Export sales of coffee seeds were held exempt from State sales tax because title passed outside India and the sale was in the course of export.

Coffee seeds sold for export were treated as not liable to State sales tax because property in the goods passed only outside Indian territory when the bill of exchange was accepted and the bill of lading was handed over. The transaction was also characterised as a sale in the course of export under Article 286(1)(b) of the Constitution. On those facts, the assessee was entitled to exemption and the State could not tax the sale.

---

---

Issues: Whether the sale of coffee seeds exported outside the Indian territory was liable to sales tax, or was exempt as a sale outside the Indian territory and in the course of export under Article 286(1)(b) of the Constitution of India.

Analysis: The contract of sale was entered into before the Constitution came into force, but the goods were booked, shipped, and the documents dealt with after the relevant events. On the facts, the property in the goods passed only outside the Indian territory when the bill of exchange was accepted and the bill of lading was handed over. Independently, the sale was also in the course of export within the meaning of Article 286(1)(b).

Conclusion: The sale was not taxable by the State and the assessee was entitled to exemption; the revision petition failed.

---