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Report No. 30

53. Combined effect of the two Travancore cases ("occasioned" means import-purchase and export-sale).-Thus, apart from the transactions effected by transfer of shipping documents as mentioned in the third conclusion set out above, it is clear from the two Travancore cases that it is only the two kinds of transaction mentioned in the first conclusion that come within the exemption under Article 286(1)(b). These two kinds of transactions are sales by export (i.e. export-sales), and purchases by import (i.e., import-purchases).

They were held in the I Travancore case that they came within the exemption because they respectively occasioned the export and the import. Thus to this category of transactions, the II Travancore case did not add any further transactions as occasioning export or import. Therefore it must be taken as settled by these two Travancore Cases that it is only the sales of the nature that we had in the first Travancore Case that occasion the export and only the purchases of similar nature that occasion the import.

In other words, when the exporter is himself a seller to a foreign buyer, his sale comes within the exemption as occasioning the export; likewise, when the importer is himself a purchaser from a foreign seller, his purchase comes within the exemption which particular transactions occasion the export or the as occasioning the import.

It is necessary to bear in mind import (as contra distinguished from the transactions effected by transfer of shipping documents) because, as we shall presently see, in the later cases also it is only these particular transactions (export-sales and import-purchases) that have been held to so occasion the export and import; and because, the word "occasion" which was used for the first time in the two Travancore cases has now come to receive statutory recognition by its being used in sections 3 and 5 of the Central Sales Tax Act.

Section 5 of the Central Sales Tax Act, 1956 - Taxation by the States of Sales in the Course of Import Back

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