Sale of Goods Act, 1930

The Supreme Court examined whether the Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993 (the 1993 Act) applies retrospectively to supply orders placed before its commencement on 23‑09‑1992. The Court held that the Act is prospective, its liability arising only after the buyer …

The Agricultural Produce Market Committee (APMC) of Baroda levied a market fee on castor seeds purchased by Biotor Industries Ltd., an industrial concern that processes the seeds into castor oil. The company argued that the seeds were brought from outside the market area and, under Rule 48(2) of the Gujarat Agricultura…

The Government of Andhra Pradesh issued a demand notice under Section 5 of the Andhra Pradesh General Sales Tax Act, 1957 for tax on the turnover of an auction sale of jewellery held on 19‑08‑1987 by Corporation Bank, invoking Explanation IV to Section 2(1)(e) inserted by Act No. 27 of 1996. The Bank challenged the not…

The Commissioner of Commercial Taxes of Kerala challenged a penalty of Rs.86 lakh imposed on K.T.C. Automobiles for allegedly evading Kerala sales tax by registering 263 cars sold from its Mahe branch under the Pondicherry Sales Tax Act. The High Court set aside the penalty, holding that the sale was completed at Mahe …

The Supreme Court examined whether the sale of lottery tickets falls within the definition of "goods" for the purpose of State sales tax statutes. The Court held that a lottery ticket is merely a token evidencing a chance to win a prize, which constitutes an actionable claim under the Transfer of Property Act, not a mo…

The State of Uttaranchal auctioned crude resin and the highest bid was placed by Khurana Brothers, leading to a formal contract of sale dated 24 March 2001 and an acceptance letter on 7 April 2001 requiring the resin to be lifted within 60 days. The issue before the Supreme Court was whether this contract amounted to a…

The Commercial Taxes Officer challenged the exemption claimed by M/s Bombay Machinery Store under Section 6(2) of the Central Sales Tax Act, 1956, arguing that the State’s circulars imposed a 30‑day time‑limit after which goods retained by a carrier were deemed to be constructively delivered, converting the inter‑state…

The Association of Leasing and Financial Service Companies challenged the levy of service tax under Section 66 of the Finance Act, 1994 (as amended) on financial leasing, equipment leasing and hire‑purchase services, arguing that Parliament lacked competence under Entry 97 of List I because Article 366(29A) treated suc…

The Supreme Court examined whether agreements between a developer and flat purchasers constitute "works contracts" under Art.366(29‑A)(b) and whether the State can levy sales tax on the goods used in such contracts. It held that a construction agreement, even when coupled with a transfer of immovable property, remains …

The petitioner bought a diesel Fiat Siena Weekender and complained of engine rattling noise, leading the dealer to replace the engine and other parts. Unsatisfied, he demanded a new vehicle or a refund of the purchase price and expenses, filing complaints before the District Forum, State Commission, and finally the Nat…

Escorts JCB Ltd., a manufacturer of excavators, sold its goods on an ex‑works basis at its Ballabgarh factory, handing over possession to the buyer's carrier. The Central Excise authorities, after a factory visit, observed that transit‑insurance and freight charges were not included in the declared value and, on the ba…

The Supreme Court considered the sanction of a scheme of amalgamation between Tata Oil Mills Company Ltd. (TOMCO) and Hindustan Lever Ltd. (HLL), a subsidiary of the foreign multinational Unilever. The petitioners – nominal TOMCO shareholders, employee unions and consumer groups – challenged the scheme on six grounds, …

Xerox Modicorp Ltd entered into Full Service Maintenance Agreements (FSMA) and Spares and Service Maintenance Agreements (SSMA) with customers after selling Xerox machines. The dispute concerned whether the supply of spare parts, toners and developers under these agreements amounted to a sale liable to Karnataka sales …

The Supreme Court examined the constitutional validity of Section 4A of the Rajasthan Sales Tax Act, 1994, which levied tax on the first point sale of drugs, medicines and formulations by wholesalers to retailers based on the Maximum Retail Price (MRP) printed on the package rather than the actual consideration paid. T…

M/s IDL Chemicals Ltd. manufactures explosives using 80% ammonium nitrate melt purchased from SAIL. An exemption notification dated 11 June 1969 exempted such ammonium nitrate from excise duty under Tariff Item 14HH, provided the licence and bond were obtained. The Central Board later reclassified the nitrate under Tar…

