Transfer of title during transit makes a sale inter-State, overriding a claimed consignment character.

Transfer of documents of title during movement of goods from one State to another constitutes an inter-State sale under section 3(b) of the Central Sales Tax Act when the transfer occurs in transit. On the facts found, the documents of title were transferred while the goods moved from Andhra Pradesh to Karnataka, so the statutory condition was satisfied. The asserted consignment character did not prevail over that statutory test, and reliance on uncertified or unacted-upon F forms was irrelevant. The disputed turnover was therefore correctly treated as an inter-State sale, and the challenge to that classification failed.

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Issues: Whether the disputed turnover arising from transfer of documents of title during movement of goods from one State to another constituted an inter-State sale liable to tax.

Analysis: Section 3(b) of the Central Sales Tax Act deems a sale to take place in the course of inter-State trade or commerce where it is effected by transfer of documents of title to the goods during their movement from one State to another. On the facts found, the documents of title were transferred while the goods were in transit from Andhra Pradesh to Karnataka. That statutory condition was therefore satisfied. The reliance placed on the assessee having F forms was irrelevant because the forms were neither certified nor acted upon by the assessing authority.

Conclusion: The transaction was an inter-State sale and the Tribunal was not justified in treating it as a consignment sale; the challenge by the Revenue succeeded.

Final Conclusion: The assessment of the disputed turnover as an inter-State sale stood restored and the revision petition was allowed.

Ratio Decidendi: A sale is an inter-State sale when the transfer of documents of title occurs during the movement of goods from one State to another, and such transfer is determinative notwithstanding an asserted consignment character.

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