Second sale exemption protected where official records were unrebutted and later cancellation of seller registration had no retrospective effect.

The Joint Commissioner's suo motu revision under Section 37 of the Tamil Nadu General Sales Tax Act, 1959 was held unjustified because the Department did not dislodge the Appellate Assistant Commissioner's factual findings supporting second sale exemption. The record showed the seller's registration remained valid until 31.03.1990, the invoices related to March 1990, the goods passed through the check post, and payment was made through banking channels and cheques. Official records and the check post seal were not effectively rebutted, and a Village Administrative Officer's certificate alone was insufficient to prove the seller was not a real and identifiable dealer. Cancellation of registration from 01.04.1990 did not affect earlier transactions, so the exemption denial could not stand.

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Issues: Whether the Joint Commissioner could exercise suo motu revisional power under Section 37 of the Tamil Nadu General Sales Tax Act, 1959 to set aside the Appellate Assistant Commissioner's finding and deny second sale exemption.

Analysis: The Appellate Assistant Commissioner had recorded factual findings that the selling dealer's registration remained valid upto 31.03.1990, that the invoices related to March 1990, that the goods moved through the check post, and that payment was made through banking channels and cheques. The impugned revisional order did not effectively dislodge those findings or explain why the check post seal and supporting records should be disbelieved. Since the burden lay on the Department to rebut the authenticity of official records and to establish that the first seller was not a real and identifiable dealer, mere reliance on the Village Administrative Officer's certificate was insufficient. The cancellation of the seller's registration from 01.04.1990 could not affect transactions completed earlier.

Conclusion: The exercise of suo motu revisional power was unjustified, and the denial of second sale exemption could not be sustained. The order of the Appellate Assistant Commissioner was rightly restored.

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