Karnataka High Court
The Cashew Corporation Of India Ltd vs M/S Peirce Leslie India Ltd on 4 November, 2009
Bench: N.Kumar, C.R.Kumaraswamy
"IN THE HIGH COURT OF KARNATAKA AT BANGALORE
DATED THIS THE 4"' DAY OF NOVEMBER, 2009
PRESENT
THE HONBLE MRJUSTICE NKUMAR » '
AND
THE HONBLE MRJUSTICE C.R:;;I{DM':' 'ARV A_SV'VAA_1.\:_/.:I'1--'_
REGULAR FIRST APPEAL No.'3v24"OF 2QO.': " ' EV
R.F.A. CROB. No.'I»5'OI"r 200'I._" A A
IN RFA NO. 324[.?.OO1
BETWEEN :
1.
1.
_ -,,_ME/S. MIZAR GOVINDA ANNAPPA
PA} AND SONS
THE CASHEwCO"R'P.ORAfIIO;\z' _
OEINDLALIMI'IED~"O;'.\,I-' =i 'g
(SINCE DISSOI;VEli?]_._*--' ' V
THE STATE CORPORADON
OF INDIAILIMITED 'f':
A GOVERNMEN Tr-CQMPANY"-..._ . .
§-IAVING=.OFFICE AZFM Ci ROAD _
ERNAKULAI/I,%cOC}III\§'« " "
REPRESENTED BY ITS] "
BRANCH IVIANAOER '
SR1, J JAMES ' ~ APPELLANTS
'(BAY ADVOCATE FOR SMT.K SUMAN, ADVOCATE)
AND: A D A
M/SD." PEIV:RC'E'.VLESLIE INDIA LIMITED
. W,HAV'ING_ OFFICE AT BRISTOW ROAD
- " WELLINGTON ISLAND, COCHIN
" « . "AND A BRANCH OFFICE
ATJEPPU, MANGALORE).
A PARTNERSHIP FIRM CARRYING
ON BUSINESS AT BUNDER
MANGALORE.
3. M/S. BOLA RAGHAVENDRA KAMATH
AND SONS
A PARTNERSHIP FIRM CARRYING ON
BUSINESS AT KUKKUNDUR
. D.K.
4. M/S. K. SUBRAYA ANANTHA -
KAMATH AND SONS
A PARTNERSHIP FIRM CARRYING ON __
BUSINESS AT MAHATIVIA GANDHI ROAD A
KASARGOD, KERALA. ' ,
5. M/S. FERNANDES BROTHERS _%
A PARTNERSHIP FIRM CARRYING"ON._" "
BUSINESS AT KULSHKAR ; A . " _
MANGALORE. _S * _ v"»,."I?}.EPONDEN'I'S.
(M/S. KING 5: FATRIDOE ASSTS; ADVCJC-A'1'IES "
FOR RESPONDENT NQIII, .: A ' =
SR1. K.N. AISVOCATE FOR R2.
M/SKAMATH £8: KA;I.4A'I'H..AI)'»fOICAiFP;S FOR RESPONDENTS 3 8: 4 M /S. SRIVATHSA ASSfIS., .ABVOCA::ES FOR RESPONDENT No.5) ~. >'"x"s=l=$:'.e ' This'--ReguIar is filed under Order XLI Ruie 1 read *witE';_ Sreetfqn 96 of CPC against the judgment and 'de,cree*_ dated 16.12.2000 passed In _O.S.Np_;;4'o7/89Ab_y the II Additional cm; Judge, I(S_1f.Dn__."j~ ;_MavnAga1ore; """ dismissing the suit for Kreeovery _O{ In4O1I,ey.
INS"R_P"'AL._CIIlOE3:..NOAV,:'15/2001 I MIFS. GOVINDA * ANNAPPA PAI & SONS ' A-PRIRFNAIERSHIP FIRM, __CA'€'_RYING ON BUSINESS AT BUNDER, MANOALORE. CROSS OBJECTOR I I _ "ISRI. K N MAHABALESHWARA RAO, ADVOCATE) AND:
1. THE CASHEW CORPORATION OF INDIA LTD.
{SINCE DISSOLVED}
2. THE STATE TRADING CORPORATION OF INDIA LTD A GOVERNMENT COMPANY HAVING OFFICE AT M.G.ROAD, ERNAKULAM, COOHIN REPRESENTED BY ITS BRANCH MANAGER V J JAMES.
