A SALE OR PURCHASE OF GOODS SHALL BE DEEMED TO TAKE PLACE IN THE COURSE OF EXPORT OF THE GOODS 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.

SYED SHAH MOHAMMED QUADRI, J.

( 1 ) THE dealer, an assessee under the Andhra Pradesh General Sales Tax Act, 1957, for short "the State Act", is the petitioner in this tax revision case, filed under section 22 (1) of the State Act against the order of the Sales Tax Appellate Tribunal in T. A. No. 166 of 1979, dated 25/08/1986.

( 2 ) THE petitioner deals in castor oil. For the assessment year 1973-74 he claimed exemption of turnover on the ground that the sales were "export sales". In respect of a part of the turnover exemption was allowed. In respect of that part for which the claim was rejected, the petitioner filed an appeal before the Assistant Commissioner. The appeal was partly allowed holding that a part of disputed turnover related to inter-State sales but not export sales. However, the appellate authority remanded the matter to the assessing authority, viz. , Commercial Tax Officer, to enable the petitioner to produce "c" forms regarding turnover which was not exempted. Against the order of the appellate authority, the petitioner filed further appeal before the Sales Tax Appellate Tribunal. The Tribunal upheld the order of the Assistant Commissioner and dismissed the appeal by the order under revision. Hence, the dealer has come up in revision.

( 3 ) THE petitioner was exporting castor oil but with effect from April, 1973, the S State Trading Corporation became the canalising agent for export. The State Trading Corporation would obtain letter of credit from the foreign buyer in the course of its activity of promoting trade and would ask the local dealer to supply the goods of the specification given by the foreign buyer. In the bill of lading the dealer will he shown as consignor for the State Trading Corporation and the invoices would he raised on the foreign buyer and that would be on account of the State Trading Corporation. The petitioner claimed that as it was entitled to receive the difference of the invoice amount and the letter of credit on the bankers of the State Trading Corporation, as per the contract, virtually it would be the exporter and, therefore, the sale would have to be treated as the "export sale".

( 4 ) THE short question that arises for consideration in this case is, whether the transactions in question constitute export sale within the meaning of section 5 (1) of the Central Sales Tax Act, 1956.

( 5 ) SECTION 5 (1) of the Central Sales Tax Act, 1956, reads as follows :"5. When is a sale or purchase of goods said to take place in the course of import or export.- (1) A sale or purchase of goods shall be deemed to take place in the course of export of the goods 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. (2 ). . . . . . . . . . . . . . . . . (3 ). . . . . . . . . . . . . . . . . . . . "

( 6 ) SUB-SECTION (1) of the said section raises a presumption as to when a sale or purchase of goods shall be deemed to take place in the course of the export of the goods out of the territory of India. It provides that if 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, such sale or purchase would be deemed to take place in the course of export of goods.

( 7 ) THE learned counsel for the petitioner contended that as the documents of title to the goods were handed over by the petitioner to the State Trading Corporation after the goods were placed on board, the second limb of section 5 (1) of the Central Sales Tax Act would be attracted and the sale Would be "export sale". Reliance is placed on a judgment of this Court in Kedia Vanaspathi Ltd. v. Commissioner of Commercial Taxes, Andhra Pradesh [1993] 89 STC 555 in support of the contention that the transaction of sale is in the course of export of the goods outside India. A Divisio

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