GUMAN MAL LODHA, J. - (1.) THIS appeal has been filed by the State of Rajasthan, the appellant -defendant, against the judgment and decree -dated 11th April, 1972 passed by the Additional District Judge No. 2, Jodhpur, decreeing the suit of the plaintiff -respondent for a sum of Rs. 5,78,817.13p.
(2.) BEFORE I proceed to consider the respective contentions of the learned Counsel for the parties in appeal, it would be useful to mention, in brief, the facts. The plaintiff -respondent filed the suit under appeal on May 18, 1955 against the appellant as well as the Union of India and the Income tax Officer, Jodhpur. The His highness Maharaja of erstwhile State of Jodhpur invited applications from the financiers for the purpose of industrial development of the Jodhpur State and in pursuance of that, the plaintiff -respondent submitted an offer for establishing a Mill under the State sponsorship and patronage. The said offer was accepted by the erstwhile Government of Jodhpur State and eventually on 17th April, 1941 a formal agreement was entered into and executed between the parties In the said agreement, amongst many concessions and immunities granted to the plaintiff -Mill also included a concession in regard to the exemption from the payment of duties and royalties. According to the appellant, the plaintiff -Mill in consideration of the concessions and immunities granted to it by the erstwhile State of Jodhpur under the said agreement agreed vide its Clause 12 to pay to the State royalties at rate of 7 -1/2% of the profits of the company in each of its financial year.
(3.) THE case of the plaintiff respondent before the lower court was that the agreement in question was acted upon by the erstwhile Government of Jodhpur so long as it remained in existence. The plaintiff -respondent had filed the present suit when its suit No. 13/52 was dismissed by the District Judge, Jodhpur on 3rd September 1954 and when the District Judge had already held that the agreement of 17th April, 1941 was not at all binding and enforceable against the State of Rajasthan. Since the appeal against the judgment of the District Judge in suit No. 13/52 was pending before this Court and since after the decision of this Court dated the 7th April, 1959 a further appeal in this connection was pending before the Supreme Court along with an appeal which the plaintiff respondent had filed before the Supreme Court against the decision of this Court dated the 19th October, 1959 given in Civil Writ Petition No. 47/53 so the proceedings of the present suit under appeal remained stayed uptil 26th October, 1963 when a review petition filed by the plaintiff -respondent in relation to the decision of the Supreme Court dated 27th November, 1961 was also dismissed by the Supreme Court.;