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TMI Blog1965 (9) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... and the other part in the course of export outside India. The Commercial Tax Officer rejected both these contentions and assessed him under section 5(3)(b) of the Act. Aggrieved by the order of the Commercial Tax Officer, the assessee went up in appeal to the Deputy Commissioner of Commercial Taxes. The Deputy Commissioner rejected the claim of the assessee in respect of the purchases claimed to have been made in the course of interState trade, but accepted his claim in respect of the purchases said to have been made in the course of export outside India. To the extent the appeal went against the assessee, he has filed second appeals before the Sales Tax Appellate Tribunal. But to the extent the Deputy Commissioner accepted the claim of the assessee, the Commissioner has revised his order acting under section 21(2) of the Act. He has held that the transactions in question were not purchases made in the course of export outside India and hence the turnover relating to them were liable to be assessed under section 5(3)(b) of the Act. The impugned orders of the Commissioner are assailed on three grounds, namely, (1) that on the proved facts of the case, the Commissioner erred in hold ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ithin Article 286(1)(b) arose directly for decision in State of Travancore-Cochin & Others v. Shanmugha Vilas Cashewnut Factory and Others(1) and it was held that they were not. Explaining, in the course of the judgment, the true scope of the observations in State of Travancore-Cochin case(2) quoted above, Patanjali Sastri, C. J., observed: "The phrase "integrated activities" was used in the previous decision to denote that "such a sale" (i.e., a sale which occasions the export) "cannot be dissociated from the export without which it cannot be effectuated, and the sale and the resultant export form parts of a single transaction". It is in that sense that the two activities-the sale and the export-were said to be integrated. A purchase for the purpose of export like production or manufacture for export, is only an act preparatory to export and cannot, in our opinion, be regarded as an act done "in the course of the export of the goods out of the territory of India", any more than the other two activities can be so regarded.' We may refer to two other decisions of this Court where this question has been considered. In The State of Madras v. Gurviah Naidu & Co. Ltd. [1955] 6 S.T.C. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he State liable to tax under this Act". It is not the case of the assessee that these goods were sold by him to any another person in the State who is liable to tax under the Act. His only case is that in the State of Mysore, these goods were purchased only by him and nobody else. Therefore he cannot be considered as the "last purchaser". In other words, according to Mr. Somasekhar, before a purchaser can be considered as a "last purchaser" there must be a series of "purchases", at least there must be two "purchases". If there is only a single purchase transaction then that transaction cannot be brought within the net of taxation. The scheme of 1957 Act was considered by a Full Bench of this Court in The State of Mysore v. Gujjadi Narayan Nayak and Another[1964] 15 S.T.C. 906. Speaking for the Court, the learned Chief Justice observed therein (at pages 916 and 917) thus: "It may be remembered that the Act replaces various sales tax enactments which were in operation in the different integrating areas which went to make up the new State of Mysore and under those enactments the general scheme was that all sales including successive sales of the same goods had to be taken into accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Schedule of the Act does not mean that there should be a series of "purchases". It merely same goods than one, then it is the last purchases transaction by the dealer liable to pay tax under the Act that attracts the levy. If there is only one such purchase transaction in respect of those goods in the State, then it is that transaction which attracts the levy. For the above reasons, we are unable to agree with Mr. Somasekhar that the transactions with which we are concerned in the case are not liable to be taxed under section 5(3)(b) of the Act. The only other contention remaining for examination is whether the Commissioner had jurisdiction to revise the orders of the Deputy Commissioner of Commercial Taxes. In order to find out the extent of the revisional power of the Commissioner, we have to determine the true scope of section 21(2) of the Act. That section reads: "(2) The Commissioner may- (i) suo motu, or (ii) in respect of any order passed or proceeding recorded by the Deputy Commissioner under sub-section (1) or any other provision of this Act and against which no appeal has been preferred to the Appellate Tribunal under section 22, on application, call for and examine th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arity of such proceeding and may pass such order with respect thereto as he thinks fit. Similarly, he may, in respect of any order passed or proceeding recorded by the Deputy Commissioner under sub-section (1) or any other provision of the Act and against which no appeal has been preferred to the Appellate Tribunal under section 22, on application, call for and examine the record of such order passed or proceeding recorded under the provisions of the Act by any officer subordinate to him for the purpose of satisfying himself as to the legality or propriety of such order, or as to the regularity of such proceeding, and may pass such order with respect thereto as he thinks fit. The two powers mentioned in section 21(2) are independent powers. They can be exercised in the manner prescribed in that provision. It is not correct to say that while exercising the suo motu power, the Commissioner can only call for the records of a case where no appeal has been filed. The limitation that he can call for the records of a case wherein no appeal has been filed, is confined to cases mentioned in clause (ii) of sub-section (2) of section 21 of the Act. That limitation does not apply to his suo mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was communicated to the assessee. The only other limitation on that power is that the Commissioner should exercise it within four years from the date on which the order was communicated to the assessee. [See section 21(3)]. In the instant case, there is no need for us to consider the scope of the doctrine of merger of the orders appealed against with the appellate order. As noticed earlier, the Deputy Commissioner held against the assessee in certain respects but at the same time, he upheld the contention of the assessee in other respects. In fact, the turnover of the assessee can be broadly divided under two heads, namely: (1) Turnover relating to transactions which according to him were made in the course of inter-State trade; and (2) turnover in respect of transactions which according to him were made in the course of export outside India. As regards the first, the Deputy Commissioner rejected the claim of the assessee. As regards the second, he upheld his claim. As against the decision of the Deputy Commissioner in so far as it went against it, the Department could not go up in appeal to the Tribunal. Unless the order of the Deputy Commissioner in that regard is revised by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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