JUDGMENT : P.K.Tare, C.J. ( 1. ) This is a reference under section 44 (2) of the Madhya Pradesh General Sales Tax Act, 1958, wherein by order of this Court, dated 15 1-1966, passed in Misc. Civil Case No. 258 of 1965, the Board of Revenue was called upon to refer certain questions of law to this Court for opinion. Accordingly, the Board of Revenue by order, dated 4-5-1966, passed in Reference Case No. 7-1/64, has referred the following questions for the opinion of this Court: (1) Whether the facts and circumstances considered and relied on by the Tribunal are sufficient in law to sustain the finding that the transactions in question resulted in intra State safes and that the movement of the goods outside the State was subsequent thereto ? (2) Whether in the facts and circumstances of the case, the finding that the movement of the goods outside the State was not for the purpose of consumption of the goods in the delivery State as a direct result of the contract and that the sales were not "Explanation Sales" [Article 286 (1) (a) with Explanation] can be sustained ? (3) Whether there is any material on record sufficient in law to justify, the finding regarding two sales, namely, one by the petitioners to the Cement Marketing Company and the other by the Cement Marketing Company to the ultimate purchasers ? ( 2. ) The said reference arose on the following facts and under the following circumstances. The petitioner Company along with three other Companies, namely, the Patiala Cement Company Limited, having its registered office at Surajpur in Patiala the Rohtas Industries Limited, having its registered office at Dalmianagar in Bihar, and Dalmia Cement Limited, having its registered office at Dalmianagar in Bihar, entered into a contract, D /- 4-6-1942 (Petitioners Annexure-1) with the Cement Marketing Company of India Ltd., having its registered office at Bombay and Branch Offices at various places, for disposal of cement to the purchasers, who were mostly outside the State of Madhya Pradesh. There was a Branch Office at Nag-pur also and till the re-organisation of States in pursuance of the States Re-organisation Act, 1956, Nagpur, located in the Vidarbha Region, was part of the old Madhya Pradesh till 31-10-1956. There was a Branch Office at Nag-pur also and till the re-organisation of States in pursuance of the States Re-organisation Act, 1956, Nagpur, located in the Vidarbha Region, was part of the old Madhya Pradesh till 31-10-1956. This vary agreement, dated 4-6-1942 (Petitioners Annexure- 1) was the subject-matter of an interpretation, where one of the contracting parties namely, the Rohtas Industries Limited having its registered office at Dalmianagar in Bihar, had contended that the transactions between itself and the Cement Marketing Company of India Ltd., were not sales within the meaning of section 5 (2) (a) of the Bihar Sales Tax Act, 1944 (No. 6 of 1944). The Division Bench of the Patna High Court in Rohtas Industries Ltd. v. The State of Bihar( (1958) 9 STC 248 .) had held that all those transactions amounted to a sale and as such, taxable under the Bihar Sales Tax Act, 1944. Being aggrieved, the Rohtas Industries Ltd. had filed an appeal before the Supreme Court and their Lordships, by judgment, dated 18-7-1961, delivered in Rohtas Industries Ltd. v. State of Bihar ((1961)12 ST C665.), affirmed the view of the Patna High Court and dismissed the appeal. As that very agreement is involved in the present reference, the learned counsel for the respondent contended that the question of interpretation of the said agreement is not now open and the interpretation put by their Lordships of the Supreme Court in the said case is binding on this Court. ( 3. ) As against this, the argument of the learned counsel for the petitioner was that that interpretation was put by their Lordships of the Supreme Court with reference to a point of time when the Constitution of India was not in force and the Government of India Act, 1935, was our constitutional document. As such, the suggestion was that Article 286 (1) (a) of the Constitution and particularly the Explanation did not at all come up for consideration and, there fore, the interpretation put by their Lordships of the Supreme Court on the agreement in the absence of consideration of the said Article cannot be a guiding factor, particularly after the enactment of the Constitution. The second line of argument advanced on behalf of the petitioner was that in the Bihar case there was no material to indicate the modus operandi and the petitioner has furnished enough material in the present case in that behalf and as such, by no stretch of imagination, can the transactions between the petitioner and the Cement Marketing Company of India Ltd. be termed as sales. In this connection the learned counsel for the petitioner relied on the subsequent pronouncements of their Lordships of the Supreme Court, which relate to a period subsequent to the coming into force of the Constitution of India. Presently, we shall deal with those cases. ( 4. ) There can be no doubt that in Rohtas Industries Ltd., v. The State of Bihar, their Lordships of the Supreme Court analysed the agreement in question clause by clause and ultimately, came to the conclusion that the transactions between the Rohtas Industries Ltd. and the Cement Marketing Co. of India amounted to sales and for that reason, the view as expressed by the Patna High Court in Rohtas Industries Ltd. v. State of Bihar was affirmed by their Lordships of the Supreme Court. ( 5. ) We may observe that that case was distinguished by their Lordships of the Supreme Court in The Cement Marketing Co. of India (Private) Ltd. v.The State of Mysore and another((1963) 14 STC 175.). It is necessary to examine the implications of the said case and the grounds on which their Lordships of the Supreme Court distinguished the case of Rohtas Industries Ltd. v. State of Bihar (supra). The facts in the said case were that the Cement Marketing Co. of India was the Sales Manager of the second appellant, the Associated Cement Co. Ltd. appointed under an agreement, dated 21-4-1954. The second appellant was a manufacturer of cement and it had over a dozen factories in different parts of India, none of which was in the State of Mysore. The head- office of the Cement Marketing Co. of India, Ltd. was at Bombay and it had then a branch office at Banglore in the State of Mysore. It was also registered as a dealer under the Mysore Sales Tax Act, 1948. Cement was a controlled article even at that time. The head- office of the Cement Marketing Co. of India, Ltd. was at Bombay and it had then a branch office at Banglore in the State of Mysore. It was also registered as a dealer under the Mysore Sales Tax Act, 1948. Cement was a controlled article even at that time. It could be sold either to the Government or to a private person, but authorisation by the Director General of Supplies and Disposal, Government of India, New Demi, was necessary. The modus operandi was more or less identical in both the cases, namely, every one wishing to buy cement had to get an authorisation in a standard form which authorised the Cement Marketing Co. of India Ltd. to sell cement in quantities mentioned therein and the cement had to be supplied from the factory therein mentioned. That document was to be in the prescribed form as mentioned in the judgment. The authorisation was subject to certain conditions, and it was not transferable. The purchaser or in debtor had then to place an order with the Cement Marketing Co. of India Ltd. as Sales Managers of the manufacturers stating the requirement, where the goods were to be sent and how they were to be sent. The seller entered into a contract with the first appellant, the Cement Marketing Co. of India Ltd. in a standard form. Thereupon the Cement Marketing Co. of India Ltd. instructed its Bombay office to despatch the cement in accordance with the instructions of the buyer and the authorisation. In this letter they had to mention the number of the authorisation and the person who had issued it and also to whom the goods were to be sent and how and certain other details, which would not be necessary. This was the modus operandi, which is also the modus operandi adopted in the present case. ( 6. ) The Mysore High Court took into consideration the fact that the Cement Marketing Co. of India Ltd. had a branch at Bangalore in the State of Mysore, and the public placed their orders with it for supply of cement against the permits granted to them, that the Cement Marketing Co. of India Ltd. after accepting the offer for the supplies of cement, collected the price from the intending purchasers and then directed one of the factories of Associated Cement Co. of India Ltd. after accepting the offer for the supplies of cement, collected the price from the intending purchasers and then directed one of the factories of Associated Cement Co. to supply cement to the purchasers and actual delivery to the purchasers was within the State of Mysore and, therefore, the contention that cement was loaded outside the State of Mysore and despatched to the purchaser did not convert sales into inter-State sales, but they were intra State sales. However, their Lordships of the Supreme Court felt that the High Court had not correctly appreciated the true nature of the transactions. According to