Indochem Electronic supplied an EPABX telephone system to the Additional Collector of Customs, Andhra Pradesh, with a one‑year warranty and a promise to open a service centre. The system was defective from the outset, and despite repeated complaints the supplier failed to provide satisfactory maintenance, even after th…

The State of Maharashtra appealed against The Britannia Biscuits Co. Ltd., which sold biscuits in tins and collected a refundable deposit for the tins, refunding it only if the tins were returned within three months. The Assessing Authority treated the amount written off from unreturned tin deposits (Rs 84,013) as part…

The complainant, a supplier of horse feed, alleged that Delhi Race Club (1940) Ltd. and its officers failed to pay Rs 9,11,434 for goods supplied and filed a private complaint invoking sections 406, 420 and 120B of the IPC. The Additional Chief Judicial Magistrate, after a magisterial inquiry under Section 202 CrPC, is…

The appellant, Commissioner of Customs and Central Excise, challenged the CESTAT order that allowed Roofit Industries Ltd. to deduct freight, insurance and unloading charges from the assessable value of its pipe products. The revenue argued that the sale of goods occurred at the buyer's premises, making those charges p…

The Supreme Court examined whether an arbitrator, appointed without court intervention, could award interest for the period before the reference and for the pendente lite period of the arbitration. It held that an arbitrator is not a court within the meaning of CPC s.34 and therefore cannot award pendente lite interest…

The appellant, a senior advocate and former legal advisor to a cooperative bank, refused to return the bank's case files after the retainership was terminated, demanding payment of alleged fees of Rs. 97,100. The bank filed a complaint before the State Bar Council, which was transferred to the Bar Council of India; the…

Federal Bank Ltd. and other banks challenged notices issued by the Kerala tax department demanding sales tax on the auction sale of gold and other valuables pledged as security for loans. The banks argued that such sales were not "sales" within the meaning of the Kerala General Sales Tax Act, 1963 and that they did not…

The Supreme Court examined whether mobile service providers (MSPs) could claim CENVAT credit on excise duties paid for mobile towers and prefabricated buildings (PFBs) used in their networks. The dispute arose from conflicting decisions of the Bombay High Court, which held the towers and PFBs to be immovable property a…

The appellants R.D. Goyal and others challenged the MRTP Commission’s finding that the issue of equity shares linked with redeemable non‑convertible debentures, before allotment, did not constitute "goods" under Section 2(e) of the Monopolies and Restrictive Trade Practices Act, 1969. They argued that shares (including…

The State of Uttar Pradesh entered into a works contract with Bridge & Roof Co. (India) Ltd., which required the State to deduct 4% tax at source under the U.P. Trade Tax Act, 1948. The Commissioner of Sales Tax, under a composition scheme, directed a reduced deduction of 1% and the State complied, prompting the contra…

Hindustan Shipyard Ltd., a public sector shipbuilder, challenged the assessment of sales tax on contracts for building ships, arguing that the contracts were works contracts under Section 2(t) of the Andhra Pradesh General Sales Tax Act, 1957. The State of Andhra Pradesh contended that the contracts were sales of goods…

Morgan Stanley Mutual Fund, a SEBI‑registered domestic mutual fund, sought to issue a public fund scheme after obtaining SEBI approval for its draft scheme and advertising the issue. A prospective investor filed a petition before the Calcutta District Consumer Disputes Redressal Forum seeking an ex‑parte injunction res…

Hyundai Motor India Ltd. appealed against the award of compensation and punitive damages granted by the State Consumer Disputes Redressal Commission and upheld by the National Consumer Disputes Redressal Commission for a defect in the air‑bag system of a Creta car that failed to deploy in a frontal collision, causing i…

The case concerns refunds of excise and customs duties collected contrary to law. The Supreme Court examined the validity of Section 11-B of the Central Excises and Salt Act, 1944, as amended in 1991, which restricts refunds to claimants who have not passed on the burden of duty to others. The Court overruled its earli…

