DECISIONS OF The SUPREME

COURT WHICH HAVE APPLIED THE DOCTRINE OF UNJUST ENRICHMENT

R.S. Joshi v. Ajit Mills [1978]1SCR338 dealt with the question of unjust enrichment.
Section 46 of the Bombay Sales Tax Act
provided that no person shall collect any sum by way of sales tax which is not exigible
according to law. Section 37 provided for penalties in case of violation of the provisions of
Section 46. Not only the person so collecting was liable to pay a penalty , but in addition
thereto, any sum collected by the person by way of tax in contravention of Section 46 was
also liable to be forfeited to the State Government. The court ruled that such provisions were
valid and ruled that: The legislative motive to blame the law as a colorant is not important.
Ensuring consumer interests against the expected excesses in the enforcement of the
Act is certainly a necessary obligation of the welfare state, not just a secondary force. An
effective deterrent procedure for this
is to punish traders by imposing innocence or absolute obligations on the state. All
"injustice" withdrawals are withheld by him "through taxes" and otherwise withheld to
"cough". It's because of him. The real key to constitutional law is to see the justice of the law
and feel the social mission of the law. Social justice clauses integrally connected with the
taxing provisions cannot be viewed as a mere device.”
In Shiv Shanker Dal Mills Etc. v. State of Haryana
[1980]1SCR1170 , the question arose arose with reference to market fees collected under a
provision which was struck down
in Kewal Krishan Puri v. State of Punjab
[1979]3SCR1217 .
The enhancement of market fee from two to three percent was held to be bad, whereupon the
traders demanded refund of the excess market fee collected from them. The Court held that
though refund of the fee so collected may be legally due to the traders, the traders may be
repaid amount only to the extent they have not passed on the burden to their customers. To
the extent they have passed on, it held, they were not entitled. This principle was deduced
from the concept of distributory justice underlying Article 38 and 39 of the Constitution of
India as from the discretionary nature of the power under Article 226 of the Constitution.
Amar Nath Om Prakash v. State, of Punjab [1985]2SCR72 was also a case arising with
reference to market fee, i.e., an indirect tax.
Section 23A of the Punjab Agricultural Produce Markets Act enabled the market committees
to "retain the fee levied and collected by it from a licensee in excess of that leviable under
Section 23, if the burden of such fee was passed on by the licensee to the next purchaser .
The validity of the said provision was called in question in this case.
The Court held that
 the primary purpose of the said section was to prevent refund of licence fee to dealers who
have already passed on the burden of such fee to purchasers and who want to unjustly enrich
themselves by obtaining refund from the market committee.
The said provision, it was held, recognised that the consumer public who have borne the
ultimate burden are the persons really entitled to refund and since the market committee
represents their interests, it is entitled to retain the amount.
It was pointed out that the provision for retention by market committee had to be made
because of the practical impossibility of tracing the individual purchasers and consumers who
have ultimately borne the burden.
It states, "In fact, it is a law that returns what it gets from the people to the people by
allowing the Commission to use that amount to provide the services required by law." Was
done.
Instead of benefiting intermediary B from fraudulent profits, the legislature devised
procedures to correct the mistakes made by overtax, and the Commission was later used for
the benefit of those people. Allowed to withhold the amount of money, for the benefit of
which marketing legislation was enacted. "
Madhya Pradesh v. Byancatral [1985] 3SCR561 represents a clear milestone in the
application of the doctrine of unjust enrichment, slightly higher than the factory price. The
notification required the difference between the supply price and the exfactory price to be
credited to the
Government Sugar Fund.
Pursuant to the demands made by the State, the sugar mills deposited certain amounts into
the said Fund under protest and then instituted suits for refund of the amounts so deposited.
The High Court upheld the plea of the sugar mills that the Director of Civil Supplies had no
authority in law to fix the exfactory prices. This meant that the sugar mills were entitled to
the refund of the amounts paid by them into the Fund.
The State appealed against the said decision. In accordance with the principles of
Shiv Shankar Dal Mills and Amar Nath Om Prakash, the court ruled that the burden of
paying the amount in question was transferred from the sugar factory to the purchaser and
was not entitled to a refund. Only the person who ultimately bears the burden of paying that
amount is entitled to a refund of that amount. The amount paid to the fund should be used for
sugarcane development. If the individual ordered to pay the fund cannot be identified, the
amount of the fund may be used by the government for the purpose for which the fund was
established, namely the development of sugar cane. No questions