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TMI Blog2024 (10) TMI 1124X X X X Extracts X X X X X X X X Extracts X X X X ..... nterstate trade for the simple reason that a head office or branch cannot be treated as having traded with itself or sold articles to itself by means of stock transfers. A contract of sale of goods would be effective when a seller agrees to transfer the property in goods to the buyer for a price and that such a contract may be either absolute or conditional. If the transfer is in presenti, it is called a sale ; but if the transfer is to take place at a future time and subject to some conditions to be fulfilled subsequently, the contract is called an agreement to sell . When the conditions subject to which the property in goods is to be transferred are fulfilled, the agreement to sell becomes a sale . When the sale or agreement to sell causes or has the effect of occasioning the movement of goods from one State to another, an inter-state sale would ensue and would result in exigibility of tax under section 3(a) of the Central Sales Tax Act. Under the Liquor Policy, the Corporation is the wholesaler for all kinds of liquor, including beer. A manufacturer desirous of supplying beer to the Corporation for subsequent distribution shall have to submit documents, including the Master Agre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... khand. The movement of goods did not occur from the State of Rajasthan to the State of Bihar or the State of Jharkhand pursuant to the Master Agreement or the Liquor Policy. The Master Agreement, therefore, cannot be treated to be an agreement to sell. It would, in fact, be in the nature of a standing order or a tender which does not amount to a sale or an agreement to sell. It is, therefore, clear that none of the clauses of the Master Agreement contemplate or refer to any inter-state delivery of the goods from the State of Rajasthan to the State of Bihar or the State of Jharkhand. The movement of goods cannot also be considered incidental to the Master Agreement. Reliance placed by the Rajasthan Tax Board and the learned senior counsel for the State of Rajasthan on clause 2 of the Master Agreement to justify that the movement of goods occurred incidental to the Master Agreement, is not correct. It will, therefore, not be possible to sustain the order dated 24.11.2014 passed by the Rajasthan Tax Board. It is, accordingly, set aside and all the fourteen appeals filed by Carlsberg, United Breweries and Mount Shivalik are allowed. - MR. DILIP GUPTA, PRESIDENT AND MR. P.V. SUBBA RAO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y] for sourcing of all kinds of liquor, including beer. Clause 6 of the Liquor Policy provides that the supplies to the Corporation shall be based on Order for Supply [the OFS], to be issued by the Corporation. It further provides that the Corporation shall be under no obligation to procure any specified minimum quantities of liquor and the quantity to be procured shall depend upon the demand of the product. Accordingly, the Corporation issues OFS on the local depots of the appellants situated in State of Bihar for supply of specified quantity of the beer. The OFS has a validity period within which goods are required to be delivered to the depots of the Corporation. The said period generally varies from 3 to 4 days. Clause 10.1 of the Liquor Policy provides that the supply of liquor to the Corporation against OFS shall be construed as an agreement to sell under section 4(3) of the Sale of Goods Act, 1930 [the Sale of Goods Act]. It further provides that the stock of liquor lying unsold for a period of over six months shall be drained out by the Corporation. 6. A person desiring to sell liquor in the State of Bihar is also required to enter into a Master Agreement with the Corporati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alik are stated to be similar except that they had depots in the State of Jharkhand also, which State had a liqour policy like the State of Bihar. As such, facts relating to Carlsberg are being considered. 10. In order to understand the issues that have been raised in these appeals, it would be appropriate to refer to the relevant clauses of the Liquor Policy, the Master Agreement dated 06.07.2009 [the Master Agreement] and the License issued to Carlsberg in Form 19-C. 11. The Liquor Policy for 2008-09 is as follows: Liquor Sourcing Policy for 2008-09 BSBCL is the sole wholesaler for all kinds of liquor in the State of Bihar. This circular pertains to sourcing of all kinds of Foreign Made Foreign Liquor (FMFL), IMFL (Brandy, whisky, rum, gin, vodka etc), BEER WINE. The Manufacturers are requested to take note of the procedures prescribed in the policy which comes to effect immediately. 1 . The Manufacturers / manufacturing companies / suppliers /importers (hence forth called manufacturers) of FMFL, IMFL, BEER WINE, who are registered in Bihar may offer, firm price for those products/brands which they want to market in Bihar. ***** 3. Submission of Initial Documents 3.1 Manufacturer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all not be under any legal compulsion to procure all or any brands produced by a particular manufacturer/supplier, simply because they have signed this Agreement and have made an offer. 