F.O.R. contract sales completed at place of delivery remain taxable there despite later interstate transport.

An F.O.R. Mandla Fort timber contract was treated as a sale completed at the place of actual delivery, because the contractual terms showed inspection, despatch against military credit notes, forwarding of railway receipts, and payment on proof of despatch were all part of the transfer at Mandla. The buyer obtained the goods there, and the seller ceased to retain dominion after booking, so section 39(1) of the Sale of Goods Act, 1930 did not alter the agreed place of delivery. The later movement of timber outside Madhya Pradesh, made on the buyer's instructions after the sale was complete, did not bring the transaction within Article 286(1)(a) or section 27-A(1)(a).

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Issues: Whether timber supplied under an F.O.R. Mandla Fort contract was actually delivered and the property passed within Madhya Pradesh so as to attract sales tax, or whether the subsequent movement of goods to destinations outside the State brought the transactions within the protection of Article 286(1)(a) of the Constitution and section 27-A(1)(a) of the Central Provinces and Berar Sales Tax Act, 1947.

Analysis: The contract required the seller to deliver the timber at F.O.R. Mandla Fort, and the surrounding terms showed that inspection, despatch against military credit notes, forwarding of railway receipts, and payment of most of the price on proof of despatch all formed part of a sale completed at Mandla. The stipulation fixed Mandla Fort as the place of actual delivery, so the buyer obtained the goods there and the seller ceased to retain dominion over them after booking. In such a contract, section 39(1) of the Sale of Goods Act, 1930 does not control the position, because the parties themselves have fixed the place of delivery as the place of despatch. The later transport of timber to places outside the State was only pursuant to the buyer's instructions after completion of the sale and did not amount to delivery outside Madhya Pradesh as a direct result of the sale.

Conclusion: The sales were completed in Madhya Pradesh, the property passed there, and the petitioner was liable to sales tax. The constitutional and statutory objections failed.

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