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1 - 6 of 6 (0.61 seconds)Section 3 in The Central Sales Tax Act, 1956 [Entire Act]
Tata Iron And Steel Co., Limited,Bombay vs S. R. Sarkar And Others on 29 August, 1960
This Court has held in a number of cases that if the
movement of goods from one State to another is the result of
a covenant or an incident of the Contract of Sale, then the
sale is an inter-state sale. See Tata Iron & Steel Co. Ltd.
v. S. R. Sarkar(1) and The State of Jammu & Kashmir & Ors.
v. Caltex (India) Ltd. (2). Here, the crude oil was carried
from Assam through the pipelines specially constructed by
the petitioner to the refinery at Barauni in Bihar and there
the oil was pumped and delivered to the Indian Oil
Corporation. Clause 12 of the agreement dated 14-1-1958
provides that the petitioner shall arrange for the
construction of pipeline or such other related facilities as
the company shall consider necessary for the transport of
crude oil to be produced by it to the refinery at Barauni.
This would indicate that the construction of pipeline was
undertaken by the petitioner in pursuance of the agreement
and that that was for the specific purpose of transporting
crude oil to Barauni from Assam. This can only point to the
conclusion that the parties contemplated that there should
be movement of goods from the State of Assam to the State of
Bihar in pursuance to the contract of sale.
Clause 7 of the 1961 agreement must needs be read with its
precursory clause 12 of the 1958 agreement since all the
contracting parties were well aware of their respective
obligations in the transactions arising out of the several
agreements-not one of which can be left out of
consideration.
State Of Jammu & Kashmir And Others vs Caltex India (Ltd.) on 17 December, 1965
This Court has held in a number of cases that if the
movement of goods from one State to another is the result of
a covenant or an incident of the Contract of Sale, then the
sale is an inter-state sale. See Tata Iron & Steel Co. Ltd.
v. S. R. Sarkar(1) and The State of Jammu & Kashmir & Ors.
v. Caltex (India) Ltd. (2). Here, the crude oil was carried
from Assam through the pipelines specially constructed by
the petitioner to the refinery at Barauni in Bihar and there
the oil was pumped and delivered to the Indian Oil
Corporation. Clause 12 of the agreement dated 14-1-1958
provides that the petitioner shall arrange for the
construction of pipeline or such other related facilities as
the company shall consider necessary for the transport of
crude oil to be produced by it to the refinery at Barauni.
This would indicate that the construction of pipeline was
undertaken by the petitioner in pursuance of the agreement
and that that was for the specific purpose of transporting
crude oil to Barauni from Assam. This can only point to the
conclusion that the parties contemplated that there should
be movement of goods from the State of Assam to the State of
Bihar in pursuance to the contract of sale.
Clause 7 of the 1961 agreement must needs be read with its
precursory clause 12 of the 1958 agreement since all the
contracting parties were well aware of their respective
obligations in the transactions arising out of the several
agreements-not one of which can be left out of
consideration.
State Trading Corporationof India Ltd vs State Of Mysore on 28 August, 1962
(2) 17 S.T.C. 612
801
the State of Assam to the State of bihar. In other words,
the movement of crude oil from the State of Assam to the
State of Bihar was an incident of the contract of sale. No
matter in which State the property IF the goods passes, a
sale which occasions "movement of goods from one State to
another is a sale in tile course of inter-state trade". The
inter-State movement must be the result of a covenant
express or implied in the contract of sale or an incident of
the contract. It is not necessary that the sale must
precede the inter-State movement in order that the sale may
be deemed to have occasioned such movement. it is also not
necessary for a sale to be deemed to have taken place in the
course of inter-State trade or commecrce, that the covenant
regarding interstate movement must be specified in the
contract itself. It would be enough if the movement was in
pursuance of and incidental to the contract of sale. See
State Trading Corporation v. State of Mysore(1).
Therefore, we think think that the sales in question were
sales in the course of interstate trade and that the Bihar
Government had no jurisdiction to tax the sales under the
Sales Tax law of the State. 'The petitioner is, therefore,
entitle to the alternative reliefs prayed for in the writ
petitions, namely, that respondents 4 to 6 in each of the
petitions should be enrolled not to impose sales tax under
the provisions of the Bihar Sales Tax Act in respect of
sales made in pursuance of clause 7 and that they should be
directed to refund to the petitioner the sales tax connected
from the petitioner by way of sales tax as the various
assessment orders made by respondent No. 4 stand quashed.
'The writ petitions are allowed to the extent indicated and
they are dismissed in other respects. In the circumstances,
we make no order as to costs.
Article 32 in Constitution of India [Constitution]
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