3. M/S. PEIRCE LESLIE INDIA LTD _ HAVING OFFICE AT ERISTOW ROAD WELLINGDON ISLAND, _ COCHIN AND A BRANCH OFFICE AT JEPPU, MANGALORE. A
4. M/S.BOLA RAGHAVENDRA KAMATHAND SONS ;
APARTNERSHIP FIRM, CARRYING ON _ A . BUSINESS AT KUKKUNDTIR, KARKALA * ; ~ D.K. g - ~
5. M/S.K. SUBEAYAANANTHA KAMATH AND SONS" . "
A PARTNERSH:IP'- _ - --
cARRYI.IéG'eON }3US1NESS--.T ATM.G.,ROAp,'i:.ASARGOp . '
6. M/S. I«'ERNANbI%;S"E_R'OTIIEIy;S A PARTNERSHI? FIRE/I ' ' CARRYING ON BUSINESS;
* RESPONDENTS #***
._ "?mIé"I5;'E_A.'OIiOB is fiieci under Order 41 Rule 22 of O CPC A agaI'.I1s"Ij, 'the Judgment and Decree dated 16.12.1200-.0'vpassed in O.S.NO.407/89 by the II ..d_O[jA.,Ad,ditiOn'a,1_Civi1 Judge, (Sr.Dn.) Mangalore. ,:'i:"'h«is RFA & RFA Cross Objection are coming On '_'_fOr"'._I'-tearing this day, N.Kumar J., delivered the following: --
self--canalising organisation for import of raw cashewnuts from East African countries. They allotted to the actual users the imported cashewnuts for4vbleilng.vv processed and for export of a certain cashewnuts. The import by theyplaiéntiffwwasivlii'n.d'e1~ licence from the Controller of it was a condition of the 1ic_ei'-ice remain the owner of the go0d_s_fli;nti1_»gcleaI'agA%'p»~fiof the goods through c'ustoI11Vs"--..il'n., plaintiff was placing orders fiafith for distribution as the vessels were 11anie_/Cit' goods from East African were sent by the plaintiff, indicarvtirig'giiantity allotted, grade of _Vcashe1w}nt1ts, price, etc. After acceptance of the A'~all.otmeI1tl:E§.y allottees individual letters of authority inlufayour"'oi.'f£:heg;;.allottees were being obtained from the Deputy Controller of Imports and Exports, The allottees had to execute the ..r'eg'2::llatAory bonds, file bills of entry and comply with various customs formalities and arrange for clearance of goods by appointing the clearing agents.
4. During the year 1970--71 to 1975-76, imported raw cashewnuts from East _A4.fric'an"
and sold specified quantities of of defendants 1 to 5, deliveringthe fgoods.atb.:1VIa,_nga].oireV Port. The particulars of the defendants are stated the plaint.
