IMPORTANT POINT
The expression sale under the Sales Tax Act has to be understood with reference to the definition of sale of goods under the Sale of Goods Act and it is essential to establish that there is an agreement between the parties for transfer of title to the goods and that such agreement should be supported by money consideration.

JUDGMENT

Faizan Uddin, J.-Leave granted.

2. Since common questions of law and facts arise for our consideration in these appeals and special leave petitions, the same are being disposed of by a common judgment.

3. The appeals and special leave petitions arise out of an order passed by the High Court of Madras in revision preferred by the respondent herein, under Section 38 of the Tamil Nadu General Sales Tax Act, 1959 (hereinafter referred to as the "Act") relating to certain transactions involved therein which are sought to be taxed as sale.

4. Since we have to decide and nature of transaction in order to determine the tax liability which is the question common to all these appeals and the special leave petitions, we shall state the facts as they emerge out of the Civil Appeal No. 2348/78.

5. The respondent assessee floated a scheme as detailed in the printed pamphlet, which reads as follows :-

"Please get a coupon of our company from your friend or from the company by paying rupees five. Please mark your address and any one article you require and send it back to the company.

After receiving your coupon we will register it and send three coupons by V.P.L. for Rs. 15/- plus V.P.L. charges. Now you have to give the coupons to three persons for Rs. 5/- each and take the money for yourself and ask them to fill up the coupons with their names and full address and send it to us.

We will send to each of your three parties three coupons each for Rs. 15/- plus postal charges by Y.P.L. As soon as the parties concerned clear the V.P.Ls., you will receive from us the article that you have mentioned in your coupon."

Further, clauses 5 & 6 of the terms and conditions of the said scheme, which are also relevant for our purposes, are reproduced hereunder :

"5. Any person sending M.O. or bank draft for Rs. 45/- along with coupon duly filled up will receive the article that is mentioned in the coupon together with three sets of (9) coupons.

6. Coupons should be returned duly filled within three months of their receipt. Coupons received after three months will not be attended to."

6. The said pamphlet containing the scheme further mentions 20 articles, one of which may be marked in the coupon by the person or party who purchases the coupon by paying Rs. 5/-. The coupon referred to in the scheme is a printed order form which is as follows :

" "ORDER FORM"

No.17435D. Regd.No.

Sri Srinivasa Sales Circulation

(Regd.)

No. 11, Gandhi Street,

Villivakkam,

Madras - 49.

From

.....................

Dear Sirs,

As mentioned in your list of articles No........I request you to kindly send me.........Please send your coupon by V.P.L., for the amount of Rs. 16-00 sent by me.

Place :-

Yours faithfully,

Date :- Signature

   Canvasser s signature"

7. Thus, on payment of a sum of Rs. 5 to the company a coupon is sent to the individual concerned, and we assume that individual as A for the sake of convenience. Then A sends back the same to the company duly filled up mentioning the number and name of article in the blank spaces. On receipt of the said coupon/order form, three order forms are sent to A, by V.P.L. for Rs. 16/- and when the said V.P.L. is cleared by A, he receives a further letter from the company acknowledging the receipt of Rs. 16. The said letter reads as follows :

"We are glad to note that you have cleared the V.P.L. No. by paying Rs. 16 and thank you very much for the same.

You please sell three order forms to three members and take that money. Fill the three forms (In Block Letters) and send them to us by Regd. Post. We will send to each among three members containing three order forms in each V.P.Ls. for Rs. 16/-. If all of them clear the V.P.Ls., paying Rs. 16/- each, we will send you the required article item No. by Registered Post."

8. After receipt of the three order forms/ coupons. A delivers them to B, C & D after collecting Rs. 5/- from each of them which amount is