(1.) This revision arises out of the order dated May 29, 1982, of the Karnataka Appellate Tribunal, Bangalore, made under section 25-A of the Karnataka Sales Tax Act (the "Act"), 1957.
(2.) The matter arises in this way : The petitioner is a partnership firm and is a dealer registered under the "Act". For the assessment period 1977-78, the petitioner purchased certain quantity of cotton (kapas). That was ginned and sold as bales of cotton. The cotton seeds separated therefrom were also sold. The total purchase made by the petitioner was 8480.24 quintals. Upon ginning, the cotton yielded was 2884.13 quintals and the quantity of cotton seeds obtained was 5434.30 quintals. There was thus a shortage of 161.81 quintals which was nearly two per cent of the total purchase turnover. The petitioner submitted gross turnover of Rs. 1,43,00,000, exempted turnover of Rs. 1,30,30,000 and taxable turnover of Rs. 12,70,000. The taxable turnover consisted of the sales of cotton seeds in respect of inter-State transactions. The exempted turnover consisted of the sales of cotton kapas and cotton seeds under own account on the ground that he was not the last purchaser. Accepting these figures, the assessment was made. But later, the assessing officer issued a notice under section 25-A of the "Act" stating that there was a difference in the quantity of the cotton purchased and the quantity of cotton and cotton seeds sold and in respect of that difference, the petitioner should be held to be the last purchaser liable to tax under entry 6 of the Fourth Schedule. The petitioner contested before the assessing officer that the difference in the weights between the purchase and the subsequent sale was due to the dryage in the processing of ginning, since the outturn of cotton and cotton seeds invariably would be at 34 per cent and 64 per cent which together comes to 98 per cent as against 100 per cent of kapas purchased and, therefore, he cannot be considered as the last purchaser in respect of the shortage of 2 per cent. The assessing officer did not accept that contention. He levied the tax in respect of the shortage that was noticed in the quantity purchased and the quantity sold, treating the petitioner as the last purchaser in respect thereof.
(3.) The appeal against the said order was dismissed by the Deputy Commissioner of Commercial Taxes (Appeals), Bellary, and the further appeal preferred before the Tribunal also became unsuccessful. Both the authorities have held that the difference in the weight of the kapas purchased and the bales of cotton and cotton seeds sold would be exigible to tax in the hands of the petitioner as the last purchaser. The correctness of this conclusion has been assailed in this revision petition. Entry 6 in the Fourth Schedule to the "Act" reads :