The plaintiff and _t'h.e the sales were in the iffaible to sales tax under the Hliarn atafi-.;a_ _Sa_1e
5. On 03'--.fi2.V1975'}.:th.e"_;~tfommercial Tax Officer, II '_Circle,.fl:'MangaIo're..V:caI1ed upon the plaintiff to show 'cause. should not be assessed to sales tax ufi'a.¢}7.:rhéf'i%'am:§Ltéka Sales Tax Act for the period 1970-
7) to" The plaintiff filed its objection, its claim and contended that the sale has place at the high seas and the sales tax is not "--«payabIe. The said objections were over ruled and it was held that the plaintiff was liable to pay sales tax for the assessed period from 28.11.1970 to 31.03.1976. An amount of Rs.2l,57,105.25ps. was the tot_aVlsl_l"t.ax.v demanded. The plaintiff preferred appeals came to be dismissed. _ySec_ond_?llappleallhealso came to be dismissed by the AppellatjeTribunal". have preferred revision beforelthi_s Court in to 51 of 1981, which also This Court held that the lsales to the defendants Werernot and hence 33135 Sales Tax Act. _ ____ a Special Leave Petition "Twas entertained by the Supreme Court.' IFioiiv*ever'5. the Supreme Court did not grant stay gave 2 months time to the plaintiff ll'-to theVA.ta.;§i'*~..demanded. Subsequently, the plaintiff pay and paid the tax demanded on V 18.11l.2'198E5p.. '"fWhen the proceedings were initiated by ViC_orrl1i'nercial Tax Officer, the plaintiff put defenfdants on notice, they kept them informed about
--«l.fai"oresaid legal proceedings. The defendants on receipt of such notices from the plaintiff disputed the liability to reimburse the plaintiff in the event of ultimately plaintiff paying the said tax. it is their case»fth._4at_ payment of sales tax was not a condition or acceptance of allotment. Themdefendlaiitsfrieyer agreed to reimburse the plaintiff. V
6. The plaintiff contends pay sales tax is a statutory .d§;pendant on any Dresnrnptioflf-'If or the purchaser. having been held to import there arises a statutory, sales tax under the Karnataka Sales sales made to them in '_VKarna,t..akai'.State."afllhepiplaintiff has been compelled to A*pay:t«he the defendants were ultimately liable payment by the plaintiff was not a iroluntfaryhbutfl a lawful payment. The plaintiff made pay:ne.nt as a person interested in payment of money the defendants were bound by law to reimburse hence the plaintiff is entitled to be reimbursed by the defendants. Therefore, the plaintiff sought for a decree in a sum of Rs.21,57,105.25ps against the 5 defendants mentioning in the prayer column the amount each defendant is liable to pay, l. on the quantity of the cashewnuts of these defendants.
7. All the defendants, afte_rfl'»s_erv_vice..loffisuprnmons entered appearance, statements.
Defendant No.1 had a monopoly during the relevant had no other alternatiyvve imported through
the plaintiff »~p:'er1od in question i.e. 1972 to __1976.__§At the tiine of allotment of cashewnuts by the :"V.plvain.,tiff of all the defendants, it was made cle'a_r"l'_py fde'fendant that the acceptance of the V &1llotrncnt»--._yv.as"'Vlon the understanding that there will not if sales tax liability in respect of the transaction ltrhisfdefendant. This is clear from the fact that at
--«'.,:t'h'e"ltirne of -the transactions, no steps were taken by
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the plaintiff either to levy or to collect sales tax in respect of the transaction from this defendant. The documents issued showed the total price payab.le'~.._ing respect to the quantities involved and it was . anywhere that in addition to this,__th_is d_ef'e'r'1=dant"iw'as liable to pay any sales tax transactions. If it was the 'plaintiffs 'case".:tlha'L.,_the;re was any sales tax the transactions payable plaintiff should have claimed 'issuing the documents assuming that the from the course of eveni;sg_Aas_ has waived its right, if any*,d_to tax from defendant No.1 in '_Vrespec1_j;ofcthesellltransactions. The plaintiff is therefore A*no.t'entit1_ed. t.ol"cl_aim amount now and must also deem tolbel'le.s*to'p'p_ed claiming the same. The suit is bad for rnis~jo'indelr of parties. There is neither contractual nuo¥r"a..stat7utory liability on defendant No.1 to pay any tax in respect of these transactions to the "plaintiff. The import license referred to in paragraph -11- No.1 of the plaint were obtained by the plaintiff and were never made available to defendant No.1 at any time. Consequently, defendant No.1 had no know.l.e'dge_V of the contents of the same. If the p1aiI1tiff:_:'.CllCl'f..,:I:'id'C:'T._._x'.. claim the sales tax at the time__of_ trarls'aCti'_crl"=Was entered into, the plaintiff has nolylegala.ilrighfito any such claim thereafter. 'ififst "time. _tli,e A§p1a.i.n.tiff wrote to this defendant on sales tax in respect of aft'??? the event. This was defendant No.1 stating acceptable, as no such at the time of "C no acceptance of any liability bfyafldefei';d.ant=T§»lo.1 at any time. The _assess1_{rient. proceedings, orders passed in appeal theévfj'-udgment of the Hon'ble High Court as well o'r.d_e'r.;"p..assed by the Hon'b1e Supreme Court fof not in any way effect the liability of the the plaintiff and the defendants. The claim is l_l_als'"o.fbarred by limitation long ago. This defendant is X
-12..
not liable to pay any interest. Defendants 2 to 4 have filed written statements on almost similar lines.
