JUDGMENT : K. VINOD CHANDRAN, J. 1. The issue in the above Appeal is in a narrow compass as to whether the assessee is entitled to input tax credit under Section 11 of the KVAT Act, 2003 (for short “KVAT Act”). The facts in so far as the claims raised are that the assessee manufactures products in its factory at Vadavathoor in Kottayam. The assessee is engaged in the manufacture of tyres, tubes and flaps. It has various units all over the Country and for the purpose of export, the assessee manufactures specific items with a Unique Product Code, which is not done in all the units. For example, if tyres for export is manufactured in Vadavathoor at Kottayam; tubes and flaps for export will be manufactured in some other units. However, the manufacture for export is made on product specifications identified by the Unique Product Code generated for the purpose of filing returns before the Excise Authorities. 2. The assessee on manufacture of these products for export, stock transfers it on consignment to its godown at Puzhal in Tamil Nadu, which is stated to be a godown for stocking goods exclusively for the purpose of export. The export is from the said godown and it is an admitted fact that certain exports are carried out from the separate manufacturing units itself. 3. The assessee claimed input tax credit of the tax paid on purchase of raw materials from registered dealers to the extent of the stock transfer on consignment, made to the godown of the assessee at Tamil Nadu. The assessee approached the Clarificatory Authority, since it was opined by the assessing authorities that Section 13 would not be applicable since the stock transfer on consignment would not be in the course of export. The Clarificatory Authority found that the stock transfer can be said to be in the course of export only if there is certainty that the goods are headed for their foreign destination and not diverted for domestic use. On facts it was found that the manufactured goods received from various manufacturing units of the assessee are pooled at the godown in Tamil Nadu and exported outside the Country. The ultimate destination of the goods would be decided only after the goods are stocked in the godown at Tamil Nadu. On facts it was found that the manufactured goods received from various manufacturing units of the assessee are pooled at the godown in Tamil Nadu and exported outside the Country. The ultimate destination of the goods would be decided only after the goods are stocked in the godown at Tamil Nadu. The goods according to the Clarificatory Authority joined the export stream only from the godown at Puzhal in Tamil Nadu. 4. The learned Counsel for the appellant submits that the goods manufactured for export in Vadavathoor unit of the appellant is destined for export, especially since it is manufactured under the Unique Product Code and the returns filed before the Excise Authorities require the assessee to export the goods and otherwise scrap the same for reason of the assessee not having been assessed to any excise duty for the manufactured goods intended only for export. Hence, there could be no diversion of the manufactured goods as has been found by the Clarificatory Authority. The learned Counsel would also rely on the decisions of the Hon'ble Supreme Court reported in Burmah Shell Oil Storage and Distributing Co. of India Ltd. vs. Commercial Tax Officer, AIR 1961 SC 315 , Ben Gorm Nilgiri Plantations Co-Conoor (Nilgiris) vs. Sales Tax Officer, AIR 1964 SC 1752 and State of Haryana vs. Nipha Exports Pvt. Ltd. (2007) 8 VST 466 (SC). 5. The learned Senior Government Pleader, however, submits that merely because the assessee intended to export the goods manufactured, there can be no refund of input tax granted under Section 13, since the assessee would also have to prove that the stock transfer is in the course of export, for which a prior export order is imperative; without which there could be no claim raised that the stock transfer was in the course of export. The learned Government Pleader also submits that the decisions cited by the appellant would only indicate that without there being prior export order before the stock transfer is made, there can be no claim raised that the stock transfer was in the course of export. The sale of goods in the course of export is only the sale carried out from the godown at Tamil Nadu and the stock transfer from Kerala would not be in the course of such export. 6. The sale of goods in the course of export is only the sale carried out from the godown at Tamil Nadu and the stock transfer from Kerala would not be in the course of such export. 