6.3 The Corporation will ordinarily indent based on the actual sales of the previous month. In respect of brands with low volume of sales the Corporation will consider the eligibility depot wise/size wise to meet requirements . The supplier/manufacturer should, as requested by the Corporation, shift the stocks from one depot to another at its own cost and risk. The closing stocks of any brand at any depot shall not normally exceed the quantity anticipated to be sold in 15 days. 6.4 Two copies of the OFS will be issued for the exact quantity that the supplier/manufacturer proposes to transport. It is, therefore, imperative that manufacturers/suppliers indicate their dispatch plan for issue of OFS. The OFS shall be signed by either of the authorized signatories of the Corporation, whose specimen signatures may be seen in Annexure 8 (page-33) 6.5 The OFS would indicate the validity date within which the manufacturer/supplier should complete the delivery. If a manufacturer/supplier does not honour the q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gainst Order for Supplies shall be construed as an agreement to sell under sub-section 3 of Section 4 of State of Goods Act, 1930 . The sale shall be concluded only when the liquor is delivered to buyers by the Corporation. The Corporation would take necessary care of the stored stock as is reasonably possible and expected of it. ***** (emphasis supplied) 12. In terms of clause 3.1(iv) of the Liquor Policy, a Master Agreement was entered into by Carlsberg with the Corporation at Patna and the relevant clauses of the Master Agreement are reproduced below: Now This Agreement witnesseth as follows - 1 . Quantity for Distribution 1.1 The quantity of the Liquors to be procured and distributed shall be determined by the Corporation from time to time keeping in view the demand for liquor manufactured/ supplied by the manufacture. 1.2 The Manufacture shall not claim the right for distribution of liquor through the Corporation. 2. DELIVERY 2.1 The Manufacture shall bottle, seal, pack, load, transport, unload and stack the liquor at the depot of the corporation at its cost and risk. The corporation is not liable for any transit risk other perils for its own interest, the manufacturer may arr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Trade) and the Army and the Military Bodies. It is evident to all the concerned that M/s Carlsberg India Pvt. Limited Karmalichack Patna is authorized to sale the Foreign Liquor/Bear (including the Foreign Liquor/Bear made in India) at Karmalichack Patna from the date of issuance of the license to till 31.03.2013 after making the payment of the tax on the following terms and conditions for the purpose of sale to the holders of license of wholesaler (Sale to the Trade) and the Army and the Military Bodies. ***** 5A. In such storage where there is license for the sale foreign liquor/bear under this license, the minimum stock of the foreign liquor/bear shall always the kept in the capacity of production which commissioner will prescribe from time to time and will inform the license holder in writing if and when the stock will become less than the minimum than license holder will fulfill it within a period of 7 days upto the minimum liable. (emphasis supplied) 13. Having examined the provisions of the Liquor Policy, the Master Agreement and the License issued in Form 19C to Carlsberg, it will be appropriate to examine how the impugned order dated 24.11.2014 has addressed the issue re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he section 3 of the CST Act, 1956 . It is a simple fact that Inter State sale or purchase is carved out of and separated from inside sales or purchases for the purpose of situs of taxation. It is to be explored whether the movement of beer from the State of Rajasthan to the State of Bihar (or, Jharkhand) was the result of a covenant or an incident of the contract of sale entered to between the authorized representative of appellant company and Bihar State Beverage Corporation Limited, if it were so, the sale was an inter-State sale. We may have a look at the provisions of the LSP which are contextually relevant in the present case and reproduced as under ***** A. In this regard, it is imperative to go through the agreement entered into between the appellant and the BSBCL under the terms and conditions of the LSP as described in its Circular no. 675/BSBCL, dated 12.03.2008 (extended for the relevant years : 2009-10, 2010-11, 2011-12, 2012-13 and 2013-14). B. At the background of above, it is apparent that the appellant manufacturers who were desirous of supplying liquor to the BSBCL for subsequent supply to buyers in reference to the aforesaid Clause 3.1 of the LSP submitted certain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conclusion that agreement for supply of Beer to the BSBCL by the appellants was an agreement to sale which was duly executed between the BSBCL and the appellant companies having their manufacturing units in district Alwar Rajasthan and branch offices in Patna in year 2008, ***** (emphasis supplied) 15. Shri B.L. Narasimhan, learned