Auction sale character turns on contract terms and delivery location, not remote bidding, so local tax treatment applied.

In an auction sale, the character of the transaction depends on the contractual sale terms and the place where delivery and completion occur, not merely on the bidder's remote participation. Where the conditions state that the auction is a local sale, local sales tax applies and Form C or CST treatment is unavailable unless expressly provided. Participation from Mumbai did not convert the sale into an inter-State sale because the goods were inspected, controlled, and delivered in Chennai. A mistaken acceptance of tax at a lower rate by a customs officer did not prevent recovery of the tax legally due in Tamil Nadu.

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Issues: Whether the clarification issued by the Commissioner, treating the auction transaction as a local sale and denying the availability of Form C, was valid and whether the petitioner could claim that the e-auction amounted to an inter-State sale.

Analysis: The sale conditions expressly stated that the auction would normally be treated as a local sale, that local sales tax would be payable according to the applicable State law, and that sale against Form C or CST would not be accepted unless specifically provided. The petitioner's participation in the e-auction from Mumbai did not by itself alter the character of the transaction, because the goods were inspected in Chennai, were under the control of the Customs House at Chennai, and were delivered there on payment of the sale price and taxes. A mistaken acceptance of tax at 4% by an officer of the Customs Department did not prevent the Commercial Taxes Department from recovering the tax legally due in Tamil Nadu.

Conclusion: The clarification was held to be valid, and the transaction was held to be a local sale taxable in Tamil Nadu rather than an inter-State sale eligible for Form C treatment.

Final Conclusion: The writ petition was rejected, and the authorities were permitted to recover the sales tax dues arising from the transaction.

Ratio Decidendi: In an auction sale, the character of the sale is determined by the contractual terms and the place of delivery and completion, and remote participation in bidding does not by itself make the transaction an inter-State sale.

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