TMI Blog1969 (1) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... the hearing, Dr. Debi Pal on behalf of the petitioner has confined his case to two items only, namely, item 1 amounting to Rs. 9,47,940.62 and item 3 relating to Rs. 12,04,097.20. The question of law involved in this case has been fully examined, with reference to all authorities then available, in the Division Bench case of S.K. Roy v. Board of Revenue[1966] 18 S.T.C. 379; A.I.R. 1967 Cal. 338., to which I was a party. The two propositions formulated therein may be reiterated: (a) Where a local or internal sale is made "for the purpose of export" or as "preparatory to export", it cannot come within the exemption under Article 286(1)(b). (b) But it would be exempted if the export or the movement of the goods out of the territory of I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n buyer himself. It is only by an arrangement for the shipping of the goods to the foreign buyer that the petitioner delivered the goods through the State Trading Corporation. There was thus no separate or independent sale by the petitioner to the State Trading Corporation. The contract and arrangement referred to in the order, form one integrated transaction of a sale to a foreign buyer and the movement of the goods outside the customs frontiers of India also took place in pursuance of the contract No. 21403. On the face of the order, therefore, it was a sale in the course of export which the Sales Tax Officer had no jurisdiction to tax in view of Article 286(1)(b) of the Constitution. How the State Trading Corporation came in between the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the foreign buyer (annexure H, page 31), under which the Corporation was to deliver the goods on board the ship at the Calcutta port. The contract was entered into by the Corporation because the export of manganese from India under this contract was in the nature of a barter deal, in lieu of cotton received from the United States. The State Trading Corporation purchased this manganese from the petitioner-company which were to deliver the goods on the ship specified at the Calcutta port (annexure H, page 26). It is to be noticed that the two agreements were executed on the same date and it is the identical goods sought to be exported, which were to be purchased from the petitioner on "F.O.B." terms, and in para. 3 of the contract between t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the purposes of Article 286 (1)(b): Burmah-Shell Co. v. Commercial Tax Officer[1960] 11 S.T.C. 764; A.I.R. 1961 S.C. 315, para 27., Ben Gorm Nilgiri Plantations v. Sales Tax Officer[1964] 15 S.T.C. 753; A.I.R. 1964 S.C. 1752, para 8. In the latter case it was clearly stated that the essence of the transaction referred to by the expression "in the course of export" was the obligation to export. If such obligation arose even by "mutual understanding between the parties" and the goods moved beyond the customs frontier in pursuance of that obligation, it was a transaction "in the course of export". In my opinion, the instant case fell under that category. It appears that under the scheme of governmental control the State Trading Corporati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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