The appellant banks entered into ready‑forward (buy‑back) contracts with brokers before June 1992, consisting of a completed ready leg (purchase of securities) and a future forward leg. The Custodian, under the Special Court Act, claimed the contracts were void for violating RBI circulars issued under the Banking Regul…

The Competition Commission of India (CCI) received a complaint alleging that four private firms colluded in the tendering process for Mizoram state lottery distributors, resulting in bid‑rigging and an appreciable adverse effect on competition. The CCI found prima facie evidence of cartelisation among the private bidde…

M/s Shanti Conductors (P) Ltd. filed a money suit against Assam State Electricity Board for interest on delayed payments. The Supreme Court had earlier held the suit barred by limitation, rejecting the plaintiff’s claim of benefit under Section 19 of the Limitation Act, 1963 and Section 14, and also held that the 1993 …

The appellant, Surendra Kumar Bhilawe, owned an Ashok Leyland truck that was insured by New India Assurance. The truck was involved in a serious accident in November 2011, and the appellant filed a claim for the loss. The insurer denied the claim, alleging that the vehicle had been sold in 2008 to Mohammad Iliyas Ansar…

The appellant, a beneficiary of a trust, claimed a pre‑emptive right under Article 57‑A of the company's Articles of Association to purchase 3,417 and 93 shares held by joint executors, but the executors sold those shares to a third‑party group without complying with the Articles or Section 108 of the Companies Act. Th…

Vijay Industries, a small‑scale supplier of castor oil, sued Natl Technologies for non‑payment of invoices and for interest on delayed payments, filing a winding‑up petition under Sections 433(e), 433(f) and 434 of the Companies Act, 1956. The respondent argued that interest was not a debt because there was no explicit…

The Builders' Association of India, an association of contractors, challenged the Karnataka Sales Tax Act, 1957, specifically Explanation 3(c) to Section 2(t) and Section 5‑B with the Sixth Schedule, alleging that they converted inter‑state sales into intra‑state sales and imposed tax on the value of works contracts in…

The appellant, a common carrier, was assessed under Section 69A of the Income Tax Act for short delivery of bitumen, with the assessing officer deeming the bitumen as an "other valuable article" owned by the appellant. The Supreme Court examined whether a carrier can be considered the owner of goods for tax purposes an…

The plaintiff (borrower) entered into contracts with suppliers for a 108 MW captive power plant and with a consortium of banks, including Svenska Handelsbanken, for financing. The plant was later found to have a capacity of only 60 MW, leading the plaintiff to allege fraud by the suppliers and the lender and to seek a …

Thampanoor Ravi was elected to the Kerala Legislative Assembly and his election was challenged on two grounds: (i) that he was an "undischarged insolvent" within the meaning of Article 191(1)(c) of the Constitution, and (ii) that he had indulged in corrupt practices under Section 123 of the Representation of the People…

The Supreme Court examined whether a credit note issued by an automobile manufacturer to a dealer, for replacing a defective part under a warranty, constitutes a sale liable to sales tax. It held that when the dealer uses a part from his own stock or purchases it from the market and is reimbursed by a credit note, the …

The Coffee Board conducts export auctions of coffee and requires registered exporters to furnish security deposits and, under a 1977 circular, contingency deposits or bank guarantees equal to the sales tax that would have been payable despite the exemption granted by Section 5(3) of the Central Sales Tax Act, 1956. The…

Ferro Alloys Corporation Ltd, a 100% export‑oriented unit manufacturing charge chrome, entered an off‑take agreement with Richco (Switzerland) and subsequently executed specific Charge Chrome Agreements for each shipment. The State of Orissa treated the sales for assessment years 1990‑91 and 1991‑92 as intra‑state sale…

The appellant, an ex‑director of the corporate debtor, contested the admission of an application filed by the operational creditor under section 9 of the Insolvency and Bankruptcy Code (IBC) alleging a debt for coal supplied under a purchase order. The creditor claimed the coal was of inferior quality, leading to email…

The State of Madhya Pradesh enhanced the royalty payable on coal and sought recovery of the differential amount from South Eastern Coalfields Ltd. (the Coalfields) and the ultimate consumers. The Coalfields, bound by their mining lease and Mineral Concession Rules, were required to pay simple interest of 24% on delayed…

