Consignment movement and Section 6A exemption cannot be denied merely from advance payment and same-day delivery patterns.

A consignment movement cannot be treated as an inter-State sale merely because goods were sold on the day of arrival, payment was received in advance, or invoices matched the assessee's receipts. Where the agency relationship and transfer of goods as consignments were undisputed, those circumstances alone were insufficient to prove a pre-existing contract of sale or defeat exemption under Section 6A of the Central Sales Tax Act, 1956. The factual findings relied on by the authorities were also inconsistent with binding precedents and lacked a legally tenable basis in writ jurisdiction. The denial of exemption was therefore unsustainable, and the assessee succeeded.

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Issues: Whether exemption under Section 6A of the Central Sales Tax Act, 1956 could be denied on the basis of the transaction pattern, including sale on the same day of arrival, receipt of advance payment, and invoices showing amounts matching the assessee's receipts, so as to treat the movement as an inter-State sale.

Analysis: The record showed that the existence of the agency and the transfer of goods as consignments was not disputed. The reasoning adopted by the authorities rested mainly on three circumstances: sale at cost value, delivery through the same vehicle on the day of arrival, and receipt of sale price in advance. Those factors, by themselves, were held insufficient to establish a pre-existing contract of sale or to convert the consignment movement into a direct inter-State sale. The Court also held that the factual findings were inconsistent with earlier binding precedents, and therefore could not be sustained in writ jurisdiction, especially when they were not shown to be supported by a legally tenable basis.

Conclusion: The denial of exemption under Section 6A of the Central Sales Tax Act, 1956 was unsustainable, and the assessee succeeded.

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