REPORTABLE IN SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 5390 OF 2007 M/s Larsen & Toubro Ltd. .... Appellant(s) Versus State of Jharkhand and Ors. .... Respondent(s) JUDGMENT R.K. Agrawal, J. 1) present appeal has been filed against final judgment and order dated 17.11.2006 passed by Division Bench of High Court of Jharkhand at Ranchi in W.P. (T) No. 2630 of 2006 whereby High Court dismissed petition filed by M/s Larsen & Toubro Ltd.-the appellant Company while upholding order dated 27.02.2006 passed by Deputy Commissioner, Commercial Taxes, Urban Circle, Jamshedpur. 1 Page 1 2) Brief facts: (a) appellant-Company, having its registered office at Mumbai, is public limited company and is involved in manufacturing, trading, leasing and construction business throughout country. At relevant time, appellant-Company was involved in execution of civil work contracts for its client, viz., Tata Iron & Steel Company Ltd. (TISCO) and had been filing its returns under Bihar Finance Act, 1981 (hereinafter referred to as State Act ) and also under Central Sales Tax Act, 1956 (hereinafter referred to as Central Act ) in Commercial Taxes Department, Urban Circle, Jamshedpur. (b) For Assessment Year (AY) 1991-92, appellant-Company filed returns under State Act. However, assessment proceedings in relation to above period, i.e., AY 1991-92 was completed in year 1996 and assessment order dated 24.01.1996 was passed by assessing authority. 2 Page 2 (c) After assessment proceedings, audit team of Auditor General, Bihar, audited assessment order dated 24.01.1996 and found that dealer was allowed exemption of Rs. 3,12,47,916/-, being amount of goods consumed by appellant-Company during course of execution of works contract. appellant-Company claimed that such goods were purchased on payment of tax but no declaration in Form IX-C along with other evidence was submitted whereas production or declaration of Form IX-C was mandatory, hence, claim was not allowable and said fact was conveyed to assessing authority. (d) On 28.09.2000, office of Commissioner of Commercial Tax, Urban Circle, Jamshedpur, served show cause notice to appellant-Company to state as to why tax should not be levied on it for amount of Rs. 3,12,47,916/- which was wrongly exempted from being taxed under provision of State Act. (e) After affording opportunity of hearing to appellant-Company, re-assessment order dated 27.02.2006 was passed by Deputy Commissioner, Commercial Taxes, 3 Page 3 Urban Circle, Jamshedpur whereby additional demand of Rs. 35,72,475/- was created against appellant-Company. f) Being aggrieved by re-assessment order dated 27.02.2006, appellant-Company preferred writ petition being W.P. (T) No. 2630 of 2006 before High Court. Division Bench of High Court, vide order dated 17.11.2006, dismissed petition filed by appellant Company while upholding order dated 27.02.2006 passed by Deputy Commissioner, Commercial Taxes, Urban Circle, Jamshedpur. (g) Aggrieved by order dated 17.11.2006, appellant-Company has preferred this appeal by way of special leave. 3) Heard arguments advanced by Mr. Pravin H. Parekh, learned senior counsel for appellant-Company and Mr. Amarendra Saran and Mr. Ajit Kumar Sinha, learned senior counsel for respondent-State and perused records. Point for consideration: 4) only point for consideration before this Court is whether on information given by audit team of 4 Page 4 Auditor General, Bihar, Assessing Authority was satisfied that reasonable ground exists to believe that part of turnover of appellant-Company has escaped assessment within meaning of Section 19 of State Act based on which assessing officer can re-open assessment? Rival contentions: 5) Learned senior counsel for appellant-Company contended that audit objection cannot be construed as information within meaning of Section 19 of State Act, based on which assessing officer can change his opinion and re-open assessment. audit objection relates to tax levied on turnover relating to consumables wherein there is no sale/deemed sale involved. Consumables by its very nature are goods used for own consumption. assessment order dated 24.01.1996 rightly records said fact. 6) Learned senior counsel further contended that original assessment order specifically considered whether purchase tax is to be paid under State Act on disputed items and same was decided in negative and hence taxing items later on is mere change of opinion by Assessing 5 Page 5 Authority on very same set of facts that were available on date of passing assessment order dated 24.01.1996. 7) Learned senior counsel further contended that non-filing of Form IX-C under Section 11 of State Act read with Rule 12 of Bihar Sales Tax Rules, 1983 (hereinafter referred to as Rules ) does not attract levy in facts of present case as goods are used for own consumption and there is no sale or deemed sale of said goods involving transfer of property in said goods to anybody. 