their Lordships, the modus operandi showed that before an intending purchaser could obtain cement, he had to get what is called an authorisation from a Government authority which nominated the factory from which the intending purchaser had to get his supplies of cement. The authorisation with an order had to be given to the Cement Marketing Co. of India Ltd. and after a contract in the standard form was entered into, the Cement Marketing Co. of India Ltd. sent the order to the factory named in the authorisation and that factory then supplied the requisite goods to the purchaser. The factory from where the cement was to be supplied was not in the hands or at the option of the first appellant, the Cement Marketing Co. of India Ltd., but was entirely a matter for the Government authority to decide, so that the cement which was supplied from a particular factory was supplied not at the choice of the Cement Marketing Co. of India Ltd. but pursuant to the authorisation. Their Lordships observed that the decision in the Rohtas Industries Ltd. v. State of Bihar (supra) would not apply to the facts of that case because the agreement between the Cement Marketing Co. of India Ltd. and the manufacturer was different from that which existed between the Rohtas Industries Ltd. and the Cement Marketing Co. of India Ltd. On an examination of the agreement between those two Companies, the Supreme Court had held that the relationship which existed between the two was that of a seller and buyer and not of a principal and agent. However, their Lordships held that the agreement in the instant case was quite different. of India Ltd. On an examination of the agreement between those two Companies, the Supreme Court had held that the relationship which existed between the two was that of a seller and buyer and not of a principal and agent. However, their Lordships held that the agreement in the instant case was quite different. Under the first clause of the agreement between the two appellants and the Patiala Cement Co., dated 21-4-1954, the Cement Marketing Co. was appointed the sole and exclusive sales Manager of the appellants and as such, the first appellant was entitled to enter into contracts of sales, receive payments of the same and do all acts and things necessary for the effective management in connection with the contracts of sale entered into on behalf of the principals. The sale price and the terms and conditions of sale were to be determined by the principals. The sales Manager was to keep its administrative and technical staff at such places in India as was determined by the principals. All the establishment charges and other expenses of the sales Managers were for and on behalf of the principals and were to be defrayed by the principals in proportion to their annual sales. At the end of every month the Sales Managers were to submit to the principals accounts showing sales contracts by it on behalf of each one of the principals. At the end of each financial year ending July 31. the Sales Managers had to make a proper account of all their operations during the year and after submitting them for confirmation to the principals had to pay the price of annual sales realisa;ions to each of the principals to whom they happened to relate. Clause 10 provided that subject to instructions of the principals, the Sales Managers were to make all necessary arrangements to secure speedy and economical transport of cement. As such, the terms were quite different from those in the case of Rohtas Industries Ltd. v State of Bihar (supra). It appears that the manufacturers and the Cement Marketing Co. of India Ltd. grew wiser after the Supreme Court decision in the case of Rohtas Industries Ltd. v. State of Bihar (supra) and, therefore, they changed the terms of the contract. It appears that the manufacturers and the Cement Marketing Co. of India Ltd. grew wiser after the Supreme Court decision in the case of Rohtas Industries Ltd. v. State of Bihar (supra) and, therefore, they changed the terms of the contract. However, in the present case we are required to consider the very terms of the contract, which were concerned in the case of Rohtas Industries Ltd. v. State of Bihar (supra). Therefore, it is not possible for us to a contrary conclusion. But for the purpose of the present writ petition, we shall assume, as interpreted by their Lordships of the Supreme Court in Rohtas Industries Ltd. v. State of Bihar, the agreement in question amounts to a sale. However, the only question for consideration will be whether it is a sale taxable under the C. P. and Berar Sales Tax Act, 1947, and whether it would amount to an Explanation sale as per Article 286 (1) (a) of the Constitution of India. It is to be noted that the case of Rohtas Industries Ltd. v. State of Bihar (supra) was a pre-Constitution matter and Article 286 (1) (a) of the Constitution providing for the definition of Explanation sale was not at all for consideration before their Lordships of the Supreme Court. In the present case the period of assessment was from 11-8-1951 to 31-7-1952 and as such, this being a post-Constitution matter, we are required to consider the implication of Article 286 (1) (a) of the Constitution of India and the amendment of the G P. and Berar Sales Tax Act, 1947, in the year 1951. ( 7. ) The original pre Constitution definition of sale was as follows: " sale with all its grammatical variations and cognate expressions means any transfer of property in goods for cash or deferred payment or other valuable consideration, including a transfer of property in goods made in course of the execution of a contract, but does not include a mortgage, hypothecation, charge or pledge; and the word purchase shall be construed accordingly; Explanation (1)-A transfer of goods on hire-purchase or other instalment system of payment shall, notwithstanding that the seller retains a title to any goods as security for payment of the price, be deemed to be a sale. Explanation (II)-Notwithstanding to the contrary in the Indian Sale of Goods Act, 1930, but subject to the provision contained in the Explanation to clause (1) of Article 286 of the Constitution the sale or purchase of any goods shall be deemed for the purposes of this Act, to have taken place in this State wherever the contract of sale or purchase might have been made- (a) If the goods were actually in this State at the time when the contract of sale or purchase in respect thereof was made, or (b) In case the contract was for the sale or purchase of future goods by description then, if the goods are actually produced or found in this State at any time after the contract of sale or purchase in respect thereof was made; Explanation (III)-Notwithstanding anything to the contrary in the Indian Sale of Goods Act, 1930, the sale of any goods which have actually been delivered in the State of Madhya Pradesh as a direct result of such sale for the purpose of consumption in the said State, shall be deemed, for the purpose of this Act to have taken place in the said State, irrespective of the fact that the property in the goods has by reason of such sale passed in another State." However, by the Madhya Pradesh Sales Tax Amendment Act, No. 4 of 1951, the following amendments were effected in Explanation (II) to sub-section (g) of section 2 of the Act:- "Notwithstanding anything to the contrary in the Indian Sale of Goods Act, 1930, but subject to the provision contained in the Explanation to clause (1) of Article 286 of the Constitution the sale or purchase of any goods shall be deemed for the purposes of this Act, to have taken place in this State wherever the contract of sale or purchase might have been made- (a) if the goods were actually in this State at the time when the contract of sale or purchase in respect thereof was made, or (b) in case the contract was for the sale or purchase of future goods by description, then, if the goods are actually produced or found in this State at any time after the contract of sale or purchase in respect thereof was made; Explanation (III)-Notwithstanding anything to the contrary in the Indian Sale of Goods Act, 1930, the sale of any goods which have actually been delivered in the State of Madhya Pradesh as a direct result of such sale for the purpose of consumption in the said State, shall be deemed, for the purpose of this Act, to have taken place in the said State, irrespective of the fact that the property in the goods has by reason of such sale passed in another State." ( 8. ) The implication of the said amendment of the definition of sale by the M. P. Amendment Act No. 4 of 1951, would be that all Explanation sales would be non-taxable sales. For this reason we find it wholly unnecessary to enter into a discussion whether the transactions between the Cement Marketing Co. of India Ltd. and the manufacturers in the present case were sales or otherwise. We have already indicated that it is not possible for us to re-examine the question on the ground that the material relating to modus operandi was not produced in the case of Rohtas Industries Ltd. v. State of Bihar (supra). We have accepted the interpretation of the agreement as made by their Lordships of the Supreme Court in that case and we proceed to determine whether the transactions, which would be deemed to be sales, were taxable sales or whether they were Explanation sales excluded from taxation as per Article 286 (1) (a) of the Constitution before its amendment in the year 1956. For the sake of convenience we may reproduce Article 286 (1) (a) of the Constitution of India, as it stood before its amendment in the year 1956, as follows:- "Art. 286. (1)-No law of a State shall impose, or authorise the imposition of, a tax on such sals or purchase of goods where such sale or purchase takes place- (a) Outside the State; or (b) in the course of the import of the goods into, or export of the goods out of, the territory of India. Explanation.