STATE OF MADRAS vs DAVAR AND COMPANY ETC.

The Supreme Court ruled that under Section 5(2) of the Central Sales Tax Act, 1956, a sale is deemed to occur in the course of import if it is executed by transferring documents of title before the goods cross the customs frontiers of India. The Court held that since the sales in question occurred after the goods had crossed these frontiers, they were subject to sales tax under the Madras General Sales Tax Act, 1959. Consequently, the assessee's claim for exemption from sales tax was rejected, affirming the decision of the State of Madras.