TMI Blog1975 (3) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... alternative reliefs prayed for in the writ petitions, namely, that respondents Nos. 4 to 6 in each of the petitions should be enjoined 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 collected 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. - Writ Petition No. 641, 642 of 1970 - - - Dated:- 3-3-1975 - MATHEW K.K. AND GOSWAMI P.K. JJ. L.N. Sinha, Solicitor-General of India (K.K. Jain, Bishambar Lal and S.K. Gupta, Advocates, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... promotion agreement dated January 14, 1958, were modified. Clause 7 of the second supplemental agreement reads as follows: "7. All crude oil produced by Oil India excluding Assam Oil Company's entitlement in respect of Oil India's existing areas under clause 20 of the promotion agreement will (subject as hereinafter provided) be sold to and purchased by the Government of India provided that after meeting as a first call on such oil the joint annual requirements up to 23 million tons of Indian Refineries Limited's Barauni and Nunmati Refineries, Assam Oil Company's Digboi Refinery shall have the next call thereon up to a maximum of 435,000 tons per annum to the extent that it cannot be economically met from Assam Oil Company's leased areas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he sales were in the course of inter-State trade. The petitioner contended that sales were intra-State and not subject to tax under the Central Sales Tax Act. By the assessment order dated March 31, 1966, respondent No. 1 negatived the contention raised by the petitioner and held that by supplying crude oil to the refinery at Barauni the petitioner effected sales of oil to the Indian Oil Company and that they were sales in the course of inter-State trade and assessed the petitioner-company to pay a tax of Rs. 4,47,892.10 (annexure J). By another order dated March 31, 1966, the petitioner was assessed to sales tax under the Central Sales Tax Act to Rs. 12,23,072.90 by respondent No. 1 (annexure K). In these writ petitions the petitioner pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (b) is effected by a transfer of documents of title to the goods during their movement from one State to another." 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 [1960] 11 S.T.C. 655 at 666 (S.C.); [1961] 1 S.C.R. 379 at 391., and State of Jammu and Kashmir v. Caltex (India) Ltd.[1966] 17 S.T.C. 612 (S.C.)., Here, the crude oil was carried from Assam through the pipe-lines 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 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 commerce, that the covenant regarding inter-State 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 [1963] 14 S.T.C. 188 (S.C.). Therefore, we think that the sales in question were sales in the course of inter-S ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
