Judgment

RAY, C.J.I.:- These six appeals are by special leave from the judgment dated 26th February, 1974, of the Andhra Pradesh High Court.

2. The principal question in these appeals is whether the appellants are the last purchasers of manganese ore within the State of Andhra Pradesh. The appellants contended before the Sales Tax Authorities that their sales of Manganese ore to the Mines and Minerals Trading Corporation in short called the M. M. T. C. were complete within the State of Andhra Pradesh. The appellants, therefore, contended that they were not the last purchasers but the M. M. T. C. was the last purchaser within the State, and, therefore, the M. M. T. C. was liable to pay the tax.

3. The High Court came to the conclusion that the appellants were the last purchaser in the State. The High Court held that the contract between the appellants and the M. M. T. C. indicated that the appellants contract of sale occasioned the export and that the contract of the appellants with the M. M. T. C. was integrally connected with the contract entered into by the M. M. T. C. with their foreign buyer. In short, the High Court held that there existed a bond between the contracts of sale entered into by the appellants with the M. M. T. C. and the actual exportation of the goods. The High Court held that these contracts were intrinsically linked and connected and the sales effected were held to be sales in the course of export of manganese ore out of the territory of India.

4. The Constitution Bench of this Court in the recent decision in Mohd. Serajuddin etc. v. State of Orissa, 1975 Supp SCR 169 held that manganese merchants who bought manganese from mines and thereafter sold the goods to the State Trading Corporation for short the S. T. C. could not be said on the terms and conditions of the contracts in that case to be exporters of the goods. The S. T. C. contracts with the manganese merchants and the S. T. C. contracts with the Foreign Buyers were held not to be integrated activities in the course of export. The crucial words in Section 5 of the Central Sales Tax Act 1956 are that a sale or purchase of goods shall be deemed to take place out of the territory of India only if the sale or purchase either occasions such export or is effected by a transfer of documents of title to the goods after the goods have crossed the customs frontiers of India. This Court found that the contracts between the manganese merchants and the S. T. C. on the one hand and the contracts between the S. T. C. and their foreign buyers on the other were two separate and independent contracts of sale. The S. T. C. entered into direct contract with their foreign buyers. The S. T. C. alone agreed to sell the goods to their foreign buyers. The S. T. C. was the exporter of goods. There was no private of contract between the manganese merchants and the foreign buyers from the S. T. C. The privity of contract was between the S. T. C. and the foreign buyers. The immediate cause of the movement of goods and export was the contract between the foreign buyers who were the importers and the S. T. C. who was the exporter and shipper of the goods.

5. In Serajuddins case (AIR 1975 SC 15640 (supra) this Court referred to the rulings in Coffee Board, Bangalore v. Joint Commercial Tax Officer, Madras, (1970) 3 SCR 147 and M/s. Binani Bros. (P) Ltd. v. Union of India. (1974) 1 SCC 459 as laying down the correct tests to find out the sale in the course of export. The tests are that there must be a single sale which itself causes the export or is in the progress or process of export. There is no room for two or more sales in the course of export. The only sale which can be said to cause the export is the sale which itself results in the movement of the goods from the exporter to the importer.

6. Counsel for the State submitted that there were six contracts and it has been the case of the appellants that the contracts were different, and, therefore, there should be examination of five