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LOCAL SALE V. INTER-STATE SALE

LOCAL SALE V. INTER-STATE SALE - Goods and Services Tax - GST - By: - Mr. M. GOVINDARAJAN - Dated:- 18-8-2017 - The sale may be effected within the State or in between two or more States. The local sale is nothing but the intra-State sales. When the sale is between two or more States the same is called as inter-State Sales. In general, sale where seller and buyer both are from same state is called as intra state sale for example seller of Kanpur (U.P.) sells goods to a dealer of Noida (U.P.) but .....

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be deemed to take place in the course of inter-State trade or commerce if the sale or purchase- (a) occasions the movement of goods from one State to another; or (b) is effected by a transfer of documents of title to the goods during their movement from one State to another. The explanation 1 to this section provides that where goods are delivered to a carrier or other bailee or transmission, the movement of the goods shall, for the purposes of clause (b), be deemed to commence at the time of s .....

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hat a sale can be said to be in the course of inter-state only if two conditions concur viz. (i) sale of goods and (ii) a transport of those goods from one State to another. Thus transaction must be a completed sale. Location of buyer and seller is immaterial. Thus, even if buyer and seller are within the same State, sale will be inter-State, if sale occasions movement of goods from one State to another. E.g., the buyer may have construction site in another State and may ask seller to dispatch g .....

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re being purchased from Andhra Pradesh in the auction conducted by the Forest Department and there after it was being dispatched to the head office in Maharashtra. The branch office claimed exemption on the turnover stating that it was an interstate sale . After different rounds of litigation before the statutory authorities, the matter reached the Apex Court at the instance of the Revenue challenging the verdict passed in favor of the assee by the High Court of Andhra Pradesh. The Supreme Court .....

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the State of Andhra Pradesh to another State were not inextricably connected, but independent of each other and hence it was never an instance of interstate sale . The Madras High Court had an occasion to consider whether the sale of sandal wood in an auction effected in the State of Tamil Nadu and the movement of the goods to another State at the instance of the successful bidder, who was having the place of business in the latter State, would constitute an inter-state sale and whether the dema .....

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bligatory to satisfy the tax under the State enactment. The entire transaction took place and was completed in the State of Tamil Nadu and accordingly interference was declined and the demand raised by the State of Tamil Nadu was upheld accepting their case that it was a local sale. In Lalitha Muraleedharan V. Commissioner of Commercial Taxes - 2017 (6) TMI 1091 - KERALA HIGH COURT the appellant, situated in Tamil Nadu, engaged in the manufacturing of essential oils, natural extracts and product .....

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her establishment was situated in a Special Economic Zone. The request was turned down by the Authority, considering it as a local sale . She approached the High Court by filing a writ petition. The High Court granted liberty to the appellant to approach the Divisional Forest Officer, Marayoor, Idukki District by filing Form I under CST Act, seeking exemption. The application of the appellant was rejected by the Authority. Therefore she again approached the High Court. The High Court held the t .....

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cation and the special conditions clearly indicated that it was nothing but a local sale. The sale is complete in the State of Kerala itself and by virtue of the terms notified, agreed and accepted, it was exigible to tax under KVAT Act, which is not a legally or factually forbidden fruit. The appeal filed by the appellant is dismissed by the High Court. In GST scenario In GST there is no sale or service. The term supply subsumes both the terms sale and service . The local supply is called as in .....

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Unit; goods imported into the territory of India till they cross the customs frontiers of India; or supplies made to a tourist referred to in section 15; Section 8(2) provides that subject to the provisions of Section 12, supply of services, where the location of the supplier and the place of supply of services are in the same State or same Union territory shall be treated as intra-State supply. The intra-State supply of services shall not include supply of services to or by a SEZ developer or a .....

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