TaxTMI Login
AI Drafter - (New and Powerful) ✕
Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
Just a moment...
AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: Whether supplies of bonded goods to ships in harbour amounted to inter-State sales or local sales, and whether the sales were taxable under the Tamil Nadu General Sales Tax Act, 1959.
Analysis: The decisive test under section 3 of the Central Sales Tax Act, 1956 was whether the sale occasioned movement of goods from one State to another. The orders placed by the ship's officers did not require delivery only on board ship, and there was no contractual contemplation that the goods had to move from one State to another. The sale and movement were therefore independent events, and the transaction did not qualify as an inter-State sale. The goods were unascertained goods drawn from a bonded warehouse and appropriated to the contract at Madras when the orders were complied with and the goods were set apart for delivery. Under section 4(2)(b) of the Central Sales Tax Act, 1956, such appropriation fixed the place of sale inside the State. By virtue of section 4(1) of the Central Sales Tax Act, 1956 and Explanation (3) to section 2(n) of the Tamil Nadu General Sales Tax Act, 1959, the sale was deemed to have taken place outside all other States and was taxable as a local sale.
Conclusion: The sales were local sales taxable under the Tamil Nadu General Sales Tax Act, 1959, and not inter-State sales.
Ratio Decidendi: Where unascertained goods are appropriated to a contract within the State, the sale is treated as a local sale under section 4(2)(b) of the Central Sales Tax Act, 1956, unless the contract itself contemplates movement of goods from one State to another so as to attract section 3.
TaxTMI 
