Inter-office movement for contract supply is not a taxable sale where title passes only on delivery to the buyer.

Goods moved from the factory to the head office for assembly and supply under a contract were not treated as a separate sale between the assessee and its own office, because the goods were appropriated at Delhi and title passed there to the buyer; Central sales tax was therefore not chargeable on the pumping sets. By contrast, the assessment on the spare parts was found sustainable, as no error was shown in the Tribunal's view that they were liable to assessment. The matter thus resulted in partial relief, limited to exclusion of the pumping sets from Central sales tax.

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Issues: (i) Whether the pumping sets valued at Rs. 8,91,100 were liable to Central sales tax as sales from the factory at Ghaziabad to the head office at Delhi. (ii) Whether the assessment of Central sales tax on spare parts valued at Rs. 31,395 was sustainable.

Issue (i): Whether the pumping sets valued at Rs. 8,91,100 were liable to Central sales tax as sales from the factory at Ghaziabad to the head office at Delhi.

Analysis: The pumping sets formed part of the machinery supplied under the contract with the buyer. The movement of the goods from Ghaziabad to Delhi was only for assembly and supply under the contract, and there was no sale by the assessee to its head office. The goods were appropriated in Delhi and title passed to the buyer there.

Conclusion: The assessee was not liable to pay Central sales tax on the pumping sets valued at Rs. 8,91,100.

Issue (ii): Whether the assessment of Central sales tax on spare parts valued at Rs. 31,395 was sustainable.

Analysis: No error was shown in the Tribunal's view that the spare parts were liable to assessment.

Conclusion: The assessment of Central sales tax on the spare parts valued at Rs. 31,395 was upheld against the assessee.

Final Conclusion: The revision succeeded only in respect of the pumping sets and failed in respect of the spare parts, leaving the assessee with partial relief.

Ratio Decidendi: Goods moved from one place to another for assembly and supply under a contract do not become taxable sales between the transferor and its own office where there is no separate sale and title passes only on delivery to the buyer.

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