S. B. SINHA, J.

( 1 ) LEAVE granted.

( 2 ) APPELLANT manufactures Steel Ingots. It purchased iron scrap from the Railways in public auction. Iron scrap is melted and converted into the finished products. Appellant had been accorded recognition under Section 4-B (2) of the U. P. Trade Tax act (for short "the Act") in terms whereof it became entitled to purchase raw-materials for manufacturing purpose at a concessional rate of tax. In the year 1985-86, it purchased 2532. 989 M. T. of iron scrap. Allegedly, the lots contained various categories of iron scraps as it was purchased on "as is where is basis". Appellant allegedly was not allowed to sort out the scrap at the time of purchase as the conditions specified therein were :

"1]. The material will be sold of "as IS WHERE IS" basis. 2]. No sorting, picking whatsoever under any circumstances will be allowed. 3]. The purchaser will be required to take delivery of the material from the lots. 4]. The purchaser should inspect the lots prior to the auction. "

( 3 ) APPELLANTS stated that about 9. 47% of the total amount of scrap purchased, i. e. , 239. 966 M. T, could not be utilized by it. It sold the said goods to other dealers at a conces