Unascertained goods and appropriation determined sale situs; motor vehicle sales were held outside the province for tax purposes.

Sales of motor vehicles were held to fall outside the province because sales tax attached only where property in the goods passed or was deemed to pass. The place of contract alone did not fix the situs of sale; on the facts, appropriation occurred at Bombay, so the transfer of property took place there and the sales were not taxable in the province. The vehicles were treated as unascertained goods, not specific goods identified at the time of contract. Section 23(1) of the Sale of Goods Act therefore governed, and property passed on appropriation to the contracts with the buyer's implied assent.

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Issues: (i) Whether the sales of the motor vehicles were effected within the province so as to attract sales tax under the Sales Tax Act; (ii) Whether the vehicles were specific goods so that property passed when the contracts were made under Section 20 of the Sale of Goods Act, or unascertained goods so that property passed on appropriation under Section 23(1) of that Act.

Issue (i): Whether the sales of the motor vehicles were effected within the province so as to attract sales tax under the Sales Tax Act.

Analysis: Sales tax was leviable only if the transfer of property in the goods took place within the province or could be deemed to have taken place there. Section 2(g) of the Sales Tax Act required a transfer of property in goods, and Explanation II did not apply because the goods were not within the province before the transfer of property occurred. The place where the contracts were made did not by itself determine the place of transfer. Since the relevant appropriations occurred at Bombay, the transfers of property also took place there.

Conclusion: The sales were outside the province and were not liable to sales tax.

Issue (ii): Whether the vehicles were specific goods so that property passed when the contracts were made under Section 20 of the Sale of Goods Act, or unascertained goods so that property passed on appropriation under Section 23(1) of that Act.

Analysis: Specific goods under Section 2(14) of the Sale of Goods Act are goods identified and agreed upon when the contract is made. Mere allotment from a stock or monthly allocation did not establish identity of the particular vehicles. The vehicles were therefore unascertained goods. Section 20 applied only to the time of passing of property in specific goods and not to the place where the contract was made. As the invoices identified the engine numbers and the goods were appropriated to the contracts with the implied assent of the buyer while the vehicles were at Bombay, Section 23(1) governed the passing of property.

Conclusion: The vehicles were unascertained goods, and property passed at Bombay on appropriation.

Final Conclusion: The revision succeeded, the sales tax assessment was set aside to the extent of the four vehicle transactions, and no sales tax was payable on those sales.

Ratio Decidendi: In a sale of unascertained goods, property passes on appropriation to the contract with the buyer's implied assent, and the sale is located where that appropriation occurs, not merely where the contract is made.

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