Export sales exemption turns on the operative sale contract itself occasioning export to the foreign buyer.

The SC held that sales of charge chrome to a foreign buyer were sales in the course of export and therefore exempt from sales tax. The decisive factor was that the later charge chrome contracts themselves specified quantity, price, foreign destination, shipment terms, inspection at the port of discharge, and transfer of title only after receipt of proceeds. By contrast, the earlier off-take arrangement was only an agreement to sell, not the operative sale contract. Because the export was immediately occasioned by the sale contract itself, and not by any independent intermediary resale, the impugned assessment orders could not stand.

---

---

Issues: Whether the sales of charge chrome to the foreign buyer were sales in the course of export so as to qualify for exemption from sales tax.

Analysis: The decisive question was whether the operative contracts were merely agreements to sell or were contracts of sale that themselves occasioned the export. The off-take arrangement was executed before production had begun and was not for a specified quantity at a fixed price, so it functioned as an agreement to sell. The later charge chrome agreements, however, specified the quantity, price, foreign destination, shipment terms, inspection at the port of discharge, and transfer of title only upon receipt of proceeds after abroad-based verification. On these features, the export was not occasioned by an independent resale by an intermediary; rather, the sales under the charge chrome agreements themselves caused the export.

Conclusion: The sales were sales in the course of export and were exempt from sales tax.

Final Conclusion: The assessment orders could not stand, and the writ petitions succeeded because the impugned transactions were export sales protected by the statutory exemption.

Ratio Decidendi: Where the operative sale contract itself requires export to a foreign buyer and the export is the immediate result of that contract, the sale is in the course of export and is exempt from sales tax; a mere antecedent agreement to sell does not alter that position if the later concluded sale contract occasions the export.

---