Strict proof for inter-State sales exemption upheld where form C was mandatory evidence of statutory eligibility.

Section 6(2) of the Central Sales Tax Act permits exemption for a subsequent inter-State sale only on strict proof that the goods fall within section 8(3) and that the seller satisfies the registered dealer requirement. The Court reasoned that the State's rule-making power under section 13 allowed Rule 12(3)(ii) to prescribe form C as the exclusive mode of proof, because this did not add an inconsistent substantive condition but only filled the evidentiary gap left by the Act. The rule was therefore treated as mandatory, and failure to furnish form C disentitled the assessee to the exemption.

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Issues: Whether rule 12(3)(ii) of the Central Sales Tax (Andhra Pradesh) Rules, requiring production of form C in addition to form E-I for claiming exemption under section 6(2) of the Central Sales Tax Act, 1956, was valid and mandatory.

Analysis: The exemption under section 6(2) applied only to a subsequent inter-State sale of goods of the description referred to in section 8(3), and the Act required strict proof of the basic facts for claiming the benefit. Section 13 conferred rule-making power on the State Government so long as the rules were not inconsistent with the Act or the Central Rules. The Court held that requiring form C as proof of the seller being a registered dealer and as evidence that the goods answered the description in section 8(3) did not add an inconsistent condition, but merely filled the gap left by section 6(2) on the mode of proof. The rule was intended to make the evidentiary requirement uniform and exclusive, and reading it as merely directory would defeat that purpose.

Conclusion: Rule 12(3)(ii) was held to be intra vires and mandatory, and the assessee's failure to furnish form C disentitled it to exemption under section 6(2).

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