2009 (2) TMI 757

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.... Central Sales Tax Act, 1956?" This reference application has subsequently been converted to sales tax revision bearing ST. Rev. No. 64 of 2008. Shorn of unnecessary details, the short facts and circumstances giving rise to this revision are that during the relevant period the petitioner-dealer was dealing in groundnuts, groundnut seeds, groundnut oil and cattle feed (oil cake). During the year 1995-96 the petitioner purchased groundnut worth Rs. 10,27,948.45 from the local cultivators. It did not pay any tax on turnover of such purchases on the ground that the same were sold to M/s. Peanut Product, Vijayawada and M/s. Essel International, Vijayawada and those two Indian exporters have sold the said goods to foreign buyer M/s. Export Khle....

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.... Hence, the present sales tax revision. Mr Ray, learned counsel for the petitioner, submitted that the petitioner supplied groundnut to Indian Exporters to fulfil the contract with the foreign buyer M/s. Export Khleb, Moscow. The supply so made by the petitioner was for the purpose of complying with the agreement/order for/ or in relation to export and, therefore, the purchase and of supply of groundnut by the petitioner to the exporters was deemed to be in course of export in terms of sub-section (3) of section 5 of the CST Act. He further argued that the agreements of the exporters with the foreign buyers were prior to the agreements entered into between the exporters and the petitioner. The Indian Exporters after receiving the purchase ....

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....e sale or purchase occasioning such export shall also deem to be a sale or purchase in course of export out of the territory of India, which means the last but one sale or purchase preceding the sale or purchase occasioning such export shall be deemed to be a sale or purchase in course of export out of the territory of India. The honourable Andhra Pradesh High Court in George Maijo & Co. v. State of Andhra Pradesh [1980] 46 STC 41, held that in order to come within the purview of sub-section(3) of section 5 the following three conditions should be fulfilled: (1) There must have been pre-existing agreement or order to sell the specific goods to a foreign buyer. (2) The last purchase referred to in section 5(3) must have taken place after ....

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.... 5 of the Central Sales Tax Act. Sub-section (3) of section 5 of the Central Sales Tax Act extends the exemption to the purchase preceding to the purchase referred to in sub-section (1) of section 5 of the Central Sales Tax Act. In other words, by virtue of sub-section (3) of section 5 of the Central Sales Tax Act, the purchase by exporter is also exempted. But sub-section (3) of section 5 of the Central Sales Tax Act cannot be extended to the purchase of the said goods by the petitioner, since the purchase by the petitioner is not a purchase preceding the export purchase, but is a purchase removed by one more step." In Bismillah & Co. [1989] 73 STC 135, honourable Andhra Pradesh High Court held that exemption under section 5(3) cannot be ....