HMM LIMITED & ANR.versusADMINISTRATOR BANGALORE CITY CORPORATION, BANGALORE & ANR.

                  HMM LIMITED & ANR.
                                                                                 A
                          v.
      ADMINISTRATOR BANGALORE CITY CORPORATION,
                   BANGALORE & ANR.

                              OCTOBER 4, 19$9
                                                                                 B
           [SABYASACHI MUKHARJI AND B.C. RAY, JJ.]

          Bangalore Municipal Corporation Act, 1949: Section 98(2) and
    Bye Law 45/Rules 24 to 27-0ctroi-Levy of-Mere physical entry into city
•   limits-Would not attract levy of octroi unless goods brought in for use,
    consumption or sale.
                                                                                 c
          Words And Phrases: "Without Breaking bulk"-Not an expres-
    sion of art-Should be construed liberally.

           The appellant company was engaged in the manufacture and sale
    of a ·malted milk product marketed under the brand name "Horlicks".          D
    The appellant bronght the product within the octroi limits of Bangalore
    in bulk containers, rebottled the same in small bottles and exported the
    major portion of the rebottled product beyond the octroi limits of
    Bangalore. The appellants made representation protesting against the
    levy Of octroi on Horlicks in respect of the quantity of the goods which
    was exported outside the municipal limits after being rebottled, and         E
    sought refund of the octroi duty on the ground that there was·no use or
    consumption or sale of the said milkfood within the municipal limits,
    and that the imposition of octroi 'was illegal and nnwarranted'. The
    respondent-Corporation rejected the claim. Thereupon the appellant
    filed a writ petition in the High Court challenging the levy /r~tention of
    the octroi duty on Horlicks exported out of the municipal limits.            F

          The petition was resisted by the Corporation on two grounds,
    namely, (i) the transferring the Horlicks imported in bulk into bottles
    amounted to use of the Horlicks within the city; and (ii) the octroi
    collected was in accordance with law and unless the procedure pre-
    scribed under rules 24 and 25 of Bye-law 45 framed by the Municipal          G
    Corporation under the City of Bangalore Municipal Corporation Act,
    1949 was followed no obligation or duty was cast 110 the part of tbe
    Corporation to refund any part of the octroi collected.

         The learned Single Judge allowed the writ petition and held that
    when the Horlicks powder was transferred into bottles of dilierent sizes,    H
                                       353
    354         SUPREME COURT REPORTS                 [1989] Supp. 1 S.C.R.

    the appellant did not use Horlicks within the city of Bangalore.
A
        In the appeal, the Division Bench agreed with the learned Single
  Judge on the first point. On the second point, however, the Division
  Bench rejected the contention of the appellant that opening or breaking
  open the drums and putting the powder in the bottles amounted to
B breaking bulk and as such there was no scope of applying for refund
  under rule 24 which provided for refund in the case of articles on which
  octroi duty had been paid and which were subsequently exported
  beyond the octroi limits without breaking bulk. According to the Divi-          •
  siou Bench, no ilnportance could be attached to the expression 'without
  breaking bulk', and the appellant not having applied in accordance
C with rules 24 and 25, no amount could be refunded.

          Before this Court, the Corporation sought to raise an additional
    plea that where refund was due in respect of the duties like this, the
    amount could not be refunded because there was possibility of undue
    enrichment of the claimant.
D
          Allowing the appeal, this Court,

         HELD: (I) Octroi in this case is a duty on the coming in of the
  raw materials which is payable by the producer or the manufacturer. It
  is not the duty on going out of the finished products in respect of which
E the duty might have been charged or added to the costs passed on to the
    consumers. In such a situation, no question of 'undue enrichment' can
    possibly arise. [362G]

          (2) There is no dispute that the Horlicks powder was brought in
    bulk in drums. After being imported, the entirety of the Horlicks
F   powder had not been sold. A part of the powder has been put in the
    bottles and exported outside the city of Bangalore. [361E]

          (3) Octroi cannot be levied or collected in respect of goods which
    are not used or consumed or sold within the municipal limits. [364F)

