UNION OF INDIA Vs. KARNAL DISTILLERY COMPANY LIMITED

JUDGEMENT

(1.) This first appeal by the Union of India (hereinalter to be called the defendant) is directed against the judgment and decree passed by the Senior Subordinate Judge Simla whereby the plaintiff's suit for recoveiy of Rs. 25,270.00 has bven decreed against the defendant with costs,

(2.) The plaintiff, the Karnal Distillery Co. (Private) Ltd, alleged that it had entered into an agreement with the government of Himaohal Pradesh on July 20, 1950 (Ex. P-l) whereby it agreed to supply 12,000 L. P. gallons, with 10% variation of quantity on either side. of country spirits to the Liquor Licensees of Mandi District during the remaining period of the financial year 1950-51, commencing from August I, 1950, at the rates mentioned in the said agreement. According to the agreement the Government had to provide a suitable building to enable the plaintiff to establish a Ware-house at Mandi, on a rent of Rs. 50.00 per mensern for the period of the contract. The plaintiff was also required to deposit a sum of Rs. 20001-1- as security for the due performance of the various clauses of the agreement.

(3.) The plaintiff established the warehouse and commenced supplies of country liquor as per terms of the agreement but alleged that out of the .quantity supplied and stored by the plaintiff in the warehouse, the Liquor Licensees of Mandi District lifted during the term of the contract only 7, 934.5 L. P. gallons of liquor leaving 2, 645.8 L P. gallons on its hands, which were taken over by the Government through the Excise Sub-lnspector, Incharge of the warehouse on March 31, 1951. The plaintiff submitted its bill for Rs. 22,264/6/3 to the Government at ths contractual rates mentioned in the agreement but the payment of the amount was withheld. The plaintiff thereupon filed a suit against the State of Himachal Pradesh Government of July 31, 1953 for recovery of Rs. 22,264/6/3 plus Rs. 3,005/9/9 as interest at the rate of 6% per annum making a total of Rs. 25.270.00.00 in the court of Senior Subordinate Judge, Karnal. The suit was contested by the defendant inter-alia on the ground that the civil courts at Karnal had no Jurisdiction to try the suit. The objection with regard to the territorial jurisdiction of the civil court Karnal prevailed with the Subi-dinate Judge who by his order dated February 27, 1954 directed- that the plaint be returned to the plaintiff for presentation to the proper court. The plaintiff preferred an appeal against that order to the High court of Punjab but the appeal was dismissed by G. D. Khosia J. of that Court on November 8, 1955. The order of the learned Single Judge was challenged by the plaintiff in further appeal to the Division Bench of the said High Court under clause 10 of its Letter Patent. The appeal was admitted to regular hearing but was eventually dismissed on September 1, 1958 with the following short judgment recorded by the learned Judges hearing the appeal:-