6. Nipha Exports Pvt. Ltd. is a case in which the assessee was engaged in the manufacture of machinery and parts thereof exclusively for the purpose of export out of the territory of India. During the relevant period, the branch office of the respondent purchased ginning machinery and spare components from registered dealers in the State of Haryana and despatched the same to its head office for export out of India in execution of the orders booked from the foreign buyers. The High Court noticed the categorical finding of the Assessing Authority that the orders were received directly by the Head Office from the foreign Country and the goods were not exported directly by the Faridabad dealer. The Tribunal also found that there was no case that the goods were sold by the branch office at Faridabad to Head Office at Calcutta and that the movement of the goods from Faridabad to Calcutta was made in the course of export of goods out of the territory of India, within the meaning of Section 5(1) of the Central Sales Tax Act, 1956. The Tribunal, however, rejected the claim of the petitioner finding that the movement of the goods from Branch Office at Faridabad to Head Office was a movement preceding the export. The High Court found that movement of goods from Faridabad to Calcutta was occasioned in the course of export out of the territory of India. The application of Mod. Serajuddin's Case (1975) 36 STC 136 was found to be not correct. The Hon'ble Supreme Court upheld the findings of the High Court. What we should specifically notice is that therein there was a prior export order on the basis of which the branch office purchased the machinery and spare parts for the purpose of manufacture at its Head Office and the transfer of such purchased machinery and spare parts to the Head Office, definitely was in the course of export. 7. Burmah Shell (supra) has to be noticed only to understand the dictum laid down as discernible from the extract from State of Travancore-Cochin vs. Bombay Co. 7. Burmah Shell (supra) has to be noticed only to understand the dictum laid down as discernible from the extract from State of Travancore-Cochin vs. Bombay Co. Ltd. (1952) SCR 1112, which is as follows:- “A sale by export thus involves a series of integrated activities commencing from the agreement of sale with a foreign buyer and ending with the delivery of the goods to a common carrier for transport out of the country by land or sea. Such a sale cannot be dissociated from the export without which it cannot be effectuated and the sale and resultant export form parts of a single transaction. Of these two integrated activities, which together constitute an export sale, whichever first occurs can well be regarded as taking place in the course of the other.” Again, what is to be emphasised is that the integrated activities commence from the agreement of sale with a foreign buyer and end with the delivery of the goods to a common carrier for transport out of the Country by land or sea. The transaction to be commence with in the course of export has to be the agreement of sale entered into with the foreign buyer or the purchase order, based on which the transaction commences. In the present case, the stock transfer has to originate with an export order, when alone it can be termed to be in the course of export. 8. State of Travancore-Cochin vs. Shanmugha Vilas Cashew Nut Factory, (1954) SCR 53, was also relied on with the following extract:- “The phrase integrated activities was used in the previous decision to denote that such sale (i.e. a sale which occasions the export) cannot be dissociated form the export without which it cannot be effectuated and the sale and the resultant export form parts of a single transaction. It is in that sense that the two activities - the sale and export - were said to be integrated. A purchase for the purpose of export like production or manufactured for export, is only an act preparatory to export and cannot, in our opinion, be regarded as an act done in the course of the export of the goods out of the territory of India any more than the other two activities can be so regarded.” (Emphasis supplied by us) 9. The Constitution Bench in Burmah Shell held so in Paragraph 26:- “26. The Constitution Bench in Burmah Shell held so in Paragraph 26:- “26. From the views here expressed, it follows that every sale or purchase preceding the export is not necessarily to be regarded as within the course of export. It must be inextricably bound up with the export, and a sale or purchase unconnected with the ultimate export as an integral part thereof is not within the exemption. It may thus be taken as settled that sales or purchases for the purpose of export are not protected, unless the sales or purchases themselves occasion the export and are an integral part of it. The views expressed in these two cases were accepted and applied in State of Madras vs. Gunviah Naidy and Co. Ltd. AIR 1956 SC 158 , Kailash Nath vs. State of U.P. AIR 1957 SC 790 , State of Mysore vs. Mysore Spinning and Manufacturing Co. Ltd. AIR 1958 SC 1002 and Gordhandas Lalji vs. B. Banerjee, AIR 1958 SC 1006 . These cases do not advance the matter further and it is, therefore, not necessary to refer to them in detail.” 10. In Burmah Shell, the question raised was whether aviation spirit loaded for consumption on board an aircraft travelling outside the country could be treated as a sale in the course of export. The Hon'ble Supreme Court in deciding the issue emphasized on the requirement of a foreign destination to find the transaction to be in the course of export. An illustration vividly expressing the difference was made. If goods are taken out of the country as ordered by the Health authorities for dumping into the sea, beyond the territorial waters, though there is transfer outside the country, there is no export since there is no destination specified. However, when goods are shipped on board a steamer with a specific destination in a foreign country, but are jettisoned in the course of the voyage, then despite the goods not reaching the destination, would be treated as export. It was