UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                             -----------------------

                                    FORM 10-Q
                   Quarterly Report Under Section 13 or 15(d)
              of the United States Securities Exchange Act of 1934

                             -----------------------


For The Quarter Ended June 30, 1996                  Commission File No. 2-95011


                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
             (Exact name of registrant as specified in its charter)


         Massachusetts                                                04-2846629
(State or other jurisdiction of                                 (I.R.S. Employer
incorporation or organization)                               Identification No.)


    One Financial Center, 21st Floor, Boston, MA                           02111
(Address of principal executive offices)                              (Zip Code)


Registrant's telephone number, including area code                (617) 482-8000

                           --------------------------


                                 Not Applicable
              (Former name, former address and former fiscal year,
                          if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                                  Yes X No ___

                             There are no Exhibits.

                                  Page 1 of 14






                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)


                                    INDEX                                                                            Page No.

                                                                                                               
Part I.       FINANCIAL INFORMATION

              Financial Statements

                    Balance Sheets as of June 30, 1996 and December 31, 1995                                              3

                    Statements of Operations For the Quarters Ended
                          June 30, 1996 and 1995 and For the Six Months Ended
                          June 30, 1996 and 1995                                                                          4

                    Statements of Cash Flows For the Six Months Ended
                          June 30, 1996 and 1995                                                                          5

                    Notes to Financial Statements                                                                     6 - 8

              Management's Discussion and Analysis of Financial Conditions
                    and Results of Operations                                                                        9 - 11

              Computer Equipment Portfolio                                                                               12

Part II.      OTHER INFORMATION

              Items 1 - 6                                                                                                13

              Signature                                                                                                  14








                          PART I. FINANCIAL INFORMATION

                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)

                                 Balance Sheets

                                                             Assets                 (Unaudited)            (Audited)
                                                                                      6/30/96               12/31/95

                                                                                                                
Investment property, at cost (note 3):
   Computer equipment                                                            $        592,514        $      1,495,761
     Less accumulated depreciation                                                        398,464               1,217,633
                                                                                 ----------------        ----------------
       Investment property, net                                                           194,050                 278,128

Cash and cash equivalents                                                                  84,478                  58,929
Marketable securities (note 6)                                                             39,353                  44,599
Rents receivable, net (note 2)                                                                711                  25,775
Sales receivable                                                                              600                      50
                                                                                 ----------------        ----------------

     Total assets                                                                $        319,192        $        407,481
                                                                                 ================        ================

                        Liabilities and Partners' Equity
Liabilities:
   Current portion of long-term debt (note 5)                                    $          9,706        $         38,051
   Accounts payable and accrued expenses - affiliates (note 4)                              7,891                   8,210
   Accounts payable and accrued expenses                                                  133,849                 176,888
   Unearned rental revenue                                                                 10,954                   2,176
                                                                                 ----------------        ----------------

     Total liabilities                                                                    162,400                 225,325
                                                                                 ----------------        ----------------

Partners' equity:
   General Partner:
     Capital contribution                                                                   1,000                   1,000
     Cumulative net income                                                                613,060                 540,111
     Cumulative cash distributions                                                       (630,754)               (624,170)
     Unrealized losses on marketable securities (note 6)                                     (131)                    (79)
                                                                                 ----------------        ----------------
                                                                                          (16,825)                (83,138)
                                                                                 ----------------        ----------------
   Limited Partners (25,020 units):
     Capital contribution, net of offering costs                                       11,139,685              11,139,685
     Cumulative net income                                                              1,031,248                 992,631
     Cumulative cash distributions                                                    (11,984,330)            (11,859,230)
     Unrealized losses on marketable securities (note 6)                                  (12,986)                 (7,792)
                                                                                 ----------------        ----------------
                                                                                          173,617                 265,294
                                                                                 ----------------        ----------------
     Total partners' equity                                                               156,792                 182,156
                                                                                 ----------------        ----------------

     Total liabilities and partners' equity                                      $        319,192        $        407,481
                                                                                 ================        ================


                 See accompanying notes to financial statements.







