Amendment status not verified — confirm the current text below against the official source.
When is 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 the 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) A sale or purchase of goods shall be deemed to take place in the course of the import of the goods into the territory of India only if the sale or purchase either occasions such import or is effected by a transfer of documents of title to the goods before the goods have crossed the customs frontiers of India. 2 [(3) Notwithstanding anything contained in sub-section (1), the last sale or purchase of any goods preceding the sale or purchase occasioning the export of those goods out of the territory of India shall also be deemed to be in the course of such export, if such last sale or purchase took place after, and was for the purpose of, complying with the agreement or order for or in relation to such export.] COMMENTS Scope of Sec. 5(1).—Under Sec. 5(1) of the Act there are two limbs and the first limb provides for a circumstance in which the sale itself occasions the export while the second limb contemplates a sale which arises as a result of transfer of documents of title after the goods crossed the customs frontiers. In the opthion of the Court the second limb of Sec. 5(1) is not at all attracted to the present case. It is clear that in finding the course of export the principles of Sec. 5(1) of the Act should be complied with. If any one of the tests fail, there will be no export sale or a sale in the course of export attracting Sec. 5(1) of the Act so as to be exempted from taxation under Art. 286 of the Constitution. 3 The word "deemed"—Meaning of. When sub-section (3) of Sec.5 of the Central Sales-tax Act uses the word "deemed" and says that the penultimate sale "shall also be deemed to be in the course of export" what is intended to be conveyed is that the penultimate sale shall also be regarded as being in the course of such export. In other words, no legal fiction is created.4 Sale and agreement to sell—Meaning of.—The' definitions of "sale" and "agreement to sell in the Sale of Goods Act, 1930, would not apply to the expression "sale" occurring in the Central Sales-tax Act, 1956, wherein the expression "sale" has been defined in Sec.2(g) for the purpose of that Act and under Sec.2(g) of the Central Sales-tax Act, "sale" means any transfer of property in goods by one person to another for cash or for deferred payment or for any other valuable consideration, and includes a transfer of goods on the hire-purchase or other system of payment by instalments, but does not include a mortgage or hypothecation of or a charge or pledge on goods". In other words, wherever the word "sale" occurs in the Central Sales-tax Act, 1956. it is this definition given in Sec.2(g) that will be applicable and therefore the word "sale" in Sec.5(3) must mean transfer of the goods by one person to another for cash or for any other valuable considerations, it cannot mean agreement to sell. 5