Inter-State sale test under the CST Act turns on movement of goods caused by the contract, not where title passes.

Sales of goods from Mumbai to a purchaser's Vapi and Silvasa units were treated as inter-State sales because section 3(a) of the Central Sales Tax Act, 1956 applies where the contract occasions movement of goods from one State to another. The decisive test is the direct nexus between the sale and the movement, not the place where property in the goods passes. On the stated facts, the purchase order, invoices showing dispatch from Bombay to Vapi, vehicle details, C forms, MODVAT claim at Vapi, and actual delivery in Gujarat established that the movement was integral to the contract. The Tribunal's view that the sales were local was rejected.

---

---

Issues: Whether the sales of goods from Mumbai to the purchaser's Vapi and Silvasa units were inter-State sales falling under section 3(a) of the Central Sales Tax Act, 1956.

Analysis: Section 3(a) treats a sale as inter-State when it occasions movement of goods from one State to another. The decisive test is not the place where property in the goods passes, but whether the movement is the result of, or incidental to, the contract of sale. On the facts, the order was for goods required at the purchaser's Gujarat works; the invoices described dispatch from Bombay to Vapi; the vehicle particulars were recorded; C forms were issued; MODVAT was claimed at Vapi; and the evidence showed delivery of the goods from Mumbai to the purchaser's units in Gujarat. These circumstances established a direct nexus between the contract and the inter-State movement of goods.

Conclusion: The sales were inter-State sales under section 3(a) of the Central Sales Tax Act, 1956 and the Tribunal was not justified in treating them as local sales. The question was answered in the affirmative, in favour of the applicant and against the Revenue.

---