Charging provision depends on proof of seller non-liability; incomplete dealer details justified remand for fresh factual inquiry.

Section 3-AAAA could be applied only on a clear foundational finding that the selling dealer was not liable to tax; in the absence of such a finding, liability could not be sustained merely on an assumption that purchases were from small agriculturists or dealers below the turnover limit. The Tribunal's reliance on that basis, without an earlier factual foundation, was unsustainable. Where the assessee had not furnished complete particulars of all selling dealers, the proper course was remand for a fresh inquiry into the dealers' tax liability and then consequential decision on the dispute, including any interest question under Section 8(1).

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Issues: (i) Whether the assessee could be brought within the charging provision under Section 3-AAAA on the basis of a finding that purchases were made from small agriculturists or dealers whose turnover was below the statutory limit. (ii) Whether the matter required remand for a fresh finding after the assessee furnished complete details of the selling dealers.

Issue (i): Whether the assessee could be brought within the charging provision under Section 3-AAAA on the basis of a finding that purchases were made from small agriculturists or dealers whose turnover was below the statutory limit.

Analysis: The liability under Section 3-AAAA could arise only after a clear finding that the selling dealer was not liable to pay tax. The record before the lower appellate authority did not contain a finding that purchases had been made from agriculturists. The Tribunal introduced that basis for the first time and treated some purchases as having been made from petty agriculturists, although that case had not been set up earlier. On that footing, the Tribunal was not justified in sustaining the assessee's liability without the necessary foundational finding regarding the selling dealers.

Conclusion: The Tribunal's finding on this aspect was unsustainable.

Issue (ii): Whether the matter required remand for a fresh finding after the assessee furnished complete details of the selling dealers.

Analysis: Under Section 3(2), the inquiry turned on whether the selling dealers had turnover below the statutory limit and were therefore not liable to pay tax. The assessee had not furnished complete particulars of all selling dealers, which prevented the Department from making the necessary inquiry. The proper course was to require disclosure of complete details, obtain a clear finding on the liability of the selling dealers, and then decide the cases according to law. The question of interest liability under Section 8(1) was left to be considered after that determination.

Conclusion: The matter was rightly sent back to the Tribunal for fresh adjudication on the necessary factual foundation.

Final Conclusion: The revisions succeeded to the extent that the Tribunal's order was set aside and the matters were remitted for fresh decision after inquiry into the liability of the selling dealers and consequential questions, including interest.

Ratio Decidendi: A charging provision dependent on the non-liability of the selling dealer cannot be applied unless there is a clear foundational finding on that non-liability, and where the necessary sale particulars are not available, remand is appropriate for a fresh factual determination.

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