counsel for the appellants assisted by Shri Dhruv Tiwari made the following submissions: (i) The terms of the Liquor Policy, the Master Agreement and the License issued to the appellants leave no manner of doubt that the appellants had stock transferred beer from the manufacturing units situated in the State of Rajasthan to their depots in the State of Bihar or the State of Jharkhand; (ii) Movement of goods did not occur from the State of Rajasthan to the State of Bihar or the State of Jharkhand in pursuance to the Master Agreement, incidental or otherwise. In this connection, learned counsel placed reliance upon the decision of the Central Sales Tax Appellate Authority, New Delhi in Northen Coal Fields Ltd. vs. States of Madhya Pradesh and Uttar Pradesh [ (2010) 29 VST 596 (CSTAA-Del) ] ; (iii) The Master Agreement is not an agreement to sell in terms o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Corporation and the appellants read with the provisions of the Liquor Policy, which is part of the said Master Agreement. In this connection, reliance has been placed on the judgment of the Supreme Court in State Trade Corporation of India Ltd. and another vs. State of Mysore and another [ (1963)14 STC 188 ], wherein it has been held that when a contract for supply can only be made under a permit and on terms and conditions contained in it, the said contract of supply has to be read as subject to the said permit; (iii) Clause 2 of the Master Agreement deals with delivery and clauses 2.1, 2.2, 2.3 and 2.4 expressly complete delivery of liquor by the manufacturer to the depots of the Corporation and other incidental obligations. Under sub-clause (iv) of clause 3.1, one of the listed document is the Master Agreement required to be submitted by the manufacturer if the said manufacturer is desirous of undertaking the said supply. Thus, sub-clause (iv) puts beyond doubt that the supply from the State of Rajasthan to the two States is incidental to the Master Agreement; (iv) The provisions of the Master Agreement as well as the Liquor Policy also show that the liquor manufactured by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods said to take place in the course of inter-State trade or commerce.- A sale or purchase of goods shall be deemed to take place in the course of inter-State trade or commerce if the sale or purchase- (a) occasions the movement of goods from one State to another; or (b) is effected by a transfer of documents of title to the goods during their movement from one State to another. 21. The provisions of sections 3 of the Central Sales Tax Act were examined by the Supreme Court in Hyderabad Engineering Industries vs. State of Andhra Pradesh [ (2011) 4 SCC 705 ] and the relevant portion of the judgment is reproduced below: 20. For a sale to be in the course of inter-State trade or commerce under Section 3(a), two conditions must be fulfilled. There must be sale of goods. Such sale should occasion the movement of the goods from one State to another. A sale would be deemed to have occasioned the movement of the goods from one State to another within the meaning of clause (a) of Section 3 of the Act when the movement of those goods is the result of a covenant or incidence of the contract of sale, even though the property in the goods passes in either State. With a view to find out wheth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iquor Policy and the Master Agreement, held that inter-state sale had taken place for the following reasons: (i) In view of the decision of the Supreme Court in Tata Engineering, it can be deduced from the Master Agreement that it necessitated the movement of beer from the manufacturing unit of the appellant in the State of Rajasthan to the State of Bihar and, therefore, all the essential conditions of section 3(a) of the Central Sales Tax Act are satisfied; (ii) The decision of the Allahabad High Court in Central Distillery and Breweries is distinguishable because of the decision of the Supreme Court in Indian Oil Corporation; (iii) The inter-state movement of beer from Alwar in the State of Rajasthan to Patna in the State of Bihar did not break there, since after a brief interval it finally terminated at different depots of the Corporation. This would not impact the nature of inter-state sale because it was merely a transit halt for the goods; (iv) The Master Agreement is the cause celebre enabling the appellants to sell beer in the State of Bihar or the State of Jharkhand through the instrument called OFS issued by the Corporation to the branches of the appellants in the State o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liquor supplied to the Delhi Administration by the revisionist under the Agreements. The contention of the revisionist was that the sale of beer to the Delhi Administration was made at Delhi from the depots of the dealers in Delhi and, therefore, these sales were affected within the territory of Delhi and were not inter-state sales. The contention of the department, however, was that since the manufacturing activity of the revisionist was at Meerut within the State of Uttar Pradesh and as the goods were taken from the State of Uttar Pradesh to the Union Territory of