OIL AND NATURAL GAS COMMISSION vs STATE OF BIHAR AND OTHERS

The Supreme Court held that the supply of crude oil by the Oil and Natural Gas Commission to the Indian Oil Corporation constitutes a sale under the Central Sales Tax Act, 1956. The Court ruled that statutory orders do not negate the existence of a contract, affirming that the Commission's obligation to supply oil under government directives does not eliminate the contractual nature of the transaction. Consequently, the Commission is liable to pay sales tax to both the State of Assam and the State of Bihar, as the sales meet the criteria for inter-state sales.