JUDGMENT

Dr. B. S. Chauhan C.J. - This writ petition has been filed for issuance of a direction to the opposite parties to refund the sales tax collected from the petitioner - company by quashing the order dated February 4, 1998 (annexure 1) and assessment order dated March 24, 1998 (annexure 2) to the writ petition.

The petitioner had established a large-scale industrial unit. However, it claimed benefit of tax exemption in view of part III of the Industrial Policy Resolution, 1989 (hereinafter called "IPR 1989") by filing an application on January 22, 1991. As the same was not granted, he filed OJC No. 6198 of 1994 which was decided vide judgment and order dated May 5, 1995 (Ipitata Sponge Iron Ltd. v. State of Orissa [2001] 122 STC 259 (Orissa)). Subsequent thereto, respondent No. 5 recommended the case of the petitioner for granting benefit of tax holidays vide letter dated March 10, 1997. As no action was taken in pursuance of the said letter, the petitioner again approached this court by filing OJC No. 5990 of 1997 which was also disposed of (Tata Sponge Iron Ltd. v. State of Orissa [2001] 122 STC 354 (Orissa)) making certain observation and issuing certain direction to the respondent to consider the claim of the petitioner. It's claim was rejected vide order dated February 4, 1998 and assessment order dated March 24, 1998 was passed. Hence this petition.

The learned counsel for the petitioner has submitted that it is settled legal position that tax collected without authority of law is unconstitutional, illegal and petitioner is entitled for refund of the same and as such the petitioner was entitled to the benefit of IPR, 1989 and the opposite parties - authorities are bound to refund the amount of tax collected from it.

Be that as it may, learned counsel for the petitioner could not satisfy the court by showing any material on record that the tax liability of the State authority for the period it claimed refund has not been passed on to consumers. Therefore, the claim of refund would amount to unjust enrichment.

In K. S. Satyanarayan v. V. R. Narayana Rao AIR 1999 SC 2544, the honourable Supreme Court has held that juristic basis for such an order of recovery, even if not based on contract or tort, may fall on another category of quasi-contract or restitution. The honourable Supreme Court, while deciding the said case, approved and followed two decision of English Courts, namely Fibrosa v. Fairbairn [1942] 2 All ER 122 and Nelson v. Larholt [1947] 2 All ER 751, which are quite illuminating and the relevant parts thereof, respectively, are reproduced as under :

"... any civilised system of law is bound to provide remedies for cases of what has been called unjust enrichment or unjust benefit, that is, to prevent a man from retaining the money of, or some benefit derived from, another which it is against conscience that he should keep. Such remedies in English law are generically different from remedies in contract or in tort, and are now recognised to fall within a third category of the common law which has been called quasi-contract or restitution.

It is no longer appropriate to draw distinction between law and equity. Principles have now to be stated in the light of their combined effect. Nor is it necessary to canvass the niceties of the old forms of action. Remedies now depend on the substance of the right, not on whether they can be fitted into a particular framework. The right here is not peculiar to equity or contract or tort, but falls naturally within the important category of cases where the court orders restitution if the justice of the case so requires."

For the same, reliance can also safely be placed on the judgment in State of Madhya Pradesh v. Vyankatlal AIR 1985 SC 901, wherein the apex court observed that "... only the persons on whom lay the ultimate burden to pay the amount, would be entitled to get the refund of the same, and if it is not possible to identify the person on whom such burden has been p