8) It was further contended that Section 19 of State Act read with Rule 20 and Form XIV of Rules specifically requires satisfaction of Prescribed Authority regarding requirement of re-assessment before issuance of notice in this regard. initiation of re-assessment proceedings and subsequent re-assessment order dated 27.02.2006 are illegal as there was no satisfaction on part of Prescribed Authority about existence of reasonable grounds to believe that turnover has escaped assessment. Hence, same are liable to be set aside. 6 Page 6 9) Learned senior counsel further contended that it is relevant to note circumstances under which appellant-Company was unable to produce relevant records. assessment year (AY) in question is 1991-92. assessment order in relation to same was passed on 24.01.1996. show cause notice proposing to re-open assessment was served on appellant-Company on 28.09.2000 which was replied in detail by appellant-Company vide letter dated 13.11.2000. Thereafter, for period of five years, there was no communication from side of respondents and appellant-Company, under bonafide belief that letter dated 13.11.2000 had satisfied requirements of show cause notice, forwarded all records to their dumping yards at Chennai. Learned senior counsel contended that owing to above circumstances failure of appellant-Company to produce aforesaid records was not at all willful. 10) Learned senior counsel finally contended that order of re-assessment dated 27.02.2006 is illegal and assessment proceedings cannot be re-opened on basis of 7 Page 7 audit objection, as same does not amount to information as contemplated under Section 19 of State Act. impugned order amounts to change of opinion on same set of facts and law which were available even at time of passing order of assessment. 11) In support of above contentions, learned senior counsel has relied upon following decisions, viz., M/s Indian & Eastern Newspaper Society, New Delhi vs. Commissioner of Income Tax, New Delhi (1979) 4 SCC 248, Bhimraj Madanlal vs. State of Bihar and Another (1984) 56 STC 273, Usha Sales (Pvt.) Ltd. vs. State of Bihar (1985) 58 STC 217 and Deputy Commissioner of Sales Tax (Law), Board of Revenue (Taxes), Ernakulam vs. M/s Thomas Stephen & Co. Ltd. Quilon (1988) 2 SCC 264. 12) Per contra, learned senior counsel for respondent-State submitted that assessing authority has not revised assessment on basis of audit report only rather it had satisfied itself before revising and same can be seen from fact that it had rejected part of audit 8 Page 8 opinion and applied its mind before passing order impugned. 13) Learned senior counsel for respondent-State further submitted that audit objection in present case is information within meaning of Section 19 of State Act and competent authority has rightly re-assessed turnover and demanded legally payable valid tax which was escaped. He further submitted that word information used in Section is of widest amplitude and comprehends variety of factors including information from external sources of any kind including discovery of new facts or information available in record of assessment not previously noticed or investigated. 14) Learned senior counsel for respondent-State submitted that if there is obvious mistake apparent on face of record of assessment, that record itself can be source of information, if that information leads to discovery or belief that there has been escape of assessment. He finally submitted that there is no illegality in re-assessment order dated 27.02.2006 as well as in order 9 Page 9 dated 17.11.2006 passed by High Court and claim of appellant-Company is liable to be rejected. 15) In support of his submissions, learned senior counsel has relied upon following decisions, viz., Commissioner of Income Tax vs. P.V.S. Beedies Pvt. Ltd. (1998) 9 SCC 272, Anandji Haridas and Co. (P) Ltd. vs. S.P. Kasture and Others AIR 1968 SC 565, Commissioner of Customs, Mumbai vs. Virgo Steels, Bombay and Another (2002) 4 SCC 316, Supreme Paper Mills Limited vs. Assistant Commissioner, Commercial Taxes, Calcutta and Others (2010) 11 SCC 593 and Chatturam & Ors. vs. CIT, Bihar AIR 1947 FC 32. Discussion: 16) In instant case, audit team of Auditor General, audited assessment order dated 24.01.1996 and found that dealer was allowed exemption of Rs. 3,12,47,916/- being amount for goods consumed by appellant-Company during course of execution of works contract. It is claim of appellant-Company that those goods were purchased on payment of tax but no declaration in 10 Page 10 Form IX-C along with other evidence was submitted. same fact was brought to notice of assessing authority which in furtherance thereof issued show cause notice to appellant-Company. production of Form IX-C was held to be mandatory and claim of appellant-Company was disallowed and order of re-assessment dated 27.02.2006 was passed by competent authority for additional amount of tax of Rs. 35,72,475/- after following due procedure of law. 17) point arises for consideration is as to whether audit objection can be construed as information within meaning of Section 19 of State Act based on which assessing officer was satisfied that reasonable grounds exist to believe that any part of turnover of appellant-Company had escaped assessment under Section 19 of State Act. 18) Learned senior counsel for appellant-Company argued that it is mere change of opinion which resulted in re-assessment order and is not information as contemplated under Section 19 of State Act. Learned senior counsel for respondent-State submitted that audit objection in 11 Page 11 present case is definitely information within meaning of Section 19 and High Court has rightly uphold re-assessment order dated 27.02.2006. 