Inter-State sales jurisdiction: ascertained goods moved from outside Madras, so the local authority lacked Central sales tax power.

Goods despatched against buyers' orders were treated as ascertained goods because the invoices showed prior acceptance of the contracts with settled quality, quantity and price, and specific goods had been appropriated to those contracts. The Madras branch office was only collecting payment and did not change the inter-State character of the transactions. As the movement of goods commenced from outside Madras pursuant to the concluded contracts, taxing jurisdiction lay with the State from which the goods moved, and the Madras assessing authority lacked power to reopen and assess the turnover to Central sales tax. The impugned assessment orders were therefore without jurisdiction and were quashed.

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Issues: Whether the goods despatched pursuant to orders placed by buyers in Madras were ascertained goods, and whether the Madras assessing authority had jurisdiction to reopen and assess the turnover to Central sales tax.

Analysis: The decisive factor was the nature of the goods and the place from which the inter-State movement originated. The invoices showed prior acceptance of the orders with particulars of quality, quantity and price, indicating concluded contracts and appropriation of specific goods to those contracts. On that basis, the goods were identifiable and ascertained goods, not unascertained goods requiring further appropriation at Madras. The branch office in Madras functioned only for collection of price and did not alter the inter-State character of the transactions. Since the movement of goods commenced from outside the State of Madras pursuant to the contracts, the taxing jurisdiction lay with the States from which the goods moved, and the Madras authority lacked jurisdiction to levy the Central sales tax on those transactions.

Conclusion: The impugned assessment orders were without jurisdiction and were liable to be quashed; the writ petitions were allowed.

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