9911796707
TMI Blog1990 (1) TMI 278X X X X Extracts X X X X X X X X Extracts X X X X ..... ch 31, 1965, the respondents entered into a contract with M/s. Gujarat State Road Transport Corporation for manufacture and supply of tarpaulin sheets. In response to a tender dated January 15, 1964, issued by the Controller of Stores, Gujarat State Road Transport Corporation, the respondents sent their quotation dated February 11, 1964, for waterproof tarpaulins. The rates which were quoted by the respondents were f.o.r., Ahmedabad. The goods were to be ready for inspection at the works of the respondents in Bombay in suitable instalments. Inspection of tarpaulins was to be carried out at the place of manufacture of the respondents. On getting the goods approved after inspection, the respondents were required to despatch them to the Gujar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dents that these were local sales. In second appeal before the Tribunal however, the Tribunal held that in the circumstances of the present case there was no obligation under the contract for movement of goods from Bombay to Gujarat either expressly or by necessary implication and therefore the various sales in question could not be held to be inter-State sales under section 3(a) of the Central Sales Tax Act, 1956. From this judgment of the Tribunal, at the instance of the department, the following question has been referred to us under section 61(1) of the Bombay Sales Tax Act, 1959: "Whether, on the facts and in the circumstances of the case, the impugned sales of tarpaulins effected by the respondents to the Gujarat State Road Transport ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 STC 232. The Supreme Court in that case said that if there is a conceivable link between a contract of sale and the movement of goods from one State to another in order to discharge the obligation under the contract of sale, the interposition of an agent of the seller who may temporarily intercept the movement will not alter the inter-State character of the sale. 7.. In the case before the Supreme Court the appellant who was a registered dealer had supplied art silk yarn to certain allotment cardholders in Maharashtra and Gujarat under the scheme of allotment of indigenous art silk yarn of the Government. The appellant had an agent in Bombay through whom delivery of goods was effected to the card-holders in the State. The Supreme Court s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er depots of the purchaser in Gujarat. 10.. It is true that the respondents sent the goods to their agent at Surat in Gujarat. This agent, in turn, effected delivery to the various depots of the purchaser in Gujarat. But, in our view, in the present case the agent at Surat has merely acted as a conduit pipe for the purpose of supply of these goods to the purchaser in Gujarat. The contract of sale was directly with the respondents. The goods were marked with the stamp which indicated that they were earmarked for the purchasers in Gujarat. It has also been found that there was no other stock of goods with the respondent's agent at Surat either before or after the supply of these goods. The Assistant Commissioner also found that there was no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n another State, sent the goods to its agent in the other State. The agent supplied the goods to the local buyer. The goods so supplied by the manufacturer had borne the markings of the ultimate buyer. The Madras High Court, after examining the circumstances, held that the goods manufactured had been sent to the branch of the manufacturer in another State in the normal course as a branch transfer and the agreement of sale was entered into between the branch office of the manufacturer and the local purchaser. In these circumstances it could not be considered as an inter-State sale. 12.. The circumstances in the present case, however, are somewhat different. There is no material before us to show that there were any regular branch transfers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to another purchaser as a relevant test in our case, the facts in the present case leave no doubt that the goods were in fact manufactured as per the contract, they bore the markings of the purchaser and were sent to the respondents' agent at Surat for the purpose of being delivered to the purchaser. There was no question therefore, of the goods being diverted to another purchaser in the present case. In our view therefore there is a direct nexus between the contract and the movement of goods from the State of Maharashtra to the State of Gujarat. The sale is, therefore, in the course of the inter-State trade and commerce. The question, therefore, is answered in the affirmative and in favour of the department. In the circumstances there will ..... X X X X Extracts X X X X X X X X Extracts X X X X
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