                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)

                            Statements of Operations
                                   (Unaudited)

                                                     Quarters Ended                         Six Months Ended
                                                        June 30,                                June 30,
                                            -------------------------------        ---------------------------------
                                                 1996              1995                1996                1995
                                            -------------------------------        ---------------------------------

                                                                                                     
Revenue:
   Rental income                            $     22,949       $    113,181         $    101,216        $    249,462
   Other income                                        -             24,764                    -              51,223
   Interest income                                 1,162              1,532                2,075               5,051
   Net gain (loss) on sale
     of equipment                                 43,458                836              139,983             (47,379)
   Recovery of unsecured
     pre-petition claim                                -             44,275                    -              44,275
                                            ------------       ------------         ------------        ------------

       Total revenue                              67,569            184,588              243,274             302,632
                                            ------------       ------------         ------------        ------------

Costs and expenses:
   Depreciation                                   33,367             60,461               66,734             173,608
   Interest                                          390                424                1,066               3,308
   Related party expenses (note 4):
     Management fees                               5,112              6,536                8,458              15,971
     General and administrative                   21,119             20,623               38,594              34,480
   (Reversal of) provision for
     doubtful accounts                            16,856             (7,327)              16,856              (7,327)
                                            ------------       ------------         ------------        ------------

       Total costs and expenses                   76,844             80,717              131,708             220,040
                                            ------------       ------------         ------------        ------------

Net (loss) income                           $     (9,275)      $    103,871         $    111,566        $     82,592
                                            ============       ============         ============        ============

Net (loss) income per Limited
   Partnership Unit                         $      (2.10)      $       3.94         $       1.54        $      (0.09)
                                            ============       ============         ============        ============


                 See accompanying notes to financial statements.







                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)

                            Statements of Cash Flows
                 For the Six Months Ended June 30, 1996 and 1995
                                   (Unaudited)

                                                                                             1996                    1995
                                                                                             ----                    ----

                                                                                                                    
Cash flows from operating activities:
   Net income                                                                          $    111,566             $      82,592
                                                                                       ------------             -------------

   Adjustments  to  reconcile  net  income  to net cash
     provided  by  operating activities:
       Depreciation                                                                          66,734                   173,608
       (Reversal of) provision for doubtful accounts                                         16,856                    (7,327)
       Net (gain) loss on sale of equipment                                                (139,983)                   47,379
       Net decrease (increase) in current assets                                              7,658                   (38,584)
       Net decrease in current liabilities                                                  (34,580)                  (73,585)
                                                                                       ------------             -------------

         Total adjustments                                                                  (83,315)                  101,491
                                                                                       ------------             -------------

         Net cash provided by operating activities                                           28,251                   184,083
                                                                                       ------------             -------------

Cash flows from investing activities:
   Purchase of investment property                                                                -                  (167,898)
   Proceeds from sales of investment property                                               157,327                    14,379
                                                                                       ------------             -------------

         Net cash provided by (used in) investing activities                                157,327                  (153,519)
                                                                                       ------------             -------------

Cash flows from financing activities:
     Principal payments on long-term debt                                                   (28,345)                  (26,146)
     Cash distributions to partners                                                        (131,684)                 (256,784)
                                                                                       ------------             -------------

         Net cash used in financing activities                                             (160,029)                 (282,930)
                                                                                       ------------             -------------

Net increase (decrease) in cash and cash equivalents                                         25,549                  (252,366)

Cash and cash equivalents at beginning of period                                             58,929                   325,125
                                                                                       ------------             -------------

Cash and cash equivalents at end of period                                             $     84,478             $      72,759
                                                                                       ============             =============

Supplemental cash flow information:
   Interest paid during the period                                                     $      1,066             $       4,385
                                                                                       ============             =============



                 See accompanying notes to financial statements.





                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)

                          Notes to Financial Statements
            For the Six Months Ended June 30, 1996 and June 30, 1995
                                   (Unaudited)

(1)   Organization and Partnership Matters

The foregoing financial statements of Wellesley Lease Income Limited Partnership
III-C (the  "Partnership")  have been prepared in accordance  with the rules and
regulations of the Securities and Exchange  Commission for Form 10-Q and reflect
all  adjustments  which are, in the opinion of management,  necessary for a fair
presentation of the results for the interim periods presented.  Pursuant to such
rules and  regulations,  certain note  disclosures  which are normally  required
under  generally  accepted  accounting  principles  have  been  omitted.  It  is
recommended  that these  financial  statements be read in  conjunction  with the
Partnership's Annual Report on Form 10-K for the year ended December 31, 1995.

(2)   Summary of Significant Accounting Policies

Allowance for Doubtful Accounts

The financial statements include an allowance for estimated losses on receivable
balances.  The  allowance  for  doubtful  accounts  is based on past  write  off
experience  and an evaluation  of potential  uncollectible  accounts  within the
current  receivable  balances.  Receivable  balances  which are determined to be
uncollectible  are charged against the allowance and subsequent  recoveries,  if
any, are credited to the allowance.  At June 30, 1996 and December 31, 1995, the
allowance for doubtful  accounts  included in rents  receivable  was $17,670 and
$814, respectively.