G         (4) Indubitably, amounts have been realised as octroi on the en-
    try of the goods on which octroi was not leviable because these were not
    for use or consumption within the municipal limits. Mere physical entry
    into the city limits would not attract the levy of octroi unless goods were
    brought in for use or consumption or sale. [364C•D I

H         (S) In this case, putting the powder from the drums to the bolt!~•
      HMM LTD. v. ADMN. BANGALORECITYCORPN. [MUKHARJl,J.J 355

for the purpose of exporting or taking these out of the city is neither use   A
nor consumption of the Horlicks powder attracting the levy of octroi.
Such amounts, therefore cannot be retained by the respondent cor-
poration .. (3620-E]

     C. W.P. No. 19873 of 1977-High Court of Punjab Burmah Shell
Oil Storage & Distributing Co. of India Ltd. v. Belgaum Borough B
Municipality; [1963] 2 Supp. SCR 216, referred to.

      (6) "Without breaking bulk" is not an expression of art, nor is it
an expression defined in the Act or the rules. It has, therefore, to be
construed in its literal and ordinary sense to the extent possible, and
construed as it is, transferring the product from the drums by breaking
seal of the drums to bottles cannot be said to be "without breaking bulk". C
Certainly the bulk was broken in the procedure followed. [361H; 362A-E]

   ' (7) Rule 24 does not apply. In that view, rules 25 and 26 have no
scope of application. [364C]
                                                                              D
     Kirpal Singh Duggal v. Municipal Board, Ghaziabad, [1968] 2
SCR 551, referred to.

      (8) Realisation of tax or money without the authority oflaw is bad
under Article 265 of the Constitution. Octroi cannot be levied or col-
lected in respect of goods which are not used or consumed or sold within E
the municipal limits. So these amounts become collection without the
authority of law. The respondent is a statutory authority in the present
case. It has no right to retain the amount, so far and so much. These are
refundable within the period of limitation. [364E-F]

      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4160 F
of 1989.

     From the Judgment and Order dated 24.3.1988 of the Karnataka
High Court in W.A. No. 637 of 1985.

      S. Ganesh, A.C. Gulati and B.B. Sawhney for the Appellants.             G

      T.S. Krishnamurthy Iyer and N. Nettar for the Respondents.

      The Judgment of the Court was delivered by

      SABYASACHI MUKHAR.11, J. Leave g_ranted.                                H
    356         SUPREME COURT REPORTS               [ 1989] Supp. 1 S.C.R.

A       This is an appeal from the judgment and order of the Division
    Bench of the High Court of Karnataka dated 25th March, 1988.

        There was a notification under section 98(2) of the City of
  Bangalore Municipal Corporation Act, 1949 dated 4th March, 1975
  levying o·ctroi, inter alia, on food drinks (including milkfood) brought
B into the municipal limits of Bangalore for sale, consumption or use.
  On 8th October, 1976, representation was submitted on behalf of the
  petitioners, HMM Limited, protesting against levy of octroi on
  "Horlicks" milkfood powder brought ihto the municipal limits in bulk
  containers (Large steel drums) for being packed at the packing station
  in Bangalore in Unit containers (glass bottles) and thereafter exported
C outside the municipal limits. In respect of the quantity of the goods
  which were exported outside the municipal limits after being bottled,
  the petitioners sought refund of the octroi duty as there was no use or
  consumption or sale of the said milkfood within the municipal limits.
  The respondent corporation rejected the claim on the ground that rule
  24 of the Byelaw 45 framed by the Municipal Corporation had not
D been complied with and as such refund could not be given. The
  petitioners again sought on 4th February, 1978, refund of octroi
  duty for the period 1974-75 to December, 1977 amounting to
  Rs.13,39,652.92· enclosing computation of the duty collected for the
  aforesaid period. Again, the· refund was refused by the respondents in
  March,. 1978. Petitioners thereafter filed writ petition in the High
E Court of Karnataka challenging the levy/retention of octroi duty on
  "Horlicks" exported out of the municipal limits and seeking refund
  thereof. From 1st April, 1979, levy of octroi on milkfood was totally ·
  abolished in Karnataka. Learned Single Judge of the High Court on
  !st February, 1984, allowed the writ petition and directed that the
  amount of octroi duty collected for the period commencing three years
F prior to the filing of the writ petition be verified within 3 months and
  refunded within 45 days thereof. Learned Single Judge noted that the
  case of the petitioners was that it was engaged in the manufacture and
  sale of a malted milk product marketed under the brand name
  "Horlicks''. The petitioner used to manufacture the said product in its
  two factories situated at Nabha in the State of Punjab and Rajah-
G mundhry in the State of Andhra Pradesh and marketed these through-
  out the country through its bottling and marketing centres situated in
  different parts of the country. One such centre was situated in the city
  of Bangalore to which it brought its said product in bulk, then rebot-
  tled the same in small bottles of different capacities like 800 gms, 450
  gms and 250 gms. It was the case of petitioners that small portion of
H the product, re bottled in small bottles, alone was sold within the city of
     HMM.LTD. v. ADMN. BANGALORE CITY CORPN. [MUKHARJI, J.]          357

