Resale tax under the Karnataka Sales Tax Act required fresh reconsideration after failure to apply proviso (x) to section 6B.

The Commissioner's suo motu revision under section 22A(2) of the Karnataka Sales Tax Act, 1957 was found to have proceeded without properly considering proviso (x) to section 6B. In light of the statutory scheme governing resale tax and the object of the levy, the High Court held that the matter required fresh examination by the Commissioner with reference to the proviso. The Commissioner's order was therefore set aside and the matter remanded for reconsideration after giving the assessee a reasonable opportunity of hearing.

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Issues: Whether the Commissioner's order under section 22A(2) of the Karnataka Sales Tax Act, 1957 required to be set aside and the matter remanded for fresh consideration in the light of proviso (x) to section 6B of the Act.

Analysis: The advance ruling had been reconsidered on remand, but the Commissioner interfered in suo motu revision and held the assessee liable to resale tax. During hearing, the revenue fairly accepted that proviso (x) to section 6B had not been properly considered. In the circumstances, and having regard to the object behind levy of resale tax under section 6B as noticed from the Finance Minister's speech, the matter required fresh examination by the Commissioner with reference to the proviso and the statutory scheme.

Conclusion: The order of the Commissioner was set aside and the matter was remanded for fresh consideration after giving reasonable opportunity to the assessee.

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