20Th Century Finance Corpn. Ltd. & Anr vs State Of Maharashtra

The Supreme Court addressed the power of State legislatures to levy sales tax on the transfer of right to use goods under clause (29A)(d) of Article 366 of the Constitution. The Court held that a State cannot impose sales tax merely based on the location of goods at the time of use if the contract for transfer was executed outside the State or if the sale occurred in inter-State trade or in the course of export/import. The judgment clarified that such taxation would violate the principles governing inter-State commerce and the nature of sales transactions.