TaxTMI 
TaxTMI 
2001 (1) TMI 78
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....s exported. In terms of the agreement, the appellant's processed sea foods were to be sold to the export house after the goods crossed the customs barrier. All formalities of export were to be completed by the appellant but the shipment would be on account of the export house. The letter of credit opened in favour of the export house by the foreign purchase would be endorsed in favour of the appellant. While the benefits from the agreement as far as the export house was concerned were limited to those available under the Policy, the appellant would not only be entitled to the entire sale proceeds realised by the export, but in terms of the agreement it could alone claim all the privileges available under other statutory provisions to an exporter, in addition to the commission of 2.25 per cent. 3. The particular transaction with which we are concerned began with a purchase order placed on the export house by a buyer in California. The buyer opened a letter of credit in favour of the export house. The goods were duly shipped and the documents were handed over by the appellant to the export house for negotiation. The letter of credit was endorsed in favour of the appellant by the ex....
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....h Court is now impugned before us. 7. It was contended by the appellant, relying on C.T. Ltd. & Anr. vs. CTO & Ors. (1997) 104 STC 94 (SC) that it was entitled to the benefits of the section because it had, in fact, exported its products by selling them to the export house after the goods had crossed the customs' barrier. According to the appellant, the export applications were in the name of the appellant, the certificate issued by the export inspection agency showed the name of the appellant against the column "Name and address of the exporter"; the bill of charges of shipping was in the name of the appellant, the Marine Products Development Authority had recognised the appellant as the exporter in respect of the exports done in the name of the export house; the GR I form issued by the Reserve Bank of India under s. 18 of the Foreign Exchange Regulation Act, 1973, was in the name of the appellants, the customs authorities had recognised the appellant as the exporter under s. 75 of the Customs Act in granting drawback on customs duties and the bill of lading showed both the appellant and the export house as the shipper. All this, it was argued, showed that the appellant was the ....
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....d is not relevant to s. 80HHC. The section does not in terms require the exporter to be the owner of the goods. Even s. 2(18) of the Customs Act does not include the idea of ownership within the definition of the word 'export'. This may be contrasted with s. 5(3) of the Central ST Act, 1956, where the emphasis is on the transfer of title by a last sale or purchase ........................" preceding the sale or purchase occasioning the export." That is why in C. T. Ltd. & Anr. vs. CTO & Ors. relied on by the appellant, this Court held that although the State Trading Corporation (STC) was shown as the exporter of goods, since there was no sale to STC, STC merely acted as an agent of the assessee who had purchased the goods for export. This decision cannot be relied on to, construe s. 80HHC of the IT Act. 10. The object of s. 80HHC is to grant an incentive to earners of foreign exchange. The matter will, therefore, have to be considered with reference to this object. The transaction commenced with the agreement between the Californian buyer and the export house. But for this contract, there would be no export and no receipt of foreign exchange at all. In fulfilment of its obligatio....
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....one as required by the system of barter. Ferro-Alloys availed of this system presumably because it was to its advantage. In fact, it appears that it was not able to sell the said goods otherwise. Be that as it may, whether by choice or by lack of alternative, it chose to route its goods through MMTC. Is it open to the Ferro-Alloys now to say that all this must be ignored in the name of 'external appearances' and it must be treated as the 'real exporter for the purposes of s. 290ZC. It wants to be the gainer in both the events. A case of 'heads I win, tails you lose' ............ Ferro-Alloys cannot come to the MMTC when it is profitable to it and disavow it when it is not profitable to it. It cannot have it both ways." 12. Secondly, the phrase, "sale proceeds ...... receivable by the assessee" in s. 80HHC, sub-s. (2), cannot be construed to mean 'sale proceeds ultimately received'. Payment for the export was by the letter of credit. The letter of credit being in favour of the export house, the foreign exchange was "receivable" by it. That the export house may have chosen to transfer the foreign exchange to a third party under some independent arrangement would not make the third ....