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TMI Blog1979 (12) TMI 144X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner held that these sales were export sales and allowed the appeal. Similarly in the case of the other assessee, Shafeeq Ahmed Company, the taxable turnover included Rs. 18,81,949.43 representing the sales of dressed hides and skins which were exported. In this case also, the amount had been brought to tax as if they were local sales. But on appeal, the Appellate Assistant Commissioner held that the turnover represented sales in the course of export and hence was exempt from tax. The orders of the Appellate Assistant Commissioner were examined by the Board in the light of the decision in Mod. Serajuddin v. State of Orissa[1975] 36 S.T.C. 136 (S.C.). and the decisions of this Court in State of Tamil Nadu v Abdul Shukoor Compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Akhtar Company and in the affidavit it is stated that they exported on behalf of Akhtar Company tanned hides to foreign buyers. Akhtar Company have a tannery at Ranipet. Tanned hides and skins were directly received by Sulaiman Company in their godowns at No. 11, Vepery High Road, Madras, for assortment, packing and export. They contact foreign buyers for direct export of the goods. After obtaining confirmation of the rates and terms of sales, they negotiate and finalise export contracts on the prices agreeable to their principals. Letters of credit were opened by foreign buyers in the name of Sulaiman Company and written communication was sent by Sulaiman Company to the assessee as the principal, indicating the quantity, r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 days sight on London and the brokerage was to be at Rs. 4.50 per bale to be paid to the Indian agents by the foreign principal after shipment. Sulaiman Company thereafter received a letter from the foreign principal reporting the purchase of ten bales and confirming the terms of the contract. The agent reported on the same date, viz., 3rd April, 1970, to Akhtar Company about having entered into a transaction of sale of ten bales with the party in London. The invoice was prepared by Sulaiman Company and the amounts were itemised and credited in their books in the name of the assessee. All the items of expenditure relating to the sales were also debited therein in the assessee's name and it was the balance after deducting also the com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estion as to whether these transactions are liable to tax has to be examined. In State of Tamil Nadu v. A. Shafeeq Ahmed and Company[1979] 44 S.T.C. 263. which was reported at page 263 of 44 Sales Tax Cases as an appendix to the decision in Hajee Abdul Khalique Sahib and Company v. State of Tamil Nadu[1979] 44 S.T.C. 261., a Bench of this Court pointed out that "If the contention of the assessees is that they were the exporters in fact and any other person was acting only as their agent, the privity of contract between the assessees and the foreign exporter would be established and the assessees themselves could become an exporter. But, if the facts were to be that the contract was entered into by the agent on his own right and not as a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese facts had been placed by the respective assessees. But unfortunately, the Board, in the common order that was passed has summarily dealt with these factual points. In relation to Shafeeq Ahmed Company, in paragraph 7 of its order the Board has observed, "in the case of Tvl. A. Shafeeq Ahmed and Company, they have sold the goods to Tvl. A. Abdul Shukoor and Company, the local buyers and exporters. The privity of contract was between the foreign buyers, Bevington Sons Limited, London, and Tvl. A. Abdul Shukoor Company. There was no contract between the assessees and the foreign buyers. In the absence of privity of contract between the assessees and the foreign buyers their transactions are only local sales and are not exempt. The d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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