M/S. AGARWAL OIL REFINERY CORPORATION, KANPUR versus THE COMMISSIONER OF TRADE TAX, U.P. LUCKNOW

Citation: [2011] 9 S.C.R. 1076 · Decided: 10-08-2011 · Supreme Court of India · Bench: D.K. JAIN · Disposal: Disposed off

Judgment (excerpt)

[2011] 9 S.C.R. 1076 
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A M/S. AGARWAL OIL REFINERY CORPORATION, KANPUR 
v. 
THE COMMISSIONER OF TRADE TAX, U.P. LUCKNOW 
(Civil AppE~al No. 2363 of 2007) 
AUGUST 10, 2011 
B 
[DJ<. JAIN AND ASOK KUMAR GANGULY, JJ.] 
U.P. Trade' Tax Act, 1948: 
c 
s. 11 - Revisional jurisdiction - Scope of - Held: 
Normally High Court while exercising revisionary powers u/ 
s. 11 should not interfere with concurrent findings of fact by the 
lower authority, unless the findings recorded by the lower 
~ 
authorities are perverse or based on apparently erroneous 
D principles which are contrary to law or where the finding of the 
lower authority was arrive'd at by a flagrant abuse of the judicial 
process or it brings about a gross failure of justice - Revision. 
s.3-AAAA - Dealer purchased uurnt mobil oil and refined 
the same but the asses.sing authority. levied tax on the said 
E burnt mobil oil u/s. 3-AAAA treating it as "old discarded 
unserviceable store" - Statutory authorities and Tribunal held 
that the refined mobil oiJ' is manufactured by the deafer from 
" 
burnt mobil oil and the said item is taxable at the point of 
.. 
manufacturer and is not .liable to be taxed at the point of sale 
F to the consumer u/s.3-AAAA - High Court set aside the 
concurrEmt finding and held that appellant was liable to be 
taxed uls. 3-AAAA - Held: Tribunal as the second appellate 
forum is the last fact finding authority - Unless High Court, 
as a revisional authority, finds that the factual conclusions by 
G both the appellate authorities are perverse, it cannot overturn 
• 
the same - The order of the High Court is not sustainable -
,. 
Matter remanded to the High Court for consideration afresh. 
The case of the· appellant-dealer was that it 
H 
1076 
AGARWAL OIL. REFINERY CORP, KANPUR v. COMMR. OF 1077 
TRADE TAX, U.P LUCKNOW 
• 
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purchased burnt mobil oil and refined the same but the A 
. assessing authority levied tax on the said burnt mobil oil 
under Section 3-AAAA of the U.P. Trade Tax Act, 1948 
treating the said oil as "old discarded unserviceable 
store". The authorities set aside the order of the 
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assessing authority. The Department filed revision before 
B 
the High Court. The High Court reversed the concurrent 
finding of the statutory authorities by relying on the 
decision in *SIS Industrial Lubricants and held that the 
appellant was liable to be taxed under Section 3-AAA 
during the years under consideration. The instant appeal c 
was filed challenging the order of the High Court. 
Disposing of the appeal and remitting the matter to 
; 
the High Court, the Court 
' 
HELD: 1.1. It is clear from the structure of Section 11 
D 
of the U.P. Trade Tax Act, 1948 that normally the High 
Court under revision does not interfere with concurrent 
findings of fact by the lower authority, unless the case 
involves any question of law. Traditionally, in exercise of 
revisional jurisdiction, High Court does not interfere with 
E 
concurrent finding of fact, unless the findings recorded 
by the lower authorities are perverse or based on an 
" 
apparently erroneous principles which are contrary to 
~ 
law or where the finding of the lower authority was 
arrived at by a flagrant abuse of the judicial process or it F 
brings about a gross failure of justice. In this case none 
of these principles were attracted. [Para 8, 9).[1084-8-C) 
1.2. In the instant case, the Tribunal as the second 
appellate forum is the lastfact finding authority. From the 
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admitted facts recorded by the Tribunal, it appeared that 
,. 1 
the appellant-dealer manufactured refined mobil oil from 
the. raw material, i.e., the burnt mobil oil which it 
purchased· and then sold a virtually new item in the 
market. In 1988-89 and 1989-90, the assessments were 
made under Rule 41(7) of the U.P. Trade Tax Rules, but 
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1078 
SUPREME COURT REPORTS 
[2011] 9 S.C.R. 
A the said assessment was opened and a fresh assessment 
was made. Aggrieved by the same, the dealer preferred 
first appeal before the A.C.(J) who allowed both the 
appeals holding that the dealer was not liable to pay and 
quashed the imposition of tax upon dealer for the 
B relevant assessment years. Aggrieved thereby, the 
revenue preferred a sEicond appeal before the Tribunal. 
The Tribunal held that the burnt mobil oil on which the 
tax was imposed was purchased by the appellant from 
unregistered dealer lil<e kabarie and hawkers in retail 
c manner. The old PVC s;hoes and chappals purchased by 
the 

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