The Allahabad High Court, while allowing the writ petition of M/s Reva Enviro System (P) Ltd Vs State of UP regarding refund of the trade tax which had been found to be not payable by the dealer, has reminded of the observation made by the Supreme Court about 35 years ago in the case of M/s Hindustan Sugar Mills Vs state of Rajasthan, that in a democratic society covered by rule of law, every government must do what is fair and just to the citizen, regardless of legal technicalities and not to defeat the legitimate claim of the assesses for reimbursement of sales tax.
“Taxing authorities are under duty to recover tax from the tax payers. But in exercise of that power, they should not be overzealous to hold the legitimate claim of refund of excess payment of tax’’, the court observed.
This decision was given by a Division Bench of Allahabad High Court comprising Justice AK Yog and Justice Prakash Krishna.
The court observed that while it was true that collection of revenue was a serious matter for the state and the bounden duty of the authorities functioning under the Act was to implement the provisions of the Act, there should be safety and assurance to an honest tax payer.