G.P. Singh, C.J.
1. The questions of law referred in this reference under Section 44(1) of the Madhya Pradesh General Sales Tax Act, 1958, are as follows :
(1) Whether, in the circumstances and on the facts of the case, the sales made by the assessee to the local buyers were inter-State sales as defined in Section 3(a) of the Central Act ?
(2) Whether, in the circumstances and on the facts of the case, the sale in question occasioned the movement of goods in pursuance of the covenant or incident of the contract ?
2. The relevant period of assessment is calendar year 1960. The sales with which we are concerned in this reference were made to M/s. Cambata Ferro Manganese Private Ltd., The Ferro Alloys Corporation Ltd. and Jaipur Sugar Co. Ltd. The buyers have their factories for manufacture of ferro-manganese at places outside the State of Madhya Pradesh. The contracts specifically provided that the buyers were buying the manganese ore from the assessee 'for the sole purpose of consumption in India, for the manufacture of ferro-manganese by the buyers and on the express understanding by the buyers that there shall be no resale of any of the ore either internally in India or for export'. The above term of the contracts coupled with the fact that the factories of the buyers were situated outside the State of Madhya Pradesh leads to the necessary inference that the movement of goods from the State of Madhya Pradesh to the places outside the State where the buyers' factories were located was clearly occasioned by the sales. In State of M.P. v. Bengal Paper Mills 1979 MPLJ 478, referring the relevant authorities of the Supreme Court, a Division Bench of this Court pointed out that a sale falls under Section 3(a) of the Central Sales Tax Act 'if the movement of goods from one State to another is under a covenant or incident of the contract of sale'. In Union of India v. K.G. Khosla & Co. AIR 1979 SC 1160 it was explained by the Supreme Court that it is not true to say that for the purposes of Section 3(a) of the Act it is necessary that the contract of sale must itself provide for and cause the movement of goods or that the movement of goods must be occasioned specifically in accordance with the terms of the contract of sale. It was also explained that in order that a sale may be regarded as an inter-State sale, it is immaterial whether the property in the goods passes in one State or another. The question as regards the nature of the sale, that is, whether it is an inter-State sale or an intra-State sale, does not depend upon the circumstances as to in which State the property in the goods passes. It may pass in either State and yet the sale can be an inter-State sale. Applying these principles, we are clearly of opinion that the sales in the instant case were inter-State sales. Indeed, on similar facts, the same view was taken by a Division Bench of this Court in Commissioner of Sales Tax, M.P., Indore v. C.P. Manganese Ore Co. (Misc. Petition No. 405 of 1976 decided on 11th September, 1980)  54 STC 145.
3. For the reasons given above, we answer the questions referred as follows:
(1) The sales made by the assessee to the buyers, the names of which have been mentioned above, were inter-State sales as defined in Section 3(a) of the Central Act.
(2) The sales in question occasioned the movement of goods as an incident of the contract of sale.
There will be no order as to costs of this reference.