1970] 3 S.C.R. 455., tax on the amount representing railway freight was collected and when such....
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....vant provision, reads as follows: "(4) If any person collects any amount by way of tax in contravention of the provisions of sub-section (1) or (2) or if any registered dealer collects any amount by way of tax in excess of the amount payable by him under this Act, the amounts so collected shall, without prejudice to any prosecution that may be instituted against such person or dealer for an offence under this Act be forfeited to the State Government and such person or dealer, as the case may be, shall within the prescribed period, pay such amount into a Government treasury and in default of such payment, the amount shall be recovered as an arrear of land revenue." Sub-section (4) provides for forfeiture to the State of any amount collected by the dealer by way of tax in excess of the amount payable by him under the Act. It was contended by the revenue that section 12A(4) is a penal provision as it provides for the imposition of a penalty on those who contravene section 12A(1) and (2) and that such a power was Incidental to the power to tax sales and as such valid. A decision of the Gujarat High Court in Ramgopal v. Sales Tax Officer, Surat [1965] 16 S.T.C. 1005., was relied o....
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....ions of the Sales Tax Act is beyond the legislative competence of the State. State of U. P. v. Annapurna Biscuit Mfg. Co. [1973] 32 S.T.C. 1 (S.C.); [1973] 3 S.C.R. 987., is a decision by a Bench of two Judges of the Supreme Court. In this case the validity of section 29-A of the U. P. Sales Tax Act, 1948, was challenged. Section 29-A runs as follows: "Refund in special cases.-Notwithstanding anything contained in this Act or in any other law for the time being in force or in any judgment, decree or order of any court, where any amount is either deposited or paid by any dealer or other person under sub-section (4) or sub-section (5) of section 8-A, such amount or any part thereof shall on a claim being made in that behalf in such form and within such period as may be prescribed, be refunded to the person from whom such dealer or the person had actually realised such amount or part, and to no other person." Following the decisions in Abdul Quader's case [1964] 15 S.T.C. 403 (S.C.); [1964] 6 S.C.R. 867., and Ashoka Marketing case [1970] 26 S.T.C. 254 (S.C.); [1970] 3 S.C.R. 455., this Court rejected the contention that the impugned section was covered by entry 54 in List....
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....tempt by the State to demand and retain the amount unauthorisedly collected, and (3) the right to direct the refund of the amounts collected from the assessee. The question as to whether the amounts thus unauthorisedly collected can be forfeited is not considered in any of these cases. An attempt was made by the assessees to derive support from Ashoka Marketing case [1970] 26 S.T.C. 254 (S.C.); [1970] 3 S.C.R. 455., that it related to a notice issued by the Assistant Commissioner to the assessees under section 20A(3) of the Bihar Sales Tax Act requiring them to show cause why the sales tax on the railway freight which had become refundable should not be forfeited. Though the notice uses the word "forfeit" the provision of section 20A(3) only mentions that the amounts collected may be required to be deposited in the Government treasury. For deciding the question at issue it is unnecessary to consider the submissions made on behalf of counsel that the reasoning in Orient Paper Mills [1961] 12 S.T.C. 357 (S.C.); [1962] 1 S.C.R. 549., and Ashoka Marketing(1) cases is not consistent. In Abdul Quader's case [1964] 15 S.T.C. 403 (S.C.); [1964] 6 S.C.R. 867., the Court clearly la....
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.... and also penalty by way of forfeiture. This punitive measure affects all persons who sell non-taxable goods. In section 37(1)(b)(ii) in addition to penalty not exceeding rupees two thousand, the sum collected by way of tax is directed to be forfeited to the State Government. The words "penalty" and "forfeiture", according to the learned counsel, are different in their application and, in the present case, forfeiture relates to the amount which is the same as has been unauthorisedly collected and, therefore, it is only a device by the State to recover the amount so collected. The section proceeds to lay down the procedure for effecting the forfeiture by requiring the Commissioner to publish a notice, hear the parties as to why penalty or forfeiture or both as prescribed should not be imposed and make such order as he thinks fit. A distinction between penalty and forfeiture is maintained. I am unable to accept the plea that forfeiture is not a penalty. Forfeiture is one form of penalty. Forfeiture of property is one of the punishments provided for in the Indian Penal Code. For contravention of the sales tax law the section provides two forms of punishment, levy of penalty and for....
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....r without a guilty mind. For proper enforcement of various provisions of law it is common knowledge that absolute liability is imposed and acts without mens rea are made punishable. Mr. Kaji as well as Mr. B. Sen, the learned counsel for some of the assessees, further brought to our notice cases in which by the application of the provisions of the sales tax enactment considerable hardship and Injustice has been caused to the dealers. It was submitted that where the assessee innocently collected amounts on the impression that tax was leviable, the amounts so collected were forfeited while his obligation to the purchasers to refund the amounts continued. If the assessee by a mistake failed to collect tax from the purchasers, tax was levied and collected from the assessee making him suffer in any event. When after a costly litigation, the assessee succeeded In establishing that sales tax cannot be collected on the railway freight on cement bags or inter-State sales, the Government promptly forfeited such amounts. I agree these are instances of hardships to the assessees and deserve Government attention. But for that reason the Courts cannot say that the act is beyond the legislativ....