Tax exemption conditions must be proved before turnover is excluded; revisional scrutiny remains valid where revenue loss may result.

Exemption from tax under the Karnataka Sales Tax Act applied only if the manufacturer proved that purchased gold or silver articles were used in making goods sold by him and that tax had been paid on the manufactured articles. Because the assessment excluded purchase turnover without examining those statutory conditions or giving reasons, revisional interference was justified to prevent revenue loss, and the show-cause notice was held valid. The pendency of another writ petition on a similar issue did not prevent the Court from deciding the matter before it, so no procedural bar arose. The challenge therefore failed.

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Issues: (i) Whether the show-cause notice issued in exercise of revisional power under section 21(4) of the Karnataka Sales Tax Act, 1957 was without jurisdiction for treating the purchase turnover as liable to tax notwithstanding the exemption notification under section 8A of the Act; (ii) Whether the pendency of another writ petition involving a similar contention barred disposal of the present petition.

Issue (i): Whether the show-cause notice issued in exercise of revisional power under section 21(4) of the Karnataka Sales Tax Act, 1957 was without jurisdiction for treating the purchase turnover as liable to tax notwithstanding the exemption notification under section 8A of the Act.

Analysis: The exemption notification applied only where the manufacturer established both that the purchased gold or silver articles were used in the manufacture of articles sold by him and that tax had been paid on the manufactured articles under section 5 of the Act. The assessment order showed exclusion of the purchase turnover without any examination of whether these conditions were satisfied and without assigning reasons. Such omission could result in loss of revenue and justified revision by the superior authority.

Conclusion: The revisional notice was not without jurisdiction and was valid.

Issue (ii): Whether the pendency of another writ petition involving a similar contention barred disposal of the present petition.

Analysis: The mere fact that another writ petition raising a similar point was pending did not disable the Court from deciding the petition before it. The cited authority did not create an embargo on judicial determination in such circumstances, and no procedural bar prevented adjudication on the merits.

Conclusion: The pendency of the other writ petition did not bar disposal of the present petition.

Final Conclusion: The challenge to the show-cause notice failed, and the writ petition was dismissed.

Ratio Decidendi: Where exemption from tax depends upon fulfilment of specified statutory conditions, exclusion of turnover without examining those conditions can justify revisional interference for loss of revenue; parallel pendency of another similar writ does not by itself preclude decision of the case before the Court.

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