SECRETARY OF STATE FOR INDIA IN COUNCIL Vs. GREAT INDIAN PENINSULA RAILWAY COMPANY

JUDGEMENT

(1.) Thin appeal is from a decree dated April 5, 1923, of the High Court at Bombay, which followed on a judgment pronounced in a Special Case under Order XXXVI of the Civil P. C.. The parties the case are the Secretary of State for India in Council as plaintiff and the Great Indian Peninsula Railway Company as defendant, and the question stated for the opinion of the Court is. Whether stores purchased and imported by the defendant Company into India for the use of the undertaking as mentioned in the case are at the time of the importation, goods belonging to Government." On the decision of this question depends the liability of the defendant Company to pay Customs duties under Section 20 of the Sea Customs Act, VIII of 1878. By this section Customs duties are imposed which would attach to the stores unless they come within the proviso to the section that no such duties shall be levied on goods belonging to the Government The answer to the question propounded depends largely on the legal effect to be attributed to the provisions of the agreement attached to the special case; but that this effect may be rightly understood a brief summary of the facts leading up to it is necessary.

(2.) The defendant Company was incorporated in 1849 by an Act of the Imperial Parliament 12 & 13 Viet. c. 83. On August 18, 1899. the Secretary of State in Council in exercise of powers vested in him gave notice to the defendant Company of his intention to purchase the railway and works that had been construct- ad together with the telegraphs, and the engines, carriages, stock, plant and machinery belonging to the railway and works. On July 30, 1900, an Act of Parliament, 63 & 64. Vict. c. 138 intituled an Act to provide for the vesting of the railways and other property of the Great Indian Peninsula Railway Company in the Secretary of State in Council of India and for other purposes was passed. After a preamble stating that notice of intention to purchase had been given and that it was expedient that arrangements should be made for the future working of the railways of the Company it was enacted that as from June 30, 1900, the railways and works should by virtue of the Act be transferred to and vested in the Secretary of State in Council. This then is how matters stood at the date of the agreement attached to the case, and it is to be borne in mind that at its date the Secretary of State in Council had become and was the owner of the railway undertaking and all that pertained to it. The agreement was made on December 21, 1900, between the Secretary of State in Council of the one part and the defendant Company of the other part, and in the opening recital it is stated that it had been agreed between the parties that the defendant Company should maintain, manage, and work, the Great Indian Peninsula system on the terms thereinafter mentioned. This recital is important; it is the key to the meaning and effect of the elaborate provisions that follow; on examination they will be found to be merely ancillary to the recited agreement.

(3.) Thus it is for the purpose of the contract that the plaintiff is to hand over to the defendant Company the Great Indian Peninsula railway system together with the rolling stock plant and machinary belonging thereto (clause 5); and for the purpose of the undertaking that he is to deliver to the defendant Company all stores belonging to the Great Indian Peninsula system (clause 6). There is no derogation here from the property vested in the Secretary of State in Council.