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TMI Blog1967 (1) TMI 72X X X X Extracts X X X X X X X X Extracts X X X X ..... s of integrated activities, occasioning export of goods out of the territory of India, and whether they are covered by Article 286(1)(b) of the Constitution? (2) Whether on the facts and circumstances as stated above the delivery of goods taken by the Nepal buyer on the last railway terminus in the State of U.P. (India) which was the only way of taking delivery amounts to actual delivery within the State and the resultant sale subject to tax under the U.P. Sales Tax Act?" The dealer in the present case is M/s. Damodar Dass Vishwanath of Farrukhabad (hereinafter referred to as the assessee). They deal in brasswares and scrap and carry on their business in the city of Farrukhabad. During the years 1956-57 and 1958-59 they claimed to have exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the goods inside Nepal State or to sell them in Nepalganj which, as stated earlier, is a part of India. On the basis of the facts stated, especially the fact that the Nepal dealer had complete freedom to sell goods at Nepalganj, it cannot be said that the assessee had made sales to the Nepal dealers in the course of exports. Article 286(1)(b) which was introduced in the Constitution by the Sixth Amendment reads thus: "286. (1) No law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of goods where such sale or purchase takes place- (a).......... (b) in the course of the import of the goods into, or export of the goods out of, the territory of India." Section 5 of the Central Sales Tax Act enacts th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out of the country by land or sea. Such a sale cannot be dissociated from the export without which it cannot be effectuated, and the sale and resultant export form parts of a single transaction': The State of Travancore-Cochin and Others v. Bombay Company Ltd. Alleppey[1952] 3 S.T.C. 434; [1952] S.C.R. 1112; A.I.R. 1952 S.C. 366.. A sale in the course of export predicates a connection between the sale and export, the two activities being so integrated that the connection between the two cannot be voluntarily interrupted, without a breach of the contract or the compulsion arising from the nature of the transaction. In this sense to constitute a sale in the course of export it may be said that there must be an intention on the part of both t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... connection between the sale and the export and the activity of sale and that of the export were not so integrated that the connection between the two could not be voluntarily interrupted. In the absence of it being proved or stated that the intention of the seller as also of the buyer was to export the goods to Nepal and until the possibility of the goods being sold at Nepalganj in India had been excluded it is impossible to hold that the sales in question had occasioned the export. That being our view our answer to question No. (1) is in the negative against the assessee and in favour of the department. In view of what we have stated above, it is not really necessary to answer question No. (2). However, since the question has been referre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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