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1960 (11) TMI 91 - SC - VAT and Sales TaxWhether sales under which goods were delivered outside the State of Bihar for the purpose of consumption but not within the State of first delivery or first destination, are exempt from the levy of sales tax by the Bihar State by virtue of Article 286(1)(a) of the Constitution as it stood before the recent amendment? Held that:- Appeal allowed. The power of the State to levy sales tax relying upon the territorial nexus between the taxing power of the State and the sale is impaired for reasons already set out to the extent to which it is restricted by the incorporation of Article 286(1)(a) and the Explanation thereto, in that Act. Therefore, sales effected on or after January 26, 1950, where goods are as a direct result of the sale delivered in another State for consumption in that other State, are not liable to be taxed. The order of the Superintendent of Taxes is set aside. He is directed to grant refund of tax paid in the light of this judgment. The appellant will be entitled to exemption from payment of tax if the goods are, as a direct result of the sale, delivered in another State for the purpose of consumption in that State.
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