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TMI Blog1985 (8) TMI 72X X X X Extracts X X X X X X X X Extracts X X X X ..... in which the transactions were put through, it cannot be disputed that there was an integral connection between the sale to the local purchaser and the actual import of the goods from the foreign supplier. In other words it is clear that the movement of the goods from the foreign country (here the United States) to India was in pursuance of the conditions of the pre-existing contract of sale between the respondent-assessee and the local purchaser. If that be so the view of the Tribunal and the High Court that the sales in question were in the course of import will have to be upheld. Appeal dismissed. - 867-869 of 1974 - - - Dated:- 19-8-1985 - V.D. Tulzapurkar, Sabyasachi Mukharji and Ranganath Misra, JJ. T.S. Krishnamurthy, Senior A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner but the Appellate Tribunal in second appeal accepted the contention and held that the disputed turnover in each year was not taxable. In the revisions preferred by the Deputy Commissioner, the High Court confirmed the Tribunal's view. In doing so the High Court considered the several decisions that were cited before it and ultimately following the test laid down by this court in Ben Conn Nilgiri Plantations Company, Coonoor and Ors. v. Sales tax Officer, Special Circle Ernakulam and Others - (1964) 7 SCR 706 and mainly relying upon another decision of this Court in K.G. Khosla and Co.'s case (1966) 3 SCR 352 it took the view that the sales covered by the disputed turnover in the facts and circumstances of the case were sales in the cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clearance through the Customs and (ii) that the goods will be utilised only for consumption as raw material or accessories in the licence-holder's factory and that no portion thereof will be sold to or be permitted to be utilised by any other party. Reading these two documents together it was clear that the import of the goods by the respondent-assessee was for and on behalf of the local purchaser and the respondent-assessee could not, without committing a breach of the contract, divert the goods so imported for any other purpose. On receipt of the goods the respondent-assessee used to invoice the local purchaser. Having regard to the terms and conditions on which the respondent-assessee imported the goods and the manner in which the tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that there must be an intention on the part of both the buyer and the seller to export, there must be obligation to export, and there must be an actual export. The obligation may arise by reason of statute, contract between the parties, or from mutual understanding or agreement between them, or even from the nature of the transaction which links the sale to export. A transaction of sale which is a preliminary to export of the commodity sold may be regarded a sale for export, but is not necessarily to be regarded as one in the course of export, unless the sale occasions export. And to occasion export there must exist such a bond between the contract of sale and the actual exportation, that each link is inextricably connected with the one im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. Counsel for the appellant fairly conceded that the facts in K.G. Khosla and Co.'s case (supra) were on all fours with the facts obtaining in the instant appeals and that the ratio of that decision would appear to govern the question arising in these appeals, but he contended that a different view has been taken by this Court in M/s. Binani Bros. (P) Ltd. v. Union of India and Ors. (1974) 1 SCC 459 and in view of this later decision the High Court ought not to have applied the ratio of K.G. Khosla and Co.'s decision to this case. It is not possible to accept this contention as in our view Binani Bros.'s case is clearly distinguishable on two material aspects. In that case the assessee itself held the import licence and the goods were i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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