TMI Blog2021 (12) TMI 1383X X X X Extracts X X X X X X X X Extracts X X X X ..... Organising States and the distributor/selling agent on the one hand and the agreement between the distributor/selling agent and the petitioner on the other without the parties to the agreement being brought before the Court. The agreements relied upon by the petitioner has been perused for a prima facie view only. It appears that to determine whether or not the burden of draw charges paid by the petitioner on behalf of the Organising States had been passed on to the ultimate consumer it is necessary to examine the complex issue of pricing of the lottery tickets which may not be possible in a writ jurisdiction. Furthermore, the issue involved here also requires an interpretation of these agreements between parties not before this Court. The only thing certain is that the petitioner had paid the draw charges. The State respondents have also raised the issue of limitation and seriously contested it. This Court is of the view that it would not be correct to decide the issues raised in writ jurisdiction. The writ petition, is therefore, dismissed. - W. P. (C) No. 8 of 2019 - - - Dated:- 7-12-2021 - MR. BHASKAR RAJ PRADHAN, J. Mr. Surajit Dutta, Advocate and Ms. Rachhitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der. The petitioners contended that since the petitioner in M/s Shubh Enterprises (supra) was also a distributor/selling agent who had raised the same issue before this court which had laid down the law, the petitioners were entitled to claim the relief. The plea of unjust enrichment was contested and it was stated that the draw charges were paid from their own pocket and the respondent no.3 had also issued receipts acknowledging the payment. It was submitted that as the petitioners were claiming the relief directly from the respondent no.3 on the basis of law it was not necessary to implead any other party and that the Organising States were not necessary parties. 5. On 27.08.2019, the Principal Secretary/Additional Chief Secretary, Finance Department, Government of Sikkim (respondent no.2) filed an affidavit stating that he was relying upon the counter affidavit filed by the respondent no.3 on 20.07.2019. 6. In compliance to the order dated 05.11.2019 passed by this court granting liberty to the petitioners to file better affidavit to show that the petitioners have actually paid the draw charges of Rs.2000/- per draw from their own pocket an affidavit was filed on 01.02.202 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zoram and Summit; agreement dated 15.04.2014 executed between State of Mizoram and Summit; agreement dated 06.05.2010 executed between State of Goa and M/s Sugal Damani Enterprises Pvt. Ltd.; agreement dated 27.07.2015 executed between the State of Arunachal Pradesh and Summit; and agreement dated 08.08.2010 executed between M/s Sugal Damani Enterprises Pvt. Ltd. and the petitioner. 10. On 12.08.2021 the respondent no.2 filed a reply affidavit to the petitioner s affidavit dated 07.04.2021 contending that the petitioners have brought in new facts after passage of two years from the date of institution of the writ petition. It was contended that as per the agreements, while the Organising State was liable for the draw charges under Rule 3(11) of the 2010 Rules, the onus to pay the draw charges has been transferred to the distributor/marketing agent. This would mean that under the agreements, the distributor/marketing agent had agreed to pay the draw charges on behalf of the Organising State. However, this does not mean that the liability of the Organising State under Rule 3(11) of the 2010 Rules had also been shifted/transferred to the distributor/marketing agent. Consequentl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the marketing agent/distributors to pay the draw charges. The petitioner under an agreement with the marketing agent/distributor was therefore liable to pay the draw charges and accordingly paid the same from its own pocket. The payment of taxes, levies, duties, etc., as a matter of general practice, is borne by the marketing agent/distributor, is evident from the agreements executed by the State of Sikkim with its marketing agents/distributors. The contention of the State respondents is, therefore, not sustainable. On the issue of limitation, Mr. Surajit Dutta contended that the judgment of Mafatlal (supra) was not applicable as it dealt with excise refund payable under excise laws which postulates assessment orders becoming final after certain length of time and that such assessment orders could not be reopened thereafter. It was because of such statutory prescription that the emphasis was made on the time limit of three years. Mafatlal (supra) does not deal with the situation where the charging provision itself has been declared unconstitutional and has not laid down any inflexible rule of law that a case of refund claimed, such as the present one, would be bound by a period of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d as such stopped from questioning the petitioner s locus to seek refund. More so when they have already refunded the draw charges to the petitioner in M/s Shubh Enterprises (supra). The State respondents had all along issued receipts in the name of the petitioners and not in the name of the Organising States and therefore, precluded from raising this contention as they had accepted the draw charges from the petitioners without any demur or raising any question. 