Export sale nexus under CST fails where buyers independently export goods after purchase, so exemption is denied.

Under section 5(1) of the Central Sales Tax Act, a sale qualifies as being in the course of export only if it is inextricably linked with the export and is either the immediate cause of the export or takes place during the progress of export. Goods sold to buyers who later export them on their own account do not satisfy that nexus. Here, the agreement terms, delivery arrangements and addendum showed that the buyers purchased ferro-silicon independently and then dealt with foreign purchasers themselves. Export-oriented clauses, export markings and a no-sales-tax stipulation were insufficient to convert the sellers' domestic sales into export sales. The sales were therefore not exempt from tax.

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Issues: Whether the sales of ferro-silicon to the buyers were sales in the course of export and therefore exempt from tax.

Analysis: The governing test under section 5(1) of the Central Sales Tax Act, 1956, is that a sale is in the course of export only if it is part and parcel of the export, either because the sale itself occasions the export or because the sale takes place during the progress of export. A sale merely made for export, or one where the buyer later exports the goods on its own account, does not qualify. The agreement, delivery terms, and addendum showed that the buyers purchased the goods from the sellers and thereafter dealt independently with foreign buyers. The presence of export-oriented clauses, export markings, and a stipulation that no sales tax would be collected did not establish the necessary legal nexus between the sellers' sales and the actual export. The interposition of the buyers as independent intermediaries broke the chain required for a sale in the course of export.

Conclusion: The sales were not in the course of export and were not exempt from tax.

Ratio Decidendi: A sale is exempt as being in the course of export only when it is itself inextricably linked with and the immediate cause of the export; a subsequent independent export by the buyer does not bring the earlier sale within section 5(1).

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