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of <h1>Dispatch from Rourkela Unit Triggers Inter-State Sales: Orissa Sales Tax Applicable</h1> The court held that the order issued by CIL constituted a contract of sale, with the sales being triggered upon dispatch from IDL's Rourkela unit. The ... - Issues Involved:1. Whether the Sales Tax Tribunal was correct in holding that the order issued by CIL was not a contract of sale but was triggered only when collieries placed indents with IDL.2. Whether the movement of goods in pursuance to the supply order placed by CIL to outside the State constitutes inter-State sales under section 3(a) of the CST Act.3. Whether the actual sales were triggered by the indents placed by the constituents of CIL and took place inside the respective State, making them intra-State sales.Detailed Analysis:Issue 1: Contract of SaleThe Tribunal initially held that the order issued by CIL was not a contract of sale but that the actual purchase and sale were triggered only when collieries placed indents with IDL. However, the court found this interpretation incorrect. The purchase order from CIL contained specific terms, including the rate of payment, quantity, and period of the contract, which indicated a firm contract of sale. The court emphasized that the movement of goods from IDL's Rourkela unit to consignment agents was in response to CIL's order, making the sale complete at the point of dispatch from Rourkela.Issue 2: Inter-State SalesThe court assessed whether the movement of goods from IDL Chemicals, Rourkela, to different States constituted inter-State sales under section 3(a) of the CST Act. The court concluded that the movement of goods was indeed inter-State sales. The goods were dispatched from Rourkela to consignment agents in different States as per CIL's purchase order, and the goods were meant for CIL from the moment of dispatch. The court noted that the interposition of consignment agents did not alter the inter-State character of the sale, as there was a clear link between the purchase order and the movement of goods.Issue 3: Intra-State SalesThe Tribunal had held that the actual sales took place inside the respective State when the collieries placed indents, making them intra-State sales. However, the court rejected this view, stating that the sales were complete when the goods left IDL's Rourkela unit. The court highlighted that the goods were dispatched to fulfill CIL's order, and the indents placed by the collieries were merely follow-up actions. The court also pointed out that CIL paid for transit insurance and freight charges, further indicating that the sales were inter-State.Conclusion:The court answered the questions of law as follows:1. The Tribunal was incorrect in holding that the order issued by CIL was not a contract of sale and that the actual purchase and sale were triggered only when collieries placed indents.2. The movement of goods from IDL Chemicals, Rourkela, to different States constitutes inter-State sales under section 3(a) of the CST Act.3. The sales took place at the exit points of IDL, Rourkela, and the State of Orissa was entitled to levy sales tax on those goods under the Central Sales Tax Act.The reference applications and the STREV were accordingly answered and disposed of.
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