-For the purposes of sub-clause (a), a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State, notwithstanding the fact that under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State. (2)-Except in so far as Parliament may by law otherwise provide, no law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of any goods where such sale or purchase takes place in the course of inter-State trade or commerce: Provided that the President may by order direct that any tax on the sale or purchase of goods which was being lawfully levied by the Government of any State immediately before the commencement of this Constitution shall, notwithstanding that the imposition of such tax is contrary to the provisions of this clause, continue to be levied until the thirty-first day of March, 1951. (3).-No law made by the Legislature of a State imposing, or authorising the imposition of, a tax on the sale or purchase of any such goods as have been declared by Parliament by law to be essential for the life of the community shall have effect unless it has been reserved for the consideration of the President and has received his assent." ( 9. ) It is to be noted that a pre Constitution law imposing a tax contrary to the provisions of sub-clause (2) could by order of the President continue till the 31st day of March, 1951, and not thereafter. In the present case we are concerned with the assessment period from 11-8-1951 to 31-7-1952 and in the meantime, the C. P. and Berar Sales Tax Act, 1947, had already been amended by the Madhya Pradesh Amendment Act No. 4 of 1951, which made the definition of sale subject of the provisions of Article 286 (1)(a) of the Constitution of India. Under the circumstances if the transactions amount to an Explanation sale as per Article 286 (1) (a) of the Constitution, they would clearly not be taxable. ( 10. ) However, the learned counsel for the respondent urged that this Court is bound by the decision of their Lordships of the Supreme Court in Rohtas Industries Ltd. v. State of Bihar (supra) and as such, no contrary conclusion can be arrived at. ( 10. ) However, the learned counsel for the respondent urged that this Court is bound by the decision of their Lordships of the Supreme Court in Rohtas Industries Ltd. v. State of Bihar (supra) and as such, no contrary conclusion can be arrived at. As against this the contention of the learned counsel for the petitioner was that subsequent to the pronouncement of their Lordships of the Supreme Court in Rohtas Industries Ltd. v State of Bihar (supra), their Lordships have in a series of cases expressed a contrary opinion and as such, it is the latest pronouncement of their Lordships of the Supreme Court, which will be binding on this Court. For this proposition attention was invited to the pronouncement of a Division Bench of the Mysore High Court in M/s. New Krishna Bhavan v. Commercial Tax Officer,(AIR 1961 Mysore 3.). We may observe that the said controversy raised by the parties is wholly unnecessary. We have already indicated that the decision in Rohtas Industries Ltd. v. State of Bihar (supra) was in relation to a period prior to the Constitution of India and Article 286 (1) (a) of the Constitution was not at all for consideration before their Lordships of the Supreme Court. By virtue of the amendment affected by the M. P. Amendment Act No. 4 of 1951, as also the enactment of the Constitution of India, we are necessarily required to consider the implication of Article 286 (1) (a) of the Constitution and as such, the conclusion arrived at by their Lordships of the Supreme Court in Rohtas Industries Ltd. v. State of Bihar (supra), cannot be taken as a guide-line for arriving at a conclusion in the present case and the said case would clearly be distinguishable, although it may involve interpretation of the very same agreement between the Cement Marketing Co. of India Ltd. and the manufacturers of cement. ( 11. ) In the present case the material relating to modus operandi has very clearly been brought out on record. Accordingly to Article 286 (1) (a) of the Constitution and particularly the Explanation, the place where the title to the goods might have passed would wholly be immaterial. It is the actual delivery that would determine the place and in pursuance of the contract of sale, the actual delivery must have been effected. Accordingly to Article 286 (1) (a) of the Constitution and particularly the Explanation, the place where the title to the goods might have passed would wholly be immaterial. It is the actual delivery that would determine the place and in pursuance of the contract of sale, the actual delivery must have been effected. In this connection we might advert to the pronouncement of their Lordships of the Supreme Court in The Bengal Immunity Company Limited v. The State of Bihar and others,((1955) 6 STC 446 at page 621.), as follows :- "It was been contended that the sales proposed to be taxed did not take place in Bihar as the goods were actually delivered as contemplated by the Explanation not there but in Bengal. The argument is that the words actual delivery in the Explanation are used in contrast to constructive or symbolic delivery as meaning physical delivery of goods, that under section 39 (1) of the Sale of Goods Act, 1930 (Act III of 1930) the common carrier is the agent of the purchaser, and that therefore, delivery of the goods to the railway authorities in Bengal was actual delivery thereof to the purchaser in Bengal-Section 39 (1) is as follows:- Where in pursuance of a contract of sale, the seller is authorised or required to send the goods to the buyer, delivery of the goods to a carrier, whether named by the buyer or not, for the purpose of transmission to the buyer, or delivery of the goods to a wharfinger for safe custody is prima facie deemed to be a delivery of the goods to the buyer. It is difficult to see what there is in this section to support the contention that delivery to a common carrier is actual delivery to the purchaser. The section does not say so. On the other hand, it proceeds on the assumption that there was, in fact, no delivery to the purchaser, actual or otherwise, a thing being deemed to be something only, when as a fact it is not that, and then enacts on that basis a fiction that delivery to a common carrier shall be deemed prima facie to be delivery to the buyer. What is the purpose of this fiction? What is the purpose of this fiction? It is, as will be clear from section 39 (2), to fix on whom the loss is to fall in case the goods are lost or damaged in course of transit. But where no such question arises, the fiction has to be ignored, and the matter will have to be decided on the factual basis whether the goods were actually delivered." The majority of their Lordships of the Supreme Court accepted the said view regarding actual delivery, although there were differing judgments on other points and accordingly, the appeal of the Bengal Immunity Co. Ltd. was allowed and it was directed that until Parliament by law provides otherwise, the State of Bihar do forbear and abstain from imposing sales tax on out-of-state dealers in respect of sales or purchases that have taken place in the course of inter State trade or commerce even though the goods may have been symbolically delivered in Bihar as a direct result of such sales or purchases for consumption in other States. Therefore, according to their Lordships, for the purposes of the Explanation to Article 286 (1) (a) of the Constitution what would be material would be the actual delivery and that will determine the place where the sale will be deemed to have taken place and the question as to where the title to the goods may have passed by constructive delivery would not at all be relevant. ( 12. ) We presently propose to advert to the pronouncement of their Lordships of the Supreme Court in subsequent cases. Another factor to be taken into consideration is that at the relevant time, the C. P and Berar Cement (Control) Order, 1949 was in force and nobody could purchase or sell cement without a proper permit. It cannot be assumed that any transaction would be a sale, which would be contrary to the provisions of the Cement Control Order. Such a sale would have to be established as a fact beyond doubt and then only a transaction could be held to be a sale. In this connection we might advert to the pronouncement of their Lordships of the Supreme Court in The State of Bombay (Now Maharashtra) v. Ratilal Vadilal and Bros.,((1961) 12 STC 18.). In that case the respondents were the commission agents and they had supplied coal to different parties. In this connection we might advert to the pronouncement of their Lordships of the Supreme Court in The State of Bombay (Now Maharashtra) v. Ratilal Vadilal and