(3)   Investment Property

At June 30, 1996, the  Partnership  owned computer  equipment with a depreciated
cost basis of $194,050,  subject to existing  leases.  All purchases of computer
equipment are subject to a 3% acquisition fee paid to the General Partner.





                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)

                          Notes to Financial Statements
            For the Six Months Ended June 30, 1996 and June 30, 1995
                                   (Unaudited)

(4)   Related Party Transactions

Fees,  commissions  and other expenses paid or accrued by the Partnership to the
General  Partner or affiliates  of the General  Partner for the six months ended
June 30, 1996 and 1995, are as follows:



                                                      1996               1995
                                                      ----               ----

                                                                        
Equipment acquisition fees                        $          -       $      4,890
Management fees                                          8,458             15,971
Reimbursable expenses paid                              44,506             36,787
                                                  ------------       ------------

                                                  $     52,964       $     57,648
                                                  ============       ============


Under the terms of the Partnership Agreement, the General Partner is entitled to
an equipment acquisition fee of 3% of the purchase price paid by the Partnership
for the  equipment.  The General  Partner is also  entitled to a management  fee
equal to 7% of the monthly rental billings collected. The Partnership reimburses
the General Partner and its affiliates for certain expenses  incurred by them in
connection with the operation of the Partnership.

(5)   Long-term Debt

Long-term  debt at June 30, 1996  consists of a $9,706  nonrecourse  installment
note  with an  interest  rate of 8.10%  from  Pioneer  Bank and  Trust  Company,
collateralized  by the equipment with a net book value of $46,680 and assignment
of the related lease. Such long-term debt of $9,706 matures in 1996.

(6)   Fair Values of Financial Instruments

Pursuant to Statement of Financial Accounting Standards No. 115, "Accounting for
Certain Investments in Debt and Equity  Securities," which requires  investments
in debt and equity  securities  other than those  accounted for under the equity
method  to be  carried  at fair  value or  amortized  cost  for debt  securities
expected to be held to maturity,  the Partnership has classified its investments
in equity  securities as available  for sale.  Accordingly,  the net  unrealized
gains and losses computed in marking these  securities to market are reported as
a component of partners'  equity.  At June 30, 1996 the  difference  between the
fair  value and the cost  basis of these  securities  is an  unrealized  loss of
$13,117.






                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)

                          Notes to Financial Statements
            For the Six Months Ended June 30, 1996 and June 30, 1995
                                   (Unaudited)

The fair value is based on currently  quoted market  prices.  The cost basis and
estimated fair value of the Partnership's marketable securities at June 30, 1996
and December 31, 1995, respectively, are as follows:



                                                                            June 30, 1996                 December 31, 1995
                                                                       ----------------------       -------------------------

                                                                       Cost           Fair          Cost               Fair
                                                                       Basis          Value         Basis             Value


                                                                                                              
Investment in Continental Information
     Systems Corporation Stock                                         $ 52,470      $ 39,353       $ 52,470         $ 44,599
                                                                       ========      ========       ========         ========









                   WELLESLEY INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)

                     Management's Discussion and Analysis of
                  Financial Condition and Results of Operations
                                   (Unaudited)

Results of Operations

The following discussion relates to the Partnership's operations for the quarter
and six months ended June 30, 1996, compared to the same periods in 1995.

The  Partnership  realized  a net loss of $9,275 and net income of  $103,871 for
the  quarters  ended  June  30,  1996  and  1995,  respectively.  Rental  income
decreased  $90,232 or 80% in 1996.  The decrease is  primarily  due to a $53,340
adjustment  for an overaccrual  of rental  income recognized  in prior  periods,
relating to  equipment  that came off lease and was returned to  inventory.  The
other factors  impacting  rental income for the second quarter of 1996, were the
lower  rental rates obtained  on equipment  lease  extensions  and  remarketings
resulting  after the  initial  lease term  expires  and the net  decrease in the
overall size of the equipment  portfolio.  Other income  reported in 1995 is the
result of the reduction of overstated liabilities recorded in prior periods. The
net gain on sale of equipment of $43,458 can be attributed to sales of primarily
fully  depreciated  equipment during the current  quarter,  versus a net gain on
sale of equipment of $836  recognized in the prior  period.  The recovery of the
unsecured  pre-petition  claim  in the  prior  quarter  was  the  result  of the
establishment  of the carrying  value of the stock  received in the December 27,
1994 distribution from the Trustee of the Liquidating Estate of CIS Corporation,
et al.  The  receivables  associated  with the stock  settlement  had been fully
reserved  in a prior  year;  accordingly,  the  Partnership  was  able to show a
recovery on those  receivables  as of June 30, 1995,  at which time an objective
stock value could be determined due to the stock's trading activities.

