BALABHAGAS HYULASCHAND Vs. STATE OF ORISSA

JUDGEMENT

(1.) THE Tribunal was called upon to make a statement of the case and refer the following question "Whether title to the goods passed after approval at the site of the mills or in Orissa". In the course of hearing we were of opinion that the appropriate question would be :

(2.) THE relevant facts as given in the statement of the case, may be narrated in brief. THE petitioner is a firm which carries on business in jute. It purchases jute in Orissa and sends it outside the State to various jute mills in West Bengal. THE headquarters of the firm is at 161/1, Mahatma Gandhi Road, Calcutta-7. For the quarter ending 30-6-69, jute worth Rs. 2,43,992.71 P. and Rs. 96,759.40 P. was despatched from Cuttack and Dhenkanal railway stations respectively to West Bengal. THE transaction was through a licensed broker "East India Jute and Hessian Exchange, Ltd.". THE procedure followed was that jute was being despatched to the sidings of the jute mills. It would appear from a letter dated 14th September, 1963, written by the Managing Agents Kettlewellbullen and Co., Ltd., addressed to the petitioner - in which the terms and conditions of the contract were set out - that the jute mills had no agents or branch offices in Orissa to make purchases of jute. After arrival of the jute at the mill sidings it is carefully inspected by the mills in respect of quality, moisture, etc. If it is found acceptable purchase is finally settled. If it is not up to the grade it is rejected. THE jute is purchased on the basis of delivery at the mill sidings in Calcutta and accordingly the mills do not pay any railway freight or other charges for bringing it there. THE sellers generally book the jute in the name of the milks as the railways do not accept any booking to the mills' sidings unless the goods are booked in the name of the mills. Payment for the value of jute is made in Calcutta. Purchase is made on the basis of weight ascertained at the mills. Every responsibility in respect of quality, moisture, shortage in weight and risk in transit lies upon the seller. This letter was produced before the Tribunal and is a part of the paper book. It is the common case of the parties that the terms and conditions enumerated in this letter governed the terms and conditions under which the transactions were effected during the quarter ending 30-6-1960. THE statement of facts has been made on the basis of the terms mentioned in letter dated 1-4-60, addressed to the petitioner by the licensed broker, which are more or less to the same effect. It is mentioned therein that 90 per cent of the payment was to be made in cash against documents and the rest on approval.

(3.) THERE is no dispute before us that if the sales were in the course of inter-State trade or commerce, the taxing authorities in Orissa were within their jurisdiction to tax the sales.