STATE OF H.P. vs GUJARAT AMBUJA CEMENT LTD.

The Supreme Court addressed the liability of Gujarat Ambuja Cement Ltd. and Associated Cement Ltd. to pay purchase tax on royalty under the Central Sales Tax Act, 1956 and the Himachal Pradesh General Sales Tax Act, 1968. The Court held that the royalty payments made by the companies do not constitute a sale under the definitions provided in the respective statutes, thus exempting them from purchase tax liability. The judgment of the Himachal Pradesh High Court was set aside, favoring the respondents.