Bangalore to its dealers and the rest was exported to its agents situated
                                                                            A
in different parts of the State and other nearby places of the country
also. In this connection, it may be mentioned that rules 24 to 27 of the
relevant Bye-laws were as follows:

            "24. On all articles on which octroi duty has been paid and
            which are subsequently exported beyond the octroi limits        B
            without breaking bulk, refunds shall, subject to the follow-
            ing rules, be granted at the rates originally charged at the
            time of import; provided that no such refunds shall, except
            in the case of timber imported and re-exported in log be
            granted unless such goods are exported within three
            months from the date on which octroi was levied.
                                                                            c
            25. Any person claiming refund under the above bye-laws
            shall produce the goods to be .exported at the Central
            Octroi Office, together with the Original receipt for octroi
            duty paid thereon, and an application for refund prepared
            in triplicate in the form prescribed in Schedule V. He shall D
            fill up columns I to 10 of the application signing and dating
            the same, before he presents it at the Central Octroi
            Office. He shall produce for record in office a certified··
            copy of the invoice as per which duty was paid on the article
            at the time of its import.
                                                                            E
            26. Any person who has been exempted under bye-law no.
            10 from production of goods at the Central Octroi Office
            on import shall, subject to the same conditions, he exemp-
            ted from the production of goods to be exported.

            27. The Octroi Superintendent of .the Central Octroi F
            Office on being satisfied as to the identity of the goods
            produced with those for which the receipt has been granted
            or the validity of the claim, shall fill up columns 1l to 15
            and also the coupon and handover the form to the
            exporter."
                                                                         G
      There is no dispute that on the entire quantity of the goods
brought within the municipal limits, octroi was collected from the
petitioner. It claimed for refund only in respect of those quantities
which were rebottled and exported from the city to outside places.
This was refused. The contention of the petitioners was that only that
portion of the goods which was imported in drums and was rebottled in H
    358         SUPREME COURT REPORTS                 I1989] Supp. 1 S.C.R..
    bottles and exported outside the city was not liable to duty of octroi. It·
A
    was contended before the learned Single Judge that portion of the
    goods was not dutiable to octroi as these did not fall within the term
    "sale, cunsumption or use" within the local area of the city of Banga-
    lore. When the petitioner approached the High Court, rule 24
    aforesaid of the Bye-law 45 was in force. Octroi was, however,
B   abolished with effect from 1st April, 1979. The question that was
    canvassed before the learned Single Judge of the High Court was that
    when the product was imported in bulk in the city only for rebottling
    and rebottled in small bottles for the consumer requirements and
    marketed, there could not be consumption or sale of that product. On
    the other hand, it was contended that in any event, it is a case of 'use'
    to attract levy of octroi. The Horlicks powder remains the same even
c   after packing, as was held by Mittal, J. of the High Court of Punjab in
    C.W.P. No. 19873 of 1977. In that case, the Horlicks powder in drums
    was sold direct to bulk consumers. It was held that the Horlicks powder
    remains the same after packing. It does not become different commo-
    dity. It also cannot be held that it acquired distinct commercial utility,
D   according to Mittal, J. Therefore, in that context; Mittal, J. held that
    the packing of the Horlicks powder in small bottles does not fall within
    the ambit of the word 'use' and, therefore, the petitioner in that case
    was not liable to the charge of octroi for its import within the limits of
    ihe city. This decision was affirmed by the Division Bench. It was
    contended that in the judgment before Mittal, J, packing was
E   entrusted to a separate agency, but it does not make any difference,
    according the learned Single Judge of Bangalore. Therefore, the
    learned Single Judge in this case found that only on that quantity of
    milk product imported by the petitioner in bulk but rebottled. in small
    bottles at its Bangalore bottling station and exporting from the city to
    other places for sale in those places and not using the same in Banga-
F   lore city, was not dutiable to octroi till that levy was in force. The
    learned Single Judge, therefore, held that the amounts so levied and
    collected as octroi for a period of three years prior to the presentation
    of the writ petition only and not beyond that are refundable by the
    respondents to the petitioner. He directed refund and pursuant to this
    direction, the learned Single Judge further directed that the same may
G   be verified. We were informed that the same has been verified.