8. Defendant No.5 in its written specifically contended that the sales of"Vcas~:}1:euinuts brought about through the plaintiff sal_e"~of at high seas and in the course of import .'*3.nCl._l.l'1:e'1'v€f0Y€» it is not exigible to tart. foreign sellers to the buyers lil:e...V:ihis_ _fi"'he plaintiff is an authorised. agen'c.y:t: such transaction. _ nor the terms of contract between defendant as Well as under law, thisl deVf'e_n"da11t«"'_jels' not liable to pay any sales tax. I.f_%gSal*es Tait" Department has made claim from the A'~plaint,iff, be foisted on this defendant. This asked the plaintiff to represent this riefend'ant'l_1oe'fore the Sales Tax Department. 011 the this defendant co--operated with the and at all material times submitted affidavits "--oVr""statements pointing out the fact namely the /"
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transaction is not exigible to sales tax at all. Having taken such a stand and persuaded the defendants also to take such a stand the plaintiff is now estoppedi.fro:n2..vv contending that the defendant is liable to . which plaintiff alleged to have paid. made by the plaintiff, even if cost and risk of the plaintiff alndytnotlto Vibe. this defendant. The defendant___ils'»vnoit_»lialoleto any sales tax. Acoordinglyi theys*ou;{:ghtu"fo1"xldisrnissal of the suit. V
9. On the aforelsaipd Trial Court has framed the fiullovviiifg:issli1es;:.,,, ' l (1) Whether paroves that the defendants '_a'r~epA1iableAl"to pay respective amount as in thepllaint?
.eW'h_e'therl"'vdefendants prove that they are _ "-l'.__legal.ly__no't*liable to pay the suit claim? the suit is bad for mis--joinder of parties and cause of action?
if ('4}i.,Whether plaintiff proves that defendants are
-liable to pay interest as claimed in plaint'? (deleted as per order on l.A.13) '[5] For what reliefs the parties are entitled? ti/A -15- defendants 53 documents were produced which are marked as Exs.Dl to D53.
11. The Trial Court on appreciation of oral and documentary evidence onrecord_--he1d::t'i1at the plaintiff has failed to prove that;'A:4thieidefendantg liable to pay respective amounts as claim,ed{_"i'n...the plaint. The defendants havejrjprovved are legally not liable to pay suit is not bad for mis--joinder_h action, as contended not barred by time. Theamount of sales tax paid by "Department. They also further proved _ particulars of sums as 'vmentionfedi'.in the schedules I to V1 are true and the plaintiff has failed to prove that they are én%'::1ed"'£o recover the said sums. It held that theufamoyunts were legally due to the plaintiffs, they vveyre ventitlfed to claim interest on the said amount. For ..tl11eA'--aforesaid reasons, when the Trial Court held there contractual or statutory liability to pay the sales -16- tax by the defendant, the tax, which the plaintiffs have paid to the Sales Tax Department and accordingly the suit came to be dismissed. Aggrieved by the said judgment and decree of the Trial Court, the has preferred this appeal. Defendant preferred the cross objections recorded on the question of action and limitation. _ V _ V.
12. Sri.Diwakar, learned cotinsel appearing for the appellants assailing and decree contended that'tl1.e'"~.'[p1aintiffs and defendants werrer'r'u'i1.der>r'a_rn~i.stal<.en notion that the sale of cashewn'ut_sl1;)yr"t._l'ier.r.plaitnrtiffs to the defendants was 4__not e,.¥._igib'le tor"t'a.>r::.v_ Therefore, the plaintiffs did not Vclaim. sales tax. in the invoice raised in favour of the is only after 1976 when the
--transactions'"Were completed the Commercial Tax ...j"t'hepa-l<im¢'i1t issued notice demanding the tax. They
--..corhritended that tax was not payable. Simultaneously, also informed defendants about the demand and 3/.
