Subject to the provisions of sub-section (5) of Section 5, every dealer who in the course of his business purchases any taxable goods in circumstances in which no tax under Section 5 is leviable on the sale price of such goods, and

(i) either consumes such goods in the manufacture of other goods for sale or otherwise or consumes otherwise, or disposes of such goods in any manner other than by way of sale in the State, or

(ii) despatches them to a place outside the State except as a direct result of sale or purchase in the course of inter-State trade or commerce,

shall be liable to pay tax on the purchase price of such goods at the same rate at which it would have been leviable on the sale price of such goods under Section 5:

Provided that this section shall not apply.-

(i) in respect of sale or purchase of goods specified in the Fourth Schedule,-

(a) which are taxable at the point of purchase; and

(b) which have already been subjected to tax under sub-section (4) of Section 5.

(ii) in respect of sale or purchase of goods specified in the Second Schedule which have already been subjected to tax under clause (a) of sub-section (3) of Section 5.

Explanation.- For the purpose of this section "consumes such goods in the manufacture" shall include goods consumed for ancillary purposes in or for such manufacture.