JUDGMENT

This appeal arises from the judgment of the Madras High Court in a Sales Tax Revision Case. The appellant is a co-operative sugar factory having its sugar factory at Chittur in Kerala State. Inasmuch as sufficient quantity of sugarcane was not available within the state of Kerala, the appellant and the Government of Kerala approached the State of Tamil Nadu for supply of sugarcane to the appellant-factory. In pursuance of the understanding arrived at between them, the Government of Tamil Nadu issued an order contained in G. O. M.S. No. 2260 dated July 20, 1963. By virtue of this order, the appellant was permitted to draw sugarcane from not more than 3,000 acres in Coimbatore and Pollachi taluks in Tamil Nadu, subject to the conditions specified therein. Condition No. 5 read thus :

"(Cl. (5) : The Co-operative Sugar Ltd.. Chittur, should remit to this Government the Sales Tax, on the cane supplies made from areas in Madras State. The basis for purposes of calculation will be taken as 3% of the purchase price of cane for a recovery of 9.8% (Rs. 1.62 per maund)"

2. In pursuance of the said order, appellant opened its offices at Coimbatore and Pollachi. The sugarcane inspectors f