The Government of Orissa entered into a construction contract with G.C. Roy, which contained an arbitration clause. After the work was completed, a dispute arose and the arbitrator awarded the contractor the claimed sum plus 9% interest pendente lite from the date the amount became due. The Sub‑ordinate Judge set aside…

Phulchand Exports Ltd. (seller) shipped 1,000 metric tons of rice to 000 Patriot (buyer) under a CIF contract but delayed shipment by 16 days and loaded the goods on a vessel that was not bound for the agreed destination, causing the cargo to be lost. The buyer invoked a reimbursement clause in the contract and obtaine…

Dhampur Sugar Mills Ltd entered into a licence deed to use a sugar mill, agreeing to pay the licence fee largely in molasses. The revenue department assessed trade tax on the molasses, treating it as a sale under the Uttar Pradesh Trade Tax Act, 1948. The appellant argued that the molasses payment was a barter, not a s…

The Coffee Board challenged the levy of purchase tax on coffee it received from growers under the compulsory delivery provision of the Coffee Act, 1942, arguing that the transaction was a compulsory acquisition and not a sale. The Karnataka High Court held that an element of consensuality existed, making it a sale liab…

The Food Corporation of India (appellant) hired Sureendra, Devendra & Mohendra Transport Co. (respondent) as a transport contractor under three written agreements. Disputes over demurrage, wharfage and shortage charges were referred to an arbitrator pursuant to an arbitration clause. The arbitrator reduced the appellan…

The Supreme Court considered two appeals by suppliers of aluminium conductors against the Assam State Electricity Board concerning claims for interest on delayed payments under the Interest on Delayed Payments to Small Scale and Ancillary Industrial Undertakings Act, 1993. The Court held that a suit seeking only intere…

The Union of India challenged the liability of several private companies, including Future Gaming Solutions, to pay service tax on the sale of paper and online lottery tickets for the Government of Sikkim. The High Court of Sikkim had set aside service‑tax notices issued under various amendments to the Finance Act, 199…

Ravinder Raj booked a Maruti car in the mid‑1980s, paid an advance and later paid the full price in February 1989. Before the official billing on 5 April 1989, the government raised excise duty, increasing the car's price by about Rs.6,710, and the dealer asked the buyer to pay the excess amount, which he did under pro…

The case concerned whether an arbitrator appointed, with or without court intervention, could award interest on sums due for the period before the arbitration reference (pre‑reference period) in disputes that arose before the Interest Act, 1978. The contractor’s award included interest from the due date to the date of …

The Uttarakhand Agricultural Produce Marketing (Development and Regulation) Act, 2011 levied a market fee and development cess on any agricultural produce arriving in a notified market area for sale, storage, processing, manufacturing or other commercial purposes. Gujarat Ambuja Exports Ltd and other manufacturers, who…

The Marwar Tent Factory supplied 1,500 tents to the Defence Services under a contract that stipulated delivery F.O.R. Jodhpur. After dispatching the consignment by rail, the Commandant of the C.O.D. at Kanpur claimed that 224 tents were missing and deducted their price from the amount due. The factory sued for the pric…

Anwar Ali filed a complaint before the District Consumer Forum alleging that his electricity supply was disconnected without prior notice. The Forum awarded him Rs 50,000 compensation with interest, an order upheld by the State Consumer Disputes Redressal Commission and the National Consumer Disputes Redressal Commissi…

The Supreme Court examined whether licensees under the Rajasthan Agricultural Produce Markets Act who purchase agricultural produce from outside Rajasthan and bring it into the market area are required to pay the market fee. The Court held that liability depends on when title in the goods passes; if ownership transfers…

In the 2019 Arunachal Pradesh Legislative Assembly election, independent candidate Karikho Kri was elected from Tezu (ST) constituency. Nuney Tayang challenged the election, alleging that Kri failed to disclose three vehicles, a no‑dues certificate for government accommodation, and municipal/property tax liabilities, t…

M/s D.J. Malpani, a manufacturer of chewing tobacco, collected a voluntary charitable donation called Dharmada from customers along with the sale price of its goods. The tax authorities treated the Dharmada amount as part of the transaction value and demanded excise duty, penalty and interest. The appellant argued that…

