Inter-State sale requires movement linked to the sale contract; later transport by buyer does not create CST benefit.

A sale qualifies as inter-State only when the movement of goods from one State to another is the proximate result of, and inseparably linked with, the contract of sale under Section 3(a) of the Central Sales Tax Act, 1956. The concessional notification applied only if the sale itself was in the course of inter-State trade and all stipulated conditions were met. Here, the contract was concluded within Uttarakhand, the buyer was free to move the goods anywhere, and invoices or transit passes to an out-of-State address did not establish the required nexus. The transaction was therefore not an inter-State sale, and the concessional benefit was unavailable.

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Issues: Whether the sale of khair wood by the Forest Corporation to the dealer was an inter-State sale falling within Section 3(a) of the Central Sales Tax Act, 1956, so as to attract the concessional notification dated 26.12.2000.

Analysis: The concessional notification had to be strictly construed, and its benefit was available only if the sale was in the course of inter-State trade or commerce and all stipulated conditions were satisfied. For a transaction to fall under Section 3(a) of the Central Sales Tax Act, 1956, the movement of goods from one State to another must be occasioned by, or be an incident of, the contract of sale. The sale and movement must be inextricably connected, and the transportation must arise from the contract, an obligation, or the nature of the transaction. On the facts, the bid was accepted and the contract concluded within Uttarakhand; the goods were specific and ascertained; the auction terms did not obligate movement to Uttar Pradesh; the buyer was free to transport the wood wherever it chose; invoices and transit passes issued to an out-of-State address did not, by themselves, create the necessary nexus between sale and movement.

Conclusion: The sale was not an inter-State sale under Section 3(a) of the Central Sales Tax Act, 1956, and the dealer was not entitled to the concessional benefit of the notification.

Ratio Decidendi: A sale is inter-State only when the movement of goods from one State to another is the proximate result of, and inseparably linked with, the contract of sale; mere subsequent transportation by the purchaser or issuance of invoices and transit passes does not convert an intra-State sale into an inter-State sale.

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