Total costs and expenses decreased $3,873 or 5% between the three month periods.
The decrease in costs and  expenses is primarily a result of lower  depreciation
expense,  offset by the  fluctuation  in the  provision  for doubtful  accounts.
Depreciation  expense  decreased $27,094 in the current quarter due to a portion
of the equipment  portfolio  becoming fully  depreciated.  For the quarter ended
June 30, 1996, the Partnership  recognized a provision for doubtful  accounts of
$16,856 for  delinquent  rents  receivable.  During the same period in 1995, the
Partnership was able to reverse a portion of its provision for doubtful accounts
taken in a prior  period due to  successful  collection  efforts  on  delinquent
accounts. Management fees expense decreased between the three month periods as a
result of the decrease in rental income. However, the decline in management fees
was not as  significant  as the  decline in rental  income due to the  increased
collections of rental receivables that occurred in the second quarter of 1996.
General and administrative expenses remained relatively constant.






                   WELLESLEY INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)

                     Management's Discussion and Analysis of
                  Financial Condition and Results of Operations
                                   (Unaudited)

The Partnership realized net income of $111,566 and $82,592 and rental income of
$101,216  and  $249,462  for the six  months  ended  June  30,  1996  and  1995,
respectively.  This overall decrease in rental income can be attributed to lower
rental rates obtained on equipment lease extensions and  remarketings  after the
initial lease term expires,  an overall reduction in the equipment portfolio and
the second quarter of 1996 rental income  adjustment,  as mentioned above. Other
income,  reported  in  1995,  is the  result  of  the  reduction  of  overstated
liabilities  recorded in prior  periods,  as discussed  in the quarter  analysis
above.  Interest income decreased $2,976 as a result of lower average short-term
investment  balances  held during  1996.  The net gain on sale of  equipment  of
$139,983 can be attributed  to sales of primarily  fully  depreciated  equipment
during 1996,  versus a net loss of $47,379  recognized in the prior period.  The
recovery  of the  unsecured  pre-petition  claim in 1995 was the  result  of the
establishment  of the carrying  value of the stock  received in the December 27,
1994 distribution from the Trustee of the Liquidating Estate of CIS Corporation,
et al.  The  receivables  associated  with the stock  settlement  had been fully
reserved  in a prior  year;  accordingly,  the  Partnership  was  able to show a
recovery on those  receivables  as of June 30,  1995 at which time an  objective
stock value could be determined due to the stock's trading activities.

Total costs and expenses decreased $88,332 or 40% between the six month periods.
The decrease in costs and expenses is primarily the result of lower depreciation
expense.  As  discussed  above in the  quarter  analysis,  depreciation  expense
decreased  $106,874 or 62% between  1995 and 1996 due to a large  portion of the
equipment  portfolio  becoming fully  depreciated and reduction in the equipment
portfolio.  Interest expense  decreased  $2,242,  in relation to the decrease in
long-term debt outstanding. Management fees decreased overall due to the decline
in rental income. General and administrative  expenses increased $4,114, or 12%.
As mentioned above, a major factor contributing to this increase is the salaries
and  expenses of the  partnership  accounting  and  reporting  personnel  of the
General Partner, which are reimbursable,  are being allocated over a diminishing
number  of  partnerships.  As  discussed  in the  quarter  analysis  above,  the
Partnership  recognized  a  provision  for  doubtful  accounts  of  $16,856  for
delinquent rents receivable,  in the current quarter.  During the same period in
1995,  the  Partnership  was able to  reverse a  portion  of its  provision  for
doubtful accounts taken in a prior period due to successful  collection  efforts
on delinquent accounts.

The  Partnership had a net loss and net income per Limited  Partnership  Unit of
$2.10 and $3.94 for the quarters ended June 30, 1996 and 1995, respectively, and
net income  and a net loss of $1.54 and $0.09 for the six months  ended June 30,
1996 and 1995,  respectively.  The  allocation for the six months ended June 30,
1996 and 1995,  includes a cost recovery allocation of profit and loss among the
General and Limited  Partners  which results in an allocation of net loss to the
Limited Partners in the first quarter of 1996. This cost recovery  allocation is
required  to  maintain  capital   accounts   consistent  with  the  distribution
provisions of the Partnership  Agreement.  In certain periods, the cost recovery
allocation  of profit  and loss may result in an  allocation  of net loss to the
Limited Partners in instances when the Partnership's  operations were profitable
for the period.