19) In view of above, it is relevant to quote Section 19 of Bihar Finance Act, 1981 which is as under:- 19. Turnover of registered dealer escaping assessment (1) If upon information which has come into his possession, prescribed authority is satisfied that reasonable grounds exist to believe that any turnover of registered dealer or dealer to whom grant of registration certificate has been refused under third proviso to sub-section (2) of Section 14, in respect of any period has, for any reason, escaped assessment or any turnover of any such dealer or dealer assessed under sub-section (5) of Section 17 has been under-assessed or assed at rate lower than that which was correctly applicable or any deductions therefrom has been wrongly made, prescribed authority may, subject to such rules may, be made by State Government under this part, and (a) Within eight years from date of order of assessment or reassessment where said authority has reasons to believe that dealer has concealed, omitted or failed to disclose willfully particulars of such turnover or has furnished incorrect particulars of such turnover and thereby returned figures below reason amount, (b) Within eight years from date of order of assessment or reassessment in any other case. Serve on dealer notice containing all or any of requirements which may be included in notice under sub-section (2) of Section 17 and proceed to assess or reassess amount of tax due from dealer in respect of such turnover, and provisions of this part shall, so far as may be, apply accordingly as if notice under this sub-section was notice under sub-section (2) of Section 17: Provided that amount of tax shall be assessed or re-assessed after allowing such deductions as were permissible during said period and at rates at which it 12 Page 12 would have been assessed had turnover not escaped assessment or full assessment, as case may be. Explanation: - Production before prescribed authority of accounts, registers or documents from which material facts could, with due diligence, have been discovered by said authority, will not necessarily amount to full disclosure within meaning of this section. (2) (a) prescribed authority shall, in case falling under clause (a) of sub-section (1), direct that dealer shall pay by way of penalty sum not exceeding three times but not less than amount equivalent to amount of tax which is or may be assessed on escaped turnover. (b) penalty imposed under clause (a) shall be in addition to amount of tax which is or may be assessed on escaped turnover, and order imposing penalty may precede assessment of escaped turnover. (c) For determining amount of penalty under clause (a), where penalty precedes assessment under clause (b) prescribed authority shall quantify amount of suppression and tax thereon provisionally in prescribed manner. (d) No order shall be passed under this sub-section without giving dealer opportunity of being heard in prescribed manner. 3) Any assessment or reassessment made and any penalty imposed under this section shall be without prejudice to any action which is or may be taken under section 49. Sub-Section (1) of Section 19 very clearly prescribes that competent authority, upon information, if satisfied that reasonable ground exists to believe that any turnover of registered dealer or dealer to whom grant of registration certificate has been refused in respect of any period has, for any reason, escaped assessment or any turnover of any such 13 Page 13 dealer assessed under sub-Section (5) of Section 17 has been under-assessed or assessed at rate lower than that which was correctly applicable, may, within eight years from date of order of assessment, proceed to assess or reassess amount of tax in respect of such turnover. 20) For ready reference, relevant portion of assessment order dated 24.01.1996 is also extracted hereunder:- Company has used following work under its Tender work on its level and if we separate both, then it is like this. Camp equipments Rs. 227301.00 Electric goods for work site Rs. 773223.00 Electrode Welding Cable and Accessories Rs. 871294.00 Fuel & Lubricants Rs. 3189205.00 General Consumables Rs. 2945086.00 (Handgloves) contenvest Oxygen & D.A. Gas Rs. 21223.00 Plywood for Shuttering Rs. 2826674.00 Safety Appliances Rs. 408392.00 Spares Rs. 8232442.00 Staging Materials Rs. 3888798.00 Shuttering & Walk-way (For Timber) Rs. 4191982.00 Tools and Tackles Rs. 3672296.00 _________________ Total Rs. 3,12,47,916.00 14 Page 14 21) It is also pertinent to understand meaning of word