Job work and customer-specific mould design excluded from taxable turnover; revisional interference rejected for lack of reliable material.

Receipts from customer-specific job work and mould design were held not to form part of taxable turnover where the pet bottles were manufactured on specifications, the moulds were retained as the assessee's assets, and there was no material showing sale of the moulds as commercial goods. The HC also held that suo motu revisional interference was unwarranted because revisional power must rest on relevant and reliable material showing prejudice to the Revenue, and the appellate authority had given cogent reasons for deleting the disputed turnover. The appellate order was restored and the revisional order set aside.

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Issues: (i) whether the receipts for job work and designing of moulds for specified customers formed part of the assessee's taxable turnover; (ii) whether the revisional authority was justified in invoking suo motu revisional jurisdiction to disturb the appellate order.

Issue (i): whether the receipts for job work and designing of moulds for specified customers formed part of the assessee's taxable turnover.

Analysis: The receipts from manufacture of pet bottles on customers' specifications were found to arise from job work and not from sale of goods in the ordinary market. The moulds were designed for particular customers, retained as assets of the assessee, and were not shown to have been sold as commercial commodities. On the facts found by the appellate authority, the sums of Rs. 4,78,595/- and Rs. 8,00,000/- did not represent taxable turnover.

Conclusion: The issue is answered in favour of the assessee and against the Revenue.

Issue (ii): whether the revisional authority was justified in invoking suo motu revisional jurisdiction to disturb the appellate order.

Analysis: Revisional power under section 34 is to be exercised on relevant and reliable material showing prejudice to the Revenue. Since the appellate authority had given cogent factual reasons for deleting the disputed turnover and the basis for revision was not supported by sufficient material, interference in revision was unwarranted.

Conclusion: The issue is answered in favour of the assessee and against the Revenue.

Final Conclusion: The appellate order deleting the disputed turnovers was restored and the revisional order was set aside, leaving the assessee without liability on the impugned receipts.

Ratio Decidendi: Receipts from genuine job work or customer-specific mould design, where the finished product is not sold as a commercial commodity and the property in the mould is retained as an asset of the assessee, do not constitute taxable turnover; revisional interference is permissible only when the appellate order is shown on reliable material to be prejudicial to the Revenue.

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