Undervaluation findings need a perverse factual basis before revision can disturb an assessment built on second quality goods.

Undervaluation could not be inferred by comparing the dealer's second quality pepper purchases with the market price of first quality pepper, because the factual finding on quality was not shown to be perverse. On that basis, revisionary interference with the First Appellate Authority's direction to accept the books of account and revise the assessment was unwarranted under the Kerala Value Added Tax Act. The Tribunal's observation that acceptance of the value declared by the dealer would always conclusively defeat the allegation was noted as overbroad, but it did not alter the result. The challenge failed and the appellate order was sustained.

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Issues: Whether the finding of undervaluation based on comparison with the market price of first quality pepper, and the consequential interference with the assessment under Section 25 of the Kerala Value Added Tax Act, 2003, called for interference in revision.

Analysis: The statutory authorities found as a fact that the dealer had purchased second quality pepper and that the alleged undervaluation had been inferred by adopting the market price of first quality pepper. No material was shown to establish that this factual finding was perverse. On that basis, interference with the First Appellate Authority's direction to accept the books of account and revise the assessment was not shown to be illegal. The observation of the Tribunal in its concluding paragraph suggesting that acceptance of the value declared by the dealer would conclusively answer the allegation in the assessee's favour was, however, not fully correct in all situations.

Conclusion: The revision petitions failed on the merits of the challenge to the factual finding and the appellate interference, and the order of the First Appellate Authority was sustained.

Final Conclusion: The assessment dispute was resolved in favour of the assessee, with the Revenue's challenge not succeeding except for clarification on the Tribunal's observation.

Ratio Decidendi: A revision court will not interfere with a factual finding on undervaluation unless the finding is shown to be perverse, and an assessment based on evidence of purchase of second quality goods cannot be disturbed merely because a higher market price of a different quality was adopted.

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