Bros.,((1961) 12 STC 18.). In that case the respondents were the commission agents and they had supplied coal to different parties. The Colliery Control Order, 1945, made in exercise of the powers under sub-rule (2) of Rule 81 of the Defence of India Rules was in force. No person could acquire or purchase or agree to acquire or purchase any coal from a colliery and no colliery owner or his agent could despatch or agree to despatch or transport any coal from the colliery except under the authority and in accordance with the conditions contained in a general or special authority of the Central Government, for which he was required to obtain a priority certificate from the State Coal Controller. However, the del credere agents were allowed to act and charge a commission of one rupee per ton of coal. One of the purchasers was allotted a priority certificate in respect of some tons of coal and he placed an order with the colliery through the respondents. The consignment was in the name of the purchaser, but the bill was sent by the colliery to the respondents, who, in their turn, made out a bill in which they charged in addition to the amount of the bill of the colliery, a sum representing their commission. The liability to,pay the colliery rested upon the respondents.. That was the modus operandi with respect to transactions with other purchasers as well The Collector of Sales Tax on an application by the respondents under section 27 (a), (b) and (c) of the Bombay Sales Tax Act, 1953, held that the respondents were dealers within the meaning of the Act. But the Tribunal on appeal held otherwise. Therefore, the State of Bombay filed an appeal to the Supreme Court after obtaining the special leave. Their Lordships of the Supreme Court held that the proper course for the appellant was to exhaust its remedies before invoking the extraordinary jurisdiction of the Supreme Court under Article 136 of the Constitution of India. But the Tribunal on appeal held otherwise. Therefore, the State of Bombay filed an appeal to the Supreme Court after obtaining the special leave. Their Lordships of the Supreme Court held that the proper course for the appellant was to exhaust its remedies before invoking the extraordinary jurisdiction of the Supreme Court under Article 136 of the Constitution of India. It was further held that the respondents were not dealers inasmuch as they were not carrying on the business of selling coal and, therefore, the position was merely that of agents, arranging the sale to a disclosed purchaser, though guaranteeing payment to the colliery on behalf of their principal. In that view, their Lordships affirmed the view of the Bombay High Court in that very case, namely, Ratilal Vadilal and Bros. v. The State of Bombay,((1958) 8 STC 97.). We may observe that the scheme of the Cement Control Order is identical with that of the Coal Control Order and for that reason, it is difficult to hold that the transactions between the manufacturers and the Cement Marketing Company of India Ltd. constituted sales taxable under the C. P. and Beral Sales Tax Act, 1947. ( 13. ) We may observe that in view of the Explanation to Article 286 (1) of the Constitution of India before its amendment in the year 1956, it is not possible to hold that the said transactions between the manufactures and the Cement Marketing Co. of India Ltd. would be sales taxable under the C. P. and Berar Sales Tax Act, 1947, after its amendment as per M. P. Amendment Act No. 4 of 1951. The matter might have been different prior to the M. P. Amendment Act No. 4 of 1951 and at that time, the matter might have been governed by the pronouncement of their Lordships of the Supreme Court in Rohtas Industries Ltd. v. State of Bihar (supra). But the position changed after the enactment of the Constitution and Article 286 (1) (a) of the Constitution of India and particularly the Explanation cannot be ignored for the purpose of ascertaining the true nature of such transactions. But the position changed after the enactment of the Constitution and Article 286 (1) (a) of the Constitution of India and particularly the Explanation cannot be ignored for the purpose of ascertaining the true nature of such transactions. We have already indicated earlier that the petitioner has furnished material in the present case regarding the modus operandi which was as follows : Cement used to be manufactured at Kymore in the State of Madhya Pradesh and was stored for the purposes of sale in the State of Madhya Pradesh. According to the scheme of the business organisation of the petitioner, they entered into the agreement with the Cement Marketing Co. of India Ltd. to effect sales on commission. They collected orders on commission. The Cement Marketing Co. of India Ltd. was a different legal entity formed for the purpose of organising sales of cement manufactured in order to eliminate namely competition. The sales were effected by the Cement Marketing Co. of India Ltd. against the goods manufactured and they entered into contracts with the buyers. After the orders were accepted, the Cement Marketing Co. of India Limited, whether located at Nagpur, Bombay, Madras, Delhi or Kymore, directed the petitioner at Kymore to despatch goods for fulfilment of the orders. The sales were effected on the basis of delivery Ex-work at Kymore and after the goods were delivered, the manufacturers responsibility ceased. The petitioner sent the despatch advices to the Cement Marketing Co, of India Ltd., who prepared the bills. The manufacturers obtained payment against their despatches from the Cement Marketing Co. of India Ltd. This was the method of working. In view of these facts, although it may not be possible for us to hold that these were not sales because of the pronouncement of their Lordships of the Supreme Court in Rohtas Industries Ltd. v. State of Bihar (supra), in which the very same agreement was for consideration, we are clearly of the opinion that these were Explanation sales and as such, exempt from taxation as per Article 286 (l)(a) of the Constitution of India. Constructive or symbolical delivery would not at all make them taxable sales, as laid down in The Bengal Immunity Company Limited v. The State of Bihar and others (supra) as also Shri Bajarang Jute Mills Ltd., Guntur v. The State of Andhra Pradesh((1964) 15 STC 430.). Constructive or symbolical delivery would not at all make them taxable sales, as laid down in The Bengal Immunity Company Limited v. The State of Bihar and others (supra) as also Shri Bajarang Jute Mills Ltd., Guntur v. The State of Andhra Pradesh((1964) 15 STC 430.). In both these cases their Lordships of the Supreme Court have clearly laid down that it is the actual delivery and not the constructive or symbolical delivery that will be the determining factor. Their Lordships of the Supreme Court in Burmah Shell Oil Storage and Distributing Co. of India Ltd. v. Commercial Tax Officer((1960) 11 STC 764 at pp. 775 and 776.) made the following observations:- "It was to avoid this welter of confusion as far as possible that the Explanation was added, and it also avoided multiple taxation. The Explanation serves two purposes. It indicates the State where the tax can be levied, and also indicates that State or States where it cannot. It achieves these two purposes by excluding all considerations as to where pro perry in the goods can be said to have passed under the law relating to the sale of goods. The purpose is achieved by the Explanation and particularly by the non obstante clause in the Explanation. Any State claiming to tax a sale of goods on the ground that it was completed by the passing of property in the goods in that State could not do so, if the goods as a direct result of the sale were delivered for the purpose of consumption in another State. The Explanation creates a fiction that the sale must be deemed to have taken place in the latter State and not in the State where the sale was completed by reason of passing of property. It thus discards the test of passing of property and adopts the test of delivery "as a direct result of such sale for the purpose of consumption in that State." Where more than one State is involved, any State claiming to tax the sale by reason of something anterior to the passing of property would not be able to claim that the sale took place there unless it was also the State of delivery, because the sale is complete only on the passing of property, and till the sale is complete, liability to tax does not arise. Once the sale is complete, the delivery State gets the right to tax the sale by the fiction introduced." Further on, their Lordships interpreting the transactions, held that it would only be the State where delivery was effected in pursuance of the contract for the purpose of consumption in that State. As such, their Lordships drew a distinction between inside sale and outside sale. We may observe that the tests laid down by their Lordships of the Supreme Court in the said case fully apply to the present case. For that reason their Lordships had affirmed the view of the High Court and the appeals were dismissed as the aviation petrol supplied at the Dumdum Aerodrome, according to their Lordships, amounted to taxable sales under the Bengal Motor Spirit Sales Taxation Act, 1941, for the same reason that only one State, namely, West Bengal, was involved in