information in its true sense. According to Oxford Dictionary, information means facts told, heard or discovered about somebody/something. Law Lexicon describes term information as act or process of informing, communication or reception of knowledge. expression information means instruction or knowledge derived from external source concerning facts or parties or as to law relating to and/or having bearing on assessment. We agree that mere change of opinion or having second thought about it by competent authority on same set of facts and materials on record does not constitute information for purposes of State Act. But word information used in aforesaid Section is of widest amplitude and should not be construed narrowly. It comprehends not only variety of factors including information from external sources of any kind but also discovery of new facts or information available in record of assessment not previously noticed or investigated. Suppose mistake in original order of 15 Page 15 assessment is not discovered by Assessing Officer, on further scrutiny, if it came to notice of another assessor or even by subordinate or superior officer, it would be considered as information disclosed to incumbent officer. If mistake itself is not extraneous to record and informant gathered information from record, immediate source of information to Officer in such circumstances is in one sense extraneous to record. It will be information in his possession within meaning of Section 19 of State Act. In such cases of obvious mistakes apparent on face of record of assessment, that record itself can be source of information, if that information leads to discovery or belief that there has been escape of assessment or under-assessment or wrong assessment. 22) There are catena of judgments of this Court holding that assessment proceedings can be reopened if audit objection points out factual information already available in records and that it was overlooked or not taken into consideration. Similarly, if audit points out some information 16 Page 16 or facts available outside record or any arithmetical mistake, assessment can be re-opened. 23) In P.V.S. Beedies (supra), this Court has held as under:- 3. We are of view that both Tribunal and High Court were in error in holding that information given by internal audit party could not be treated as information within meaning of Section 147(b) of Income Tax Act. audit party has merely pointed out fact which has been overlooked by Income Tax Officer in assessment. fact that recognition granted to this charitable trust had expired on 22-9-1992 was not noticed by Income Tax Officer. This is not case of information on question of law. dispute as to whether reopening is permissible after audit party expresses opinion on question of law is now being considered by larger Bench of this Court. There can be no dispute that audit party is entitled to point out factual error or omission in assessment. Reopening of case on basis of factual error pointed out by audit party is permissible under law. In view of that we hold that reopening of case under Section 147(b) in facts of this case was on basis of factual information given by internal audit party and was valid in law. judgment under appeal is set aside to this extent. (emphasis supplied) 24) Similarly, in Commissioner of Income Tax, U.P., Lucknow vs. M/s Gurbux Rai Harbux Rai (1971) 3 SCC 654, this Court has held as under:- 6. Section 15 of Act provides that if in consequence of definite information which has come into possession of Excess Profits Tax Officer he discovers that profits of any chargeable accounting period have escaped assessment, etc., he may at any time serve notice containing all or any of requirements which may be included in notice under 17 Page 17 Section 13 and may proceed to assess or reassess amount of such profits liable to excess profits tax. power so conferred can be exercised in course of original assessment or reassessment. It is essential, according to law laid down by this Court, that before any action can be taken or order made under Section 10-A there should be proceeding which should be pending for assessment or reassessment of excess profits tax .. 7. On first question submission of Mr M.C. Chagla for assessee is that there was no definite information which had come into possession of Tax Officer from which it could be said that he had discovered that profits of relevant chargeable accounting period had escaped assessment. We are unable to agree. Appellate Assistant Commissioner had made order on October 10, 1947, in proceedings relating to assessment of income tax of assessee that there had been only partial partition in respect of movable property business of Gurbux Rai. That was certainly information which came into possession of Excess Profits Tax Officer not because of any change of opinion by himself but because of decision of Appellate Assistant Commissioner in income tax proceedings. This Court has consistently held that Income Tax Officer would have jurisdiction to initiate proceedings under Section 