JUDGMENT

WANCHOO, J. –

This is an appeal on a certificate granted by the Kerala High Court relates to refund of sales tax collected by the appellant, State of Kerala, from the respondent. It appears that sales tax was assessed on the appellant by an order dated May 7, 1951. That order related to two periods, the second being from May 30, 1950, to March 31, 1951. The respondent in its writ petition claimed refund of Rs. 80,048-13-6 with respect to both the periods on the ground that sales on which this tax had been levied were exempt from tax under Article 286(1)(a) of the Constitution as it then stood. In the present appeal however we are concerned only with refund of Rs. 54,375-5-0 in respect of which relief has been granted by the High Court. The remember of the claim has been dismissed and the respondent not having appealed that has become final.

The circumstances in which this sales tax came to be levied are these. The respondent submitted returns for the period from May 30, 1950, to March 31, 1951, showing a net turnover of Rs. 23,02,776-1-9 and deposited necessary sales tax. The respondent's case further was that by mistake it did not claim exemption in connection with sales made to the State of Punjab and that is how it came to pay over Rs. 71,000 towards sales tax for these periods. The respondent seems to have discovered this mistake soon after May 7, 1951, though the exact date is not available on the record. It therefore addressed the Sales Tax Officer on August 29, 1951, in this connection. Correspondence seems to have gone on between the respondent and the Sales Tax Officer and eventually the Sales Tax Officer wrote to the respondent on October 1, 1952, that the respondent should move the Government directly detailing all the facts. The respondent then appears to have moved the Government and asked for refund. But it received no reply from the Government and filed the writ petition in the High Court out of which the present appeal has arisen on May 30, 1954. It was thereafter that the Government intimated to the respondent that it would make no refund with respect to the year ending March 31, 1951. The respondent's case in the petition was that it had paid the sales tax by mistake and was entitled to refund as sales outside the State were not liable to tax under Article 286 of the Constitution as it then stood.

The petition was opposed on behalf of the appellant and it was urged that the respondent was estopped from claiming any refund because it had paid the tax voluntarily. A number of other points were also raised on behalf of the appellant of which it is only necessary to mention that after some hesitation the appellant had contended that the sales were not outside sales and therefore not exempt under Article 286 of the Constitution.

The High Court rejected the contention that the respondent was estopped from claiming refund even if the payment of tax had been made by mistake and relied on the judgment of this Court in Sales Tax Officer v. Kanhaiyalal ([1959] S.C.R. 1350; 9 S.T.C. 747.). It did not finally decide the question whether the sales in respect of which tax amounting to Rs. 54,375-5-0 had been levied were outside sales and the levy was contrary to Article 286(1)(a) of the Constitution. It however issued a mandamus to the State Government "to determine the claim of the writ petitioner for return of Rs. 54,375-5-0 on the ground of such of such levy being contrary to Article 286(1)(a) of the Constitution and paid by mistake and further on the claim being justified, to return what be found to have been wrongly collected". It is this order of the High Court which is being challenged before us.

There is no doubt in view of the decision of this Court in Sales Tax Officer v. Kanhaiyalal (A.I.R. 1964 S.C. 1006; 15 S.T.C. 450.) that money paid under a mistake of law comes within the word "mistake" in section 72 of the Contract Act and there is no question of estoppel when the mistake of law is common to both th