the transaction and no other State where delivery could be effected was involved. ( 14. ) We may further advert to the pronouncement of their Lordships of the Supreme Court in Singareni Colleries Co. Ltd. v. Commissioner of Commercial Taxes((1966) 17 STC 197.), wherein their Lordships reversed the decision of the Andhra Pradesh High Court in Singareni Colleries Co. Ltd v. State of Andhra Pradesh((1961) 12 STC 7657), and held that as coal supplied pursuant to directions of the Coal Commissioner issued under the Colliery Control Order, 1945, was meant for consumption by the allottee, who Was outside the State, the State in which the allottee resided or carried on business alone had the right to tax the sale by virtue of the Explanation to Article 286 (1) (a) of the Constitution of India. Their Lordships relied on their earlier pronouncement in Shri Bajrang Jute Mills Ltd., Guntur v. The State of Andhra Pradesh (supra). ( 15. ) We may further observe that this question had come up for consideration before another Division Bench of this Court in Associated Cement Co. Ltd., Kymore v. Assistant Commissioner of Sales Tax, Jabalpur ( 1971 MPLJ 444 = (1971) 28 STC 629 .). ( 15. ) We may further observe that this question had come up for consideration before another Division Bench of this Court in Associated Cement Co. Ltd., Kymore v. Assistant Commissioner of Sales Tax, Jabalpur ( 1971 MPLJ 444 = (1971) 28 STC 629 .). In that case the petitioner Company claimed exemption under Article 286 (1) (a) of the Constitution in respect of the sales in which cement was despatched by rail by the manufacturers to places outside the State of Madhya Pradesh and also claimed exemption under section 2 (j) (a) (iii) of the C. P. and Berar Sales Tax Act, 1947, in respect of sale of cement to the Madhya Pradesh Electricity Board under certificates which showed that the cement was used for generation and distribution of electrical energy. The Assistant Commissioner of Sales Tax disallowed both the claims. Therefore, the manufacturers filed a writ petition under Article 226 of the Constitution of India. A Division Bench of this Court, presided over by B. Dayal C. J. and G. P. Singh J. observed that the cement was a controlled commodity and there could be no sale except upon a certificate to a named purchaser. In that view, following the pronouncements of their Lordships of the Supreme Court in the cases mentioned in the judgment and particularly, the cases of Shri Bajrang Jute Mills Ltd., Guntur v. The State of Andhra Pradesh (supra); Singareni Collieries Co. Ltd. v. Commissioner of Commercial Taxes (supra); Bengal Timber Trading Co. v. Commissioner of Sales Tax, M. P. (1967 MPL J 521=(1967) 19 STC 366= AIR 1967 SC 1348 .), the Division Bench held that the sales effected to outside purchasers for consumption in outside States were not taxable by virtue of the Explanation to Article 286 (1) (a) of the Constitution of India; while the sales effected to the Madhya Pradesh Electricity Board did not fall within exemption under section 2 (j) (a) (iii) of the C. P. and Berar Sales Tax Act, 1947. In that view, the petition filed by the Associated Cement Co. Ltd., Kymore, was partly allowed. We may observe that the present case is not any different from the said case and consequently relying on the principles laid down by their Lordships of the Supreme Court in the cases mentioned above, we hold that the transactions effected between the petitioner and the Cement Marketing Co. Ltd., Kymore, was partly allowed. We may observe that the present case is not any different from the said case and consequently relying on the principles laid down by their Lordships of the Supreme Court in the cases mentioned above, we hold that the transactions effected between the petitioner and the Cement Marketing Co. of India Ltd. were Explanation Sales, as per Article 286 (1) (a) of the Constitution of India and as such, not taxable under section 2 (j) (a) (iii) of the C. P. and Berar Sales Tax Act, 1947, as amended by the M. P. Amendment Act No. 4 of 1951. ( 16. ) As a result of the discussion aforesaid, we answer the questions referred to us for our opinion as follows:- (1) That having considered the facts and circumstances relied on by the Tribunal, we are of opinion that the material is not sufficient in law to sustain the finding that the transactions in question resulted in intra State sales and that the movement of the goods outside the State was subsequent thereto as, in our opinion, the transactions between the petitioner and the Cement Marketing Co. of India Ltd. were Explanation sales not taxable under section 2 (j) (a) (iii) of the C. P. and Berar Sales Tax Act, 1947. (2) That in the facts and circumstances of the case, the finding that the movement of the goods outside the State was not for the purpose of consumption of the goods in the delivery State as a direct result of the contract, cannot be sustained and on the contrary, the sales were Explanation sales as per Explanation to Article 286 (1) (a) of the Constitution of India. (3) That there is no material on record sufficient in law to justify the finding regarding two sales, namely, one by the petitioners to the Cement Marketing Company and the other by the Cement Marketing Company to the ultimate purchasers. On the other hand, they were integrated transactions constituting one sale and the State of actual delivery alone had the power to tax such sales. ( 17. ) Let the case be returned to the M. P. Board of Revenue (Tribunal) for taking further action in accordance with the opinion given by us above. The respondent will bear the petitioners costs including counsels fee at Rs. 200. ( 18. ( 17. ) Let the case be returned to the M. P. Board of Revenue (Tribunal) for taking further action in accordance with the opinion given by us above. The respondent will bear the petitioners costs including counsels fee at Rs. 200. ( 18. ) I have had the advantage of reading the judgment of my Lord the Chief Justice. I regret I am unable to agree with his construction of the transactions as Explanation Sales. In my view, the sales by the manufacturer assessee to the Cement Marketing Company of India were "Non- Explanation" sales and power of the State to tax those sales remained unimpaired. They were "inside" sales to which the Explanation was inapplicable. ( 19. ) I need not state the facts which have been succinctly given by my Lord the Chief Justice. I agree with him that we are bound to assume that the agreement dated 4-6-1942 under which the transactions were effected in favour of the Cement Marketing Co. of India and which was the subject-matter of an interpretation in Rohtas Industries Ltd. v. State of Bihar((1961) 12 STC 615.) by the Supreme Court, was not an agreement of agency but amounted to sale. After the pronouncement of the Supreme Court, we could come to no different conclusion. It logically follows that the assessee-manufacturer under the agreement could not directly sell the cement to the consumer but had to sell it to the Cement Marketing Co. who in turn, sold it to the consumer either inside the State or outside the State. It was the Cement Marketing Co. who determined the price and terms and conditions of sale to the consumer. The manufacturer was unconcerned with the sale to the consumer. As soon as cement was appropriated by the manufacturer to the contract in favour of the Cement Marketing Co., the title in goods passed to them and any subsequent movement of the goods outside the State on the despatch instructions of the Cement Marketing Co. was a sale by the Cement Marketing Co. and not by the manufacturer. The first sale was an infra-State sale liable to taxation the second sale with which we are not concerned, may or may not be an Explanation Sale, depending on the place of delivery for the purposes of consumption. was a sale by the Cement Marketing Co. and not by the manufacturer. The first sale was an infra-State sale liable to taxation the second sale with which we are not concerned, may or may not be an Explanation Sale, depending on the place of delivery for the purposes of consumption. I am guided in my view by the pronouncement of the Supreme Court in Gordhandas Lalji v. B. Banerjee and others((1958) 9 STC 581.). The platinum reads as under: "The appellant who purchased teas at public auctions in Calcutta, appropriated the goods to his contract with Bombay parties, soon after the purchase, and thereafter shipped the goods outside India in the name of the Bombay parties and according to their instructions: Held, (I) that as the goods were appropriated to the contract soon after the purchase, the property in the goods immediately passed in favour of the Bombay parties and therefore the despatch of the goods outside West Bengal was not on behalf of the appellant but was by and on behalf of the Bombay parties. Consequently the appellant was not entitled to the exemption under section 5 (2) (a) (v); (2) that the appellant was also not entitled to the exemption under Article 286 (1) (b) inasmuch as what was taxed were the sales by the appellant in favour of the Bombay parties and not sales by the Bombay parties in favour of outsiders and title to the goods had passed in favour of the Bombay parties long before goods were entrusted to the carrier." Similar is the view taken by the Division Bench of this Court in Ram- chandra