Concessional tax declarations must match the recognised manufacturing unit's permitted use, or false declaration liability follows.

Under the U.P. Trade Tax scheme, Form IIIB for concessional purchase of raw material is available only where the goods are to be used in the recognised manufacturing unit covered by the recognition certificate within the State. A declaration issued for tendu patta intended for use in a unit outside the State was treated as contrary to the statutory requirement and, because it was knowingly issued for an impermissible use, attracted liability for a false declaration. The earlier Delhi ruling in Polestar Electronic was distinguished on the basis of different statutory wording and form restrictions.

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Issues: Whether the assessee was entitled to issue Form IIIB and claim concessional tax on purchase of tendu patta when the raw material was intended for use in a manufacturing unit outside Uttar Pradesh, and whether such declaration amounted to a false declaration attracting liability under section 3B.

Analysis: On a harmonious reading of section 4B(2) of the U.P. Trade Tax Act and rule 25B(1) of the U.P. Trade Tax Rules, 1948, the facility of issuing Form IIIB was held to be available only to a dealer holding a recognition certificate for use of the goods as raw material in the manufacturing unit covered by that certificate within Uttar Pradesh. The form itself contemplated that the manufactured goods would be sold in the manner contemplated by section 4B(2), which the Court read as requiring both manufacture and sale to fall within the statutory scheme applicable to a unit in the State. Since the assessee knew at the time of purchase that the tendu patta would be used in a unit outside Uttar Pradesh, the declaration was held to be contrary to the statutory requirement. Section 3B was applied because a declaration knowingly issued for a purpose outside the permitted statutory use was deemed to be wrong. The reliance on Polestar Electronic was rejected as distinguishable because the Delhi form and statutory context there did not contain the same restriction as Form IIIB under the U.P. regime.

Conclusion: The assessee had no right to issue Form IIIB for raw material intended for use in a unit outside Uttar Pradesh, and the declaration was false within the meaning of section 3B.

Ratio Decidendi: Where a declaration form for concessional tax under the U.P. Trade Tax scheme is statutorily tied to use of raw material in a recognised manufacturing unit within the State, a declaration issued for use in a unit outside the State is false and attracts liability under section 3B.

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