- (1.) This is a suit by Jardine Henderson Ltd. for recovery of Rs. 79,071.62 from the defendant.
(2.) The plaintiff's claim arises in the following circumstances. The plaintiff who is a manufacturer of products including B. Twills entered into several contracts with the defendant from the beginning of 1st April, 1969 ending with 31st March, 1970 where by and whereunder the plaintiff agreed to sell the defendant and the defendant agreed to buy from the plaintiff diverse quantities of B. Twills. One of the common terms and/or conditions of the said contracts was that sales tax if applicable would be under the defendant's account. The defendant purchased the said goods covered by the said contract for the purpose of exporting and in fact exported the same out of the territory of India. At all relevant point of time the plaintiff reasonably believed that the sales of the said goods covered by the said contracts took place in the course of export out of the territory of India within the meaning of Section 5(2) (a) (v) of the Bengal Finance (Sales Tax) Act 1941 and the Sales Tax under the Act would not be applicable in respect of the said sales and as such did not include such Sales Tax in the bills and/or invoices submitted to the defendant in respect of the said sales. By and under Assessment Order, dated 22nd February, 1974 passed by the Commercial Tax Officer, Lyons Range, Calcutta in the relevant provisions of the Act in respect of the said Financial year, the taxable turn over of the plaintiff was arrived at after deducting therefrom the said sales under and/ or in terms of Section 5 ( 2) ( a) ( v) of the Act. However, the Supreme Court of India by its judgment, dated 16th April, 1975 delivered in the case of Md. Sirajuddin vs. State of Orissa held that where the mineral ore had been sold by the appellant namely, Md. Sirajuddin to the defendant State Trading Corporation of India Ltd. and that the defendant in its turn entered into similar contracts with the foreign buyers for sale of the identical goods purchased by it from Md. Sirajuddin, the sales of Md. Sirajuddin to the defendant were eligible to tax because they were not sales in the course of export. After this judgment had been delivered the Assistant Commissioner, Commercial Taxes, Chowringhee Circle by his Memo No.3660, dated 16th June 1976 initiated a suo moto Revision Case No.36 of 1976-77 alleging that an amount of Rs. 1,24,66!655.54 has been wrongfully allowed under. Section 5 ( 2) ( a) ( v) of the Act and it was necessary to revise the said assessment order. After receiving the above Memo, the plaintiff by its letter, dated 12th July, 1976 informed the defendant about the receipt of the said Memo and pointed out to the defendant as per the terms of the said contract with the defendant the amount claimed in the said Memo would become payable by the defendant to the plaintiff and requested the defendant for arranging the issue of relevant Sales Tax Declaration Forms to the plaintiff. The defendant by his letter, dated 30th July, 1976 requested the plaintiff to challenge the reopening made by the said assessment order but promised to furnish the appropriate declaration forms. Thereafter the plaintiff again made further demands for the supply of declaration forms in writing and the defendant by its letter, dated 22nd February, 1977 again promised to furnish the relevant declaration forms as soon as it obtained the adequate quantity of forms from the Sales Tax Authorities. Thereafter the defendant duly submitted the relevant declaration forms to the plaintiff. On or about 23rd December, 1977 the plaintiff received the Memo No.7842, dated 13th December, 1977 from the Assistant Commissioner informing the plaintiff that the said Assessment Order, dated 22nd February, 1974 had been revised by the Assistant Commissioner by the Order, dated 21st November, 1977.
(3.) On or about 19th April, 1978 the plaintiff applied for a certified copy of the Order, dated 21st November, 1977 and came to know about the relevant Order which has been set out in paragraph 17 of the plaint. In the premises aforesaid, the Sales Tax became applicable to the said sales that had taken place with the defendant became liable to pay the same to the plaintiff under the terms of the said contracts. The plaintiff thereafter, duly submitted a bill for a sum of Rs. 63,187,83 being half percent of Rs. 1,24,66,655.54 to the defendant. On or about the 21st October, 1978 the plaintiff received a revised notice of assessment from the concerned authorities whereby the plaintiff was directed to pay a sum of Rs. 62,021.62 failing which it was threatened that the said amount would be recovered from the plaintiff as an arrear of Land Revenue as sales penalty and on 12th March, 1979 the plaintiff was constrained to pay and paid the said sum of Rs. 62,021.62 as per the demand contained in the said revised notice of assessment. The plaintiff is entitled to recover the said sum from the defendant and the defendant is bound to pay the same to the plaintiff. But the defendant purported to deny its liability for the said sum and has failed and/or neglected to pay the same. In the circumstances the plaintiff is entitled to claim and claims compensation amounting to Rs. 17,650 on account of its inability to utilise the said sum of Rs. 62,021.62 from the date of payment namely, 12th March, 1979 until the date of institution of the Suit, i.e., the interest which is the plaintiff could have earned in the said sum calculated at the rate of 15% per annum. Therefore, the plaintiff has filed the suit for recovery of the sum of Rs. 79,071.62.;