Inter-State sale requires a concluded contract; open purchase orders without quantity were only standing offers and stock transfers.

Open purchase orders that do not specify quantity do not, by themselves, create a concluded contract of sale. The later specific purchase orders fixed the quantity and delivery obligations and were the operative contract. Applying the distinction between a completed sale and a mere agreement to sell, the movement of goods from Karnataka to depots under Form-F was only for stocking and not occasioned by a concluded inter-State sale. Title and ownership remained with the assessee until supply under the later orders, so the transaction was a stock transfer and did not fall within Section 3(a) of the Central Sales Tax Act, 1956.

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Issues: Whether the open purchase orders constituted a binding agreement to sell so that the movement of goods from Karnataka to depots in other States amounted to an inter-State sale under Section 3(a) of the Central Sales Tax Act, 1956, or whether the transactions were only stock transfers.

Analysis: The open purchase orders did not specify quantity and did not, by themselves, create a concluded contract. The later purchase orders issued from time to time fixed the quantity and delivery obligations and alone constituted the operative contract. Applying the distinction between a completed sale and a mere agreement to sell, and the principle that a standing offer does not become an inter-State sale merely because goods are kept ready for call-off supplies, the movement of goods to depots under Form-F was only for stocking. Title and ownership remained with the assessee until supply was made pursuant to the later purchase orders.

Conclusion: The transaction did not fall within Section 3(a) of the Central Sales Tax Act, 1956 as an inter-State sale. The open purchase orders were only standing offers, and the movement of goods was a stock transfer.

Ratio Decidendi: A movement of goods to branch depots is not an inter-State sale unless it is occasioned by a concluded contract of sale; an open purchase order without specified quantity is merely a standing offer, and sales made only against later specific orders remain stock transfers.

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