Revisional powers and bottle taxability depend on escaped-assessment limits and the existence of a true sale under the Sale of Goods Act.

Revisional power under section 21(1) could not be used to reopen escaped turnover where the action was, in substance, barred by the limitation applicable to escaped assessment proceedings, so the revisional order failed for the earlier years. The value of bottles could form part of taxable turnover only if the facts showed that the container itself was intended to be sold as part of the bargain, so bottle value was not automatically excluded. Excise-controlled supply, however, did not amount to a true contractual sale of liquor under the Sale of Goods Act; without a sale of the liquor in law, there could be no independent taxable sale of the bottles as packing material.

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Issues: (i) Whether the revisional authority could invoke section 21(1) to assess escaped turnover after the limitation period prescribed for section 11-A proceedings; (ii) whether the price of bottles was liable to sales tax when bottled liquor was sold; (iii) whether, in the circumstances of excise-controlled supply, there was a sale of liquor and consequently of the bottles as packing material within the meaning of the Sale of Goods Act.

Issue (i): Whether the revisional authority could invoke section 21(1) to assess escaped turnover after the limitation period prescribed for section 11-A proceedings.

Analysis: The revisional power under section 21(1) could not be used to reopen a matter which in substance amounted to assessment of escaped or under-assessed turnover. For the assessment years in which the price of bottles had not been taken into account by the assessing authority, the subsequent action was outside the scope of revision and was hit by the limitation applicable to escaped assessment proceedings.

Conclusion: The revisional order was without jurisdiction for the relevant earlier assessment years and the issue was answered in favour of the assessee.

Issue (ii): Whether the price of bottles was liable to sales tax when bottled liquor was sold.

Analysis: Liability to tax on the value of a container depends on whether the container itself was intended to be sold as part of the bargain. Where liquor is sold in bottles, the price of the bottle may be included in the taxable turnover if the facts show that the bottle was also the subject of sale and its price was taken into account in fixing the sale price.

Conclusion: The price of bottles was liable to sales tax, but this conclusion was subject to the answer on the existence of a true sale.

Issue (iii): Whether, in the circumstances of excise-controlled supply, there was a sale of liquor and consequently of the bottles as packing material within the meaning of the Sale of Goods Act.

Analysis: A taxable sale requires a contract of sale, express or implied, involving transfer of property in goods for money consideration. On the facts, the producer was bound by excise controls to supply liquor only to permit-holders at regulated prices, and the transaction lacked the necessary voluntary bargain for sale as understood in the Sale of Goods Act. If there was no sale of the liquor itself in the legal sense, there could be no independent sale of the bottles as packing material.

Conclusion: There was no sale in law of liquor and, consequently, no taxable sale of the bottles as packing material; this issue was answered against the revenue.

Final Conclusion: The reference was disposed of on mixed findings: the revisional action failed for the earlier years, the bottle value was otherwise taxable in principle, and the absence of a true contractual sale under the Sale of Goods Act defeated liability on the central transaction as a whole.

Ratio Decidendi: Value of a container is taxable only where the facts show an express or implied contract to sell that container, and revisional powers cannot be used to circumvent the limitation governing escaped assessment.

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