M/S. MARIKAR MOTORS LIMITED vs SALES TAX OFFICER AND ANR.

The Supreme Court addressed the valuation of motor vehicles sold under hire-purchase agreements under the Kerala Sales Tax Act, determining that the sale occurs only when the hirer exercises the purchase option after fulfilling the agreement terms. The Court reaffirmed the principles from K.L. Johar & Co. v. Deputy Commercial Tax Officer, allowing two methods for determining sale consideration: original price minus depreciation or market value at the sale date. The Court held that the Sales Tax Officer's method of applying a fixed depreciation rate was incorrect, emphasizing the need for flexibility based on the hire-purchase agreement's terms.