Inter-State sale classification turns on movement occasioned by the sale, even without a written transport contract.

Reference jurisdiction is confined to questions of law arising out of the Tribunal's order, so issues not raised before or dealt with by the Tribunal cannot be answered; on the record, the first two referred questions were therefore left unanswered. A sale is in the course of inter-State trade or commerce when the movement of goods outside the State is occasioned by the sale and forms an integrated transaction; the obligation to transport need not be in a written contract and may be inferred from the nature of the transaction and surrounding circumstances. On the facts, the timber sales were correctly treated as inter-State sales and were exempt from tax.

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Issues: (i) Whether the first two referred questions, relating to the Tribunal's power to entertain additional evidence and the manner in which certain documents were brought on record, arose out of the Tribunal's order. (ii) Whether the sales of timber were sales in the course of inter-State trade or commerce and were exempt from tax despite the absence of a written contract expressly obliging the assessee to transport the goods outside Bihar.

Issue (i): Whether the first two referred questions, relating to the Tribunal's power to entertain additional evidence and the manner in which certain documents were brought on record, arose out of the Tribunal's order.

Analysis: The reference jurisdiction was confined to questions of law arising out of the Tribunal's order. Questions not raised before the Tribunal and not dealt with by it could not be treated as arising out of that order. The record also showed that no objection was raised when the documents were produced before the Tribunal and the department had an opportunity to meet the material relied upon. Even on the wider assumption that the revisional authority could in appropriate cases receive additional evidence, the issue did not assist the Commissioner on the facts stated.

Conclusion: The first two questions did not arise out of the Tribunal's order and were not required to be answered; if considered in principle, the competence to receive additional evidence was in favour of the assessee.

Issue (ii): Whether the sales of timber were sales in the course of inter-State trade or commerce and were exempt from tax despite the absence of a written contract expressly obliging the assessee to transport the goods outside Bihar.

Analysis: A sale is in the course of inter-State trade or commerce when the movement of goods outside the State is occasioned by the sale and is so linked with the transaction that the sale and the movement form an integrated whole. The obligation to transport need not always be express in writing; it may arise from contract, mutual understanding, or the nature of the transaction, and may be inferred from surrounding circumstances. The Tribunal's findings, including orders placed by telephone, credit memos showing truck numbers, and check-post declarations evidencing actual movement outside Bihar, supported the inference that the sales occasioned movement of the goods outside the State.

Conclusion: The sales were rightly held to be sales in the course of inter-State trade or commerce and were not liable to tax under the Bihar Sales Tax Act, 1959.

Final Conclusion: The reference failed on the substantial tax issue and the assessee succeeded on the question of exemption, with the first two questions left unanswered as not arising from the Tribunal's order.

Ratio Decidendi: A sale is in the course of inter-State trade or commerce if the movement of goods outside the State is the direct result of the sale and the requisite obligation to transport may be inferred from the nature of the transaction and surrounding circumstances, without the necessity of a written contract.

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