held: “The difference lies in the fact that whereas the goods, in the first example, had no foreign destination, the goods, in the second example, had. It means, therefore, that while all exports involve a taking out of the country, all goods taken out of the country cannot be said to be exported. It was held: “The difference lies in the fact that whereas the goods, in the first example, had no foreign destination, the goods, in the second example, had. It means, therefore, that while all exports involve a taking out of the country, all goods taken out of the country cannot be said to be exported. The test is that the goods must have a foreign destination where they can be said to be imported. It matters not that there is no valuable consideration from the receiver at the destination end. If the goods are exported and there is sale or purchase in the course of that export and the sale or purchase occasions the export to a foreign destination, the exemption is earned.” 11. Identical was the declaration made in Ben Gorm Nilgiri Plantations Co-Conoor (Nilgiris) (supra) relying on the very same decision relied on in Burma Shell. It was held that “to constitute a sale in the course of export of goods out of the territory of India, common intention of the parties to the transaction to export the goods followed by actual export of the goods, to a foreign destination is necessary” (sic). It was also held that “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 immediately proceeding it” (sic). 12. On the binding declarations herein above it has to be held that unless the assessee proves that the stock transfer was in pursuance of an export order, there cannot be a contention raised that the stock transfer was in the course of export merely for the reason that the goods have been identified under the Central Excise Act to be exported. Even if there is no diversion of goods and if there is no export, then necessarily the intention is not served and it cannot be said that the benefit conferred specifically for the export of goods should also be extended to those goods manufactured for export, but eventually not actually exported. In fact, on each such stock transfer, the assessee could establish that the transfer of stock on consignment basis to the godown at Tamil Nadu was in pursuance of an export order. In fact, on each such stock transfer, the assessee could establish that the transfer of stock on consignment basis to the godown at Tamil Nadu was in pursuance of an export order. However, there cannot be any blanket clarification issued in so far as the entire manufactured goods consigned to the godown at Puzhal in Tamil Nadu being entitled to the refund of input tax under Section 13, categorising the consignment to be one in the course of export. 13. The mere fact that the goods so consigned is manufactured under a Unique Product Code enabling exemption from excise duty and specifically earmarked for export would not by that alone qualify for the consignment to be treated as a consignment made in the course of export. At the risk of repetition, we have to say that there can be no declaration that any goods consigned to the godown at Puzhal in Tamil Nadu is entitled to be considered as a consignment in the course of export. As a corollary, it is also to be stated that merely for the reason that the manufactured goods are first consigned to the godown at Tamil Nadu and then exported, it would not result in disentitling the assessee to a claim that the stock transfer is in the course of export. This would have to be proved by sufficient documents, which the assessee could produce before the Assessing Authority. 14. The stock transfer destined to Tamil Nadu cannot be said to be in the course of export, since the destination of the foreign buyer is not clear at the time stock transfer originates. The stock transfer is not on any specific export order and as has been admitted by the assessee, the goods manufactured for export, are pooled at the export godown at Tamil Nadu and the exports made in accordance with the orders made by the foreign buyer. These orders could be either before or after the stock transfer and if the goods are despatched on export in pursuance to a purchase order received after the stock transfer, the movement of goods from Kerala to Tamil Nadu cannot be termed in course of the export. 15. These orders could be either before or after the stock transfer and if the goods are despatched on export in pursuance to a purchase order received after the stock transfer, the movement of goods from Kerala to Tamil Nadu cannot be termed in course of the export. 15. While not interfering with the order of the Clarificatory Authority, we make it clear that the consideration as to whether a specific stock transfer on consignment, is in the course of export has to be considered by the Assessing Authority on the basis of the observations herein above. It is submitted by the learned Government Pleader that orders have already been passed by the Assessing Authority and matters are now pending before the Tribunal or the appellate authorities for the various years. The assessee would be entitled to substantiate their claim by producing necessary export orders before the Tribunal or any authority before whom the matter is pending. The O.T. Appeal is rejected, however, with the above reservations. No order as to costs.