                   WELLESLEY INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)

                     Management's Discussion and Analysis of
                  Financial Condition and Results of Operations
                                   (Unaudited)

Liquidity and Capital Resources

For the six months ended June 30, 1996,  rental revenue generated from operating
leases and sales  proceeds  generated  from  equipment  sales  were the  primary
sources of funds for the Partnership. As equipment leases terminate, the General
Partner  determines  if the  equipment  will be  extended  to the  same  lessee,
remarketed to another lessee,  or if it is less marketable,  sold. This decision
is made upon analyzing which options would generate the most favorable results.

Rental income will continue to decrease due to two factors.  The first factor is
the lower rate obtained due to the  remarketing  of existing  equipment upon the
expiration of the original lease.  Typically the remarketed  rates are lower due
to the decrease in useful life of the equipment. Secondly, the increasing change
of technology in the computer  industry  usually  decreases the demand for older
equipment,  thus  increasing  the  possibility  of  obsolescence.  Both of these
factors together will cause remarketed rates to be lower than original rates and
will cause certain leases to terminate upon expiration.  This decrease, however,
should  not  affect  the   Partnership's   ability  to  meet  its  future   cash
requirements,  including  its  long-term  debt  obligations.  To the extent that
future cash flows should be  insufficient  to meet the  Partnership's  operating
expenses and liabilities, additional funds could be obtained through the sale of
equipment,  or a  reduction  in the rate of cash  distributions.  Future  rental
revenues amount to $156,981 and are to be received over the next two years.

The Partnership's investing activities for the first six months of 1996 resulted
in equipment sales with a depreciated cost basis of $17,344, generating $157,327
in proceeds. The Partnership has no material capital expenditure commitments and
will not purchase equipment in the future as the Partnership has reached the end
of its reinvestment period.

The Partnership's  financing  activities resulted in a paydown on long-term debt
during the period of $28,345.  Such  long-term debt bears interest at 8.10% with
installments to be paid monthly. Total long-term debt assumed by the Partnership
from inception is $10,641,478, for a total leverage of 43%.

Cash  distributions  are  currently  at  an  annual  level  of  2%  per  Limited
Partnership  Unit, or $2.50 per Limited  Partnership  Unit on a quarterly basis.
For  the  quarter  ended  June  30,  1996,  the  Partnership   declared  a  cash
distribution  of $65,842,  of which $3,292 was allocated to the General  Partner
and $62,550 was allocated to the Limited Partners. The distribution will be made
on August 29, 1996. The  Partnership  expects to continue paying at or near this
level in the future.  The effects of inflation have not been  significant to the
Partnership  and are not  expected  to have any  material  impact in the  future
periods.

On  January 9, 1996,  TLP  Holding  LLC  purchased  all the common  stock of TLP
Leasing  Programs,  Inc.  from CMI Holding Co.  Under the new  ownership,  it is
expected  that TLP Leasing  Programs,  Inc. will continue to operate in the same
manner of business as it has in the past.






                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)

                    Computer Equipment Portfolio (Unaudited)
                                  June 30, 1996

Lessee

Baylor Health Network, Incorporated
Centura Bank
Hughes Aircraft Company, Incorporated
J. Walter Thompson & Co.
NYNEX National, Incorporated
Sports & Recreation, Incorporated
USG Corporation
Xerox Corporation



Equipment Description                         Acquisition Price

                                                         
Computer peripherals                             $      112,578
Processors & upgrades                                   314,032
Telecommunications                                      148,129
Other                                                    17,775
                                                 --------------

                                                 $      592,514
                                                 ==============







                           PART II. OTHER INFORMATION

                WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
                      (A Massachusetts Limited Partnership)


            
Item 1.        Legal Proceedings
               Response:  None

Item 2.        Changes in the Rights of the Partnership's Security Holders
               Response:  None

Item 3.        Defaults by the Partnership on its Senior Securities
               Response:  None

Item 4.        Results of Votes of Security Holders
               Response:  None

Item 5.        Other Information
               Response:  None

Item 6.        Exhibits and Reports on Form 8-K
               Response:

               A.  None

               B.  None






                                    SIGNATURE

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

WELLESLEY LEASE INCOME LIMITED PARTNERSHIP III-C
(Registrant)

By:    Wellesley Leasing Partnership,
       its General Partner

By:    TLP Leasing Programs, Inc.,
       one of its Corporate General Partners


Date:  August 14, 1996

By:    Arthur P. Beecher,
       President