Tribunal's order in the case betwecn M/s. Binjrrsaria Metal Box Company v. State of A.P. disal

Counsel for the Petitioner : Mr. T. Chaitanya Kiran, Representing Mr. Swaroop Oorilla (SpL Gp) Counsel for the Respondent : Mr. A.V.A. Siva Kartikeya The Court made the following: ORDER THE ITONOUIIABLE SRI JUSTICE P.SAM KOSIIY AND THE IIONOURABLE SIII JUS'I'ICE NARSIN(I RAO NANDIKONDA TAX REVISION CASE No.3l OF 2009 ORDER, (pe r t ton'ble Sri Justicc P.San Koshv) Heard Mr. T. Chaitanya Kiran, learned Assistant Govemment Pleader representing Mr. Swaroop Oorilla, learned Special Gov:mment Pleader, appearing {br the petitioner and Mr A.V.A. Sivrr Kartikeya, Iearned counsel lor lhe respondent Perused the lecord.

2. The instant is a Tax Revision Case prelerred by the State Govemment assailing the ordel dated 05.09.2008 passed ln Tribunal Appeal No.ll47 of 2002 by tire Sales l'ix Appellate Tribunal, Ardhra Pradesh, Hyderabad (hercinalter re li'rted as, 'the Tribunal').

3. Vide tlrc said impugned order clated 05.09.2008, the Tribunal had answered the questions of law in favour of the respondent assessee, who was the appellant belore the Tribunal. One of the major issues decided by the Tribunal is reduction of rurning loss from l0% to 5o/o by ttre revisional authority \\;as illegally 2 -i sustainable or not. It coutd be relevant at this juncture to take note of the observation of the revisional authority while reducing the burning loss of, l0% as assisted by the Assessing Officer to 5% "lt is also noted that the assessing authority has adopted the buming loss at the rate of 10% without any basis. In general the burning loss be around 5o% or else the dealer has to prove it to be otherwise by producing the actual quantitative details of the raw material consumed and the finished products manufactured as per the records maintained under the Central Excisc Laws. Hence, the percentage of burning loss at the rate of l\uh as adopted by the assessing authority is at higher side. It is therefole proposed to restrict the percentage of burning loss as 5oh and accordingly to reckon the eligibility of the set off of tax as under:"

4. It was this tinding ol the revisional authority which has been reversed by the 1-ribur.u.l viclc the order under challenge in the present tax revision casc. Thc'l'ribunal, while reversing the order of the revisional authority had rnade the following observations in 3 points, which are reproduced hcreinunder: "Point (a): It is the case of the appellant that reduction of set off based on the pro rala method between Sponge and lron Scrap used in the manufacturing of hnished products is without any basis. We have peruscd the impugned order. It appears that the revisional authority following this 3 Tribunal's order in the case betwecn M/s. Binjrrsaria Metal Box Company vs. State of A.P. disal[lwed the stt off granted by the assessing authority antl reducr:d it by adopting a pro rats method. But the order does not indicate the 'I.A. number or datc ot'the order purportedly passed by this Tribunal. After writing the T.A. number, gap is teft without indicating the T.A. number. There is no indication that the revisirrnal authority did conduct an enquiry to corne to his cc,nclusion. [n revision, the burden shifls to the revisional authority. The revisional authority does not appear to have discharged the burden. Hence, the revision lails. Point is answered accordingly. Point (b): As regards the burning loss, the revisional authority records that the Assessing Olficer had no basis for adopting l0% towards burning loss consu med in production of tinished good:;. He adopt,:d 5% burning loss. But he has not sho'"r'n any basis lor adopting that. In revision the burden lies on the revisional authority. In as much as the btrrdcn is not rlischarged the revision sul'fers lrom legat infir-n ity and so it is liable to be set aside. Point is answ(:red accordingly. Pointldi It is the contention of the appellant that the impul;ned order was passed without granting reasorrable opportunity of hearing. The impugned order discloses that no opportunity was grantecl to the appellant and without hearing them it was passed. At page I of the revisional order it is recorded that the appelJants on 2l-08-2001 requestcd to glirnt l5 days lime to file the objections. No endorscnlent was passerl by the revisional authority in response to this reque;t whether 'yes' or 'no' to the request sceking time tc file the objections". 4

5. The contention of the leamed counsel for the petitionel was that the Tribunal has interlered with the hnding of the revisional authority without any strong cogent proof or materials available on record and therefore, the finding is per.se perverse. It was also the contention that the Tribunal has ered in as much as not taking any consideration that the respondent asscssee in fact has not produced before the authorities either at thc Assessing Offlcer level or at the revisional authority level the proof of the quantitative details of the raw materials consumed and the f rnished products manufactured so as to reach to the conclusion of the actual percentage of the buming loss that has occurred. [t was also the contention that in the absence of such strong materiai, thc Tlibunal ought not have interfered with the finding given by the revisional authority. However, perusal oi the record would show that initially, the assessing ziuthority had adoptcd the burning loss at l0% which was disagreed by the revisional authority. But, rvhen we look into the finding of the revisional authority, we flnd that in fact the revisional authority also has not rcflected any basis on which the revisional authority has corne lo the conclusion that the burning loss would be at 5o/" instead o l- I 094,. lf the assessinq-aglhority \ -- 5 finding <tf 10%o is without any weightage, the linding of the revisional authority also is equally without any basis as has been rightly arrived at by the Tribunal.r:

6. As regards the finding of the burden being upon the respondert assessee to show or prove the actual burning loss, the Tribunal has reached to the conclusion that the burden is always on the agenr:y who has gone for the revision to pro\.e their case as much as while exercising the revisional powers, the burdcn would always bt: upon the revisional authority or the parly who is coming for the rr:vision before the revisional authority to prove that the finding 11iven by the assessing authority to be incorrect and improper In the instant case, it was the petitioncl rvho had gone for revision before the revisional authority and therefore, the burden li:s upon the petitioner as also the revisional authority to prove thal the finding ofthe assessee to be incorrect and improper.

7. In view of the above, we do not find any strong case made out by thr: petitioner calling for interference to the irnpugned order. Moreover', when we look at the pleadings, the qr.restion of law proposed by the petitioner while'preferring the tax revision case as I I 5 also the ground of the assessing authority having assessed 10Yo as buming loss to be incorrect, was not assessed

8. For all the aforesaid reasons. the Tax Revision Case fails and is accordingly rejected. There shall be no order as to costs. Consequently,, miscellaneous petitions pending, if any, shall stand closed \ \ To, //TRUE COPY// SD/. K. SRINIVASA RAO JOINT REGISTRAR SECTI N OFFICER

1. The Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad. 2. The Dy. Commissioner (CT), Punjagutta Division, Hyderabad 3. The Commercial Tax Officer, Ramgopalpet, Secunderabad. 4. One CC to SRI Swaroop Oorilla, (SPL GP), High Court, HYD [OPUC] 5. One CC to SRI A.V.S. SIVA KARTIKEYA, Advocate [OPUC] 6. Two CD Copies PSL // HIGH COUFIT DATED:01 lll712025 -/::-:::='\- ,'j.1 tr:. sr.ifu:']^\\ v'c'\' tr- 1ll SEP 20fi . \ /,1. ,!,^. ,lL!,) i ,,-r ORDER TREVC.No.31 of 2009 * :a-- DISMTSSIN(; THE REVISION t1 f