STATE Vs. LAXMINARAIN

JUDGEMENT

(1.) This second appeal of the defendant, the State of Madhya Pradesh, has been directed against the reversing decree passed by Shri N. R. Ithape, Second Additional District Judge. Indore, in Civil Appeal No 217 of 1956-C decreeing plaintiff's suit for permanent injunction.

(2.) The respondent plaintiff was an excise contractor who, on 15th February, 1950, obtained from the Government of Madhya Bharat a contract to sell liquor in 6 shops in the city of Indore. The contract was for one year from 1-4-1950 to 31-3-1951. Now there is no dispute that some time after, the said contract was transferred by the plaintiff to 6 sub-contractors (Pot Thekedars) with the consent and knowledge of th Government. One of the questions which arises for consideration is who is liable to pay sales-tax on the sales of liquor of these 6 shops. i. e. plaintiff or the six sub-contractors.

(3.) The State of Madhya Bharat levied sales-tax with effect from 1st May 1950 and attempted to recover it from the plaintiff in respect of the liquor sold to consumers from the said six shops by the sub-contractors. The case of the plaintiff as originally laid was that the Excise Commissioner who was present at the time of the auction had given an assurance to the bidders that no sales-tax would be levied and that the plaintiff would not have offered such a high bid had such an assurance not been given. As the sales-tax in respect of the year 1950-51 for the six shops in question was demanded by the Government from the plaintiff he served the Government and the Excise Commissioner with notices under Section 80 of the Code of Civil Procedure. The notices were given on 29-7-1950, they were served on 31-7-1950, and as no reply was received, the plaintiff filed the present suit out of which this appeal arises, on 25/29-9-1950. i. e. before the expiry of two months of the service of the notices.