Inter-State sale requires movement under a contract of sale; branch dispatches without that nexus remain stock transfers.

Goods sent from Uttar Pradesh to the dealer's own branches and depots in other States were stock transfers, not inter-State sales, because the movement was not shown to be in pursuance of contracts of sale. An inter-State sale under section 3(a) of the Central Sales Tax Act requires that the sale and movement of goods form part of the same transaction and that the movement occur under a sale contract. On the facts found by the Tribunal, the goods were dispatched in bulk to branch depots outside Uttar Pradesh, and there was no evidence of sales to ex-U.P. buyers. That factual finding was not open to reappreciation in revision, so Central sales tax did not apply.

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Issues: Whether the dispatch of goods by the dealer to its branches outside Uttar Pradesh constituted inter-State sales exigible to Central sales tax, or only stock transfers not amounting to sales.

Analysis: An inter-State sale under section 3(a) of the Central Sales Tax Act, 1956 requires that the goods actually move from one State to another in pursuance of a contract of sale, and that the sale and movement form part of the same transaction. On the facts found by the Tribunal, the dealer maintained depots and godowns outside Uttar Pradesh, the goods were sent in bulk to those depots, and there was no material to show that the movement from Uttar Pradesh was in pursuance of purchases by ex-U.P. buyers. The finding that the movements were not referable to contracts of sale was a finding of fact based on evidence and was not open to reappreciation in revision.

Conclusion: The dispatches to the branches outside Uttar Pradesh were stock transfers and not inter-State sales.

Final Conclusion: The Revenue failed to establish that the goods were moved under contracts of sale so as to attract Central sales tax, and the Tribunal's view was left undisturbed.

Ratio Decidendi: Goods moved to branches in another State are liable as inter-State sales only when the movement is pursuant to a contract of sale and forms part of the same transaction; absent such nexus, the transfer remains a stock transfer.

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