Rampratap v. Commissioner of Sales Tax, Madhya Pradesh, Indore( 1971 MPLJ 141 = (1970) 26 STC 334 ). The assessee in these sales a dealer in food-grains in the State of Madhya Pradesh who purchased goods pursuant to the orders of a Nagpur merchant, appropriated them to his account and debited against him the price and subsequently despatched them to Madras parties. It was held that the contract with the Nagpur merchant was complete within the State on appropriation of the goods to his account and the subsequent movement to Madras on his instructions was a sale by the Nagpur merchant. That the sales in favour of the Nagpur merchant were infra-State sales, taxable by the State. ( 20. It was held that the contract with the Nagpur merchant was complete within the State on appropriation of the goods to his account and the subsequent movement to Madras on his instructions was a sale by the Nagpur merchant. That the sales in favour of the Nagpur merchant were infra-State sales, taxable by the State. ( 20. ) I also hold that there was no relation between the transaction of sale in favour of the Cement Marketing Company and movement of goods across the State border; the contract with the Cement Marketing Company did not necessarily involve the movement of goods from one State to another. In fact, the movement of goods was a matter of a subsequent contract between the Cement Marketing Company and the consumer and the goods were then dispatched by or on behalf of the Cement Marketing Company. The original contract did not occasion the movement of goods and did not involve any inter-State element. ( 21. ) Had the case been one of direct sale between the manufacturer assessee and the consumer to whom the delivery for purposes of consumption outside the State was made, or had the sale been with the manufacturers agent acting for or on behalf of the manufacturer and delivery was made outside the State for the purposes of consumption at his instructions, the sale would have been an Explanation Sale exempt from the taxation by the State of Madhya Pradesh. The law enunciated in Shree Bajarang Jute Mills Ltd., Guntur v. The State of Andhra Pradesh((1964) 15 STC 430.) or in Associated Cement Co. Ltd. Kymore, M. P. v. Assistant Commissioner of Sales Tax, Jabalpur( 1971 MPLJ 444 = (1971) 28 STC 629 .) would then have squarely applied. But in the present case as I conceive, two sales are involved; one in favour of the Cement Marketing Co. and other in favour of the consumer. The Cement Marketing Co. was acting as the principal, and not as the manufacturers agent. That is the interpretation given by the Supreme Court in Rohtas case and to hold otherwise would be taking up an irreconcilable position. The sale in favour of the Cement Marketing Company was an inside sale to which the Explanation to Article 286 (1) was not attracted. The Explanation would be attracted to the second sale effected by the Cement Marketing Co. The sale in favour of the Cement Marketing Company was an inside sale to which the Explanation to Article 286 (1) was not attracted. The Explanation would be attracted to the second sale effected by the Cement Marketing Co. in favour of the consumer provided he had been given delivery outside the State. The Explanation governs "Outside" sales only. ( 22. ) The second question to be considered is the effect of the C. P. and Berar Cement (Control) Order, 1949, then in force which prohibited sale and purchase of Cement without a proper permit. It was argued that there could possibly be no sale in favour of the Cement Marketing Company without an authorisation and since the presumption operated in favour of the legality of sales, the sales should be treated as direct sales between the manufacturer and the consumer, the Cement Marketing Co. merely acting as agents of the manufacturers. In Ratilal Vadilals case: The State of Bombay v. Ratilal Vadilal ((1961)12STC18.) their Lordships of the Supreme Court took into consideration the scheme of the Colliery Control Order, 1945, and observed that the sale of coal could not take place except to a person holding a certificate ; the sale otherwise was in contravention of the Control Order. Ratilal Vadilal were commission agents and they merely arranged sale to a disclosed purchaser though guaranteeing payment to the Colliery on behalf of their principal. The prohibition under the Colliery Control Order was taken as a circumstance to lend support to the finding that Ratilal could not possibly be a dealer as a principal. Their Lordships of the Supreme Court did not mean to suggest that a transaction in breach of statutory provisions could never take place; or that there could not be two sales, one in contravention of the law and the other under the authority of law. We are not presently concerned whether or not the Cement Marketing Company had any lawful authority to deal in the business of cement and whether the authorisation forms issued to them for supply of cement to the consumers had any basis of title. The fact is that the Cement Marketing Co. were the suppliers of the cement under the authorisation forms and they gave the despatch instructions to the manufacturers. They acted under the agreement dated 4-6-1942 which has been construed as a sale and not an agency. The fact is that the Cement Marketing Co. were the suppliers of the cement under the authorisation forms and they gave the despatch instructions to the manufacturers. They acted under the agreement dated 4-6-1942 which has been construed as a sale and not an agency. They acted as principals. Even if there be taint of illegality in the sales in favour of the Cement Marketing Co., the tax cannot be avoided. The Revenue merely looks at an accomplished fact, and by bringing the turnover to tax, does not condone or take part in the illegal enterprise. The assessee is liable to pay tax on the sale transactions apart from any other penalty he incurs by the breach of law. (Please see Income-Tax" by Kanga and Palkhiwala, 5th Edition, at page 87 under the heading "Income tainted with illegality." ( 23. ) In the result, my answers to the three questions referred would be (i) that the transactions with the Cement Marketing Co. were intra State sales and the movement of the goods outside the State was subsequent thereto, (ii) that they were not Explanation sales within the meaning of Article 286 (1)(a) and (iii) that there was material sufficient in law to justify the finding of two sales, one by the petitioners to the Cement Marketing Co. and the other by the Cement Marketing Co. to the ultimate purchasers. ( 24. ) This reference under section 44 (3) of the Madhya Pradesh Sales Tax Act, 1958, which comes to me on a difference of opinion between Honble Tare C. J. and Malik J., has been made by the Sales Tax Appellate Tribunal referring for the decisions of the High Court on the following questions: (1) Whether the facts and circumstances considered and relied on by the Tribunal are sufficient in law to sustain the finding that the transactions in question resulted in intra State sales and that the movement of the goods outside the State was subsequent thereto? (2) Whether in the facts and circumstances of the case, the finding that the movement of the goods outside the State was not for the purpose of consumption of the goods in the delivery State as a direct result of the contract and that the sales were not "Explanation Sales" [Article 286 (1) (a) with Explanation] can be sustained? (2) Whether in the facts and circumstances of the case, the finding that the movement of the goods outside the State was not for the purpose of consumption of the goods in the delivery State as a direct result of the contract and that the sales were not "Explanation Sales" [Article 286 (1) (a) with Explanation] can be sustained? (3) Whether there is any material on record sufficient in law to justify the finding regarding two sales, namely, one by the petitioners to the Cement Marketing Company and the other by the Cement Marketing Company to the ultimate purchasers? ( 25. ) The facts appearing from the statement of the case are as follows. The Associated Cement Companies Ltd. hereinafter referred to as the ACC is the assessee in this case. It has a cement factory at Kymore in Madhya Pradesh. The relevant period of assessment is from 11th August 1951 to 31st July 1952. The sales of cement during this period were regulated by an agreement entered into on 4th June 1942 between four cement manufacturing companies including the ACC and the Cement Marketing Company of India Ltd., hereinafter referred to as the CMI. This agreement is Annexure 1. By clause 2 of the agreement the CMI was appointed the sole and exclusive Sales Manager for the sale of cement and by clause 3 the manufacturing companies agreed that none of them will directly or indirectly sell or deliver or export or consign any cement to any person, firm or company save and except the CMI or to the order of or as directed by the CMI. By clause 5 it was agreed that the manufacturing companies shall be paid by the CMI a uniform basic payment at a certain rate Free on Rail, or Free of Board, or Free on truck or lorry at works for all cement delivered to or to the orders of the CMI or in accordance with the instructions of the CMI. By clause 6 the CMI was authorised to sell the said cement at such price or prices and such