        There was an appeal to the Division Bench of the High Court.
  The question before the Division Bench was whether the Corporation
  was liable to refund that part of the amount of octroi duty paid by the
  petitioners on the quantity of the Horlicks powder imported into the
H city of Bangalore on the petitioners' informing the Corporation that
         HMM LTD. v. ADMN. BANGALORECITYCORPN. [MUKHARJl,J.] 359

they had despatched that part of the same from time to time by filing
                                                                               A
the same in bottles to places outside the city of Bangalore even though
petitioners had not followed the procedure prescribed in rules 24 and
25 of Bye-law No. 45 framed by the Corporation and even though they
had not even informed of such despatches as and when these were
made?
                                                                               B
     Item 17 of the notification dated 4th March, 1975, as mentioned
before, so long as it continued, was as follows:

               "17. Confectionary, biscuits, toffee, chocolates food
               essence, food coloured, aerated water and soft drinks, food
               drinks other than milk in condensed form bottled or canned
             · arecounts both scomted or plain.                                c
                                                               2% 0.06ps.
    ·'                                                 ad valorem JO Kg."

       The Division Bench noted that in terms of the aforesaid levy, the       D
petitioners were paying octroi on the basis of the total quantity of
Horlicks imported into the city of Bangalore. Then a letter was addres-
sed on the 8th October, 1975 to the Corporation of the city of Banga-
lore, which was set out in the judgment of the Division Bench. In the
said letter, it was, inter alia, stated that the petitioners were not bring~
ing the goods within the municipal limits for use or consumption the-          E
rein and as such the imposition ·of octroi was illegal and unwarranted
and that the petitioners had paid under protest the amount and
claimed the refund. The petitioners claimed only the octroi paid on the
goods which were exported outside the city of Bangalore and not used
or consumed within the city. The petitioners further stated, inter alia,
as follows:                                                                    F

              "The petitioner is willing to differentiate the goods
              intended to be used consumed within the octroi limit of
              Bangalore and the goods which are exported out of the
              limits of Bangalore and not used or consumed therein ap-
              propriately in order to facilitate movements of goods and        G
              avoid difficulties to the octroi incharge."

     The Corporation turned down the demand. The Division Bench
noted that the petition was resisted by the respondent on to grounds:

              "1. The transferring of Horlicks imJ>O_rted in bulk into the     H
    360          SUPREME COURT REPORTS               [1989] Supp. 1 S.C.R.

A                    city of Bangalore into bottles amounts to use of the ·
                     Horlicks within the city of Bangalore notwithstanding
                     the fact that a part of the total number of bottles were
                     despatched outside the city of Bangalore.

                    2. The octroi collected on the Horlicks imported into·
B                   the city of Bangalore was in accordance with law and
           ..,      unless the procedure prescribed under rules 24 and 25
                    of Bye-law 45 was followed, no obligation or duty was
                    cast on the part of the Corporation to refund any part
                    of the octrio collected."

