of Orissa & Ors Vs. Mahanadi Coalfields
Ltd. & Ors  INSC 658 (6 May 1996)
A.M. (Cj) Ahmadi A.M. (Cj) Hansaria B.L. (J) Sen, S.C. (J)
1996 SCALE (4)229
THE MATTER OF Orient Paper & Industries Ltd. & Anr. V.Mahanadi
Coalfields Ltd. & Others
O R D E
interim order dated 3.1.1994, this Court directed
of Bank guarantee for the amounts in respect of the difference in regard to
payment of duty for the period subsequent to 1.1.1994 on condition that the
said amount shall be kept in a separate bank account in interest-earning
the respondents succeed in the writ petitions, the amount together with
interest should be refunded to the respondents. Admittedly the High Court by
its judgment dated 26.4.1994 allowed the writs and this Court affirmed that
order by its decision dated 21.4.1995. Ordinarily, therefore, under the Court's
order dated 3.1.1994 the respondents would be entitled to refund.
the language of this Court's order dated 21.4.1995 is relied upon to deny the
refund since it said:
our opinion, the amount so collected may be refunded to persons entitled to the
same, within a period of one year from today, failing which they should pay
interest at 18% p.a. on expiry of one year." Emphasis is laid on the word
"entitled" to say that the respondents are not entitled to refund. In
this connection, our attention was also invited to our subsequent order dated
11.8.1995 whereby pending determination of the dispute Mahanadi was ordered to
deposit the amount of the difference within three weeks, which deposit we
understand has come to be made. A separate statement was also required to be
filed in regard to those who were granted refunds. This is evident from the
affidavit of Kumarendra Nath, General Manager (Finance), which shows that the
company had deposited Rs.49,22,68,098.89 by two separate Demand Drafts.
Appended to the affidavit is a statement marked Appendix 'A' which shows the
amounts collected from purchasers/consumers of coal together with interest due
thereon minus the amount refunded betwecn 21.4.1995 and 11.8.1995. Appendix 'B'
is a statement showing the amount refunded/adjusted towards the sale price. The
total amount Rs.4,34,32,498 is shown to have been refunded/adjusted.
no merit in the objection raised. We consider it to be frivolous. The
submission that the refund must be refused because it would amount to 'unjust
enrichment' cannot be countenanced since this Court's order dated 3.1.1994 in
no uncertain words provided that on the respondents succeeding in the writ
petitions, they shall, without any other condition or stipulation, be granted
refund together with accrued interest. By our order of 11.8.1995, we secured
the amount by directing Mahanadi to deposit the amount in this court
subject to their contentions. Accordingly the amount of Rs.49,22,68,098.89 came
to be deposited on 31.8.1995.
is clear from this Court's order of 3.1.1994 that on a certain event happening,
namely, the respondent succeeding in the writ petitions, the amount was to be
refunded to them together with interest accrued thereon. The words used were
'shall be refunded' and the High Court was requested to dispose of the writ
petitions. Indisputably the writ petitions have been finally disposed of in favour
of the respondents. The condition precedent of the order of 3.1.1994 has since
been satisfied. The subsequent order dated 21.4.1995 extracted hereinbefore
merely said that the refund may be allowed to those entitled to the same. By
the use of the expression 'entitled', the court did not and could not have
intended to depart from or modify the order of 3.1.1994. And the question of
entitlement in relation to unjust enrichment was far from the court's mind. It
is only another attempt on the part of the State to retain the money. Besides,
the position has also been clarified in this behalf in the subsequent
affidavits dated 4.8.1995. The allegation that the tax liability had been
passed on and collected from the consumers has been specifically and
emphatically denied. We, therefore, see no merit in the contention.
result, we see no merit in the objections raised and repel them in toto. We
direct that pursuant to this Court's order dated 3.1.1994, the tax amount with
interest deposited in this Court' be refunded to the respondents in the appeal
arising from SLP Nos.16120-21 of 1993.
is no doubt that in the concluding part of the judgment of this Court dated
21.4.1995 in Civil Appeal Nos.330-604 of 1995 heard along with I.A. Nos.4-5 of
1994 in Civil Appeal Nos. 42-43 of 1994, Shri Shanti Bhushan had appeared on
behalf of the Orient Paper & Industries and not for Mahanadi Coalfields
Ltd. and therefore, the reference to him as counsel for Mahanadi Coalfields is
inaccurate and needs to be corrected by substituting the name of Orient Paper
and Industries in place of Mahanadi Coalfields Ltd.
disposes of I.A.No.278 of 1995.
view of the above, the interim applications Nos.279- 553 of 1995 filed by the
State of Orissa will stand dismissed. Interim
applications Nos.278, 554 and 556 of 1995 will stand allowed and the applicants
shall be entitled to refund and discharge of bank guarantee.
of 1995 has been filed by Mahanadi Coalfields Limited pursuant to the
directions of this Court in its order dated 11.8.1995. It seeks to record the
deposit of Rs.4.92 Crores with the Court and seeks further directions in
respect of (i) a sum of Rs.27,77,000/- which had earlier been deposited with
the State of Orissa by Mahanadi Coalfields which in turn had collected it from
customers who had not gone to court but had nevertheless paid the amount, and
(ii) a sum of Rs.1,82,173/- which still remains with Mahanadi Coalfields as a
result of a computation error. With respect to (i), the State is directed to
return the sum to the customers who were not parties to the litigation by
referring to the details provided by Mahanadi Coalfields, and as regards (ii),
our directions in respect of the money already deposited with this Court will
apply to this amount also.
will be no order as to costs.
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