Law:

Section:

Article 226, read with article 227, of the Constitution of India, read with section 14 of the Orissa Sales Tax Act, 1947 - Writ jurisdiction - In an interim order, High Court in exercise of its writ jurisdiction under articles 226 and 227 held that 'in event of petitioner's succeeding in second appeal, sales tax authority would refund amount with interest at rate of 18 per cent' - Petitioner succeeded in second appeal and filed a writ petition claiming amount with interest - Respondent-State denied benefit of interest on ground that interest would be given only at rate permissible under section 14 of 1947 Act - Whether since provisions of State Act were not invoked by High Court while directing State to refund said amount, any direction made while making an order under articles 226 and 227 to deposit any sum of money would be governed by conditions imposed in order directing such deposit - Held, yes - Whether since order had directed refund with 18 per cent interest refund had to be made at that rate only - Held, yes FACTS The appellant had challenged an interim order made by the Additional Commissioner of Sales Tax in a writ petition before the High Court. The High Court in exercise of its writ jurisdiction under articles 226 and 227 passed an order that 'in the event the petitioner succeeded in the second appeal, then the sales tax authorities would refund the amount with interest at the rate of 18 per cent per annum'. Subsequently, the appellant succeeded in the proceedings and the amount directed to be deposited by the High Court became liable to be refunded to the appellant. Instead of asking the respondent-State to repay the amount deposited by it, the appellant seemed to have filed an application under the provisions of the Orissa Sales Tax Act for refund of the amount in deposit. Taking advantage of that procedure followed by the appellant, the respondent-State had denied the appellant the benefit of interest granted by the High Court. On writ petition, the High Court taking a very narrow view of the matter held that the appellant was entitled only to the interest that was permissible under section 14 of the Act. On appeal to the Supreme Court : HELD It…

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