Tax classification requires clear evidence before a commodity can be moved to a higher taxable category.

A commodity cannot be taxed under a higher classification unless the statutory description is supported by acceptable evidence. The Karnataka HC noted that "heavy chemicals" was undefined under the Karnataka Sales Tax Act, so classification had to rest on relevant indicia such as production and price structure, but not on unsupported assumptions. As the record contained no material showing trichloroethylene's comparative price or any firm basis for treating it as a heavy chemical, retrospective revision of completed assessments was unjustified. The court restored the original assessment orders and rejected revision based on conjecture rather than proof.

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Issues: Whether trichloroethylene was a "heavy chemical" falling under item No. 79 of the Second Schedule to the Karnataka Sales Tax Act, 1957, and whether the revision of completed assessments treating it as such was justified.

Analysis: The expression "heavy chemicals" was not defined in the Act. The classification depended on relevant indicia such as bulk production and price structure, but those factors could not be applied mechanically without acceptable evidence. The record contained no material showing the comparative price of trichloroethylene or the basis for treating it as a heavy chemical, and the department itself had not treated it as such until later. In taxing statutes, liability cannot be imposed by guesswork or by stretching general observations beyond their proper limits. A long-accepted assessment should not be revised retrospectively without a reasonable foundation, particularly where the assessee had been informed by the assessing authority about the applicable rate.

Conclusion: Trichloroethylene was not conclusively established to be a heavy chemical under item No. 79, and the revision of the assessments was unjustified.

Final Conclusion: The revision petitions succeeded and the original assessment orders were restored.

Ratio Decidendi: In taxation, a commodity cannot be brought within a higher taxable category unless the statutory description is clearly supported by acceptable evidence, and a settled assessment should not be retrospectively revised on mere conjecture or unsupported inference.

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