Form C penalty under the Central Sales Tax Act fails where goods are used for the registered purpose.

Penalty under section 10A read with section 10(d) of the Central Sales Tax Act, 1956 was unsustainable because goods purchased against Form C were used for the very purpose covered by the registration certificate. The registration certificate expressly covered printing of lottery tickets, and the attached list included the raw materials purchased at concessional rate. The fact that the activity was characterised as job-work or a works contract did not alter the statutory question. On these facts, the goods were used for the registered purpose, so the penalty was quashed.

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Issues: Whether penalty under section 10A read with section 10(d) of the Central Sales Tax Act, 1956 was leviable when goods were purchased against Form C for use in printing lottery tickets under the registration certificate.

Analysis: The registration certificate covered printing of lottery tickets and the list attached to it included the raw materials purchased against Form C. The Court treated the use of those materials in printing lottery tickets as use for the very purpose for which registration had been granted. The circumstance that the printing activity was treated as job-work or works contract did not control the penalty question. For clause (d) of section 10 of the Central Sales Tax Act, 1956, the decisive consideration was whether the goods purchased against Form C were used for the registered purpose, and on the facts they were so used.

Conclusion: Penalty under section 10A read with section 10(d) of the Central Sales Tax Act, 1956 was not sustainable and was quashed in favour of the assessee.

Final Conclusion: The revisions succeeded and the penalty order did not survive.

Ratio Decidendi: Penalty for misuse of Form C cannot be sustained where the goods purchased at concessional rate are used for the precise purpose for which registration was granted.

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