STATE TRADING CORPORATIONOF INDIA LTD. vs STATE OF MYSORE

The Supreme Court held that sales made by the C. Company from factories outside the State of Mysore to purchasers within the State constituted inter-State sales under Section 3(a) of the Central Sales Tax Act, 1956. The Court clarified that a sale occasions the movement of goods when such movement is a result of a covenant in the contract of sale. Consequently, the State of Mysore lacked jurisdiction to impose sales tax on these transactions due to the constitutional prohibition under Article 269, leading to the quashing of the assessment orders.