29 C.F.R. § 779.332 Resale of Goods In an Altered Form Or As Parts Or Ingredients of Other Goods Or Services

• Library: Code of Federal Regulations
• Edition: 2023 Edition
• Currency: Current through September 30, 2023

Sale for resale includes the sale of goods which will be resold in their original form, in an altered form, or as a part or ingredient of another article. A sale of goods which the seller knows, or has reasonable cause to believe, will be resold after processing or manufacture is a sale for resale. Thus, sales of parts with the expectation that they will be incorporated in aircraft and that the aircraft will be sold clearly are sales for resale. ( Arnold v. Ben Kanowsky, Inc.,361 U.S. 388.) Similarly, the sale of lumber to furniture or box factories, or the sale of textiles to clothing manufacturers, is a sale for resale even though the goods are resold in the form of furniture or clothing. The principle is also illustrated in cases where the article sold becomes a part or an ingredient of another, such as scrap metal in steel, dyes in fabrics, flour in bread and pastries, and salt in food or ice in beverages. ( Mitchell v. Douglas Auto Parts Co.,...