Judgment

SHAH, J. : The question which falls to be determined in these appeals is

"whether the appellant Company is liable to pay sales-tax assessed under the Hyderabad General Sales Tax Act, 1950 on the price of coal supplied to allottees outside the taxing State pursuant to directions of the Coal Commissioner issued under the Colliery Control Order, 1945".

The Company which has its registered office at Hyderabad in the former Part B State of Hyderabad, and now in the State of Andhra Pradesh, carried on the business of mining coal from its collieries and supplying it to consumers in the outside the State of Hyderabad.

2. These appeals relate to three financial years 1954-55,1955-56 and 1956-57, during which coal was a controlled commodity and its disposal and use could be made only under orders issued by the appropriate anthority under the Colliery Control Order, 1945. The Company claimed that Rs. 175,67,286-1-2 in the year 1954-55 Rs. 1. 17,39,636-11-8 in the year 1955-56, and Rs. 1,55,18,937-6-5 in the year 1956-57were not liable to be included in the taxable turnover for levying sales tax under the Hyderabad General Sales Tax Act, 1950 because the State Legislature which enacted that Act was, by Art, 286 of the Constitution, prohibited from imposing tax on transactions of supply of coal outside the limits of the State under orders of the Coal Commissioner.

3. The Commercial Tax Officer, Hyderabad, admitted the claim of the Company for the years 1954-55 and 1955-56 for exemption from liability. The claim of the Company for the year 1956-57 was, however, rejected, The Company appealed to the Deputy Commissioner of Commercial Taxes and to the Sales Tax Appellate Tribunal, Hyderabad, against the order of assessment for the year 1956-57, but without success. The Company then applied to the High Court of Andhra Pradesh in its revisional jurisdication, and submitted in support of its claim that a part of its turnover was exempt from liability to sales tax under the Hyderabad Ceneral Sales Tax Act because the turnover was in respect of sales, (a) which had taken place outside the State within the meaning of Art. 286 (1) (a) read with the explanation thereto, and (b) which were effected in the course of inter-State trade or commerce, and the Parliament had not by law removed the ban against imposition of tax on such sales by the State legislature. The High Court rejected these contentions. In the meanwhile the Commissioner of Commercial Taxes issued notices to the Company to show cause why the orders of assessment for the years 1954-55 and 1955-56 should not be reopened and why the sales which were exempted by the order of the Commercial Tax Officer should not be charged to tax, and by his orders respectively dated February 8, 1961 and November 16, 1960 for the two years 1954-55 and 1955-56 brought to tax the turnover which was previously treated as exempt. The Orders were carried to the High Court in appeal and the same grounds which were set up in the revision application relating to the assessment year 1956-57 were set up, beside the ground that the action for reopening the assessments by the Commissioner of Commercial Taxes was barred by limitation and was, therefore, incompetent. The High Court rejected these contentions. With certificate granted by the High Court, these appeals are preferred by the Company.

4. at the material time, by S. 2 (k) of the Hyderabad General Sales Tax Act, 1950, the expression "sale" was defined as under.

"Sale with all its grammatical variations and cognate expressions means every transfer of property in goods by one person to another in the course of trade of business for cash or for deferred payment or other valuable consideration and includes also a transfer of property in goods involved in the execution of a works contract, but does not include a mortgage, hypothecation, charge or pledge.

Explanation 2.- Notwithstanding anything to the contrary in any other law for the time being in force, a transfe