-13- said admission committed a serious error in dismissing the suit of the plaintiffs.
13. Per contra, learned counsel appearing fora-the respondents contended that no sales tax is K the import of cashewnuts. it is sold to the l on the high seas and therefore, it The plaintiff having contended tax through out the proceedingsup to they cannot now turn' said amount from the defenldants°,"':lll' ::lM.erel_y:.,lf7_1lhecause the Apex Court has thief'-ls--al_e_s7tax is liable to be paid,l7the_re pay sales tax. There is no statutoryliiabilityfAlto' sales tax and the liability to payigisales tai arisen after the completion of the A"icon:tr.agcct.,_f: iI'he:r'e.fore, they contend that when they have solldrihevllfcla_she;Wnuts purchased by them to Various
--eusto"rher'slgV and they have not collected sales tax from I'lthe'1ri;~~_it yvould be highly unequivocal and unjust to the said amount from the defendants who did not "--«.hHaye any benefit of purchasing the cashewnuts Without -19- the payment of sales tax, as they have passed on the said benefit to their customers.
14. In the light of the aforesaid facts contentions, the point that arises forour co'n'si:dera:tion if is:
"Whether the defendan:"_fV_g'«.a.re iialoie the sales tax paid by the'~.ipia_intift's. "the Commercial Tax De_part*I':oeI1.t€ the demand for which arose after;th'e__c.o}mpiee_t.ion_pof the contract between th--e.,pa.rtie&s.?""
£5. The facts For the period from thevmplaintiff has imported cashewnnts from Countries. Exs.P114 to P153 are the" letters fshoswing the allotment of such i1"n.poivte'dimashewniitfsff in favour of the 5 defendants he.rei_nf* P118 are the copies of the invoices issued! by.-t~h_e3'..--pV1aintiffs to the defendants for purchase cashefwrruts. Exs.P154 to Ex. 160 shows the quantity casfhewnuts received by the defendants from the Vpiafrltiffs. The said transactions are also reflected in h/ ssss -20- the Sales Day Book at EXs.P215 to P218 and also for the ledgers in the year 1970-71 at Exs.P219 to P234. The relevant entries in these books are also marked with respect to each of the defendants as to 22-4{e). The correctness of the entries tlierre.i:n:: it the genuineness of these docume'nts"<are..¢ the evidence of DWs.1 to 4 eVxamine_d.'A«A_o.n defendants 1, 2, 3 and 5 the amount thereunder shvown stand.s';nr'ey«ed.A'A"Besides in the plaint schedules I years from 1970-71 to sold, sale value as per =ithe».'ini%oi--ees"'--an%d' thielamount that has been paid. adfusted,Vas"-;ier_transaction are clearly set out. Defendants'a1__ to 4 »'n"q»t4dispute the correctness of the sz3.i}:d'Vd'ocumVe11,tsv. fhough defendant No.5 disputed '~.th.e'c.o_r1"-ectneéss,of the amounts in his evidence, he is how this statement is wrong.
7l"here'i"ore"';vnonltappreciation of the oral and documentary evxideoce on record, the Trial Court was justified in ..fr.-ecording a finding, that they clearly establish the total M21- quantity and the value of the cashewnuts supplied by the plaintiffs to each of the defendants.
