Inter-State sales through an online portal cannot be taxed as local VAT merely because goods pass through a delivery hub.

Retail sales through an online portal were treated as inter-State sales where orders were placed online, goods were earmarked in the originating State, and movement to Puducherry delivery hubs was occasioned by the purchaser's order. The presence of a delivery hub, collection of payment on delivery, or routing through a logistical conduit did not alter the character of the transaction, so Puducherry VAT did not apply. A writ petition challenging the assessing authority's jurisdiction was maintainable despite an alternative statutory remedy because the dispute went to the very power to levy local tax on alleged inter-State sales. The impugned assessment and penalty could not survive.

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Issues: (i) Whether the retail sales effected through the online portal, with movement of goods from warehouses in another State to Puducherry delivery hubs and payment on delivery, constituted inter-State sales under the Central Sales Tax Act, 1956 or local sales exigible to Puducherry VAT; (ii) Whether the writ petition was maintainable despite the alternative statutory remedy, in view of the challenge to the assessing authority's jurisdiction.

Issue (i): Whether the retail sales effected through the online portal, with movement of goods from warehouses in another State to Puducherry delivery hubs and payment on delivery, constituted inter-State sales under the Central Sales Tax Act, 1956 or local sales exigible to Puducherry VAT.

Analysis: A sale qualifies as an inter-State sale when it occasions the movement of goods from one State to another, and the movement and sale have a reasonable direct link. The passing of property, the situs of sale, or the existence of a storage or sorting hub in the destination territory is not decisive. Even if the movement is not expressly stated in the contract, it is sufficient if it is incidental to the sale and the goods are moved pursuant to the purchaser's order. The Court found, on the admitted facts, that the customer placed the order online, a bill was generated in the purchaser's name, the identified goods were earmarked in the originating State, and the movement from Karnataka to Puducherry was occasioned by the purchase. The delivery hub functioned only as a logistical conduit and the drawing of consignments in self-name did not alter the character of the transaction.

Conclusion: The transactions were inter-State sales and were not liable to Puducherry VAT.

Issue (ii): Whether the writ petition was maintainable despite the alternative statutory remedy, in view of the challenge to the assessing authority's jurisdiction.

Analysis: Where the challenge is to the very jurisdiction of the authority to levy tax under the local enactment on transactions claimed to be inter-State sales, the existence of an alternative remedy does not bar writ jurisdiction. The Court proceeded to examine the matter on the available admitted facts and rejected the objection that the petitioner should be relegated to the statutory remedy.

Conclusion: The writ petition was maintainable.

Final Conclusion: The impugned assessment and penalty could not survive because the disputed transactions were held to be inter-State sales falling outside the reach of Puducherry VAT, and the jurisdictional challenge was entertained in writ proceedings.

Ratio Decidendi: A sale is an inter-State sale when it occasions movement of goods from one State to another pursuant to, or incidental to, the contract of sale, and the existence of a destination hub or the place where consideration is collected does not by itself convert such movement into a local sale.

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