Delhi pursuant to Agreements, the goods moved to Delhi in pursuance of the Agreements which occasioned the movement of goods from the State of Uttar Pradesh. Thus, according to the department, the transaction amounted to an inter-state sale within the meaning of section 3(a) of the Central Sales Tax Act. Though the contention of the department had been accepted by the authorities, but it was held not be an inter-state sale by the Allahabad High Court and the observations are as follows: 6. ***** The Tribunal has failed to appreciate the nature of the agreement executed between the Delhi Administration and the dealerrev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eived the orders, communicated the same to the factory at Hyderabad, the manufactured goods were then despatched to the dealer s branch offices where they were inspected by the customers and accepted by them. The branches raised the bills and received the sale price. The contention of the dealer was that the sales were effected in the State where the branches were situated while the contention of the Revenue was that the sales were inter-State sales. The Honourable Supreme Court held that the sales were inter-State sales as it were the orders placed by the purchaser that occasioned the movement of the goods. The principle of law as explained by the Honourable Supreme Court is not open to any doubt or explanation. However, it is apparent that the Tribunal has not properly appreciated the facts of the present case while applying the ratio of the judgment of the Honourable Supreme Court. In the case before the Supreme Court, the buyers had placed purchase orders on the dealer and it was in compliance of those orders that the goods were manufactured and despatched. In the present case, however, it has not been so established. ***** 7. The judgment of the Honourable Supreme Court in Sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court ultimately concluded: 9. As is evident from the terms of the agreement, the intention of the parties was to bring about intra-State sales at Delhi from warehouse of the dealer that it was required to establish within the territory of Delhi where the dealer was required to maintain a buffer stock of atleast two trucks without any guarantee of any purchase being actually made by the Delhi Administration. As and when the Delhi Administration would make the purchases, the dealer who was to be a L1-A licensee would supply the goods and replenish the stocks and the things would go on like that during the currency of the agreement. Therefore, as is indicated by the agreement, the movement of the goods to Delhi was not in pursuance of any transaction of sale but in pursuance of the licence under which the dealer was to maintain a warehouse with a minimum stock within the territory of Delhi. The agreement by itself did not bring about any sale or purchase and, therefore, the transport of goods from the distillery in U.P. to warehouse in Delhi could not be treated as a movement of goods occasioned by any sale or purchase. The sale, as stated above, took place only when any order w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no two movements but only one movement from Barauni to Kanpur pursuant to the contract of sale and the agreement regarding storage facilities provided in Clause 8 is only for operational convenience, it is only a mechanism devised to facilitate the transfer of naphtha through the seller s pipeline to their depot at Kanpur and from there to the Buyer s factory at Kanpur through the pipeline constructed at the buyer s cost. It is relevant in this connection to note that under Clause 7(ii) the cost of transferring naphtha from Barauni to the buyer s fence is to be borne by the buyer. 9. Each case turns on its own facts and the question is whether applying the settled principle which we have mentioned above to the facts of the present case the sales can be said to be inter-State sales. An attempt to show that some of the factors present in the instant case are present or absent in some case or other in which this Court held the sale to be a local sale or interstate sale hardly serves any useful purpose. On the facts of the present case the sales are clearly interState sales and the State of U.P. had therefore no jurisdiction to assess the petitioners to sales tax under the State Act. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs and thereafter transfers the stock to its godowns situated near the manufacturing unit of the customers and supplies the paint as and when the indent is received. The department believed that this was an inter-state movement of goods from the manufacturing unit of the petitioner at Mangaluru in the State of Karnataka to various depots in other States against pre-existing contract and, therefore, would amount to inter-state sale leviable to tax under section 3(a) of the Central Sales Tax Act. The contention that was advanced on behalf of the writ petitioner was that the open purchase orders do not stipulate any specified quantity and so it cannot be construed as an agreement to sell . The question, therefore, that fell for consideration before the High Court was whether the transfer of the goods under Form-F