SRI VILAS FIRM Vs. TINNEVELLY MUNICIPAL COUNCIL

JUDGEMENT

(1.) The appellants are a firm styled Sri Vilas. They have been assessed to pay the companies tax under Section 92, District Municipalities Act as agents of the Tinnevelly Textiles Co., Ltd. The question for decision is whether they are employed by that company as agents to represent it for the purpose of transacting business in the Tinnevelly Municipality. The Courts below have found that they are so employed. Their contention is that they are, as stated in para. 8 of the plaint, "independent contractors; in other words that the relations between them and the company are those of buyer and seller.

(2.) The answer to the question turns on the construction of the agreement between the parties, Ex. 4. Under that agreement the appellants were appointed sole banyans of the company for a period of 30 years. They were (Clause 2) to sell all goods manufactured or produced by the company at such prices as shall be approved by or on behalf of the company. and to be: responsible to the company for the due payment by the buyers of the prices of all such goods and merchandise sold by them for and on behalf of the company and for the due performance by the buyers of all contracts entered into by them through the said banyans with regard to such goods and merchandise.

(3.) By Clause 2, the prices of goods sold were to be paid to the company in 1? months from the date of the sales and in default the appellants were to pay interest. By Clause 4 the appellants were bound to assist the company in procuring cotton at the market rates and be responsible to the company for the due performance of all contracts entered into with the company through them for the supply of cotton. By Clause 5, the rates of commission were fixed. By Clauses 6 and 11 arrangements were made by the parties for mutual inspection of accounts. By Clause 7 the company has to bear the cost of carrying the goods from their mills to the appellants depots. By Clause 9 the company had to pay Rs. 150 a month to the appellants for their Tinnevelly depot.