TMI Blog1978 (5) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... , on March 1, 1970, where it loaded 13,000 long tons of bauxite belonging to the time-charterers, the Aluminium Company. On March 20, 1970, the ship left for Alfred port, Canada. The ship was allowed to leave the port of Betul on the basis of a guarantee bond executed by the respondent in favour of the President of India, undertaking to pay the income-tax payable by the time-charterers under section 172 of the Income-tax Act, 1961. On April 15, 1970, the First Income-tax Officer, Margao, Goa, issued a demand notice to the respondent for payment of ₹ 51,191 by way of income-tax under the aforesaid provision. The respondent filed Special Civil Application No. 31 of 1970, in the court of the Judicial Commissioner, Goa, asking for a writ of mandamus directing the Income-tax Officer to withdraw the demand notice. By a judgment dated October 29, 1971, the learned Judicial Commissioner allowed the respondent's writ petition and passed an order quashing the demand notice. Having obtained from the Judicial Commissioner a certificate of fitness to appeal to this court under article 133(1)(b) and (c) of the Constitution, the Union of India has filed this appeal. The question as t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documents as he may require. (6) A port clearance shall not be granted to the ship until the Collector of Customs, or other officer duly authorised to grant the same, is satisfied that the tax assessable under this section has been duly paid or that satisfactory arrangements have been made for the payment thereof. (7) Nothing in this section shall be deemed to prevent the owner or charterer of a ship from claiming before the expiry of the assessment year relevant to the previous year in which the date of departure of the ship from the Indian port falls, that an assessment be made of his total income of the previous year and the tax payable on the basis thereof be determined in accordance with the other provisions of this Act, and if he so claims, any payment made under this section in respect of the passengers, live-stock, mail or goods shipped at Indian ports during that previous year shall be treated as a payment in advance of the tax leviable for that assessment year, and the difference between the sum so paid and the amount of tax found payable by him on such assessment shall be paid by him or refunded to him, as the case may be. Section 172 occurs in Chapter XV whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The ship was delivered to the time-charterers at Betul, Goa, whereupon they loaded it with their own goods to the fullest capacity of the ship. Under the charter-party, the charterers had agreed to pay to the owners of the ship a sum of 4.50 U.S. dollars per ton on the total dead-weight carrying capacity, per calendar month, commencing on and from the date of the delivery of the ship. The short question for consideration is whether the amount which the time-charterers had agreed to pay to the owners of the ship was payable on account of the carriage of goods. If any guidance is to be sought from the terms of the agreement between the parties, the conclusion seems inescapable that the amount which the time-charterers were required to pay to the owners of the ship was not payable on account of the carriage of goods but was payable on account of the use and hire of the ship. The charter-party provided by clause (4) that the charterers shall pay a sum at the rate of 4.50 U.S. dollars on the total deadweight carrying capacity of the ship, for the use and hire of the said vessel . It is true that one cannot place over-reliance on the form which the parties give to their agreeme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods in a port in India. What is payable as hire charges for the use of the ship cannot transform itself into an amount payable on account of the carriage of goods, by reason of the circumstance that the ship was loaded with goods in India. It is relevant, for the decision of the question under consideration, that the time-charterers loaded the ship at Betul, Goa, with their own goods. They did not sublet the ship for the purpose of carriage of goods nor did they load the ship with goods belonging to a third party in which event they might have earned some freight on account of the carriage of goods. They paid hire charges to the owner of the ship for the use of the ship and since they loaded the ship with their own goods, they received nothing on account of the carriage of the goods. Neither the one nor the other, therefore, received any amount on account of the carriage of the goods. The weakness of the argument advanced by the appellant's counsel consists in its assumption that the charter-party has to be an agreement for the carriage of something like goods, passengers, live-stock or mail. A contract by charter-party, says B.C. Mitra in his Law of Carriage by Sea (Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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