to the depots of the petitioner situated in different States would amount to inter-state sale under section 3(a) of the Central Sales Tax Act. After taking note of the fact that the open purchase orders did not mention the quantity of the goods supplied and it was only to ensure prompt delivery of goods as and when called upon that BASF India transferred the goods and stocks ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act? ***** 35. Adverting to the facts of this case, the Open Purchase Orders referred to hereinabove, do not mention the quantity of the goods supplied. We may record that in order to avoid inventory, manufacturers have been using the JIT (Just in time) supply model. It was argued on behalf of the assessee that to ensure, prompt delivery of the goods as and when called upon, the assessee transfers the goods and stocks it in its depot. Shri Sridharan also urged that the automobile manufacturing Industries nor the ancilliary units had any obligation to place purchase orders. In case the paint had remained unsold, the option for the assessee is to either destroy it or to take it back to its Manufacturing unit. 36. It is not in dispute that goods were transferred from Mangaluru to various depots situated in different States under Form-F and assessments for the years 2006-07 and 2007-08 were concluded by accepting the Statutory declarations filed in Form-F. 37. In view of the Authorities in the case of Maddala Thathiah and Kelvinator, we are of the considered view that the Open Purchase Orders do not constitute any Contract. The Purchase Orders issued from time to time for supply of goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the Act would, however, arise if the sale of the refrigerators to distributors were to take place at Faridabad and the movement of refrigerators from Faridabad to Delhi were to take place under the contract of sale. The question with which we are concerned is whether the appellant entered into such an arrangement with the distributors that the liability to pay tax would be attracted and not the other arrangement under which no such liability could be fastened on the appellant. So far as this question is concerned, we find that the parties expressly stated in each of the three distribution agreements that it would be in Delhi that the sale of refrigerators would take place to the distributors and the property therein would pass to them. It was again in Delhi that the refrigerators were delivered to the distributors. The orders for the refrigerators were placed by the distributors in Delhi and it was also here that the price of refrigerators was paid. Looking to all the facts of the case, we have no doubt that the arrangement between the parties was that refrigerators would be sold by the appellant to the distributors after they had been transported to the sales office and god ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... handup at Bombay was a part of the same transaction. The movement of the goods from Madras to Bhandup was integrated with the contract of sale for the following reasons. The Bombay branch received the Bombay buyer s order and sent the same to the Madras branch factory. When the Bombay buyer asked for quotation of prices the Bombay branch wrote to the Madras branch and gave all the specifications and stated that the goods were for the Bombay buyer. The Madras branch in reply referred to the order of the Bombay buyer and gave particulars mentioning that the price was F.O.R. Madras. The Bombay branch thereafter wrote to the Bombay buyer reproducing all the particulars, conditions of sale and mode of dispatch as stated by the Madras branch and further stated that the goods would be manufactured at the Madras branch factory. ***** 15. The appellant in the present case sent the goods direct from the Madras branch factory to the Bombay buyer at Bhandup, Bombay. The railway receipt was in the name of the Bombay branch to secure payment against delivery. There was no question of diverting the goods which were sent to the Bombay buyer. When the movement of goods from one State to another is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he contract of sale and the fact that the contract emanated from correspondence which passed between the Bombay branch and the company could not make any difference. (emphasis supplied) 40. The aforesaid decision of the Supreme Court in English Electric would not come to the aid of the State of Rajasthan. It is seen that the Bombay buyer wrote to the Bombay branch of the appellant asking for lowest quotation. The factory of the appellant was situated in Madras. The buyers order was sent by the Bombay branch to the Madras branch, which quoted the price FOR Madras. The Bombay branch then wrote to the Bombay buyer quoting the FOR Madras price and also informed that the delivery would be ex-works Madras. The Bombay buyer then placed an order with the Bombay branch. The Bombay branch instructed its Madras factory to dispatch the goods directly to the buyers and the goods were then sent to the buyer under these instructions. It is in this context that the Supreme Court held that the movement of the goods from Madras to Bombay was part of the same