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TMI Blog1962 (11) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... machinery. It has its place of business in Calcutta in the State of West Bengal. Between January 26, 1950 and September 30, 1951, it sold diverse machinery to various parties in the State of Bihar. In respect of these sales the appellant was assessed to sales tax under the Bihar Sales Tax Act, 1947. These appeals arise out of such assessments but, as will be seen later, the dispute now is much narrower than what it was in the beginning. Before proceeding further we may briefly refer to the procedure of the sale. The price payable for the goods was F.O.R. Calcutta and it is not in dispute that the property in them passed to the purchaser as soon as the appellant put the goods on the railway at Calcutta. It has however been found and is no l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es even though they were inter-State sales. The appellant appealed from this decision to the Deputy Commissioner of Sales Tax, Bihar. By the time that authority heard the appeal, the judgment of this Court in State of Bombay v. United Motors [1958] S.C.R. 1069; 4 S.T.C. 133., had been delivered. This judgment confirmed the view taken in the Patna case earlier mentioned. It said that clause (2) of Article 286 does not affect the power of the State in which delivery of goods is made for consumption there to tax inter-State sales or purchases and that the effect of the Explanation was that the transactions mentioned in it were outside the ban imposed by Article 286(2). In view of this judgment, the Deputy Commissioner dismissed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se were in identical terms and perhaps, therefore, were not confined to the period with which each case was concerned. As we have said earlier, two questions had been referred to the High Court but the appellant has not in this Court challenged the answer given by the High Court to the second question. We are, therefore, concerned in these appeals only with the first question which is in these terms: "Whether the sales by the petitioner of (sic.) goods which were actually delivered in Bihar as a direct result of such sales for the purpose of consumption in Bihar during the period 26th January, 1950, to 30th September, 1951, were sales, which took place in the course of inter-State trade or commerce within the meaning of Article 286(2) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n view of the judgment of this Court in the Bengal Immunity Company case [1955] 2 S.C.R. 603; 6 S.T.C. 446., a dispute as to whether the sales by the appellant could be taxed by a Bihar law was no longer open. It was because of this that the dispute took a different turn and was based on the Sales Tax Continuance Order, 1950. The contention of the appellant is this: This Sales Tax Conti- nuance Order, 1950, was made in exercise of the powers conferred by the proviso to clause (2) of Article 286 of the Constitution. That proviso was in these terms: "Provided that the President may by order direct that any tax on the sale or purchase of goods which was being lawfully levied by the Government of any State immediately before the commencement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the definition that the Act purported to tax. Learned counsel's contention is that the sales in this case do not come within the definition and, therefore, were not taxed by the Bihar Act at all. Now the definition of sale in the Act is in these terms: " 'Sale' means, with all its grammatical variations and cognate expressions, any transfer of property in goods for cash or deferred payment or other valuable consideration, including a transfer of property in goods involved in the execution of contract but does not include a mortgage, hypothecation, charge or pledge: Provided that a transfer of goods on hire-purchase or other instalment system of payment shall, notwithstanding the fact that the seller retains a title to any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f sub-clause (i) of clause (a) of sub- section (1)." Now, it has been held by this Court in M.P.V. Sundararamier and Co. v. The State of Andhra Pradesh' that an enactment of this kind did in fact impose a tax on the class of sales covered by the Explanation to Article 286(1)(a) but that the imposition was conditional on the ban mentioned in Article 286(2) being lifted by law of Parliament as provided therein. We do not think that the respondent State can derive any advantage from this provision. It was inserted in the Bihar Act by the Adaptation of Laws (Third Amendment) Order, 1951, and was brought into force from January 26, 1950. Even though on the ban being lifted it might have been possible under this provision to tax the explanation ..... X X X X Extracts X X X X X X X X Extracts X X X X
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