Export sale exemption depends on an integrated sale and export transaction, not a domestic sale followed by buyer-led export.

Exemption under section 5 of the Central Sales Tax Act, 1956 applies only where the sale occasions the export or is effected by transfer of title documents after the goods cross the customs frontiers. A sale completed in India, followed by export at the purchaser's discretion, is not enough because the sale and export must form an integrated, inseparable transaction. On the facts, the Nepali buyers took delivery at Varanasi, the seller retained no control after sale, and there was no contractual obligation to export. The sales were therefore not in the course of export and were not exempt from tax.

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Issues: Whether the sales made to Nepal buyers were sales in the course of export so as to qualify for exemption from tax.

Analysis: Exemption under section 5 of the Central Sales Tax Act, 1956 is available only where the sale occasions the export or is effected by transfer of title documents after the goods cross the customs frontiers. A mere sale followed by export by the purchaser is not enough. The sale and the export must form an integrated transaction with a direct and inseparable link, so that the export is occasioned by the sale. On the facts found, delivery was taken by the Nepali purchasers at Varanasi, the seller retained no control over the goods after sale, and the purchasers were free to carry the goods to Nepal on their own. There was no obligation on the buyers to export under the contract and no bond between the sale and the actual export.

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

Ratio Decidendi: A sale qualifies as a sale in the course of export only when it occasions the export and is so integrated with the export that the two cannot be separated into independent transactions; a sale completed in India, followed by export at the purchaser's volition, does not satisfy section 5.

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