Revisional power cannot enhance tax on a new ground outside the appellate dispute, the High Court confirms.

Revisional power under section 10 of the U.P. Sales Tax Act was confined to the subject-matter of the appeal or revision and did not include an implied power of enhancement. Because the rate of tax on dhoop batti had not been in dispute before the appellate authority, only the turnover quantum, the revising authority could not introduce a new ground to increase the tax rate. The revising authority therefore acted beyond jurisdiction by enhancing tax on an issue not raised below. The assessee succeeded, and the objection to enhancement was upheld.

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Issues: Whether, in a revision filed by the State against the appellate order, the revising authority could entertain and decide a new ground enhancing the tax rate when that issue had not been in dispute before the appellate authority.

Analysis: The revising authority under section 10 of the U.P. Sales Tax Act had wide power to examine the legality and propriety of orders of the assessing or appellate authority, but that power was confined to the subject-matter of the appeal or revision and did not include a power of enhancement. The rate of tax on dhoop batti had never been in dispute before the appellate authority; only the quantum of turnover was in issue. The revising authority therefore exceeded its jurisdiction by raising and accepting a new ground to increase the rate of tax. The scope of revisional power was treated as analogous to the limitation recognised in the context of section 33(4) of the Income-tax Act, 1922, where powers to pass such orders as thought fit did not extend to enhancement, except possibly in cases specifically authorised.

Conclusion: The question was answered in the negative. The revising authority had no jurisdiction to enhance the tax rate on a ground not raised before the appellate authority, and the assessee succeeded.

Ratio Decidendi: Revisional power, however wide, is confined to the subject-matter of the appeal or revision and does not carry an implied power to enhance tax liability unless the statute expressly so provides.

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