TMI Blog1956 (9) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... rs of the Cochin harbour to be stored in the ships' bunkers and exported outside the territorial waters of Travancore-Cochin State for consumption on the high seas" and the course of dealing will be clear from the following extract from paragraphs 7 to 10 of the said affidavit: "7. These steamers have their respective steamer agents. When- ever any coal is required for any steamer the agent for the steamer places an order with the petitioner-company for sale to the steamer of a specified quantity of coal. When orders are accepted by the petitioner-company at Fort Cochin the transporting contractor is given a delivery order to the company's stores at Candle Island. The steamer agents also hand over to the contractor shipping bill and export permit. On the strength of the delivery order and other records the contractor takes delivery of the quantity authorised from the store and delivers the same trimmed into the ship's bunker getting a receipt therefor from ship's officers. Payment for goods so sold to the steamers is received by the petitioner-company at their office in Fort Cochin". Exhibit P-1 is the original of an order dated 19th February, 1952, placed by the Malabar St ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sons, Limited: "Bill No. 7 Ex-Candle Island Stacks. 'S.S. TOBATA MARU' Rs. To Cost of 200 (two hundred) tons Bengal coal supplied to the above vessel as per receipt attached, in duplicate, at Rs. 83 per ton T.I.B. Sales tax at Rs. 1-9-0% 16,600 0 0 263 7 10 16,863 7 10 (Rupees sixteen thousand eight hundred and sixty-three, annas seven and pies ten only) E. O.E. Cochin, 30th July, 1951. For THE COCHIN COAL CO., LTD." and Exhibit P-15 is the covering letter that accompanied the bill: "'S.S. TOBATA MARU.' As desired in your letter dated 25th July, we have supplied the above vessel with 200 tons Bengal coal and enclose our bill No. 7 of date for Rs. 16,863-7-10, in duplicate, and shall be glad to receive payment in settlement. Please also find enclosed triplicate copy of the shipping bill No. 964 of 27th July, 1951, relating to the above duly endorsed by the Chief Engineer of the vessel." Exhibits P-16 to P-20 relate to a similar supply in March, 1952, to 'S.S. Bharatmata' in pursuance of an order placed by its agents, The Malabar Spices Company, Mattancherry, Travancore-Cochin. On the strength of the documents and affidavits filed on behalf of the Cochin Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ti, J., in Ram Narain Sons Ltd. v. Assistant Commissioner of Sales Tax and Others)(2) is: (1)[1955] 6 S.T.C. 446. (2)[1955] 6 S.T.C. 627. "The bans imposed by Article 286 on the taxing powers of the States are independent and separate and each one of them has to be got over before a State Legislature can impose tax on transactions of sale or purchase of goods. These bans have been imposed from dif- ferent view-points, and, even though the transactions of sale or purchase may in conceivable cases overlap so far as these different view-points are concerned, each of those bans is operative and has to be enforced. So far as Article 286(1)(a) is concerned, the Explanation determines by the legal fiction created therein the situs of the sale in the case of transactions coming within that category and when a transaction is thus determined to be inside a particular State it necessarily becomes a transaction outside all other States. The only relevant enquiry for the purposes of Article 286(1)(a), therefore, is whether a transaction is outside the State and once it is determined by the application of the Explanation that it is outside the State it follows as a matter of course that the Stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g on behalf of the petitioners contended "that the transactions in question were in the course of inter-State commerce and were, therefore, within the ban of Article 286(2) and the State of Madhya Pradesh had no authority to impose or to authorise imposition of tax on these transactions". The judgment dealt with the contention as follows: "We are of the opinion that this contention of the learned Attorney- General is sound. It was in fact admitted by the respondents in their return that the petitioners imported tobacco from the State of Bombay in large quantities. The Bombay suppliers processed tobacco in their godowns situated within the State of Bombay and supplied the finished tobacco to the petitioners in Madhya Pradesh. The petitioners import- ed this finished tobacco into Madhya Pradesh from these suppliers who were carrying on business in the State of Bombay and there was of necessity, as a result of these transactions, the movement of the goods across the border. As a result of the transactions entered into by the petitioners with these suppliers the finished tobacco which was supplied to the petitioners moved from the State of Bombay to the State of Madhya Pradesh and thes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ace in the course of inter-State trade or commerce sub- sequent at any rate to the insertion of that section with effect from the 26th day of January, 1950, by Act XII of 1951 and Ordinance No. IV of 1951 which it replaced. In view of this we must hold that the Sales Tax Laws Validation Act, 1956, and the Sales Tax Laws Validation Ordinance, 1956, which it replaced are of no avail as far as this State is concerned. In the light of what is stated above this petition has to be allowed and it is hereby allowed with costs, Advocate's fee Rs. 150. According to the learned counsel for the petitioner the decisions of this Court in K.J. Mathew v. Sales Tax Officer(1) and Kunju Moideen Kunju v. State of Travancore-Cochin and Others(2) require reconsideration and the view we should adopt is the one embodied in Tata Iron and Steel Co. v. State of Madras(3), Minerva Mills and Another v. (1)[1954] 5 S.T.C. 58. (3)[1954] 5 S.T.C. 382. (2)[1954] 5 S.T.C. 462. State of Mysore and Another(1), Cement Marketing Co. v. A.V.R. Krishnamurthy(2) and Hiranand Ramsukh v. Sales Tax Officer, III Circle, Hyderabad(3). We are unable to agree. 12.. In Kunju Moideen Kunju v. State of Travancore-Cochin(4) the ..... 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