In Brief

Cigarettes imported from abroad were stored in a bonded warehouse within West Bengal and later sold to foreign-going ships as ship stores. The appellants claimed exemption from sales tax, arguing the sales occurred 'in the course of import' under the Central Sales Tax Act. The Supreme Court held that the sales took place after the goods had crossed the customs frontiers (outside the customs port/station area) and did not occasion the import—the goods were already imported and unloaded before sale. Therefore, the sales constituted taxable transactions within West Bengal territory. The Court dismissed the appeals, confirming that sales tax was lawfully levied, as the transactions were neither in the course of import nor export.

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