The Sales Tax Validation Act, 1956, validated the levies or collections or purported levies or collections of sales tax during the period 1 April 1951 to 6 September 1955, and the setting aside of the assessment orders did not render the levies or purported levies illegal or unauthorized.

1. THIS is a suit for the recovery of Rs. 13,136. 69 np. consisting of a sum of Rs. 11,096. 69 np. as and by way of refund and sum of Rs. 2,080/- being interest from 24 September 1955 till 24 November 1958. The plaintiff's case is that the plaintiff was purported to be assessed to pay sales tax to the extent of Rs. 2803-2-0, Rs. 3670-5-0 and Rs. 4623-6-0 for the assessment periods 1950-51, 1951-52 and 1952-53 respectively under the Sales Tax Registration No. DH/2383. The orders for assessment were passed by the Assistant Superintendent of Sales Tax, Dhanbad in the State of Bihar by orders dated 25th September 1954. The plaintiff states that under a bonafide mistake that it was liable to pay sales tax for the said periods and that the defendant had a right to demand and receive such taxes from the plaintiff, the plaintiff paid a sum of Rs. 10,000/ - to the defendant on account of such taxes. The payment was made by cheque, being cheque No. 041203 dated 14 December 1953 for Rs. 10,000/- drawn on the Oriental Bank of Commerce Ltd. having its office at 12, India Exchange Place, Calcutta within the jurisdiction. The plaintiff was compelled to deposit a further sum of Rs. 1096-13-0 in respect of such assessment in order to appeal from the said pretended orders. The said payment was also made by cheque No. 011015 dated 23 July 1955 for Rs. 1096-13-0 drawn on Oriental Bank of Commerce Ltd. having its office at 2, India Exchange Place, Calcutta within the jurisdiction.

2. THE plaintiff preferred appeals from the said pretended orders. By an order dated 24 September 1955, the Assistant Commissioner, Sales Tax, Chota Nagpur Division in the State of Bihar allowed the appeal holding, inter alia, that the plaintiff could not be assessed to pay tax in Bihar. On or about 12 October 1955, the plaintiff filed with Superintendent of Sales Tax, Dhanbad from Calcutta within the jurisdiction an application for refund of Rs. 11,096-13-0. The defendant did not pay the said sum or any portion thereof. Under these circumstances, the plaintiff claims refund of Rs. 11,096. 69 np. and claims interest. The plaintiff states that by letter dated 7 June 1958 notice was served on the defendant under the Interest Act claiming interest @ 6 per cent.

On behalf of the defendant, the affidavit affirmed by Radha Raman Prasad on 17 December 1959 was treated as written statement. The defendant denies that the plaintiff was entitled to claim the said sum.

3. THE brief of documents, which was tendered and marked as Ex. A, shows that on 14 December 1953 the plaintiff sent a cheque for Rs. 10,000/- in compliance with the direction of the Sales Tax authorities of Bihar. On 25 September 1954, there were three several orders in respect of the years 1950-51, 1951-52 and 1952-53. It is recorded in the said orders that 'the dealer is liable to tax with effect from 26 January 1950. ' The plaintiff was not a registered dealer. The plaintiff gave an explanation in its letter dated 30 November 1953 contending that the plaintiff was not liable to registration in Bihar. The Sales Tax authority held that the plaintiff did not willfully fail to apply for registration and under those circumstances did not impose any penalty on the plaintiff. The plaintiff thereafter filed three appeals against the assessment orders. The appeals were disposed on 24 September 1955. It was held in those appeals that according to the latest decision of the Supreme Court, the plaintiff could not be assessed to pay any tax in Bihar.

4. THE following issues were framed at the trial:-1 (a) Was the sum of Rs. 10,000/- paid by the plaintiff under a bona fide mistake as stated in paragraph 2 of the plaint? (b) Was the plaintiff compelled to deposit with the defendant the sum of Rs. 1096-13-0 as stated in paragraph 3 of the plaint? 2. Is the plaintiff entitled to refund of the said sum in view of the provisions of the Sales Tax Validating Act of 1956 and Sales Tax Continuance Order of 1950? 3. Is the suit ba