Suo motu revision requires recorded satisfaction of error and revenue prejudice before jurisdiction can be validly assumed.

Before exercising suo motu revisional jurisdiction, the Commissioner had to record a reasoned satisfaction that the subordinate order was erroneous and prejudicial to the Revenue. That jurisdictional condition was mandatory and not a mere formality. Here, the file note did not record the essential satisfaction, stating only that the sales tax officer had not properly evaluated a fraud report. The defect could not be cured by references in the show-cause notices because a valid foundational record was absent at initiation. The HC therefore quashed the revision notices and consequential orders.

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Issues: Whether the revisional authority could validly invoke suo motu revision under section 23(4)(a) of the Orissa Sales Tax Act, 1947 read with rule 80 of the Orissa Sales Tax Rules, 1947 without first recording in writing that the order sought to be revised was erroneous and prejudicial to the interests of the Revenue.

Analysis: The statutory scheme required the Commissioner, before exercising suo motu revisional jurisdiction, to form and record a reasoned belief that the subordinate order was erroneous in so far as it was prejudicial to the Revenue. This requirement was not a formality but a mandatory condition precedent for assumption of jurisdiction. The recorded note in the file merely stated that the sales tax officer had not properly evaluated the fraud report, but it did not record the essential jurisdictional satisfaction that the order was erroneous and prejudicial to the Revenue. Mention in the show-cause notices could not cure the absence of a valid foundational record at the stage of initiation.

Conclusion: The initiation of revision was jurisdiction, and the impugned notices and consequential orders were quashed. The writ petition was allowed.

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