Report No. 30
Subsequent transport not material.-On the other hand, if there is no contractual obligation to export or to transport, then the mere fact that after purchase, the assessee transports the goods across the State does not bring the case under section 3(a), Central Sales Tax Act1-2.
1. Shafeeq Shammeem & Co. v. State of Andhra Pradesh, (1964) 15 STC 828 (836) (AP), noted in the yearly Digest, May, 1965, Col. 1198.
2. Government of Andhra Pradesh v. Nagendrappa, (1956) 7 STC 568: AIR 1957 AP 297.
In a decision of the Calcutta High Court in 19631 the matter has been discussed exhaustively, and it has been pointed out that the question whether a sale is to be regarded as an inter-State sale is to be determined on an interpretation of the facts on the point whether the transport was a part of the contract for sale or whether the transport was made after the completion of the sale independently of the contract.
"The question is whether the transport of the movement under the contract is a part of its incident, i.e., an inseparable incident or whether it is de hors or outside the contract." In the same decision it was pointed out, that the place where the title passes cannot by itself alone determine whether the sale is in the course of inter-State trade or not.
1. Dhiraj Lal v. Commissioner of Commercial Taxes, AIR 1961 Cal 442 (448, 455), paras. 24 and 43 (P.B. Mukherjea J.)
Test of "Linking".-In some cases, it has been emphasised that the movement of the goods contemplated must be closely linked with the sale of goods, and that the exemption is not intended to cover a later movement undertaken "for the better enjoyment of the goods" after the title has passed1.
In one case, in relation to inter-State trade, it was emphasised, that the connection between the f.o.r. sale at a railway station in the State for a destination outside the State and the movement that followed the delivery to the common carrier, was so intimate and real that it was occasioned, caused, or brought about by the sale. In that case, the delivery was to the common carrier for the purpose of despatch to the purchaser in the other State,2 and the sale was held to be exempt under section 3, Central Sales Tax Act, 1956.
1. T. Bapputy v. Government of Kerala, AIR 1962 Ker 79 (71), para. 3: 12 STC 722 (Inter-State sales).
2. Sudarshanam Iyengar and Son v. State of Kerala, AIR 1962 Ker 66 (67), para. 713: STC 17 (Inter-State sales).