C.S.P. Singh, J.
1. The Revising Authority, Varanasi, has referred the following three questions for the opinion of this Court:
(1) Whether, on the facts and circumstances of this case, the supply of cement from 'Churk Cement Factory' to 'Dalla Cement Factory' amounted to sale, and liable to sales tax ?
(2) Whether, on the facts and circumstances of the present case, the amount of freight is to be excluded from the taxable turnover and
(3) Whether, on the facts and circumstances of the case, the amount of freight is to be taxed at the rate of 10 per cent under the Central Sales Tax Act, even though the primary transaction is covered by form D ?
2. The U. P. Government owned a cement factory known as 'Churk Cement Factory'. It thereafter decided to establish another factory at Dalla. Cement was required for constructing the Dalla Cement Factory, and the State Government decided that cement be supplied from the 'Churk Cement Factory'. The Churk Cement Factory started billing the Dalla Cement Factory for supplies of cement. The Dalla unit paid for the cement supplied by the Churk Cement Factory. Although, the Churk Cement Factory had billed the Dalla Cement Factory for the supply of the cement, and had received the price thereof, it took up the stand during the assessment proceedings that the transactions did not amount to sale, as both the Churk Cement Factory and the Dalla Cement Factory were owned by the State Government. This contention has been rejected by the Sales Tax Officer, the appellate authority, and the revising authority. Apart from these transactions, the assessee sold cement to various purchasers, some of whom were covered under the rate contract with the Director General of Supplies and Disposals. In the bills prepared, the gross amount charged for the cement was worked out by multiplying the quantity by a fixed rate which included the national all-India average freight. However, while calculating the actual amount to be charged from the purchasers, the amount of freight was deducted from the gross amount. The assessee received only the amount that was left after deducting the amount chargeable for freight. The system of supply adopted by the assessee was twofold. Some of the purchasers took their supply by road. In such cases, the purchasers brought their own transport and carried away the goods on their carriers. In the case of despatch by rail, the goods were despatched at the sellers' risk, and the purchasers paid freight at the destination and bore the entire responsibility for transit losses, damages, etc. The taxing authorities have included the charge for freight in the turnover of the assessee.
3. Turning now to the first question, Section 3 of the Act imposes liability to tax on the turnover of sales of every dealer. 'Turnover' has been defined in Section 2(i) of the Act. According to this provision, it means the aggregate amount for which goods are supplied or despatched by way of sale. 'Sale' is defined in Section 2(h) in the following manner :
(h) 'Sale' means within its grammatical variations and cognate expressions, any transfer of property in goods for cash or deferred payment or other valuable consideration....
4. It will be seen that before a transaction can be taxed and included in the turnover of a dealer, it has to be a sale. Although the word 'sale' as defined in Section 2(h) does not specifically mention that the transaction must be between the two entities, but inasmuch as it contemplates transfer of property, it is obvious that before a transaction can amount to a sale, there must be two entities involved in the transaction, so that there may be a transfer of property in the goods sold. It would be anomalous to hold that a person can sell goods to himself. In the case of Mahendra Kumar Ishwarlal & Co. v. State of Madras  21 S.T.C. 72, it was held that in order to constitute a sale within the definition of that word in the Central Sales Tax Act, 1956, there must be two different persons in the ordinary sense of the term 'person'. A similar view was expressed by this Court in the case of Hindustan Metal Works, Hathras v. Commissioner of Sales Tax, U.P., Lucknow  27 S.T.C. 555, where it was held that goods sent by the main office to its branch would not be a sale because no one can sell his own goods to himself. It was contended that the word 'sale' was differently defined in Section 2(g) of the Central Sales Tax Act inasmuch as it contemplated a transfer of property in goods by one person to another for cash or for deferred payment. It was stressed that as the definition of the word 'sale' in the U. P. Sales Tax Act does not refer to transfer of property from one person to another, the decisions given under the Central Sales Tax Act cannot be appropriately applied to cases arising under the U. P. Act. I am unable to accept this contention, for although Section 2(h) of the U. P. Act does not specifically refer to two persons being