The petitioners, registered dealers under the Jammu and Kashmir General Sales Tax Act, 1962, filed quarterly returns but failed to pay the tax on time, leading the Assessing Authority to levy interest under section 8 of the Act. They challenged the constitutional validity of sections 8(1), 8(2) and 8(3) on grounds of v…

The appellants, who were registered lottery dealers in Kerala, bought state lottery tickets in bulk at a discount and resold them to retailers on an outright basis, earning a profit. The Central Excise authorities directed them to obtain service‑tax registration and pay tax under the heading ‘business auxiliary service…

Indian Railways sought open access to procure 100 MW of power and claimed it is a deemed distribution licensee (DDL) under the Electricity Act, 2003, thereby exempt from cross‑subsidy surcharge (CSS) and additional surcharge. The dispute centered on whether activities under sections 11(g) and 11(h) of the Railways Act …

The Bihar State Electricity Board imposed a central excise duty on electricity generation and merged it into a uniform tariff, later levying a surcharge. When the central excise duty was abolished, the Patna High Court held that the Board should reduce the uniform tariff. The Board appealed, arguing that tariff fixatio…

M/s Sri Chamundeswari Sugar Ltd., a sugar manufacturer, purchased sugarcane from growers and paid the Statutory Minimum Price fixed by the Central Government together with the State Advised Price (SAP) fixed by Karnataka. The assessing authority levied purchase tax on the total amount, including SAP, under the Karnatak…

The appellant Krishi Utpadan Mandi Samiti, Ghaziabad claimed market fee under Section 17(iii)(b) of the Uttar Pradesh Krishi Utpadan Mandi Adhiniyam, 1964 on rice exported by the respondent partnership firm. The respondent argued that the rice was purchased from millers outside Uttar Pradesh and shipped directly to por…

The Agricultural Market Committee, a statutory body under the Andhra Pradesh (Agricultural Produce and Livestock) Markets Act, 1966, levied a market fee on Shalimar Chemical Works Ltd for its purchase of copra. The respondent challenged the fee, arguing that the sale occurred in Kerala, not within the notified market a…

The State of Karnataka appealed against the High Court's setting aside of a confiscation order of a 7,200 kg consignment of groundnut oil. The oil had been seized because the transporter failed to file the mandatory Form II declaration with the Tehsildar before the consignment left the place, as required by Clause 3(2)…

The Supreme Court considered a dispute where the State of Madhya Pradesh, under a new excise policy, purchased foreign liquor from a wholesaler, Bhupendra Singh Bhatia, at rates fixed by a district‑level purchase committee in April‑May 1996, pending a final decision by a state‑level committee. After the state‑level com…

Numaligarh Refinery Ltd (NRL), a Government undertaking, awarded a turnkey power plant contract to Daelim Industrial Co Ltd (DIC). During execution, DIC lodged a claim of Rs 55.8 crore covering substituted material, turbo‑technical price, counter‑vailing duty, exchange‑rate fluctuation, liquidity damages, and interest,…

The Court examined whether a composite contract for the manufacture, supply and installation of lifts constitutes a "sale of goods" or a "works contract" for tax purposes under Article 366(29A)(b) of the Constitution and related sales‑tax statutes. The petitioners argued that the installation component made the contrac…

M/s Durga Projects Inc, a civil works contractor registered under the Karnataka Value Added Tax (KVAT) Act, 2003 and the Central Sales Tax Act, sought clarification from the Authority for Advance Clarification and Ruling on the tax rate applicable to works contracts before 1 April 2006. The AAR held that the rate shoul…

Tata Consultancy Services (TCS) sold canned computer software packages and was assessed sales tax by the Andhra Pradesh Commercial Tax Officer, who held that the software constituted "goods" under the Andhra Pradesh General Sales Tax Act, 1957. TCS appealed, arguing that software is intangible intellectual property and…

The case concerned whether the sale, promotion and marketing of state‑run lottery tickets by M/s Martin Lottery Agencies Ltd. attracted service tax under Section 65(19) of the Finance Act, 1994. The High Court had held that lottery tickets are not "goods" and that the distributor’s activities were merely promotion, not…

The case concerns the ownership of Rs. 50 crore 9% tax‑free bonds (the "suit bonds") issued by Nuclear Power Corporation Ltd. (NPCL). Andhra Bank Financial Services Ltd. (ABFSL) sold the bonds to Standard Chartered Bank (SCB) on 26‑27 February 1992, and SCB paid consideration and received a Banker's Receipt. Canbank Mu…

