The Minerals (Validation) Act, 1992 validated both imposition and collection of cess. Cess recovered till 4.4.1991 cannot be refunded, and the State is entitled to recover cess imposed/became due even after the said date.

S.K.Chattopadhyaya, J.

1. The petitioners have prayed for declaration that the respondents have no jurisdiction to realise cess on supply of coal/rejects/middlings from Kargali and Giddi Coal Washeries and also for direction to the respondents to refund the amount of cess on coal and local cess to the petitioners which were realised from them for different periods since March, 1991.

2. The legal position involved in this case has been settled by the Supreme Court as well this Court. In the case of Tata Iron and Steel Company Ltd. and another vs. Union of India and Others, 1996(1) PLJR 404 a Division Bench of this Court while upholding the validity of the cess and other taxes on Minerals (Validation) Act, 1992 observed that "the taxes collected before 4.4.1991 are not required to be refunded but Act does not sanction the recovery of any tax after 4.4.1991. " The effect of the said observation is that if the cess was realised by this State up-to 4.4.1991 it is not required to be refunded but it could not be recovered after 4.4.91. However, thereafter the Apex Court considering the same controversy in the case of P.K.Kannadasan vs. State of Tamil Nadu and others, AIR 1996 SC 2560 while upholding the validity of the Validation Act declared that no distinction can be drawn between the person who has paid the cess and the person who has not paid it because the Act indicates the intention to validate imposition as well as collection." Their lordships were of the view that the said Validation Act had validated both imposition and collection of cess. Their lordships held that "once the provisions, which create the levy, are deemed to have been enacted by Parliament, the levy is very much there with retrospective effect. Once there is a valid levy, not only the tax already collected need not be refunded but the taxes and cesses which have not already been collected can also be collected. This decision in effect has laid down that the taxes recovered till 4.4.1991 cannot be refunded and the State is entitled to recover the cess, which was imposed/became due even after the said date. This decision of the Supreme Court was relied by a Division Bench of this court in the case of Bharat Coking Coal Ltd. vs. State of Bihar and Ors., 1998(2) PLJR 523 wherein it has been held that it is open for the State to recover the tax even after the cut-off date if it is for the period prior to 4.4.1991.

3. The petitioners have alleged that they submitted tenders and offered to purchase middlings/slurry of different quantities from March, 1991 onwards for which respective purchase orders were given to them. It is further asserted that though the petitioners were only required to pay the amount of royalty, cess charge and taxes under the Bihar Sales Tax Act, but, on the contrary, they had to pay a huge amount towards cess for the months of March, April, May and June, 1991 respectively. According to them, a total sum of Rs.3,23,600-10P has been realised from them from March, 1991 to June, 1991 as cess on purchase of slurry/middlings by the respondent. This assertion has been countered by the respondents by averting that they are realising cess as the same relates to coal mined prior to 25.10.1989 and they have already deposited the amount of cess with the State Government. Thus, from the assertion made by the respondents it appears that they have not recovered any tax after 4.4.1991, the cut-off date as mentioned in the aforesaid judgment. Though the petitioners in their rejoinder have not controverted the aforesaid statement of the respondents that they were realising cess on coal which was mined prior to 25.10.1989, they have asserted that the respondents have not paid royalty on cess to the State Government and were realising cess even after the judgment of this Court.

4. In the case of M/s. Orissa Cement Limited vs. State of Orissa and Ors. and other analogous cases reported in AIR 1991 SC 1676 in Paragraph 64, the issue regarding refund of the