Controlled supply transactions can still be sales in law when agreement, transfer of property, and consideration are present.

Statutory control over the supply, price, allocation, and purchaser of iron and steel does not by itself prevent a transaction from being a sale in law. The legal concept of "sale of goods" still requires an agreement to sell, money consideration, and transfer of property, but those elements can exist despite control order restrictions. On the facts described, the transactions involved offer, scrutiny by the Controller, acceptance by the producer, issue of works orders, despatch of goods, and payment within controlled limits, so they were treated as sales exigible to tax under the Bengal Finance (Sales Tax) Act, 1941. Earlier decisions were distinguished where contractual volition or agreement for sale was absent.

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Issues: Whether transactions in iron and steel effected under the control order constituted sales within the meaning of the sales tax law and were, therefore, liable to assessment to tax.

Analysis: The expression "sale of goods" in the constitutional entries and in the sales tax statute has to be understood in its legal sense. A sale requires an agreement to sell the same goods, supported by money consideration, followed by transfer of property in those goods. The existence of statutory control over production, allocation, despatch, price, and choice of purchaser does not by itself destroy the legal character of a bargain if the parties still enter into a contract of sale and property passes pursuant to that contract. On the materials available, the transactions showed an offer by the intending purchaser, scrutiny by the Controller, acceptance by the producer on its terms, issue of works orders, despatch of goods, and payment of price within controlled limits. The earlier Supreme Court decisions dealing with transactions lacking contractual volition or lacking any agreement for sale were distinguished.

Conclusion: The transactions were sales in law and were exigible to tax under the Bengal Finance (Sales Tax) Act, 1941.

Final Conclusion: The trial court's view was set aside and the assessment proceedings were held maintainable, with costs awarded against the assessee.

Ratio Decidendi: Statutory control over the incidents of a bargain, including the choice of supplier, quantity, and price, does not negate a sale where the transaction still contains an agreement to sell, transfer of property, and payment of consideration in the legal sense.

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