Purchase tax enhancement requires evidence and proper enquiry; wastage estimates and new appellate points cannot sustain assessment additions.

Purchase tax on mohua flower could not be increased by adding 10 per cent for driage and wastage after completion of purchase, because purchase tax attaches to the actual purchase transaction and wastage does not form part of the purchase price. The assessed turnover and price also could not be enhanced on suspicion alone, as best judgment assessment required documentary support, enquiry, and material basis under the Orissa Sales Tax Act, 1947. The Tribunal further could not sustain the addition on a point not specifically raised in the Revenue's appeal, since that would deny the dealer a fair opportunity to meet the case. The enhancement was set aside in favour of the dealer.

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Issues: (i) whether the addition of 10 per cent to the disclosed purchase quantity of mohua flower towards driage and wastage could be sustained for levy of purchase tax; (ii) whether the purchase turnover and purchase price of mohua flower could be enhanced in the absence of adverse material and on mere suspicion and conjecture; (iii) whether the Tribunal could decide and sustain an issue not specifically raised in the Revenue's grounds of appeal.

Issue (i): whether the addition of 10 per cent to the disclosed purchase quantity of mohua flower towards driage and wastage could be sustained for levy of purchase tax.

Analysis: The disclosed purchase quantity was supported by a certificate of the Superintendent of Excise. The statutory concept of purchase tax attaches to the actual purchase transaction, and the purchase price is the consideration payable for the goods purchased. Driage and wastage occurring after completion of purchase do not form part of the purchase price or justify an artificial increase in purchase quantity for the purpose of levy.

Conclusion: The addition of 10 per cent towards driage and wastage was not sustainable and the finding went in favour of the dealer.

Issue (ii): whether the purchase turnover and purchase price of mohua flower could be enhanced in the absence of adverse material and on mere suspicion and conjecture.

Analysis: The dealer's purchase quantity had documentary support and no material was produced to show suppression of purchases. The assessing authority enhanced the price without enquiry or supporting evidence, although section 12(9) of the Orissa Sales Tax Act, 1947 required satisfaction based on the prevailing market price and a proper enquiry before any such enhancement. Best judgment assessment cannot rest on arbitrary assumptions and must have a material basis.

Conclusion: The enhancement of the purchase turnover and purchase price on mere suspicion and conjecture was invalid and the finding went in favour of the dealer.

Issue (iii): whether the Tribunal could decide and sustain an issue not specifically raised in the Revenue's grounds of appeal.

Analysis: The Revenue's appeal grounds did not specifically challenge the deletion of the 10 per cent addition by the first appellate authority. A tribunal cannot make out a new case or decide an issue not raised and not put to the opposite party, because that would deny a fair opportunity of meeting the point and offend natural justice.

Conclusion: The Tribunal was not justified in sustaining the addition on an issue not raised in the appeal, and the finding went in favour of the dealer.

Final Conclusion: The revision succeeded, and the assessment enhancement made by the Tribunal was set aside, with all three questions answered against the Revenue.

Ratio Decidendi: A purchase-tax assessment or best judgment enhancement must rest on material evidence and lawful enquiry, and a tribunal cannot sustain an enhancement on an issue not specifically raised in appeal without violating natural justice.

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