CARONA SAHLI CO PRIVATE LIMITED Vs. STATE OF MAHARASHTRA

JUDGEMENT

(1.) This appeal is brought by special leave against the judgment of the High Court of Judicature at Bombay dated April 23, 1962 on a reference by the Bombay Sales Tax Tribunal under S. 34(1) of the Bombay Sales Tax Act, 1953.

(2.) The appellant is a manufacturer of footwear in Bombay. During the assessment year April 1, 1954 to March 31. 1955, the appellant purchased rubber from certain dealers residing in the State of Cochin. These purchases were assessed to purchase tax by the Sales Tax Officer under S. 10(a) of the Bombay Sales Tax Act (Bombay Act III of 1953-hereinafter referred to as the Act) as they were made "from a person who is not a registered dealer". The Cochin sellers had their agents in Bombay who received orders on behalf of the appellant. The orders of the appellant were accepted by the agents in Bombay and the goods were shipped by the sellers from Cochin to Bombay. After the goods were shipped, the demand drafts were forwarded along with the Bills of Lading by the vendors to their bankers in Bombay. The Bankers endorsed the bill of lading in Bombay and handed it over to purchasers in Bombay in exchange for the price. The price was also paid in Bombay. In the Bills of Lading the sellers in Cochin were described as both consignors and consignees. After the goods were shipped, an invoice was drawn on the appellant in which were printed the following words:

(3.) The first question that arises for determination in this case is, whether on the facts and circumstances of the case, the property in the rubber consignments passed to the appellant in Cochin i.e. outside the territorial limits of the State of Bombay. In this connection the facts found by the Sales Tax Tribunal are that the Cochin sellers had their agents in Bombay who received the orders of the appellant and arranged for the shipping of the goods. In accordance with these orders the goods were shipped by the Cochin sellers from Cochin to Bombay. The Bills of Lading were in the name of the sellers as consignors and consignees. The invoices however showed that the goods were shipped at the "risk and on account of of M/s. Carona Sahu and Company (P) Ltd". The insurance charges were borne by the appellant who also paid freight and other charges. The bills of lading were sent by the sellers through the bank to be delivered to the buyers in Bombay on payment of the price of the goods. In view of these facts, the High Court held that the property was intended by the parties to pass in Bombay and the endorsement in the invoice that the goods were being shipped "on account of and at the risk of the buyers" did not mean anything more than that the insurance charges were to be paid by the buyers. On behalf of the appellant, Mr. Donde submitted that the property in the rubber consignments had passed to the appellants in Cochin. In our opinion, there is no warrant for this submission and the view taken by the High Court is correct.