involved in the transaction, the necessity of two persons being involved in the transaction arises out of the fact that before a transaction can be a sale within the meaning of Section 2(h) of the U. P. Act, there must be a transfer of property. Transfer of property, unless a particular statute expressly provides otherwise, contemplates passing of title from one person to another. It has, as such, to be held that even under the U. P. Act, two entities must be involved before a transaction would fall within the category of 'sale'. Sri V. D. Singh, with his usual ingenuity, urged that the transaction in question should not be treated other than sale, because the assessee had billed the Dalla Cement Factory and has charged the price of cement supplied by it. The billing of Dalla Cement Factory and the payment of price of the cement was only a method of accounting adopted by the two units owned by the State Government, and this method of accounting cannot alter the true character of the transaction : See Commissioner of Income-tax, Bombay City v. Shoorji Vallabhdas & Co.  46 I.T.R. 144 (S.C.). The residuary contention made is that as both the units were registered dealers, they should be treated as separate entitites for the purposes of the Act. So far as the Dalla Cement Factory is concerned, that was registered as a dealer in February, 1971. This reference and the other connected references relate to the assessment years 1967-68, 1968-69, 1969-70, 1970-71, 1971-72 and 1972-73. Thus, so far as the assessment years from 1967-68 to 1969-70 are concerned, this argument is of no avail to the department. It is also inconsequential so far as the remaining assessment years are concerned, the reasons being that the registration of the Dalla Cement Factory as a dealer will entitle the department only to tax the turnover of Dalla Cement Factory separately; but will not clothe it with a separate juristic personality for the purposes of Section 2(h), inasmuch as both the units continued to be owned by the State Government during all the relevant assessment years. The conclusion is inescapable that the transactions of supply of cement by the assessee to the Dalla Cement Factory were not sales and, as such, were not liable to sales tax.
5. So far as the second question is concerned, the facts have already been sufficiently stated earlier. The standing counsel strongly relied on explanation II(i) of Section 2(i) of the Act, which defines turnover. We will omit reference to the meaning of turnover as it is not relevant, and confine ourselves to explanation II of Section 2(i). Explanation II runs thus:
Explanation II.-Subject to such conditions and restrictions, if any, as may be prescribed in this behalf,-(i) the amount for which goods are sold shall include any sums charged for anything done by the dealer in respect of the goods sold at the time of or before the delivery thereof, other than cost of freight or delivery, or cost of installation when such cost is separately charged.
6. Sri V. D. Singh, the standing counsel, urged that as freight has not been separately charged, it had to be included in the turnover. This argument overlooks the requirements of explanation II(i), that only such amounts can be included in the turnover which have been charged from the purchaser. In the present case, as the assessee had deducted the charges of freight and had received only such amounts as were shown in the bill, after deducting the freight charges, freight charges were not charged by the assessee from the purchasers. This being so, freight charges could not be included in the turnover. A Bench of this Court took a similar view where the form of bill issued by the assessee was in pan materia with the one issued in this case in the case of Commissioner of Sales Tax, U.P. v. Indian Traders 1975 U.P.T.C. 586. In view of a direct decision of our own Court, it is not necessary to comment on the decision of the Madhya Pradesh High Court in the case of Birla Jute . v. Commissioner of Sales Tax, M.P.  29 S.T.C. 639.
7. So far as the third question is concerned, that is consequential to the answer given to the second question. As the second question is being answered in favour of the assessee on the view that freight had to be excluded from the taxable turnover, no tax under the Central Sales Tax Act was exigible in respect of the amount for it did not form part of the sale price of the assessee.
8. The first question is answered by saying that the transactions in question did not amount to sale and were not liable to sales tax ; the second question by saying that the amount of freight had to be excluded from the taxable turnover. The third question is answered by saying that the amount of freight could not be taxed at the rate of 10 per cent under the Central Sales Tax Act, even though the primary transaction is covered by form D. The assessee is entitled to its costs, which is assessed at Rs. 200.