2: Definitions:

In this Act, unless the context otherwise requires-

(40) "Sale" with its grammatical variation and cognate expressions means any transfer of property in goods (other than by way of mortgage, hypothecation, charge or pledge) by one person to another in the course of trade or business for cash or deferred payment or other valuable consideration, and includes-

(a) a transfer other wise than in pursuance of a contract, of property in any goods for cash, deferred payment or other valuable consideration.

(b) a transfer of property in goods(whether as goods or in some other form) involved in the execution of a works contract

(c) the delivery of goods on hire purchase or any system of payment by instalments;

(d) a transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration;

(e) a supply of goods by any unincorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration;

(f) any supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or drink (whether or not intoxicating) where such supply or service is for cash, deferred payment or other valuable consideration,

(g) a transfer of property in goods by an auctioneer referred to in clause (g) of sub-section (11) or sale of goods by any dealer in the course of any other activity in the nature of banking or insurance, who in the course of his main activity also sells goods repossessed or reclaimed;

And such delivery, transfer or supply of any goods under clauses(a) to (g) above shall be deemed to be the sale of those goods by the person making the delivery, transfer or supply, and purchaser of those goods shall be the person to whom such delivery, transfer or supply is made;

Explanation 1: A sale or purchase shall not be deemed to have taken place in side the State if the goods are sold-

(a) in the course of inter-state trade or commerce; or

(b) out side the State of Uttarnachal otherwise than by way of sale; or

(c) in the course of import into or export out of the territory of India;

Explanation 2: A sale or purchase shall be deemed to have taken place in the State under sub- clause (b) if the goods are in the State at the time of transfer of property in such goods (whether as goods or in some other form) involved in the execution of works contract, notwithstanding that the agreement for works contract has been wholly or in part entered into outside the State;

Explanation 3: Notwithstanding any thing contained in this Act, two independent sales or purchases shall, for the purpose of this Act, be deemed to have taken place-

(a) when the goods are transferred from a principal to his selling agent and from the selling agent to his purchaser;

(b) when the goods are transferred from the seller to a buying agent and from the buying agent to principal, and if the agent is found in either of the cases aforesaid-

(i) to have sold the goods at one rate and passed on the sales proceeds to his principal at another rate, or

(ii) to have purchased the goods at one rate and passed them to his principal at another rate; or

(iii) not to have accounted to his principal for the entire collection or deductions made to him, from the sales or purchases effected by him on behalf of his principal; or

(iv) to have acted for a fictitious or non-existent principal;