C         The Division Bench of the High Court in the decision under
   appeal observed that as far as the first ground raised was concerned,
   the learned Single Judge had rejected the claim and held that when the
   Horlicks powder was transferred into bottles of different sizes it did not
   use Horlicks within the city of Bangalore. In this connection, the Divi-
   sion Bench referred to the decision of Burmah Shell Oil Storage &
D Distributing Co. of India Ltd. Be/gaum v. Belgam Borough Municipa-
   lity, Be/gaum, [1963] 2 Supp. SCR 216. This Court in that case held that
   mere transferring of a bulk product into small containers like packets
   or bottles for the purpose of sale does not amount to use of the goods
   in the sense the word is used in relation to levy of octroi. On this
   aspect, the Division Bench agreed with the learned Single Judge. So
It far as the second contention raised by the Corporation was concerned,
   the Division Bench noted that the relevant provision of the. rules was
   not considered. We have set out hereinbefore the said rules. In the
   Schedule there is a form for refund. The contention of the petitioners
   was that rule 24 did not apply. Rule 24, as we have noticed herein-
   before, provided that in respect of articles on which octrio has been
F paid and which are 'subsequently exported beyond the octroi limits
   without breaking bulk', refunds shall be subject to the rules indicated
   therein. So, according to the petitioners, after opening or breaking
   open the drums and putting the powder in the bottles, as in this case
   amount to breaking bulk, and as such there was no scope of applying
   for refund under Rule 24. But the Corporation contended that it was
G not so. The Division Bench, however, accepted the contention of the
   Corporation. It is indubitably true that the petitioners had not claimed
   the refund in accordance with the law because according to the
   petitioners the said rules would have no application as the bulk was
   broken. The Division Bench, however, observed that the petitioners
   in their letter addressed to the Commissioner have specifically stated
H that the goods were subsequently exported outside the city of Banga-
     HMM LTD. v. ADMN. BANGALORECITYCORPN. [MUKHARJl,J.] 361

lore as envisaged by Bye-law 24 of notification No. N.A.1(53) of A
1952-53 dated 5th April, 1954. Regarding the expression "without
breaking bulk", the Division Bench of the High Court was unable to
accept the contention that the bulk of the goods on which the octroi
has been paid was transferred to containers of small sizes and
despatched outside the city, the bulk was broken. But the question was
whether in such a situation, it can be said that it was done without B
breaking the bulk. The Division Bench was of the view that having
regard to the rule and having regard to the fact that it was imported
into the city of Bangalore, and was to be despatched outside the city of
Bangalore in the same form, i.e., without the same having been used
or sold or consumed in the production or manufacture other goods,the
person concerned can only claim refund in accordance with the rules.
Therefore, according to the Division Bench, no importance can be c
attached to the expression "without breaking bulk" on despatches of
the goods. Refund could be claimed only on despatches ofthe goods
outside the city, for octrio is leviable only if the goods impored into the
city are consumed, used or sold within the city. Therefore, 'bulk', in
the view of the Division Bench, was, in fact, broken and the petitioner D
not having applied in accordance with rules 24 and 25, no amount
could be refunded to the appellant. In that view of the matter, the
appeal was allowed by the Division Bench and the judgment of the
learned Single Judge was reversed.

      It may be mentioned that there is no dispute that the Horlicks        E
powder was brought in bulk in drums. At the relevant time, there was
levy of octroi at the entry of such goods. After being imported, it has
been found that the entirety of the Horlicks powder had not been sold.
A part of the powder has been put in the bottles and exported outside
the city of Bangalore. It has been found by the Division bench that
putting powder from the drums to the bottles inside the city, is not user   F
or consumption as contemplated by the rule. And on that no octroi
duty was leviable. In this case also, it has been found pursuant to the
order of the learned Single Judge how much octroi will be refundable
on account which has been paid by the petitioners. The only ground on
which the Division Bench had resisted the refund was that the petition-
ers did not apply in accordance with the precedure envisaged by rules       G
24 and 25 of the aforesaid Bye-laws. Mr. Krishnamurthi Iyer, learned
counsel for the respondent, contended that the High Court was right in
the view it took on the construction of rules 24, 25 and 26. We are
unable to agree with this submission. As we have indicated before,
"without breaking bulk" is not an expression of art, nor is it an expres-
sion defined in the Act or the rules. It has, therefore, to be _construed   H
    362         SUPREME COURT REPORTS                 [1989] Supp. 1 S.C.R.