terms as it may in its discretion think fit. The CMI was further authorised to enter into such contracts for the sale or supply of cement on such terms and conditions as it may think fit. By clause 6 the CMI was authorised to sell the said cement at such price or prices and such terms as it may in its discretion think fit. The CMI was further authorised to enter into such contracts for the sale or supply of cement on such terms and conditions as it may think fit. By clause 7 the manufacturing companies agreed to deliver or consign cement in accordance with the orders and instructions of the CMI and from the factory or works specified by the CMI. ( 26. ) The manner in which the sales took place is shown by Annexures 2A to 2E. The purchaser obtained an authorisation in form Annexure 2A from the Regional Honorary Cement Advisor to the Government of India authorising the CMI to sell cement. The authorisation mentioned the name and address of the person in whose favour it was issued, the name of the cement factory or company required to supply cement, the quantity authorised to be sold and the name of the Railway Station to which cement was required to be booked. The authorisation also mentioned full details of the purpose for which and the place at which the cement was to be consumed. On the basis of the authorisation the CMI received order from the purchaser for despatch of cement (Annexure 2B). The CMI entered into a separate agreement with the purchaser (Annexure 2C). In this agreement the condition for delivery was F. O. R. works siding. The price was either F. O. R. ex-works or F. O. R. destination, but in either case the risk passed to the purchaser after delivery by the works to the carrier. The purchaser was required to pay the railway freight and in those cases where the rate agreed was F. O. R. destination the freight was deducted from the price entered in the invoice. After receiving an order from a purchaser backed by requisite authorisation of the Regional Honorary Cement Advisor, the CMI in its turn placed order with the ACC for despatch of the required quantity of cement to the purchaser. The order mentioned the name of the consignee (purchaser) and the name of the destination railway station (Annexure 2B). The ACC then advised its Factory Manager at Kymore to despatch cement to the purchaser in accordance with the instructions of the CMI (Annexure 2F). The order mentioned the name of the consignee (purchaser) and the name of the destination railway station (Annexure 2B). The ACC then advised its Factory Manager at Kymore to despatch cement to the purchaser in accordance with the instructions of the CMI (Annexure 2F). After despatch of cement the factory intimated the purchaser about it (Annexure 2G) and debited the price to the account of the CMI (Annexure 2H). The railway receipt mentioned the ACC as the consignor and the purchaser as the consignee (Annexure 2-I). ( 27. ) The sales of cement in accordance with this procedure fall into two categories. In the first category came the sales where the place of destination to which cement was despatched was within Madhya Pradesh. These were in any view internal sales and were admittedly taxable. The second category consisted of those sales in which orders for supply were received from Bombay, Madras, Calcutta, Delhi and Kanpur offices of the CMI and the places of destination to which cement was despatched were outside Madhya Pradesh. The ACC claimed that these sales were sales in the course of inter-State trade or commerce and fell within clause (2) of Article 286 of the Constitution as it then stood. It was also claimed that the sales were explanation sales under clause (1) of the same Article. The assessment order was passed by the Assistant Commissioner of Sales Tax on 15th April 1956. The Assistant Commissioner held that as the delivery was given at the works, the sales were internal sales and did not qualify for exemption under Article 286. The same view was taken in appeal by the Deputy Commissioner of Sales Tax. There was then an appeal to the Tribunal. The Tribunal held that the transactions involved two sales; the first sale was by the ACC to the CMI and the second sale was by the CMI to the purchaser holding the authorisation. It was further held that the sales to the CMI were complete at the works siding and these sales being internal sales were outside the ban of Article 286. It was also pointed out that these were the sales that were taxed in the assessment and not the sales made by the CMI to the purchasers holding authorisations. ( 28. It was further held that the sales to the CMI were complete at the works siding and these sales being internal sales were outside the ban of Article 286. It was also pointed out that these were the sales that were taxed in the assessment and not the sales made by the CMI to the purchasers holding authorisations. ( 28. ) The first question that calls for determination is whether there were two sales as held by the Tribunal It has been contended that the agreement Annexure 1 did not involve any sale by the ACC to the CMI and the said agreement was merely an agency agreement appointing the CMI as the sole and exclusive sales manager. It is, however, impossible to accept this contention because this agreement came up for construction in Rohtas Industries Ltd. v. The Stale of Bihar((1961) 12 STC 615 (S C).) and the Supreme Court ruled that on a proper construction of the relevant clauses of the agreement the relationship between the manufacturing companies and the CMI was that of seller and buyer and not of principal and agent and that the cement delivered, despatched or consigned by the manufacturing companies to the CMI or to its orders or in accordance with its direction was sold by the manufacturing companies to the CMI and these sales were liable to be taxed under the Bihar Sales Tax Act, 1944. The learned counsel for the ACC sought to get out of this case by submitting that the Supreme Court did not notice that any sale between the manufacturing companies and the CMI was ruled out as there were no authorisations issued by the Honorary Cement Advisor to enable such sales. The learned counsel argued that the agreement and the course of dealing between the parties should be viewed and construed in the light of the relevant Control Order and the agreement should be given a meaning consistent with the legality of the course of dealing between the parties. The Control Order that has been placed before me is an order issued by the Central Government on 6th July 1946 under sub- rule (2) of Rule 81 of the Defence of India Rules. The Control Order that has been placed before me is an order issued by the Central Government on 6th July 1946 under sub- rule (2) of Rule 81 of the Defence of India Rules. Clause 2 of this Order provided that "no person shall sell cement unless authorised in writing to do so by the Honorary Cement Advisor to the Government of India or a Regional Honorary Cement Advisor to the Government of India". The authorisation (Annexure 2A) issued under this provision referred to the CMI as the supplier and authorised it to sell cement of the named quantity to the named purchaser. Further, the authorisation mentioned the name of the cement factory or company which alone could be required to supply cement. The authorisation thus permitted the supply of cement by the manufacturing company or the factory named in it on the order of the CMI and if this involved a sale between the manufacturing company and the CMI, the sale was impliedly authorised. So the authorisation in addition to expressly permitting a sale between the CMI and the named purchaser impliedly permitted a sale between the named manufacturing company and the CMI. It is, therefore, not correct to say that a finding that the agreement (Annexure 1) contemplated a sale between the ACC and the CMI will lead to illegality. The ruling of the Supreme Court in the case of Rohtas Industries Ltd. cannot, therefore, be distinguished and the construction placed in that case on the agreement must be held to be binding. It has, therefore, to be held that the Tribunal was right in holding that the course of dealing between the ACC and the other by the CMI involved two sales; one by the ACC to the CMI and the other by the CMI to the purchaser named in the authorisation. ( 29. ) The next question is whether the sales of cement to the CMI by the ACC from its Kymore factory in cases where cement was despatched to places outside the State of Madhya Pradesh qualified for exemption as sales in the course of inter-State trade or commerce under Article 286 (2) of the Constitution before its amendment by the Constitution (Sixth Amendment) Act, 1956. The nature of sales in the course of inter-State trade and commerce under Article 286 (2) has been considered by the Supreme Court in a number of cases. The nature of sales in the course of inter-State trade and commerce under Article 286 (2) has been considered by the Supreme Court in a number of cases. See Mohanlal Hargovind Das v. State of Madhya Pradesh ( (1955) 2 SCR 509 .); Bengal Immunity Co. Ltd. v. The State of Bihar( (1955) 2 SCR 603 .); M/S Ram Narain Sons Ltd. v. Asstt. Commissioner of Sales Tax ( (1955) 2 SCR 483 .); Cement Marketing Co. of India Ltd. v. State of Mysore ((1966) 3 SCR 777.); Singareni Collieries Co. v. State of Andhra Pradesh ( (1966) 2 SCR 190 .) and State of Bihar v. Tata Engineering and Locomotive Company Ltd.