OIL INDIA LTD. versus THE SUPERINTENDENT OF TAXES & OTHERS

OIL INDIA LTD. versus THE SUPERINTENDENT OF TAXES & OTHERS

The sales in question were sales in the course of inter-State trade under Section 3 of the Central Sales Tax Act, as movement of crude oil from Assam to Bihar was in pursuance and an incident of the contract of sale. Therefore, Bihar Government had no jurisdiction to tax the sales under its Sales Tax Act.

Parties
Petitioner: Oil India Ltd.; Respondents 1 3: Superintendent of Taxes & Others; Respondents 4 6: Respondents No. 4-6 (Bihar Tax Authorities)
Jurisdiction
India
Judgment Date
03 March 1975
Procedural Posture
Writ Petition (article 32) / Supreme Court Original Jurisdiction Final Disposition
Outcome
Petitions allowed in part
Legal Topics
Central Sales Tax Interstate Trade, Sales Tax Jurisdiction, Assessment and Refund of Taxes
Taxation Law Constitutional Law Central Sales Tax Interstate Trade Sales Tax Jurisdiction Assessment and Refund of Taxes

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Parties

Oil India Ltd.

Petitioner

Superintendent of Taxes & Others

Respondents 1 3

Respondents No. 4-6 (Bihar Tax Authorities)

Respondents 4 6

Procedural Posture

Writ Petition (article 32) / Supreme Court Original Jurisdiction Final Disposition

Legal Issues

  1. 1 Whether the supply of crude oil by the petitioner to Barauni Refinery was a sale in the course of inter-State trade under Section 3 of the Central Sales Tax Act, 1956
  2. 2 Whether Bihar Government had jurisdiction to levy state sales tax on such sales

Ratio Decidendi

The sales in question were sales in the course of inter-State trade under Section 3 of the Central Sales Tax Act, as movement of crude oil from Assam to Bihar was in pursuance and an incident of the contract of sale. Therefore, Bihar Government had no jurisdiction to tax the sales under its Sales Tax Act.

Court Disposition

Petitions allowed in part

Orders

  • Bihar Sales Tax Authorities (respondents 4 to 6) are restrained from imposing sales tax under the Bihar Sales Tax Act on the sales made in pursuance of contract (clause 7) to Barauni Refinery.
  • Bihar Sales Tax Authorities are directed to refund to the petitioner the sales tax already collected.