Inter-State sale under the CST Act turns on movement of goods, and absence of C forms alone cannot defeat the claim.

Inter-State sale under the Central Sales Tax Act depends on statutory movement of goods from one State to another and the transaction structure, not merely on the form of the assessment record. The record showed movement of goods outside the State with supporting documents and stock records, so treating the turnover as local sales was not sustainable. Non-furnishing of C forms could affect tax rate, but it could not by itself convert an otherwise inter-State sale into an intra-State sale. Because the assessment and revisional orders failed to apply the correct legal tests and the revisional authority gave no reasons, both orders were quashed and the matter was remitted for fresh disposal.

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Issues: (i) whether the disputed turnover represented inter-State sales or local sales under the Central Sales Tax Act, 1956; (ii) whether non-furnishing of C forms by itself could justify rejection of the assessee's claim of inter-State sale; (iii) whether the assessment and revisional orders could stand where the revisional authority had not given reasons and the assessment had not addressed the relevant legal tests.

Issue (i): whether the disputed turnover represented inter-State sales or local sales under the Central Sales Tax Act, 1956.

Analysis: The relevant test under sections 3 and 4(2) of the Central Sales Tax Act, 1956 is whether there is movement of goods from one State to another and whether the transaction answers the statutory requirements of an inter-State sale. The record showed movement of goods outside the State and supporting documents were produced. The maintenance of stock account and sales/purchase records also negatived the conclusion that the turnover was merely local sales on the basis adopted by the assessing authority.

Conclusion: The rejection of the claim of inter-State sale was not sustainable.

Issue (ii): whether non-furnishing of C forms by itself could justify rejection of the assessee's claim of inter-State sale.

Analysis: C forms are relevant to the rate of tax but are not the test for determining whether a transaction is inter-State or intra-State. The nature of the sale has to be determined under section 3 of the Central Sales Tax Act, 1956, and the absence of C forms cannot by itself convert an otherwise inter-State sale into a local sale.

Conclusion: Non-furnishing of C forms could not, by itself, defeat the assessee's claim of inter-State sale.

Issue (iii): whether the assessment and revisional orders could stand where the revisional authority had not given reasons and the assessment had not addressed the relevant legal tests.

Analysis: The assessment proceeded without properly applying the governing statutory tests and the revisional authority dismissed the revision without recording reasons. Such orders could not be sustained when the core legal questions governing the tax liability had not been properly examined.

Conclusion: The assessment and revisional orders were liable to be quashed and the matter remitted for fresh disposal.

Final Conclusion: The assessee succeeded in challenging the impugned orders; the tax determination was set aside and the matter was sent back for reconsideration in accordance with law.

Ratio Decidendi: The character of a sale under the Central Sales Tax Act, 1956 must be determined from the statutory test of inter-State movement and the attendant transaction structure, and the absence of C forms does not by itself determine the nature of the sale.

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