Purchase tax on construction materials does not arise where goods are used in sea wall works and not manufactured into saleable goods.

Purchase tax under section 5A(1)(a) of the Kerala General Sales Tax Act applies only when purchased goods are consumed in the manufacture of other goods for sale or for a comparable qualifying use; the phrase "or otherwise" does not extend the provision to every form of consumption. Materials bought by a contractor for constructing or repairing sea walls were used in immovable property works and did not undergo manufacture into other goods. On that reasoning, the purchase of granite and similar materials was not exigible to purchase tax, and the Revenue's revision failed.

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Issues: Whether the purchase of granite and other materials by a contractor for use in the construction and repair of sea walls was liable to purchase tax under section 5A(1)(a) of the Kerala General Sales Tax Act, 1963.

Analysis: Liability under section 5A(1)(a) arises only when goods purchased are consumed in the manufacture of other goods for sale or otherwise. The expression "or otherwise" qualifies "sale" and does not widen the clause so as to cover every kind of consumption. Materials used by a contractor in constructing or repairing sea walls do not undergo manufacture into other goods; they become part of immovable property. The later decision construing the same kind of language was followed as the directly applicable precedent.

Conclusion: The purchase of materials by the contractor for use in the construction and repair of sea walls was not exigible to tax under section 5A(1)(a), and the revision filed by the Revenue failed.

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