SATYANARAYANA RAJU, J.

( 1 ) THE questions formulated for the decision of the Full Bench are: 1. Whether transactions falling within the definition of sale in the Madras General Sales Tax Act and not proved to be outside sales within the Explanation to Article 286 (1) (a) of the Constitution of India can be assessed to sales tax under the said Act? 2. Whether after the coming into force of the Constitution of India, the Slate is competent to legislate and levy tax on sales and purchases on the basis of the theory of nexus as embodied in the Explanation 2 to Sub-section (h) of Section 2 of the Madras General Sales Tax Act?

( 2 ) THESE questions involve the determination of the true meaning and scope of the provisions of Article 286 (1) of the Constitution. Having regard to the general terms of the reference it is not necessary to set out the facts in each of the above cases.

( 3 ) THE levy and collection of taxes on the sale of goods came into vogue when as a result of the world-wide economic depression which followed the First War, governments of the European countries were forced to seek new sources of revenue.

( 4 ) IN 1935 the Parliament of Great Britain enacted the Government of

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