16. A perusal of the invoices clearly shows that__the amount due by each of the defendants for the supplied is clearly set out. In the invoices,.--_"'salelS"
payable or claimed was not mentioned.' 'l'he'lr'ela'so'n_i_s on the day the invoices were raised, the" allotment Kvaypgp made in favour of the thes bonafide believed that the said' nolt"e.xi..gible to sales tax. The defendalnts'al'sol=l§onafi'd:e"' believed that they are not liabl.e tax for the purchase ' in terms of the Value mentioned _ thelll'.:i'n:v'_.oices, admittedly all the 4'_.ydefend_iants have the money due to the plaintiffs. and payment, the entire transaction carrie'=.,'toV'a"n_ "end. However, the Commercial Tax
--Departme'nt.'on 06.01.1978 after the completion of all .1"theses-ytransactions, issued a demand notice to the calling upon them to pay sales tax on the "'<.afo"resaid sales on the ground that the sales tax is l\*\/ -22- payable on sale of these goods. The plaintiffs replied contending that no sales tax is payable on import of goods as the sales has taken place on the high seas. Over ruling the said objection, the held that the sales tax is payable on goods. The plaintiffs preferred an to be dismissed. The second;-,ppeal'* fate. Revision before this '.V'difs:'§niVssed and it is not in dispute Jthat 'hasfupheld the said demandpyof levy tjaiti-'.f._'jjfherefore, the plaintiffs were an amount of Rs.21,57,€ijQ5fi!_'2.t%ps'; tthe'«V"sales tax payable in respect by them in favour of the 5 defendants the suit. "
dispute that the plaintiffs after the receifpti' notice from the Commercial Tax
--Departrne*nt,'yvrote a letter to each of the defendants on bringing to their notice the demand made department, the amount claimed and called them to pay the amount in the event the plaintiff W/,t...t -23- had made to pay the said amount. In the reply sent by these defendants on 08.03.1978, they unequivocally denied the liability to pay the sales tax. However_..___in some other letters, they took a stand that if ulti:natfely'..A' in the final analysis the Apex Court declares "
sales tax is payable, then if the pl-la'i1i--tiff "saw amount they would reimburse _ paying the amount on 18.1l.'l._§8._6, theplain_tiff:"oa1led upon the defendants to;1f.eimburs.e'--thern, in"p.ur'suance of the said undertaking"d'efe'n:'daln'ts».iLdid not pay. Therefore, the plaipntiffs§_'wer'e'..:con'st'raine::l to file a suit.
18. The;aforesValid:v..fa'cts"fVeilearly demonstrate that there is no contractuallllliabiilityj-to pay. sales tax as is clear from i13.voices=_.l:Vv'l'he statutory liability to pay tax if 'Kandy:'would.be:atthe time of sale of the products. The sallesf.-tool:'llpvlacellbetween 28.11.1970 and 31.03.1976. if at allpthe plaintiff had to pay tax, they should have C"lpaiéiitphelllltax at the time of the sale. In fact, the
-plainftiff never demanded the tax at all. It is not a case 'koffpayment of tax being kept in abeyance on the date of \\V/' /"V ..24_ sale and the date of payment of sale consideration. Both the parties understood clearly that the sale was not exigible to tax. There was no implied CO1'ltI'aC'~i'..">£VO pay tax on the date of sale. It is in this plaintiff claim the said amount by virtue of H of the Contract Act. Section 69 reiadsas V "Reimbursement of person payiixig money ' ii . due by another, is pa§"iiji'e.:_it of Iivhiutiiij is interested -- A persondfvho -is interestecii in the payment o.f:re_on(iAy bound by iaw to W::hoVi'_'.the.refore pays it is entitled:-'t'o"ble by the other." H é Theft' this provision is directed the plaintiff establishing the iiabvilityaof et1i'eA"v»:1eii'endant to pay tax to the A.Tax'h"'De'partment on the day they The plaintiffs sold the goods to the'd.eiendantVs'§V' The primary liability to pay sales tax such._s3a1es is on the plaintiffs, it is not on the it The piaintiff may recover from the it"'~'.id_e_féndants, the tax payable by the plaintiff to the -25- department. The plaintiff paid this amount of Rs.21,57,105.25ps., towards sales tax payable by them to the department towards the sale of goods effected.-by them in favour of the defendants. This is amount which the defendants were iiabie to pay "
date of the sale to the departmen:t'.'""The said was not a payment on behalf of .It payment to discharge theirffstjatutoryV.1iabi1'ity';--:MIt'dis only when a person pay-'s._.monte'y anofth'er'A"person is bound by law $'_»__entit1ed to reirI1b1Wrsement:,, an express contract to the Trial Court rightly held--.cti1at°Vt1'i'e:Said_:se.ction 69 has no application to the facts'o_f = f '=_19.:=.In $0',fa}""aS Section 70 is concerned, it reads as ur1de'I':_h 'V tflizivigiitfion of person enjoying benefit of .A _:'no:n'-~-gsratuitous act. -- Where a person if e._>_1a_'wful1y does anything for another person or delivers anything to him, not intending to do so gratuitously, and such other M/it
-25..
person enjoys the benefit thereof, the latter is bound to make compensation to the former in respect of, or to restore, the thing so done or delivered."
