Delivery under the sale contract determines intra-State character where goods move later outside the State through the buyer's agent.

Turnover from coffee sales concluded through the buyer's commission agent in Madras was treated as an intra-State sale because the bid was accepted through the buyer's authorised agent, delivery was made by the seller to that agent at the seller's premises in Madras, and the seller had no role in the later despatch to Bombay. The decisive factor was where delivery under the contract of sale occurred, not the buyer's residence or the intended outside-State movement of goods. On those facts, the transaction was completed within the State and remained taxable under the Madras General Sales Tax Act rather than being protected as an inter-State sale under Article 286(2).

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Issues: Whether the turnover arising from coffee sales concluded through the buyer's commission agent within Madras was an inter-State sale protected by Article 286(2) of the Constitution of India, or an intra-State sale liable to tax under the Madras General Sales Tax Act.

Analysis: The sale was bid for and accepted through the buyer's authorised agent, delivery was effected by the seller to that agent at the seller's premises within Madras, and the seller had no connection with the subsequent despatch of goods from the agent to the buyer at Bombay. The decisive factor was the delivery under the contract of sale as between seller and buyer, not the buyer's residence or the later movement of goods by the agent. On those facts, the transaction was completed within the State and did not acquire an inter-State character merely because the goods were intended for transport outside the State.

Conclusion: The turnover was taxable as an intra-State sale and was not exempt under Article 286(2) of the Constitution of India.

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