Report No. 61
1C.4. Effect of judicial decisions.-
A survey of the judicial decisions shows that the tests which have been adopted do not reveal a simple or single criterion which could be neatly or precisely stated. Some of the decisions might give the impression that if the party to whom the seller is to sell the goods is not to be selected by the Government or by the authority acting in pursuance of the law, then the transaction could be regarded as a sale. But some of the decisions do not emphasise any such test. Again, the fact that there was no offer and no acceptance, is sometimes highlighted;1 but, then, there are cases2 where many essential matters were not subject to offer or acceptance and not only the party to whom the goods are to be delivered, but also the price and the manner Of transportation and payment, were determined by the Controller; and yet the transaction was regarded as a sale.
No doubt, cases at the extremes may be easy to decide. For example, where only the price is regulated by law and most of the other matters are left to contract, the transaction could be regarded as a sale, on the reasoning that the effect of the price control order is only to super-impose, upon the agreement between the parties, the rate fixed under the control order.3 This is one extreme. At the other extreme is the case4 where every aspect of the transaction was wholly and completely controlled, and therefore it has been held that there is no sale. But, in a fairly large number of cases, it is not easy to decide on which side of the line the case should be regarded as falling.
1. See New Indian Sugar Mills case, AIR 1963 SC 1207.
2. See Indian Steel & Iron Products case, AIR 1968 SC 478.
3. See State of Rajasthan v. Karam Chand Thapar, AIR 1969 SC 343.
4. See Vishnu Agencies Private Ltd. v. Commercial Tax Officer, 77 CWN 141.