C-form concessional purchase fails when goods are used only in job-work manufacture, not for sale by the purchasing dealer.

Goods purchased against C forms qualify for the concessional purchase facility under section 8(3)(b) only when the registered dealer uses them in manufacturing or processing goods for sale by that dealer. Where the dealer uses the goods merely in job-work to produce intermediate goods for another concern, the statutory requirement is not met. On the facts, the assessee manufactured tread rubber as a job worker, while the tyres ultimately sold were manufactured by the other concern. Section 10(d) liability therefore arose, and the penalty order was upheld.

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Issues: Whether goods purchased against C forms and used by the assessee in job-work manufacture satisfied section 8(3)(b) of the Central Sales Tax Act, 1956 so as to avoid liability under section 10(d).

Analysis: The concessional purchase facility under section 8(3)(b) applies where the registered dealer uses the purchased goods in the manufacture or processing of goods intended for sale. The Court held that the manufacture or processing contemplated by the provision must be by the purchasing dealer, and the goods so manufactured must themselves be the goods brought to sale. On the facts, the assessee used the goods to manufacture tread rubber only as a job worker for another concern, while the tyres ultimately sold were manufactured by that other concern. The authorities relied on by the assessee did not assist, because they did not cover a situation where the goods manufactured by the assessee were not themselves brought to sale by or through the assessee in the relevant sense.

Conclusion: The assessee did not satisfy section 8(3)(b), and liability under section 10(d) was attracted.

Final Conclusion: The penalty order was upheld and the appeal failed.

Ratio Decidendi: For section 8(3)(b), the purchased goods must be used by the registered dealer in the manufacture or processing of goods for sale by that dealer, and mere use in job-work production of intermediate goods later employed by another person for sale does not satisfy the statutory requirement.

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