Actual delivery under Article 286(1)(a) requires physical transfer of possession, not mere railway receipt endorsement.

For Article 286(1)(a), taxability turns on whether goods were actually delivered outside the State for consumption there, meaning physical delivery or delivery putting the buyer in possession. Mere appropriation of specific goods, transfer of property within the State, or symbolic delivery through entrustment to a carrier or handing over railway receipts is not enough. The text notes that, on the record discussed, no authority had found actual physical delivery within the State, and the Tribunal gave no independent reasoning to support a contrary conclusion. It therefore explains that the assessment could not be sustained on that basis and that the assessee was entitled to relief.

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Issues: Whether the goods were actually delivered outside the State as a direct result of the sales for the purpose of consumption in that State within Article 286(1)(a) of the Constitution of India.

Analysis: The finding of the taxing authorities that the sales were intra-State rested not on any clear factual finding of actual physical delivery within the State, but on the view that appropriation of specific goods and transfer of property inside the State were enough to attract tax. The governing legal test, however, is whether the goods were actually delivered, meaning physical delivery or delivery putting the buyer in possession, and not mere symbolic or notional delivery by entrustment to a carrier or by delivery of railway receipts. On the record, no authority had found as a fact that the goods were physically delivered within the State in any of the transactions, and the Tribunal gave no independent reasoning to support its conclusion.

Conclusion: The question was answered in the negative. The sales were not shown to be outside the protection of Article 286(1)(a), and the assessee succeeded.

Final Conclusion: The assessment could not be sustained on the basis adopted by the Tribunal, and the reference was disposed of in favour of the assessee with costs and refund of the deposit.

Ratio Decidendi: For the purpose of Article 286(1)(a), actual delivery requires physical delivery or equivalent delivery into the purchaser's possession, and mere endorsement or handing over of railway receipts does not amount to such delivery.

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