IMPORTANT POINT
The main legal point established in the judgment is the limited scope of revisional jurisdiction, focusing on jurisdictional errors, perversity, and procedural irregularities. The court emphasized the principles outlined in Hindustan Petroleum Corporation Limited v. Dilbahar Singh and Vinod Kumar Tiwari v. State of U.P. to underscore the boundaries within which revisional jurisdiction is to be exercised.

JUDGMENT :

1. This is a revision petition under Section 58 of the Uttar Pradesh Value Added Tax Act, 2008 (hereinafter referred to as the ‘UPVAT Act, 2008’) preferred by The Commissioner, Commercial Tax, U.P., Lucknow (hereinafter referred to as the ‘Revisionist’) against the impugned order dated January 25, 2023, passed by the Commercial Tax Tribunal. The Opposite Party in the instant revision application is M/S Godfrey Philips India Ltd.

FACTS

2. The factual matrix of the instant lis has been delineated below:

a. Opposite Party is in the business of manufacture and sale of cigarettes, tea leaves, pan masala, and other different items. For the Assessment Year 2012 – 13, as per the Revisionist, the Opposite Party had admitted a purchase turnover and stock transfer of goods to the tune of INR 3,21,65,65,914/-and sale turnover inside U.P. to the extent of INR 1,99,27,81,937/-and admitted a tax liability of INR 62,53,93,015/-.

b. A survey was conducted by the S.I.B., Ghaziabad, on the production unit of the Opposite Party on February 2, 2012, and at the time of survey, 14,338 cartons containing 17,04,84,000 cigarettes were found whereas in the books of account stock of 14,818 cartons were found as recorded according to the Revisionist. Accordingly, a total sum of 480 cartons were found less on physical verification.

c. Since, the rate of tax on cigarette was enhanced to 50% from July 1, 2012, the assessing authority took the view that 480 cartons were sold on July 1, 2012, and July 2, 2012, and no sale invoices thereof were issued in order to escape the actual sales. On this ground, the account books were rejected and evaded turnover of cigarette was determined at INR 6,00,00,000/-beside evaded purchases of tobacco paper and packing material was determined at INR 2,55,00,000/-. The evaded sale of cigar was determined at INR 58,261 and an additional liability was created of INR 78,75,000/-+ INR 75,00,000/ -= INR 1,53,75,000/-on sales, and a tax liability on purchases at INR 29,75,000/- and on sale of cigar at INR 29,131/-.

d. Aggrieved by the order dated December 3, 2015, passed by the assessing authority, the Opposite Party preferred first appeal before the Additional Commissioner, Grade – 2 (Appeal) -1st, Ghaziabad. The first appellate authority vide its order dated March 8, 2016, rejected the reconciliation figures submitted by the Opposite Party and upheld the order passed by the assessing authority. Being aggrieved by the order dated March 8, 2016, passed by the first appellate authority, the Opposite Party preferred second appeal before the Commercial Tax Tribunal, Bench – I, Ghaziabad. The second appellate authority vide its order dated January 25, 2023, accepted the contention of the Opposite Party that there was no difference in the stock of the cigarettes and the stock found was in accordance with the stock ledger. The second appellate authority further held that the surveying authority had committed fault in counting the cartons. Accordingly, the second appeal filed by the Opposite Party was allowed and the account books were accepted by the second appellate authority.

e. The Revisionist filed the instant revision application under Section 58 of the UPVAT Act, 2008 against the impugned order dated January 25, 2023, passed by the second appellate authority.

CONTENTIONS OF THE REVISIONIST

3. Mr. Ravi Shankar Pandey, learned Additional Chief Standing Counsel appearing on behalf of the Revisionist has advanced the following submissions:

(i) The second appellate authority was not legally justified in accepting the contention of the Opposite Party that the surveying authority committed error in counting the stock which resulted in noting shortage of 480 cartons.

(ii) At the time of survey dated July 2, 2012, the counting of stock was conducted in the presence of Sri Pankaj Pataudi, Deputy General Manager (Accounts) who never objected that physical counting was done wrongly. The surveying authority on counting found 14,338 cartons of cig