In a contract of sale of goods, the seller is entitled to add the excise duty or tax on the sale or purchase of goods to the contract price, and the buyer is liable to pay the same. If the buyer refuses to pay the excise duty, the seller is not liable to perform the contract and the buyer cannot claim damages for non-performance.

RAMAPRASADA RAO, J.:- The unsuccessful defendant in O. S. No. 239 of 1970 on the file of the Subordinate Judge of Erode is the appellant. The plaintiff filed a suit for recovery of a sum of Rs. 43,875/- and costs which according to him was damages payable by the defendant consequent upon his non-performance of a major portion of three agreed contracts he entered into according to him on 15-11-1969, 16-12-1969 and during the third week of January, 1970. The plaintiff's case is that the defendant is a manufacturer and dealer of empty tin containers at Quilon, and he being a businessman dealing in groundnut oil and refined oil, placed orders on three different dates for the supply at three different prices for varied quantities and those contracts are evidenced in writing excepting the last of them and the defendant accepted such contracts but failed to perform the same in full and therefore he was entitled to claim such damages which flowed from the breach of contract committed by the defendant. The defendant's case is that it was no doubt true that the first two contracts were entered into on the dates specified by the plaintiff in the plaint, but in so far as the third contract is concerned, there was no written contract but only an oral contract to supply one wagon. His further claim is that from time to time the plaintiff injuncted him from normally performing the contract on the ground that he had sufficient stocks of tins or on the ground that the demand had come down and that, therefore, he could not fully perform the agreed contracts. He would refer to the correspondence which we shall presently consider and would add that in or about February-March, 1970 there was an increase in the excise duty payable on tins and as such increase has to be borne in law by the buyer, he demanded whether the plaintiff was inclined to agree to the despatch of the goods at prices which would include such excise duty also and the plaintiff categorically refusing to suffer any such additional responsibility the defendant could not, though he was anxious otherwise to, perform the contract in terms thereof. The defendant's case is that there was no failure to deliver the goods due to any fault of his and he would deny that the damages claimed were in accord with the usual measure of damages which could be claimed even if it is assumed that he has committed a breach of contract. On the above relevant pleadings the following issues were framed:

(1) Whether the defendant committed breach of contract?

(2) Whether the plaintiff is bound to pay the Central Excise Duty on supplies made to him on and after 1-3-1970?

(3) To what damages, if any, is the plaintiff entitled?

(4) Whether this court has no jurisdiction to try the suit?

(5) To what relief?

2. The trial Judge found that the defendant committed breach of contract and that the plaintiff is bound to pay the Central Excise Duty on supplies made to him on and after 1-3-1970, and in the peculiar circumstances of the case and after having traced the recitals in the correspondence between the parties, the learned Judge thought that the defendant was bound to pay damages and he assessed the damages in the manner he did but having regard to the fact that the plaintiff as buyer should also shoulder the responsibility of excise duty took this aspect into consideration and finally assessed the damages at Rs. 30,780/-. The suit was, therefore, decreed for the said sum with subsequent interest and costs. It is against this the defendant has preferred this appeal.

3. For purposes of the ready appreciation of the facts and contentions of parties, it is necessary for us to summarise the correspondence which is the foundation for the three contracts referred to by the plaintiff in the plaint. The first contract could be gathered from Exs. B-1 and B-2. Ex. B-1 is a telegram issued by the plaintiff dated 15-11-1969 seeking for the despatch of 15 wagons of tins. Obviously there were prior contracts between the