transaction. The Supreme Court, therefore, held that the Bombay branch merely acted as an intermediary between the Madras factory and the buyer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s any contract. The marking at best would indicate that the goods were intended for a person who had entered into a contract of purchase with the branch office in Andhra Pradesh. That would not either finally or conclusively determine the question as to the nature of the transaction for, the mere marking of the name of the purchaser on the consignment when the lorry receipt under which they were despatched stood in the name of the branch office would not, by itself, be sufficient to prove or establish a contract of sale between the appellant and the Government of Andhra Pradesh. (emphasis supplied) 46. It would now be appropriate to examine the facts of the present case in the light of the provisions of the Liquor Policy, the Master Agreement, and the License issue to the appellants. 47. As noticed above, the appellants manufacture beer at the breweries in the State of Rajasthan. The State of Bihar and the State of Jharkhand have created Corporations to facilitate and regulate retail sale of beer in their States. 48. Under the Liquor Policy, the Corporation is the wholesaler for all kinds of liquor, including beer. A manufacturer desirous of supplying beer to the Corporation for su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Corporation. The Corporation has to specify the quality of beer to be delivered and the manufacturer has to adhere to such quality specification. The Corporation also has the right to forthwith terminate any or all OFS placed on the manufacturer and forfeit the deposits on certain conditions. The manufacturer has to deliver the beer at a price indicated by the Corporation but payment for the beer delivered shall be made only after the disposal of beer. 50. Clause 5A of 19C License requires Carlsberg to maintain minimum stock of liquor at its depots as prescribed by the Commissioner from time to time and to recoup within 7 days in case the stock goes below the minimum limits. 51. The decision of the Allahabad High Court in Central Distillery and Breweries, notices that though the manufacturing unit of the revisionist was situated at Meerut in the State of Uttar Pradesh but as it was required to maintain a buffer stock of atleast two trucks without any guarantee of any purchase by the Delhi Administration, it established a warehouse at Delhi from where liquor would be supplied as and when the Delhi Administration placed orders. The movement of the goods from Meerut in the Stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icy of the State of Bihar, the Corporation is under no obligation to procure any specified minimum quantities of beer. The Corporation issues the OFS on the local depots of the appellants situated in the State of Bihar for supply of specified quantity of beer. The OFS have a validity period within which the goods are required to be delivered to the Corporation. Clause 10.1 of the Liquor Policy clearly provides that the supply of beer to the Corporation against OFS shall be construed as an agreement to sell under section 4(3) of the Sale of Goods Act. Clause 5A of the License also requires Carlsberg to maintain a minimum stock of liquor at its depots in the State of Bihar as prescribed by the Corporation from time to time and to recoup the stock within seven days in case it goes below the minimum limits. Carlsberg is, therefore, justified in asserting that in order to comply with the requirement of maintaining a minimum stock at the local depots in the State of Bihar and also to ensure the delivery of beer to the Corporation within the validity period prescribed in the OFS, it has to effect inter-state stock transfer of beer from its factory in the State of Rajasthan to its depots i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is, therefore, clear that the time and place of delivery of the stock of beer has been left unspecified. The delivery of beer has also been left open for the parties to determine from time to time. None of the clauses of the Master Agreement contemplate manufacture and delivery of liquor to the depots of the Corporation from outside the State of Bihar. The clauses merely discuss the manner in which the goods are to be delivered at the depots of the Corporation and issues incidental to it. In fact, there is no reference to the manufacturing activity undertaken by the appellants. The Master Agreement merely grants an option to the Corporation to purchase goods at a subsequent date as and when required by the Corporation. The Corporation does not actually purchase or agree to purchase beer from the appellants under the Master Agreement. If the Corporation does not place OFS on the appellants, the latter cannot sue the Corporation for damages because the Master Agreement has not been breached. There is no binding obligation that the Corporation has to purchase the goods under the Master Agreement. The Master Agreement, therefore, cannot be treated to be an agreement to sell. It wou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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