S.L.Saraf, J. - (1.) The applicant carries on business of manufacturing and selling fruit and vegetable products. During the assessment year 1975-76 the applicant had exported goods worth Rs. 6,37,038.49 to the Russian buyers and the same were in the course of export out of the territory of India, for which, the applicant claimed exemption under Section 5(1) of the Central Sales Tax Act, 1956 (for short, "the Act") read with Article 286 of the Constitution of India. The claim of the applicant, however, was rejected by the assessing authority who imposed tax at 10 per cent amounting to Rs. 67,672.78. Aggrieved by the said order, an appeal was filed before the Deputy Commissioner (Appeals), Sales Tax, Allahabad, which was also rejected. As against the same, a further appeal was filed before the Sales Tax Tribunal, who confirmed the order passed by the Deputy Commissioner of Appeals, on March 29, 1990. Aggrieved by the said order, the applicant has preferred this revision-application and prays for setting aside of the said orders passed by the sales tax authorities.
(2.) From the records, it appears that the applicant has appointed United Breweries Limited as its authorised indenting agent by a letter dated January 3, 1975 for promotion of sales in foreign countries in consideration of United Breweries Limited being entitled to all the benefits derived from the utilisation of import entitlements. The United Breweries Limited were authorised to promote sales either directly or through any other body corporate, individual or other persons for that purpose. It was also stipulated in the said agreement that at no point of time, the property in the goods manufactured by the applicant would be transferred to United Breweries even when the goods were sought to be supplied by the applicant in execution of the contract entered by United Breweries Ltd. with any body, corporate, individual or any other person. Further, the property in the goods would always remain with the assessee-applicant and in their custody and the assessee would be the owners of the same till the property in the goods was transferred to the foreign buyers.
(3.) Pursuant to the aforesaid authorisation United Breweries Ltd., had entered into a contract with the State Trading Corporation of India (in short, "STC") to secure, export order for and on behalf of the applicant for supply of mango juice to Sojuzplodoimport, Moscow. The STC was to get 1 per cent of the value of the goods shipped as consideration for securing the order from foreign buyers. In effect, STC had acted as a sub-agent of the applicant for procuring the export orders for supply of 400 M.T. of mango juice. Paragraph 9 of the agreement provided as follows : "9. Passing of property : Notwithstanding anything contained elsewhere in this contract,- (a) the property in the goods agreed to be supplied under this contract shall remain in the suppliers and shall not pass to the STC until after the goods have actually crossed the customs frontiers of India ; and (b) the suppliers shall transfer the documents of title to the goods to STC only after the goods have actually crossed the customs frontiers of India.";