The key to solving this problem is to recognize the following concept. If the ratio of blue paint (B) to yellow paint (Y) in the original mixture was 4:1, then the same ratio for the two paints will hold when a certain quantity of the mixture is taken out.

So, the ratio of Y to B in new mixture = 4:1. Assume x is the multiplier. Then, the quantities of Y and B in the new mixture are respectively, 4x and 1x. If we can determine the value of x, we can determine the quantities of the respective paints in the new mixture. The difference between the original quantity (40 litres) and the new total quantity (4x + 1x) will be the amount of the mixture that was taken out.

Four litres of each of B and Y were added to the new mixture. Hence, the new ratio will be (4x+4)/(x+4). This should be equal to 8:3 (given). Solving for x, we get x = 5 litres.

Therefore, the total quantity of the new mixture is equal to (4x+1x) or 25 litres. Since the original quantity of the mixture was 40 litres, the amount of the mixture that was taken out is equal to 40 - 25 = 15 litres.

Answer: C