Sale in the course of export requires a real nexus with the export order and actual shipment of the same goods.

A penultimate sale qualifies as a sale in the course of export only if it is made after and for the purpose of complying with the export order and is inextricably linked with the actual export of the same goods. The claimed nexus failed because the goods in the sale invoices differed from those in Form H and the bill of lading, and the foreign buyer's order number and date were not shown in Form H. In the absence of the foreign buyer's order, the requisite connection was not proved, so the sale was not exempt under Section 5(3) of the Central Sales Tax Act and deletion of U.P. trade tax was not justified.

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Issues: Whether the applicant's sale of goat skins to the exporter qualified as a sale in the course of export under Section 5(3) of the Central Sales Tax Act and, consequently, was exempt from tax, and whether the levy under the U.P. Trade Tax Act could be deleted.

Analysis: The statutory test under Section 5(3) requires that the last sale or purchase preceding export must be made after, and for the purpose of complying with, the export order, and the transaction must be inextricably linked with the actual export. Applying that test, the goods shown in the sale invoices were found to be different from the goods mentioned in Form H and the bill of lading. The foreign buyer's order number and date were not mentioned in Form H, and no order from the foreign buyer was produced to establish the necessary bond between the applicant's sale and the export. The claimed nexus was therefore not proved.

Conclusion: The sale was not proved to be in the course of export under Section 5(3) of the Central Sales Tax Act and the tax deletion was not sustainable; the revision was dismissed.

Ratio Decidendi: A penultimate sale qualifies as a sale in the course of export only when it is real, intimate, and inextricably linked with the export order and the actual export of the same goods.

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