KARYA PALAK ENGINEER,CPWD, BIKANER vs RAJASTHAN TAXATION BOARD, AJMER .

The Supreme Court addressed appeals concerning the Rajasthan Sales Tax Act, 1994, and the applicability of Article 285 of the Constitution of India regarding the State's authority to levy sales tax on the Union's transactions. The Court held that the supply of materials by the Union to its contractors does not constitute a 'sale' under the Sales Tax Act, as the contractors act merely as custodians of the materials. Consequently, the Union cannot be treated as a 'dealer' under the Act, and the imposition of sales tax is impermissible under Article 285, affirming the High Court's rejection of the appellants' contentions.