Export sale exemption depends on the sale itself occasioning export; an independent domestic contract remains taxable.

Article 286(1)(b) of the Constitution and section 5(1) of the Central Sales Tax Act protect only sales that occasion the export or are effected by transfer of title documents after the goods cross the customs frontiers. A sale concluded in India as a distinct domestic contract does not qualify merely because the goods are later exported under a separate arrangement between the buyer and a foreign purchaser. Where there is no privity of contract with the foreign buyer and no obligation on the seller to export, the transaction is not in the course of export and remains taxable under sales tax law.

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Issues: Whether the sale of goods by the assessee to an Indian buyer was a sale in the course of export so as to be exempt from sales tax.

Analysis: Article 286(1)(b) of the Constitution forbids State taxation on sales that take place in the course of export, and section 5(1) of the Central Sales Tax Act, 1956 confines such protection to sales that either occasion the export or are effected by transfer of title documents after the goods have crossed the customs frontiers. Applying these principles, the sale in question was found to be a distinct and independent domestic contract concluded in India. The export was occasioned by a separate arrangement between the Indian buyer and its foreign purchaser, with no privity of contract between the assessee and the foreign buyer and no obligation on the assessee to export the goods.

Conclusion: The sale was not in the course of export and was exigible to sales tax; the exemption claim failed.

Final Conclusion: The assessment made by the revenue authorities stood restored and the assessee was not entitled to exemption on the footing of export sale.

Ratio Decidendi: A sale is protected as being in the course of export only when the sale itself occasions the export or forms an integral part of the export transaction; an independent domestic sale lacking privity with the foreign buyer does not qualify.

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