34(1)(b) of Income Tax Act, 1922, which is in pari materia with Section 15 of Act if he acted on information received from decision of superior authorities or court even in assessment proceedings. (See R.B. Bansilal Abirchand Firm v. CIT1 and Assistant Controller of Estate Duty, Hyderabad v. Nawab Sir Osman Ali Khan Bahadur, H.E.H. Nizam of Hyderabad and others. It has next been urged that alleged object of having partial partition, namely, of reducing liability to excess profits tax had never been examined by Appellate Assistant Commissioner in income tax proceedings and therefore it could not be said that there had been escapement of income as result of information derived from his order. Appellate Assistant Commissioner apparently did not go into that question because proceedings before him related to assessment of income tax. Section 10-A of Act is special provision which deals with transactions designed to avoid or reduce liability to excess profits tax. information which came into possession of Excess Profits 18 Page 18 Tax Officer of partial partition having been effected was relevant for purpose of Section 15 and once he had initiated proceedings under that section he was perfectly competent and had jurisdiction to examine for purpose of Section 10-A whether partial partition had been effected for avoidance or reduction of liability to excess profits tax. first question, therefore, should have been answered against assessee and in favour of Revenue. (emphasis supplied) 25) In M/s Phool Chand Bajrang Lal and Another vs. Income Tax Officer & Another (1993) 4 SCC 77 this Court has held as under:- 25 .. He may start reassessment proceedings either because some fresh facts come to light which were not previously disclosed or some information with regard to facts previously disclosed comes into his possession which tends to expose untruthfulness of those facts. In such situations, it is not case of mere change of opinion or drawing of different inference from same facts as were earlier available but acting on fresh information .. 26) contention whether finding information from very facts that were already available on record amounts to information for purpose of Section 19 of State Act, it would be sufficient to refer to judgment of this Court in Anandjiharidas & Co. vs. S.P. Kasture AIR 1968 SC 565 wherein it was held that fact which was already there in records doesn t by its mere availability becomes item of 19 Page 19 information till time it has been brought to notice of assessing authority. Hence, audit objections were well within parameters of being construed as information for purpose of section 19 of State Act. 27) expression information means instruction or knowledge derived from external source concerning facts or parties or as to law relating to and/or after bearing on assessment. We are of clear view that on basis of information received and if assessing officer is satisfied that reasonable ground exists to believe, then in that case power of assessing authority extends to re-opening of assessment, if for any reason, whole or any part of turnover of business of dealer has escaped assessment or has been under assessed and assessment in such case would be valid even if materials, on basis of which earlier assessing authority passed order and successor assessing authority proceeded, were same. question still is as to whether in present case, assessing authority was satisfied or not. 20 Page 20 28) At this stage, we deem it appropriate to reproduce matter dealt with between audit team and assessing authority which led to initiation of re-assessment proceedings under Section 19 of State Act which is as under:- Part II Section Para 1. Non levy of purchase tax Rs. 24,19,385.31 Name of dealer M/s Larsen & Toubro Ltd., ECC Construction Group, Jamshedpur Registration No. JU 848 Nature of Business Works Contract Asstt. Year 1991-92 Date of Order 24.01.1996 G.T.O. Determined Rs. 17,57,01,372.00 Less: Sale of tax paid goods Rs. 1,31,75,779.63 ------------------------- Rs. 16,25,25,592.37 Less: Works done by sub-contractor Rs. 27,17,304.00 -------------------------- Rs. 15,98,08,208.37 Less: Labour charges and overhead charges Rs. 11,91,66,742.38 21 Page 21 ------------------------- Rs. 4,06,41,465.99 Tax was levied @ 4% on Rs. 17,48,096.90 Rs. 69,923.00 @ 8% on Rs. 1,96,71,099.14 Rs. 15,73,678.93 @ 9% on Rs. 1,45,34,488.10 Rs. 13,08,103.92 @ 10% on Rs. 2,048.00 Rs. 204.80 @ 11% on Rs. 4,82,125.70 Rs. 53,033.86 @ 12% on Rs. 42,03,608.15 Rs. 5,04,432.97 --------------------- Rs. 35,09,387.36 Add: Tax @ 1% on Rs. 5,55,08,612.25 Rs. 5,55,086.12 --------------------- Rs. 40,64,473.48 Surcharge @ 10% on Rs. 39,94,549.60 Rs. 3,99,454.00 --------------------- Rs. 44,63,928.44 Penalty U/S 16 (8) Rs. 920.00 --------------------- Rs. 44,64,848.44 Scrutiny of assessment order revealed that dealer was allowed exemption of Rs. 11,91,66,742.38 on account of labour charges and overhead charges claimed as detailed below: 22 Page 22 Labour Charges Rs. 7,02,77,549.00 Overhead charges Rs. 1,87,15,545.00 Goods consumed in