( (1971) 2 SCR 849 ). These cases establish that before a sale could be said to be in the course of inter-State trade or commerce the movement of goods from one State to another must have been under a covenant or as an incident of the contract of sale or the sale must have taken place by transfer of documents of title during the movement of goods from one State to another. These cases also decide that Parliament in section 3 of the Central Sales Tax Act, 1956 has only codified the principles laid down by the Supreme Court for determining inter-State sales under Article 286 (2). These cases further show that the words "in the course of" in the expression "in the course of inter-State trade or commerce" bear the same meaning which has been given to them in construing the expression "in the course of import of the goods into, or export of the goods out of, the territory of India", as it occurs in Article 286 (1) (b) of the Constitution. In Kelvinator of India Ltd. v. State of Haryana( AIR 1973 SC 2526 .), while dealing with section 3 of the Central Sales Tax Act, the Supreme Court said that "a sale of goods is in the course of inter-State trade if the sale and movement of goods from one State to another are integral parts of the same transaction". It was further observed that "there must exist a direct nexus between the sale and the movement of goods from one State to another." ( 30. It was further observed that "there must exist a direct nexus between the sale and the movement of goods from one State to another." ( 30. ) Now the facts of the instant case as noticed earlier are that there were two sales in respect of the same consignment; one between the ACC and the CMI and the other between the CMI and the outside purchaser holding the authorisation. Both these sales were F.O.R. sales and were complete when the goods were loaded in the wagons at the works siding and railway receipt obtained. The movement of goods to another State was, however, not the direct result of the sale between the ACC and the CMI but was a direct result of the sale between the CMI and the outside purchaser. There was no privity between the ACC and the purchaser under the second sale. But for the second sale there was no occasion for the movement of goods outside the State of Madhya Pradesh. The movement of goods was occasioned by the terms of contract of sale between the CMI and the outside purchaser and not by the terms of contract of sale between the ACC and the CMI. The sale between the ACC and the CMI was not, therefore, in the course of inter-State trade or commerce. This conclusion is strongly supported by the recent decision of the Supreme Court in the case of Mohd. Serajuddin v. State of Orissa(A I R1975 SC 1564.). In that case there were two F. O. B. sales in respect of the same goods ; one between the assessee and the State Trading Corporation and the other between the Corporation and the foreign buyer. It was held that the first sale between the assessee and the Corporation was not in the course of export and only the second sale between the Corporation and the foreign buyer was in the course of export. On a parity of reasoning, when there are two F O. R. sales in respect of the same goods, only the sale to the outside purchaser occasions the movement of goods from one State to another and it is this sale alone which can be said to be a sale in the course of inter-State trade or commerce. ( 31. On a parity of reasoning, when there are two F O. R. sales in respect of the same goods, only the sale to the outside purchaser occasions the movement of goods from one State to another and it is this sale alone which can be said to be a sale in the course of inter-State trade or commerce. ( 31. ) This brings me to the third question, whether the sales between the ACC and the CMI can be said to have taken place outside the State of Madhya Pradesh by taking recourse to the Explanation to Article 286 (1) (a) before its amendment by the Constitution (Sixth Amendment) Act, 1956. In cases where the Explanation did not apply the test of passing of property was applied for determining whether a sale was an inside or an outside sale. The explanation had relevance to those cases where the title passed in State A but the goods were actually delivered as a direct result of the sale for consumption in State B; in such cases the sale was deemed to take place in State B and outside all other States: [See Burmah Shell Oil Storage and Distributing Co., of India Ltd. v. Commercial Tax Officer( (1961) 1 SCR 902 .) ; Indian Copper Corporation Ltd. v. The Stale of Bihar( (1961) 2 SCR 276 .) and A. V. Thomas and Co. Ltd. v. Deputy Commissioner of Agricultural Income Tax((1963) 2 Supp. SCR 608.). The words "actually delivered" as occurring in the explanation were construed to mean physical delivery e.g. by entrusting the goods to a common carrier or delivery of documents of title like receipts: [See Shree Bajarang Jute Mills Ltd., Guntur v. State of Andhra Pradesh((1964) 15 STC 430 (S C).) and Singareni Collieries Co. v. State of Andhra Pradesh (supra)]. Now let us apply these principles to the facts of the instant case. The sale between the ACC and the CMI was complete when the goods were loaded in the wagons on the works siding and title under this sale passed within the State of Madhya Pradesh. v. State of Andhra Pradesh (supra)]. Now let us apply these principles to the facts of the instant case. The sale between the ACC and the CMI was complete when the goods were loaded in the wagons on the works siding and title under this sale passed within the State of Madhya Pradesh. The transportation of goods from Madhya Pradesh to another State was not a direct result of this sale but a direct result of the sale between the CMI and the outside purchaser and it is under that sale that the goods were actually delivered to the outside purchaser for consumption in another State. Thus there is no scope for applying the Explanation to the sales between the ACC and the CMI and these sales being inside sales could be taxed by the State of Madhya Pradesh. ( 32. ) Learned counsel for the ACC strongly relied upon the cases of The Cement Marketing Co. of India v. The State of Mysore (supra) and Associated Cement Co. Ltd. Kymore v. Assistant Commissioner of Sales Tax(28 STC 629.). From these cases it appears that the agreement dated 4th June 1942 (Annexure I) entered into between the Cement Manufacturing Companies and the C M I was later replaced by another agreement dated 21st April 1954. The later agreement on its proper construction was purely an agency agreement involving no sale between the Cement manufacturers and the CMI. Under the new agreement the CMI acted purely as a Sales Manager or distributor for and on behalf of the manufacturers. Because of this change the working of the new agreement resulted in a direct sale between the cement manufacturers and the persons holding authorisations from the Regional Honorary Cement Advisor and if such a sale occasioned the movement of goods from one State to another, the sale became an inter-State sale; and if goods were delivered in another State for consumption in that State the sale also became an outside sale governed by the Explanation. The two cases relied upon had to deal with the new agreement and not with the old agreement with which we are concerned in these case. Because of the material difference between the two agreements the cases relied upon have no application. ( 33. The two cases relied upon had to deal with the new agreement and not with the old agreement with which we are concerned in these case. Because of the material difference between the two agreements the cases relied upon have no application. ( 33. ) For the reasons stated above, I am substantially in agreement with Malik J. and I will answer the questions as follows: (1) The sales between the ACC and the C M I were intra State sales as the movement of goods outside the State of Madhya Pradesh was not a direct result of these sales. (2) The sales between the ACC and the C M I were not "Explanation Sales" (3) There were two sales, one by the ACC to C M I and the other by the C M I to the ultimate purchaser. The parties will bear their own costs of the reference. ( 34. ) The case shall now be laid before the Division Bench for final disposal. ( 35. ) On a difference of opinion between members of the Division Bench, this case was referred to a third Judge for resolving the conflict. G. P. Singh J. as the third Judge has answered the three questions as follows: (i) The sales between the Associated Cement Co. and the Cement Marketing Co. of India were intra State sales as the movement of goods outside the State of Madhya Pradesh was not a direct result of these sales. (ii) The sales between the Associated Cement Co. and the Cement Marketing Company of India were not "Explanation Sales." (iii) There were two sales, one by the Associated Cement Co., to the Cement Marketing Company of India and the other by the Cement Marketing Company of India to the ultimate purchaser. Let the reference be returned to the Tribunal for passing a consequential order in accordances with the opinion of the third Judge. We make no order as to costs which shall be borne as incurred. Reference answered accordingly.