Suo motu revision survives where an appellate order is factually incorrect, prejudicial to revenue, and unsupported by corroborating evidence.

Suo motu revision under the sales tax and VAT framework was sustained because the appellate order rested on an incorrect factual assumption and an incorrect application of law, making it erroneous and prejudicial to revenue. The existence of a separate appellate remedy did not bar revision where the revisional power operated independently and extended to appellate orders on matters not properly considered and decided. The assessee also failed to produce independent material to displace the evidentiary value of the seized documents, so the Board of Revenue was justified in insisting on corroboration. The revision petitions accordingly failed.

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Issues: (i) Whether the revisional authority could validly invoke suo motu revision against the appellate order on the ground that it was erroneous and prejudicial to the interests of revenue; (ii) Whether the availability of an appellate remedy to the Commissioner barred exercise of suo motu revisional power; (iii) Whether the Board of Revenue was justified in holding that the assessee had failed to adduce further evidence to displace the evidentiary value of the seized documents.

Issue (i): Whether the revisional authority could validly invoke suo motu revision against the appellate order on the ground that it was erroneous and prejudicial to the interests of revenue.

Analysis: The scope of suo motu revision under the relevant sales tax and VAT provisions was held to be limited to cases where the order is both erroneous and prejudicial to the interests of the revenue. An order can be erroneous not only when it is contrary to law or passed without enquiry, but also where there is an incorrect assumption of facts or an incorrect application of law. The appellate order was found to have accepted the assessee's explanation without any supporting evidence as to the identity of the other hotel or the alleged loan-related sales projection. On that basis, the rejection of the seized documents rested on an incorrect factual premise and the resulting non-assessment of taxable sales caused prejudice to revenue.

Conclusion: The revisional authority was correctly held to have jurisdiction to invoke suo motu revision, and the appellate order was rightly treated as erroneous and prejudicial to the interests of revenue.

Issue (ii): Whether the availability of an appellate remedy to the Commissioner barred exercise of suo motu revisional power.

Analysis: The statutory scheme provided two distinct remedies. The existence of a right of appeal did not curtail the separate discretionary power of suo motu revision, particularly where the revisional provision expressly applied notwithstanding proceedings in appeal in respect of matters not actually considered and decided. The broad wording of the revisional power was treated as sufficient to include appellate orders, and the presence of an appellate route did not create an implied prohibition against revision.

Conclusion: The Commissioner was not barred from exercising suo motu revisional power merely because an appellate remedy was also available.

Issue (iii): Whether the Board of Revenue was justified in holding that the assessee had failed to adduce further evidence to displace the evidentiary value of the seized documents.

Analysis: The assessee's stand that the seized papers related to another hotel and were prepared for a projected loan presentation remained unsupported by independent material. No evidence was produced to identify the alleged other hotel or to show any actual interaction with a financial institution. In those circumstances, the Board's insistence on corroboration was treated as a possible view on the facts and not one warranting interference in revision.

Conclusion: The Board of Revenue was justified in requiring further evidence, and its view was not shown to be perverse or extraneous.

Final Conclusion: The assessment-related documents were validly relied upon, the revisional interference was within jurisdiction, and the assessee failed to establish any ground for upsetting the Board's decision. The revision petitions were therefore liable to fail.

Ratio Decidendi: A revisional order is sustainable where the subordinate order rests on an incorrect factual assumption or incorrect application of law and thereby prejudices revenue, and the existence of an appellate remedy does not exclude a separate statutory power of suo motu revision.

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