    in its literal and ordinary sense to the extent possible, and construed as
A
    it is, in our opinion, transferring the product from the drums by break-
    ing seal of the dr]lI11s to bottles, cannot be said to be "without breaking
    bulk". "Breaking bulk" is an expression not unknown to legal
    terminology especially in England. In the Cyclopedic Law Dictionary,
    3rd Edn., "breaking bulk" has been stated to mean that for a bailee to
B   open a box or packaging entrusted to his custody and fradulently
    appropriate its contents. In Stroud's Judicial Dictionary, 4th Edn.,
    Vol-1, it has been stated that to 'break bulk' is not now necessary to
    constitute larceny or theft by a bailee. It is stated that the cases were
    very numerous and turned on nice distinctions as to what amonted to
    "breaking bulk". In the Dictionary of English Law by Earl Jowitt
    "breaking bulk" has been defined as that at common law there could
c   be no larceny of goods which had orginally been lawfully obtained by a
    person who subsequently wrongfully converted them to his own use,
    unless such conversion was preceded by some new act of taking. It that
    is so, we are unable to agree with the construction suggested by the
    Division Bench. It was contended that the octroi was leviable on the
D   entry of the goods in the municipal limits of the city but the Horlicks
    powder had not entered into the local limits of Bangalore for the
    purpose of use or consumption, as understood in the decision of the
    Burmah Shell's case (supra) and as found both by the learned Single
    Judge and the Division Bench that putting the powder from the drums
    to the bottles for the purpose of exporting or for taking this out of the
E   city, is neither use nor consumption of the Horlicks powder, attracting
    the levy of octroi. Certainly, the bulk was broken in the procedure
    followed. The High Court was wrong in putting the construction on the
    expression as it did. Mr. Iyer soug_ht to raise before us the plea that in a
    case where refund is due in respect of the duties like this whether
    petitioners would be entitled to refund on the basis that refund cannot
F   be given because there was possibility of undue enrichment of the
    claimant, is pending before the Seven-Judge Constitution Bench in
    this Court. Therefore, it was submitted that we should await the said
    decision or refer the matter to the Ceas1itution Bench. Octroi in this
    case is a duty on the entry of the raw materials for coming in. It is the
    duty on the coming in of the raw materials which is payable by the
G   producer or the manufacturer. It is not the duty on going out of the
    finished products in respect of which the duty might have been charged
    or added to the costs passed on to the consumers. In such a situation,
    no question of 'undue enrichment' can possibly arise in this case. If
    that is the position then the pendency of the question before the Con-
    stitution Bench should not deter us from proceeding with this
H   adjudication.
     HMM LTD. v. ADMN.BANGALORECITYCORPN. [MUKHARJI,J.l              363

       Shri Ganesh drew our attention to a decision of this Court in
                                                                            A
Kirpal Singh Duggal v. Municipal Board, Ghaziabad, [1968[ 3 SCR
551. There, the appellant had transported, between August 1953 and
March 1955, certain materials ·in execution of a contract to supply
goods for use by the Government of India. The respondent Municipal-
ity collected toll while the appellant's trucks were passing through the
toll barrier. The appellant, in that case, obtained in June, 1955, a        B
certificate from the authority concerned that the goods transported
were "meant for Government work and had become the property of
the Government". The appellant then applied to the Municipality for
refund of the amount paid pursuant to the exemption granted by the
Government of India under the U.P. Municipalities Act, 1916. The
respondent declined to refund the amount. In an action against the
respondent, the trial court decreed the claiin. The High Court
                                                                            c
affirmed the order of the Civil Judge. Both the Civil Judge and the
High Court took the view that by the rules framed under the Act an
application for refund within six months from the date of actual pay·
men! is a condition precedent for refund of the toll. The party apealed
to this Court. This Court was unable to accept this contention. Shah, J,    D
as the learned Chief Justice then was, speaking for this Court noted
that the respondent therein had contended that the rules framed by the
Government regarding the procedure constituted a condition prece-
dent to the exercise of the right to claim refund and recourse to the
civil court being conditionally strict, compliance to that procedure was
necessary for obtaining any decree in civil court. Allowing the appeal,     E
this Court held that this contention was untenable. Shah, J. observed
at p. 555 of the report as under:

