Inter-State sale requires proved movement of goods and reliable evidence; account-book entries alone are insufficient.

Whether sales were inter-State or local depended on proof of the actual movement of goods and a contract of sale causing that movement. Unproved entries in a broker's account book could not, by themselves, establish the inter-State character of the transactions, especially where the broker was not examined and the assessee had no opportunity to challenge the entries. In the absence of reliable evidence showing a sale followed by movement of goods from Rajasthan to another State, the essential ingredients of an inter-State sale were not made out, and the Revenue failed to dislodge the Board of Revenue's findings.

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Issues: Whether the transactions were inter-State sales or sales outside the State, and whether the entries in the dealer's account book could by themselves establish the alleged inter-State character of the sales.

Analysis: The character of a sale as inter-State or local is a question of fact to be determined on the evidence on record. The entries in the account book of the alleged broker were neither proved nor tested by examination of the broker, and no opportunity was given to the assessee to challenge those entries. In the absence of proved material showing a contract of sale followed by movement of goods from Rajasthan to another State, the essential ingredients of an inter-State sale were not established.

Conclusion: The transactions were not proved to be inter-State sales, and the Revenue failed to establish interference with the findings of the Board of Revenue.

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