(1) The petitioner in these two revision petitions is a firm of partnership doing business as dealers in hides and skins, and tanners. In respect of its business turnover in the year 1955-56 under the Madras General Sales-tax Act, the petitioner claimed three items of sale of tanned hides and skins ; (i) sale in favour of P. Haji Abdul Wahab and sons, Madras for Rs. 7,60,278 13-7; (ii) sale in favour of Messrs. Rallis India Ltd. For Rs. 11,77,329-2-0 and (iii) sale in favour of Messrs, Gordon Woodroffe and Co. For Rs. 35198-0-3, as being exempt from taxation on the ground that they were sales which occasioned an export or that they were sales in the course of export to foreign territories. The Deputy Commercial tax Officer, Gudiyattam held that the sales in favour of Haji Abdul Wahab and Sons, Madras were export sales, but that the other two sales were local sales. There was an appeal to the Commercial tax Officer by the assessee which was however dismissed. The Commercial Tax Officer invoked his powers of revision and set aside the order of the Deputy Commercial tax Officer exempting the sales in favour Abdul Wahab and Sons as export Sales. On appeal by the assessee to the Appellate Tribunal all the three sales have been held to be local sales not falling within the ban imposed under Art. 286(1)(b) of the Constitution. 'T' C No. 28 of 1959 is the revision petition directed against the said order of the Appellate Tribunal.
(2) The petitioner filed an application for review of the order of the Tribunal in T. R. Appln No. 1 of 1959 but that application was dismissed. T. C. No. 146 of 1959 is the revision directed against the order of the Tribunal refusing review.
(3) The question that arises for consideration in these two revision cases is whether all or any of the three sales are not liable to be taxed on the ground that they are either sides which occasioned export or sales in the course of export out of India.
(4) The sale in favour of Gordon Woodroffe and Co. Is clearly a sale in the course of export. The terms of the contract are identical with the terms of the contract which we had occasion to consider in T. C. A. No. 4 of 1959 and we have no hesitation in holding that the property in the goods forming the subject matter of the contract passed only beyond the customs frontier. The petitioner is entitled to claim the exclusion of the amount of these sales from its turnover.
(5) The terms of the contract between the petitioner and Haji Abdul Wahab Sahib and Bros. Are set out in the order of the Appellate Tribunal. They need not be repeated in this judgment. The sale is not one which occasioned export as it is not even known who the foreign buyer is. The Opening sentence in the letter addressed by Haji Abdul Wahab Sahib and sons to the petitioner, namely, 'We confirm your sale through our London correspondent '. Is very equivocal and cannot indicate a sale in favour of a foreign buyer. The delivery of the goods was to be effected in the godowns of Haji Abdul Wahab Sahib and Sons. On delivery very Haji Abdul Wahab agreed to pay to the petitioner an advance of 95 per cent of the price of goods sold after deducting discount, brokerage, marine, insurance, freight, shipping charges etc. The balance of sale price was to be paid to the petitioner after shipment is completed. This is merely postponement of the payment of price.
There is nothing express or implied in the contract to indicate that the property does not pass on delivery to the Madras godown but only on board the ship after presentation of shipping documents. This does not indicate that the property in the goods passed only after shipment. The conditions in the contract declaring a charge in favour of Haji Abdul Wahab Sahib and sons on all goods covered by the contract for monies advanced and for payment of interest at the rate of 5 per cent on the money advanced are special stipulations in the contract not affecting the passing of the title in the goods sold. We agree with the finding of the Tribunal that these sales in favour of Abdul Wahab Sahib and Sons are merely local Sales.
(6) The terms of the contract with Rallis have also been set out in the judgment of the Tribunal. The opening sentence in the Contract is 'We confirm your sale through our London correspondent'. As pointed out already this does not mean that the sale was one between a foreign buyer and the petitioner. It is not known who the foreign buyer is and obviously there is no privity of any contract between the petitioner and the undisclosed foreign buyer. Regarding payment of the price of goods, it was stipulated that on delivery of the goods in the Madras godown of Rallis, the petitioner should be paid an advance of 95 per cent. The payment of the balance is provided for as follows : 'Any balance amount after allowing for all the items herein stated will be paid to you or collected from you after shipment is completed.' The terms of the contract indicate that the property in the goods passed to Rallis the moment they were delivered at their godown but that the price was payable in two instalments, the first instalment of 95 per cent on delivery and the second installment of 5 percent after the completion of the shipment. The terms of this contract are almost identical with the terms of the contract between the petitioner and Haji Abdul Wahab and Sons. We agree will the finding of the appellate Tribunal that the sale in favour of Rallis should be considered as local sales.
(7) In the result, we allow the revisions in part and hold that the petitioner will be entitled to relief in respect of the sales in favour or Gordon Woodroffe and Co. In other respects the revision petitions fail and are dismissed. There will be no order as to costs.
(8) Revisions partly allowed.