Essential identity of exported goods preserved despite processing, keeping the last purchase within export exemption.

Processed prawns purchased locally and then cleaned, peeled, packed and exported were held to retain their essential commercial identity as prawns. Because section 5(3) of the Central Sales Tax Act, 1956 applies only where the last purchase is of the same goods ultimately exported, mere processing did not change the commodity into a different article. The last purchase was therefore treated as a purchase in the course of export, and the exemption was available where the goods retained their identity despite processing.

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Issues: Whether prawns purchased locally, when cleaned, peeled, processed and packed for export, retained their identity so as to qualify the last purchase as being in the course of export under section 5(3) of the Central Sales Tax Act, 1956.

Analysis: Section 5(3) applies only where the last purchase precedes the export sale and relates to the same goods that are exported, so identity of the goods is essential. The processing carried out on the prawns did not convert them into a commercially different commodity. The processed prawns remained prawns in trade and export, and the reasoning accepted that mere processing, without loss of essential identity, does not take the transaction outside the export exemption.

Conclusion: The processed prawns and the purchased prawns were the same commodity, and the claim to exemption under section 5(3) was rightly allowed in favour of the assessee.

Ratio Decidendi: Where the goods purchased and the goods exported retain their essential commercial identity despite processing, the last purchase remains within section 5(3) of the Central Sales Tax Act, 1956 and is treated as in the course of export.

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