In the case of Service Storage & Transfer Co., Inc. v. Virginia, the U.S Supreme Court ruled in favor of Virginia, upholding its right to impose a tax on an out-of-state corporation for using and storing natural gas within state boundaries. The plaintiff, Service Storage & Transfer Co., argued that this taxation was unconstitutional as it violated the Commerce Clause by burdening interstate commerce. However, the court disagreed with this argument stating that since the company had local activities in Virginia such as storage and use of gas which were separate from interstate transportation or commerce; these could be subjected to state taxation without violating any constitutional provisions. Therefore, despite being involved in interstate business operations, companies cannot evade taxes imposed on their intrastate activities.

In the dissenting opinion for Service Storage & Transfer Co., Inc. v. Virginia, the justice argued that the majority's decision to uphold a state tax on interstate commerce was inconsistent with previous court rulings and violated principles of federalism. The justice contended that by allowing Virginia to impose a property tax on goods stored in transit, the Court was effectively permitting states to regulate and interfere with interstate commerce - an area traditionally reserved for federal jurisdiction under the Commerce Clause of the U.S Constitution. Furthermore, he expressed concern about potential double taxation if other states followed suit and imposed similar taxes on goods passing through their borders. He also pointed out inconsistencies between this ruling and prior cases where similar state taxes were struck down as unconstitutional burdens on interstate commerce.