Judgment

GAJENDRAGADKAR, J.: The short question which arises in this appeal is whether the suit instituted by the appellant Firm of Illuri Subbayya Chetty and Sons, in the court of the subordinate Judge at Kurnool, seeking to recover Rs. 8,349/- from the respondent, the State of Andhra Pradesh, on the ground that the said amount had been illegally recovered from it under the Madras General Sales Tax Act, 1939 (No. IX of 1939) (hereinafter called the Act) for the years 1952-54 is competent or not; and this question has to be determined in the light of the scope and effect of S. 18-A of the Act.

2. The appellant is a firm of merchants carrying on commission agency and other business at Kurnool and as such, it purchases and sells groundnuts and other goods on behalf of principals for commission. For the year 1952-53, the Sales-tax authorities included in the appellant s taxable turn over an amount of Rs. 3,45,488/12/10 representing groundnut sales and collected the tax on the total turnover from it in September, 1953 when the amount of the said tax was determined and duly adjusted. The said turnover of Rs. 3,45,488/12/10 in fact represented sales of groundnuts and not purchases and tax was recovered from the appellant on the said amount illegally inasmuch as it is only on purchase of groundnuts that the tax is leviable. As a result of this illegal levy, the appellant had to pay Rs.. 5,398/473 for the said year. Similarly, for the subsequent year 1953-54 the appellant, had to pay in illegal tax of Rs. 1,159/11/9. In its plaint, the appellant claimed to recover this amount together with interest @ 12 per cent per annum and this is how the claim was valued at Rs. 8,349/-

3. This claim was resisted by the respondent on two grounds. It was urged that the suit was incompetent having regard to the provisions of Section 18-A of the Act; and on merits it was alleged that the transaction in regard to groundnuts on which sales-tax was levied and recovered from the appellant were transactions of purchases and not of sale. In this connection, the respondent referred to the fact that appellant itself had included the transactions in question in the return submitted by it in form A and that it was making payments tentatively every month to be adjusted after the final assessment was made at the end of the year. Accordingly, the final adjustment was made in September and the total amount due from the appellant duly recovered. Thus the appellant having voluntarily made the return and paid the taxes, it was not open to him to contend that the transactions in regard to groundnuts were not taxable under the Act. Besides, the appellant had not preferred an appeal either to the Deputy Commissioner of Commercial Taxes or to the Sales Tax Appellate Tribunal; and so, it had not availed itself of the remedies provided by the Act.

4. On these pleadings, the trial court framed three principal issues. The first issue was whether the suit was barred by S. 18-A of the Act; the second was whether there had been excess collection of sales tax for the two years in question and if so, how much? and the third issue was whether the appellant was estopped from questioning the validity of the assessment? According to the trial court, the respondent had failed to prove its pleas against the appellants claim and so, it recorded findings in favour of the appellant on all the three issues. In the result, a decree followed in favour of the appellant for the recovery of Rs. 6,558/- with interest @ 6 per cent per annum from November 12, 1955 till the date of payment.

5. This decree was challenged by the respondent by preferring an appeal before the High Court of Andhra Pradesh. It appeared that the decision of the said High Court in the case of State of Andhra Pradesh v. Shri Krishna Coconut Co., (1960) 1 Andh WR 279 was in favour of the view taken by the trial Court; but the respondent urged before the High Court that the said decision was erroneous in law and required reconsid