Counsel for the Parties :
For the Appellant :Ashok H. Desai, Dr. Rajeev Dhavan and A.K. Ganguli, Sr. Adv., S.C. Ghosh, Soumitra Ghose Choudhari, Ms. R. Rea Sinha, Snehasish Mukherjee, Debapriya Samanta, Parijat Sinha, Sumeet Kachwaha, Ashok Sagar, Dharmendra Rautray, R. Vasanth, Ms. Meenakshi Arora and Ashok Sagar Advocates.
For the Respondent: None.

The ratio in the context of Section 64A of the Sale of Goods Act, as elucidated in the provided legal document, is that in the absence of a clear contractual provision to the contrary, if there is an imposition, increase, or decrease in taxes after the formation of the contract, the party liable to pay such taxes is entitled to include the amount of such taxes or the increased amount in the contract price, and conversely, if there is a reduction or remission, the buyer is entitled to deduct the corresponding amount from the contract price (!) (!) (!) (!) (!) (!) .

Furthermore, the contractual terms and specific clauses in the agreement are paramount in determining responsibility. When the contract explicitly stipulates that taxes, duties, and levies shall be borne by the contracting party, such clauses take precedence over general principles. The interpretation of the contract’s language, especially clauses that specify responsibility for taxes and duties, guides whether the party can claim reimbursement or be liable for additional duties arising due to statutory changes (!) (!) (!) (!) (!) .

In the present case, the contractual provisions clearly establish that the contractor (DIC) is responsible for paying all taxes, duties, and levies, including countervailing duties and customs duties, as per the specific clauses of the agreement. This contractual responsibility aligns with the statutory provisions under Section 64A, which permits the addition or deduction of taxes to the contract price depending on whether such taxes are imposed or reduced after the contract’s formation, provided the contract does not specify otherwise.

Thus, the ratio emphasizes that the contractual language and the parties’ clear intentions are determinative, and statutory provisions like Section 64A serve as a guiding principle that supports the inclusion of tax liabilities within the contractual obligations unless explicitly excluded by agreement. This reinforces the principle that the responsibility for taxes and duties, especially those introduced or increased post-contract, depends on the contractual terms and the interpretation of the parties’ obligations.