course of execution of work Rs. 3,12,47,916.00 ------------------------ Rs. 12,02,41,010.00 Out of above claim, sum of Rs. 10,74,267.62 to us disallowed as below: Tax paid claim disallowed Rs. 3,50,698.37 Recovery of cement taxable Rs. 2,20,972.50 Amount of plant hire charges Rs. 5,02,596.75 -------------------- Rs.10,74,267.62 dealer had furnished statement of material utilized in contract work and goods consumed for own use. Scrutiny of assessment order revealed that dealer was allowed exemption on Rs. 3,12,47,916.00 being amount of goods consumed or used itself in course of execution of work, details of which were discussed in assessment order. It had been stated by assessing authority that such goods were purchased on payment of tax, but no declaration in form IX C along with other evidences were kept on record. Production of declaration form in IX C was mandatory one and hence claim was not allowable. entire materials received from outside State or purchased within State without payment of tax was normally leviable to tax at specified rates under section 12 of B.F. Act 1981. Under section 4 of Act ibid, every dealer liable to pay under section 3 of Act, if otherwise disposes 23 Page 23 goods in any manner other than by way of sale in State was also liable to purchase tax. In this connection reference to judgement of Hon ble Karnataka High Court and duly confirmed by Hon ble Supreme Court in case of Chevvabbo Vs. State of Karnataka (1986) 62 STG 194 Se) is invited . Disposal of goods in this section (Similar to those Karnataka) was clarified as transfer of title over goods otherwise than sale, included gifts, own use or consumption section 4 of Act (B.F. Act) is similar to section 7 of Tamil Nadu General Court in case of State of Tamil Nadu Vs. M.K. Kandaswami (1975 36 STC 191) where it was held that (1) this Section is separate charging provision in Act and is not subject to section 3 and (ii) brings to tax goods, sale of which would normally have been taxed at same point or other in State but could not be taxed even due to destroying them or other reasons. Thus purchase tax was leviable on goods consumed for own use. Since cost price/purchase price was reflected as value of goods consumed for own use of dealer, tax at rate specified in section 12 of Act ibid was leviable. In this case, even if same charges like Electrodes, Welding Cables, welding appliances, fuel and lubricants, oxygen and P.A. Gas safety, safety appliances valued at Rs. 44,90,114.00 was not considered as taxable, consumable goods worth Rs. 2,67,57,802.00 attracted levying of tax at specified rates. case may please be re-examined in light of above observation and levying of purchase tax amounting to Rs.24,19,385.31 (including additional tax and surcharge) as calculated below may be considered under intimation to audit. S. Name of Purchase value Rate Non-levy of Goods No. of goods applicable purchase tax 1. Camp Equipment, general consumable, plywood for shuttering spares and Rs. 8% Rs. staying 1,81,20,301.00 14,49,624.08 material 24 Page 24 2. Electrical Rs. 12% Rs. 5,95,824.60 Goods and 49,65,205.00 Timber 3. Tools & Rs. 4% Rs. 1,46,891.84 Tackles 36,72,296.00 Rs.21,92,340.52 Rs. 20,454.48 Addl. Tax @ Rs.22,12,795.00 1% on Rs. 2,06,590.31 20,45,448.68 Rs.24,19,385.31 Surcharge @ 10% on 20,65,903.16 use of fuel and lubricants may please be bifurcated and value of lubricants only may be levied to tax. On being pointed out in audit, it was stated that since goods had not been transferred to contractee co-under provisions of works contract, but it had been consumed and so it does not come under purview of taxation. reply is not tanable in view of above judgements and hence case needed to be reviewed. (emphasis supplied) 29) From perusal of last paragraph of aforementioned report of audit party, it is clear that Assessing Officer was of opinion that as goods had not been transferred to appellant-Company but had been consumed, so it does not come under purview of taxation. In other words, Assessing Officer was not satisfied on basis of information given by audit party that any of turnover of appellant-Company had escaped assessment 25 Page 25 so as to invoke Section 19 of State Act. From above, it also appears that assessing officer had to issue notice on ground of direction issued by audit party and not on his personal satisfaction which is not permissible under law. 30) In view of above discussion, we are of considered view that order dated 27.02.2006 passed by Deputy Commissioner, Commercial Taxes, Urban Circle, Jamshedpur is without jurisdiction and High Court was not right in dismissing petition filed by appellant-Company. We, therefore, allow appeal and set aside order dated 27.02.2006 passed by Deputy Commissioner, Commercial Taxes, Urban Circle, Jamshedpur as well as order dated 17.11.2006 passed by Division Bench of High Court of Jharkhand. However, parties shall bear their own costs. ... . J. (MADAN B. LOKUR) . .... J. (R.K. AGRAWAL) NEW DELHI; MARCH 21, 2017. 26 Page 26 M/s Larsen & Toubro Ltd. v. State of Jharkhand and Or