Export sale exemption for bus bodies denied where the exported product was a different commercial commodity and not the same goods sold.

Section 5(3) exemption under the Central Sales Tax Act applies only where the last sale is of the same goods ultimately exported; sale of bus bodies fitted on chassis did not qualify because the exported article was a commercially distinct complete bus, so the component sale was not the penultimate export sale. The refund-based relief under G.O. Ms. No. 115 was confined to the named beneficiary and did not extend as a general concession to other assessees. Penalty under the local sales tax law depended on the fate of the underlying assessment and turnover, resulting in deletion in one matter and restoration in another only to the extent supported. Turnover relating to extra fittings and accessories was held taxable under the local Act.

---

---

Issues: (i) whether the sale of bus bodies built on chassis and supplied to exporters qualified for exemption under section 5(3) of the Central Sales Tax Act, 1956 as the last sale preceding export; (ii) whether the exemption granted under G.O. Ms. No. 115, Revenue, dated 17 January 1972 could be claimed by assessees other than the named beneficiary; (iii) whether penalty under section 12(5)(iii) of the Tamil Nadu General Sales Tax Act, 1959 was sustainable; and (iv) whether the turnover relating to extra fittings and accessories was taxable under the local Act.

Issue (i): Whether the sale of bus bodies built on chassis and supplied to exporters qualified for exemption under section 5(3) of the Central Sales Tax Act, 1956 as the last sale preceding export.

Analysis: The decisive test was whether the goods sold by the assessees were the same goods as those exported. The foreign buyers had ordered complete buses, and the bus body fitted on the chassis brought into existence a new commercial commodity, namely, a bus. Chassis, bus body and complete bus were treated as commercially distinct commodities. The sale of bus bodies was therefore not the penultimate sale of the very goods exported, but only a component used in manufacturing the exported bus. The exemption under section 5(3) was thus unavailable on these facts.

Conclusion: The claim for exemption under section 5(3) failed, except where specifically covered by the separate government refund order.

Issue (ii): Whether the exemption granted under G.O. Ms. No. 115, Revenue, dated 17 January 1972 could be claimed by assessees other than the named beneficiary.

Analysis: The Government Order was confined to bodies built and supplied by the named concern and granted exemption by way of refund subject to proof of export. It was a specific concession and not a general exemption for all body builders. The order was not treated as having been extended to similarly situated assessees as a matter of right. Article 14 was held not to enlarge the scope of a concession granted to a particular entity on its own request.

Conclusion: The refund-based exemption was available only to the named beneficiary and not to the other assessees.

Issue (iii): Whether penalty under section 12(5)(iii) of the Tamil Nadu General Sales Tax Act, 1959 was sustainable.

Analysis: In the case where the assessment was treated as a best judgment assessment and the turnover position was disputed, penalty was held not to be warranted. In the case where the exemption was disallowed and the taxable turnover stood restored, the penalty following that turnover was also restored insofar as the assessment sustained it. The penalty question was thus dependent on the fate of the underlying turnover and assessment.

Conclusion: Penalty was deleted in one matter and sustained in the other only to the extent supported by the restored assessment.

Issue (iv): Whether the turnover relating to extra fittings and accessories was taxable under the local Act.

Analysis: The additional fittings were not shown to be covered by the foreign buyer's export order in the manner required to attract export-related exemption. The turnover was therefore liable to be assessed under the local Act along with the related revision action.

Conclusion: The turnover relating to extra fittings and accessories was taxable under the local Act.

Final Conclusion: The Tribunal upheld the refusal of section 5(3) exemption for bus bodies in the impugned matters, preserved the special refund relief only for the concern specifically named in the Government Order, and sustained the tax on extra fittings while giving case-specific treatment to penalty.

Ratio Decidendi: Section 5(3) exemption applies only when the last sale is of the same goods that are exported; where processing or fabrication results in a new commercially distinct commodity, the penultimate sale of a component does not qualify as a sale in the course of export.

---