TaxTMI 
TaxTMI 
2006 (1) TMI 588
X X X X Extracts X X X X
X X X X Extracts X X X X
....cial conditions, visualised that boulders of the specified size and weight are available in certain river quarries situated in Arunachal Pradesh from where the contractors may procure the required boulders and supply the same in terms of the contract agreements entered into by and between the parties. Materials have been brought on record by the petitioners to show that after the contract agreements were entered into, the authority of the N.F. Railways had written a letter dated January 10, 2003 addressed to the Director, Geology and Mining Department, Government of Arunachal Pradesh, informing the said authority that contractors have been engaged by the Railways for procurement of river boulders from the several locations within the State of Arunachal Pradesh as mentioned in the letter dated January 10, 2003. By the aforesaid letter the Railway authority had requested the Director, Geology and Mining Department, Government of Arunachal Pradesh, to extend necessary co-operation to the contractors to enable them to obtain permission fo extraction of boulders and for grant of permits for transportation of the same subject to payment of royalty and other statutory dues by the contract....
X X X X Extracts X X X X
X X X X Extracts X X X X
....been moved from the State of Arunachal Pradesh and supplied to places within the territories of the State of Assam and such movement having been occasioned by the contracts entered into by and between the parties there can be no doubt that it is pursuant to the contract agreements in question that the boulders have moved from the State of Arunachal Pradesh to the State of Assam. Learned counsel have further argued that in view of the constitutional mandate enshrined in article 286, section 7 of the Assam General Sales Tax Act, 1993 clearly excludes transactions of sale or purchase of goods which had taken place in course of inter-State trade and commerce from the purview of any tax liability under the Act of 1993. Therefore, the actions resorted to or proposed, as the case may be, by the authority of the Indian Railways would be constitutionally impermissible and wholly outside the purview of the Act of 1993. In this regard, reliance has been placed on a large number of decisions of the apex court laying down the law as to in what situations the movement of goods from one State to another can be understood to be a sale in the course of inter-State trade and commerce so as to exclud....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f the Central Sales Tax Act, 1956, a sale or purchase of goods must be deemed to have taken place in the course of inter-State trade or commerce if such sale or purchase occasions the movement of goods from one State to another. The different circumstances in which a sale transaction can be said to have occasioned the movement of goods from one State to another has been considered by the apex court, amongst others, in its judgments in the case of Oil India Ltd. [1975] 35 STC 445; [1975] 1 SCC 733 and in the case of National Thermal Power Corporation Ltd. [2002] 127 STC 280; [2002] 5 SCC 203. The following passages from the aforesaid two judgments would amply sum up the position: "9. Even though clause 7 of the supplemental agreement does not expressly provide for movement of the goods, it is clear that the parties envisaged the movement of crude oil in pursuance to the contract from the State of Assam to the State of Bihar. In other words, the movement of crude oil from the State of Assam to the State of Bihar was an incident of the contract of sale. No matter in which State the property in the goods passes, a sale which occasions 'movement of goods from one State to ano....
X X X X Extracts X X X X
X X X X Extracts X X X X
....v. K.G. Khosla and Co. Ltd. [1979] 43 STC 457 (SC); [1979] 2 SCC 242, it was observed that a sale would be an inter-State sale even if the contract of sale does not itself provide for the movement of goods from one State to another provided, however, that such movement was the result of a covenant in the contract of sale or was an incident of the contract. Similar view was expressed in Sahney Steel and Press Works Ltd. v. Commercial Tax Officer [1985] 60 STC 301 (SC); [1984] 4 SCC 173. In Manganese Ore (India) Ltd. v. Regional Assistant Commissioner of Sales Tax, Jabalpur [1976] 37 STC 489 (SC); [1976] 4 SCC 124, after referring to Balabhagas Hulaschand v. State of Orissa [1976] 37 STC 207 (SC); [1976] 2 SCC 44, it was observed that so far as section 3(a) of the CST Act is concerned there is no distinction between unascertained or future goods and goods which are already in existence, if at the time when the sale takes place these goods have come into actual existence. " [2002] 127 STC 280 (SC) [para 25 in STC]; [2002] 5 SCC 203. The rival submissions advanced on behalf of the parties may now be considered. I have read and perused the contract agreements entered into by and b....