20. In the instant case, the Rs.21,57,105.25ps. is not a ;,ii:;ade plaintiff, on behalf of the defen.dants---towthe Tax Department. By makin§:.".9u0hl" the defendants did not enjoy the event of the defendants on account of payment not legally bound to payment is not made gratui_to1isly.«V..s'uch«-gierson who made the payment is to be reimpbursedl.'"fi'he"----defendants did not enjoy any benefit; of the payrnent of sales tax by the plaintiff. The all traders. After purchase of goods p.ayrneiii1:.«:"of sales tax, they have passed on the said 'b_enefit,.t'o their customers. In their sale price, '":l"v'A"--.tll'1epyphay*e.:not included this component of sales tax.
"l'heref_o're Section 70 of the Contract Act is not -27- attracted and the claim based on the said section has to necessarily fail.
21. Under law it is the dealer who is liable to pay the sales tax. However, the sale price means the amoiint of valuable consideration already paid or payable to the dealer by the purchaser goods sold at the time of deliverylhtortbefore goods and nevertheless the sale pricte-._may_l.a;lso 'covert it the sales tax and sale price canjbe fixe'd_:b'ylthevipdlealer if the purchaser agrees 'land s.o"Cl>Il11:}l/1. '.'h'~--that lgmfind the dealer can recover from thifisltax payable as part :cft"'saix.giv;y_pri:E§Vé'. fl'l:l:owetrér;'Vtlafter the delivery of goods, the dealer*'canlr1«o_:ti'---ccllect separately the sales tax from thel"purcha«SeA1--'._ astlper the provisions of Section .$fa1e_Aof Coca.g«Act. After sale and delivery of can be recovered only if there is a contract specifically provided for that. in the instant case, the sale price is in the invoice. it did not include the sales .j'«..ftai{%playab1e by the plaintiff to the Department on sale said goods. On the date of sale, the parties did N/be .,28..
not either expressly or iinpliedly agree for payment of sales tax as both were under the impression that the said sale is not exigible to tax. Therefore, the plain--tiff did not reserve its right to claim the said sales future date if ultimately, it has to pay The defendant on its part after punihayse goods to various customers. "I'hei':7V saleflv price include {his sales tax circumstances, when there is or a contractual liability to date of purchase by the_A'defen:d'a1'1.ts':, are not liable to pay_t.h§'e has paid the tax thefliudgment by the Apex Court holding that:tiie'fp_l_'a'i.ritiff is liable to pay the tax. Though thxefl said.' the plaintiff could have recoyVered--«i'trom the defendants on the date foyffthe=sa'1ve:;'~t:hey--~have not recovered the same, in law it is not"'iperrnifs_sible for them to recover the same after 4 the saie..iks...comp1eted in the absence of any contract to the said amount. The trial Court, on appreciation '-«of the oral and documentary evidence on record and various authorities cited before it and keeping in My _gg_ mind the law laid down by the Apex Court on the point, has rightly held the defendant is not liable to answer the plaintiff's claim. We do not see any committed by the trial court which interference. Therefore, we do see any mer.i:t".Vifi--..:'th_is appeal. Accordingly, it is dismissed:..,_lylAi.nu'--jVieAW--:
fact that the suit is dismissedand ii"isl'o.ffirmé;..i.. Court. the Cross objections _disrnis:sed vlrhat is challenged is only Accordinglyfi app'€§a1V:.:A~.alslV__Vllb the cross objections Sd/ -
JUDGE ..... JUDGE