Intra-State sale classification turns on where auction sale is concluded, confirmed and delivered despite later inter-State movement.

A tender-cum-auction sale of sandalwood concluded, confirmed and delivered within Tamil Nadu was treated as an intra-State sale, because the auction, confirmation, payment and depot delivery all took place in the State under accepted tender conditions. The document explains that the bidders had agreed to pay value added tax at the notified rate, and that the statutory definitions under the Tamil Nadu Value Added Tax Act, 2006 supported local taxation. Subsequent movement of the goods to another State at the purchaser's instance did not alter the character of the sale, so the VAT demand was valid and the inter-State sale claim failed.

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Issues: Whether the sale of sandalwood in the tender-cum-auction was an inter-State sale taxable under the Central Sales Tax Act or an intra-State sale taxable under the Tamil Nadu Value Added Tax Act, 2006.

Analysis: The auction was conducted in Tamil Nadu, the confirmation of sale was issued there, payment was to be made there, and delivery was to be effected from the depot in Tamil Nadu in terms of the tender conditions. The bidders had unreservedly accepted the tender conditions, including the clause requiring payment of value added tax at the rate specified in the notification. The statutory definitions of dealer, casual trader and sale under the Tamil Nadu Value Added Tax Act, 2006 supported the conclusion that the transaction was a sale within the State. Mere subsequent movement of goods to another State at the buyer's instance did not alter the character of the sale. The claim of inter-State sale was also inconsistent with the contractual terms and the statutory scheme.

Conclusion: The transaction was an intra-State sale exigible to tax under the Tamil Nadu Value Added Tax Act, 2006, and the demand for value added tax was valid.

Final Conclusion: The writ petitions failed on the tax classification issue, and the impugned demand for sales tax at the local rate was sustained.

Ratio Decidendi: Where an auction sale is concluded, confirmed and delivered within a State under accepted tender conditions, subsequent movement of the goods outside the State at the purchaser's instance does not convert the transaction into an inter-State sale.

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