Export sale nexus under the CST Act requires an inextricable link between sale contract and actual export, with remand ordered.

Movement of goods from Karnataka to Maharashtra was examined under Section 5(1) of the Central Sales Tax Act to determine whether it formed part of a sale in the course of export or was a stock transfer under Section 6A. The governing test is whether the sale occasions export and whether there is an inextricable, unseverable link between the contract of sale and the actual export; absence of F Forms or routing through a branch is not decisive. The High Court found the existing record insufficiently analysed on this link, set aside the impugned order, and remanded the matter to the Tribunal for fresh consideration of the statutory character of the movement.

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Issues: Whether the movement of goods from Karnataka to Maharashtra was a sale in the course of export under Section 5(1) of the Central Sales Tax Act, 1956 or a stock transfer under Section 6A, and whether the matter required fresh reconsideration by the Tribunal.

Analysis: The governing test for Section 5(1) is whether the sale occasions export and whether there is an inextricable or unseverable link between the contract of sale and the actual export. The Court relied on the settled principle that the relevant enquiry is not confined to the absence of F Forms or the fact that the goods moved through the branch or head office, but whether the movement from Karnataka was occasioned by the export contract and formed part of the export chain. It found that the authorities had not properly examined this link on the available documents and that the issue required re-examination in light of the applicable statutory principles and precedents.

Conclusion: The impugned order was set aside and the matter was remanded to the Tribunal for fresh consideration on the applicability of Section 5(1) and the true character of the movement of goods.

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