Retail sale classification for C.T. scanners turned on buyers' own use and lack of ordinary resale capacity.

C.T. scanners cleared to hospitals and nursing homes were examined for valuation under the Central Excises and Salt Act, 1944 by applying the distinction between wholesale trade and retail sale. Wholesale trade under Section 4(4)(e) was treated as sales to buyers purchasing for their requirements otherwise than in retail, with emphasis on whether the goods could be resold in the ordinary course and whether the buyers acquired them for their own use. On the facts stated, the scanners were sophisticated items not ordinarily capable of further resale and were consumed by the buyers in their own activities, so the transactions were characterised as retail sale rather than wholesale trade.

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Issues: Whether the clearances of C.T. scanners to hospitals and nursing homes were in the nature of retail sale or wholesale trade for purposes of valuation under the Central Excises and Salt Act, 1944.

Analysis: Wholesale trade under Section 4(4)(e) covers sales to dealers, industrial consumers, Government, local authorities and other buyers purchasing their requirements otherwise than in retail. The decisive test applied was whether the goods could be sold further and whether the buyers purchased them for their own use in normal activities. On the facts found, the scanners were sophisticated items not capable of further resale in the ordinary course, and the buyers used them for their own consumption. The transaction therefore answered the description of retail sale rather than wholesale trade.

Conclusion: The transaction was held to be a retail sale and not wholesale trade, and the appeal succeeded with consequential relief.

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