Bhagawati Oxygen Ltd. (BOL) entered into a contract with Hindustan Copper Ltd. (HCL) for the supply of oxygen, which contained an arbitration clause. An arbitrator awarded Rs. 74,84,521.34 to BOL and granted interest at 18% per annum, dismissing HCL's counter‑claim. HCL challenged the award under Section 30 of the Indi…

The appeal concerned whether sales tax is payable on the free replacement of defective motor‑vehicle parts supplied by a dealer under a warranty, when the dealer receives a credit note from the manufacturer for the returned defective part. The dealer pays sales tax on the purchase of spare parts and on the sale of the …

The Supreme Court examined a coupon scheme operated by Sri Srinivasa Sales Circulation where a customer paid Rs.5 for a coupon, received three coupons for Rs.16 each, sold them to three persons for Rs.5 each, and ultimately obtained an article of his choice after the downstream purchasers cleared their payments. The As…

The Supreme Court examined whether state lotteries organised by Tamil Nadu and West Bengal could be taxed under the states' sales‑tax statutes. The petitioners, dealers in lottery tickets, argued that lottery tickets are not "goods" but merely actionable claims, rendering the amendments to the Tamil Nadu General Sales …

The Reserve Bank of India (RBI) issued a Statement and a Circular in April 2018 directing banks and other regulated entities to cease dealing with persons or entities dealing in virtual currencies (VCs) and to exit existing relationships within three months. The petitioners – a trade association and several cryptocurre…

United Breweries Ltd. (the appellant) challenged the assessment of sales tax on the value of bottles and crates supplied with its beer, arguing that these were not sold but were returned against a refundable deposit. The Commercial Tax Officer, the Tribunal and the Andhra Pradesh High Court held that the bottles and cr…

Skill Lotto Solutions Pvt. Ltd., an authorised agent for Punjab lotteries, filed a writ petition under Art.32 challenging the Central Goods and Services Tax Act, 2017 (CGST Act) on the grounds that the definition of ‘goods’ in s.2(52) – which includes actionable claims – is unconstitutional and that taxing lottery, bet…

Canbank Financial Services Ltd., a subsidiary of Canara Bank, purchased CANCIGO units worth Rs 33 crore from a stock broker (Respondent 2) who had applied for the units through two other banks (Respondents 3 and 4) that held the certificates in their names but transferred possession to the broker. The Special Court hel…

The parties entered into a high‑seas sale agreement for 16,943 metric tonnes of South African coal. The seller delivered the whole consignment to a stevedore, who released 9,542.92 tonnes to the buyer, leaving 7,400.082 tonnes in its custody. The buyer failed to pay the balance price, prompting the seller to sue for br…

The appellant, Shilpa Shares and Securities, had taken a loan from the National Co-operative Bank Ltd. and defaulted on repayment. Under the Maharashtra Co-operative Societies Rules, 1961, the bank initiated recovery proceedings and conducted an auction of the appellant's immovable property pursuant to Rule 107, which …

The Supreme Court examined whether the provision of telephone services by telecom operators constitutes a sale of goods, a service, or a composite contract of both, and consequently whether State governments can levy sales tax under Entry 54 of List II. The petitioners argued that the transaction is purely a service, i…

The case involved a family dispute over the control of Kerala Kaumudi Pvt. Ltd., focusing on the validity of share transfers from Mani and his children to M.S. Madhusoodhanan, the removal of Madhusoodhanan as Managing Director and the deletion of Article 74, the allotment of additional shares to Ravi and Srinivasan, an…

The Supreme Court examined whether the freely transferable "replenishment licences" (R.E.P. licences) and later "Exim Scrips" issued under the Imports and Exports (Control) Act, 1947 constitute "goods" for the purpose of state sales‑tax statutes. The Court held that these licences have an independent market value, are …

The State of Orissa issued notifications under the Orissa Sales Tax Act, 1947, imposing a 10% purchase tax on bamboos and standing trees agreed to be severed. Petitioners challenged the validity of these notifications, arguing that the transactions were not sales of goods, that the tax amounted to double taxation, and …