13. The petitioner in M/s Shubh Enterprises (supra) was the distributor of lottery tickets organised by the State of Mizoram and contractually liable to pay taxes and other charges levied by various States on lotteries. The petitioner therein had challenged the validity of Rule 3(11) of the 2010 Rules which provided that a State, where lotteries are conducted by another State is entitled to charge an amount of Rs.2000/- per draw from the Organising State as being ultra vires the Lotteries Act. The Organising State was the State of Mizoram who was impleaded as proforma respondent no.4 therein. This court held that Rule 3(11) of the 2010 Rules is ultra vires the provisions of the Lotteries Act and struck it down. This Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levied by other State Governments shall be the responsibility of the marketing agent. However, the liability of payment of Sales tax/VAT or any other taxes on lotteries within the State of Sikkim shall be borne by the Director of State Lotteries. Prima facie, the agreement dated 09.11.2012 between the Government of Sikkim and Summit extending the period of Summit operative as a marketing agent for the State of Sikkim did not also contain a specific provision for payment of draw charges by the marketing agent. 17. The agreement signed between the State Government of Mizoram and Summit dated 29.05.2012 reflects that Summit had taken the liability to pay all statutory taxes, duties and charges imposed by the State Government under whose jurisdiction the Mizoram State Lottery tickets are being sold and to pay those charges under Rule 3(11) of the 2010 Rules on behalf of the Government . 18. The agreement dated 06.05.2010 between the Government of Goa and M/s Sugal Damani Enterprises Pvt. Ltd. provides in clause 11(ii) that all statutory taxes, levies, duties, etc., in respect of sale of Goa brand lotteries outside the State of Goa shall be borne by the marketing agent/distribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tates and the distributor/selling agents and between the distributor/selling agents and the petitioner as stockist has been filed, the parties to those agreements are not before this Court except the State of Sikkim. 22. Under the scheme of the Lotteries (Regulations) Rules, 2010, Rule 2(f) defines Organising State to mean the State Government which conducts the lottery either in its own territory or sells its tickets in the territory of any other State. Section 2(c) defines distributor or selling agent to mean an individual or a firm or a body corporate or other legal entity under law so appointed by the Organising State through an agreement to market and sell lotteries on behalf of the Organising State. 23. Rule 3 deals with the organisation of lottery and provides that a State Government may organise a paper lottery or online lottery or both subject to the conditions specified in the Act and the Rules. Rule 3(3) (b) provides that the Organising State shall announce in advance, by way of a Notification in the Official Gazette, the price of lottery tickets amongst others enumerated in sub-clauses (a) to (j). Rule 3(11) which has now been struck down by this Court provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt allowed the prayer for refund in some cases and rejected in some other. The Supreme Court answered the question whether the relief of repayment has to be sought by the tax payer by an action in a Civil Court or whether such an order can be made by the High Court in exercise of its jurisdiction under Article 226 of the Constitution. The Supreme Court held that the High Court has the power for the purpose of enforcement of fundamental rights and statutory rights to give consequential relief by ordering repayment of money realised by the Government without the authority of law. It further held that at the same time one could not lose sight of the fact that the special remedy provided in Article 226 is not intended to supersede completely the modes of such actions. The power to give relief under Article 226 is a discretionary power. This is especially true in the case of power to issue writs in the nature of mandamus. Among the several matters which the High Courts rightly take into consideration in the exercise of that discretion, is the delay made by the aggrieved party in seeking this special remedy and what excuse there is for it. Another is the nature of controversy of facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, neither the Organising States nor the distributor/selling agents have been made parties. The claim for refund is being made by the sole stockist of the distributor/selling agent. The sole stockist of the distributor/selling agent would have, under the scheme of the Act and the Rules, no hand in the pricing structure of the cost of the lottery tickets. It is settled that refund of this nature cannot be granted if the burden of the draw charges had been passed on to a third party or the ultimate consumer. Although the petitioners have filed affidavits stating that they had not passed on the burden, when it is for the Organising State to structure the pricing of the lottery tickets, it may not be possible to determine this lis without the Organising States and the distributor/selling agent. Further, the petitioner has sought to rely upon the agreements entered between the Organising States and the distributor/selling agent on the one hand and the agreement between the distributor/selling agent and the petitioner on the other without the parties to the agreement being brought before the Court. The agreements relied upon by the petitioner has been perused for a prima facie view on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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