           "The rules framed by the Government. merely set up the
           procedure to be followed in preferring an application to the
           Municipality for obtaining refund of the tax paid. The           F
           Municipality is under a statutory obligation, once the pro-
           cedure followed is fulfilled, to grant refund to the toll. The
           application for refund of the toll must be made within
           fifteen days from the date of the issue of the certificate and
           within six months from the date of payment of the toll. It
           has to be accompanied by the origin.al receipts. 1f these        G
           procedural requirements are not fulfifled, the Municipality
           may decline to refund the toll and relegate the·claimant.to a
           suit. It would then be open to the party claiming a refund to
           seek the assistance of the court, and to prove by evidence
           which is in law admissible that the good.~ transported. by
           him fell within the order issued under s. 157(3) of the Act.     H
      364         SUPREME COURT REPORTS                [1989] _Supp. 1 S.C.R.

A
                  The rules framed by the Government relating to the proce-
                  dure to be followed in giving effect to the exemptions on
                  AJ>ril 15, 1939, do not purport to bar the jurisdLction of the
                  civil court if the procedure is not followed. In our judg-
                  ment, the Civil Judge and the High Court exalted what
                  were merely matters of procedure, which the Municipality
B                 was entitled to require compliance with in granting refund,
                  into conditions precedent to the exercise of jurisdiction of
                  the civil court. It is impossible on a bare perusal of the
                  order issued by the Government and the rules framed by it
                  to give to the) order and the rules that effect."

C           These observations, in our opinion, in view of the contentions
      raised on behalf of the Municipality here are apposite in this case. The
      aforesaid Rule 24 does not apply. In that view, rules 25 and 26 have no
      scope of application. Indubitably, amounts have been realised as oc-
      troi on the entry of the goods on which octroi was not leviable because
      these were not for use or consumption within the municipal limits.
lJ)   Mere physical entry into the city limits would not attract the levy of
      octroi unless goods were brought in for use or consumption or sale. In
      this case, putting the powder from the drums to the-bottles for the
      purpose of exporting or taking these out of the city is neither use nor
      consumption of the Horlicks powder attracting the levy of octroi. Such
      amounts, therefore, cannot be retained by the respondent-Corpora-
E     tion. There is no dispute as to the quantum in view of the fact that the
      amount has now been found to be certified to be credited pursuant to
      the direction of the learned Single Judge of the High Court. We see no
      ground as to why amount should not be refunded. Realisation of tax or
      money without the authority of law is bad under Article 265 of the
      Constitution. Octroi cannot be levied or collected in respect of goods
F     which are not used or consumed or sold within the municipal limits. So
      these amounts become collection without the authority of law. The
      respondent is a statutory authority in the present case. It has no right
      to retain the amount, so far and so much. These are refundable within
      the period of limitation. There is no question of limitation. There is no
      dispute as to the amount. There is no scope of any possible dispute on
G     the plea of undue enriehment of the petitioners. We are, therefore, of
      the opinion that the Division Bench was in error in the view it took.
      Where there is no question of undue enrichment, in respect of money
      collected or retained, refund, to which a citizen is entitled, must be
      made in a situation like this.

H           We, therefore, hold that amounts should be refunded subject to
     HMM LTD. v. ADMN. BANGALORECITYCO:\PN. [MUKHARJI,J.J 365

the verification directed by the learned Single Judge of the High Court     A
of the amount of refund. The appeal is, thus, allowed. The Judgment
and the order of the Division Bench of the High Court are, therefore,
set aside. In the facts and the circumstances, there will be no orders as
to costs.
                                                                            B
R.S.S.                                                  Appeal allowed.