2013 (12) TMI 1249 - HC - Income Tax

Unreasoned order of Tribunal - Valid or not - Held that - Though tribunal has extended the benefit of its earlier judgement while deciding the controversy as raised but not indicated as to what and in which manner the case is identical to the earlier judgment - It was incumbent upon the tribunal to discuss the similarity between two controversy one which was decided earlier and the other i.e. the case in hand - If the tribunal would have compare the similarity between two disputes the one of which was decided earlier and thereafter parity have been extended then finding should have been recorded with regard to similarity of dispute Following Assistant Commissioner Commercial Tax Department Works Contract and Leasing Quota Vs. Shukla and Brothers 2010 (4) TMI 139 - SUPREME COURT OF INDIA - It shall be obligatory on the part of the judicial or quasi judicial authority to pass a reasoned order while exercising statutory jurisdiction - Reason is the very life of law. When the reason of a law once ceases the law itself generally ceases - The tribunal has been failed to discharge his obligation by not discussing the evidence and material available on record extending parity to the respondent - The order is unreasoned and decided without discussing the similarity between the case in hand and the earlier judgement of tribunal The issue was restored for fresh adjudication.

Summary

Issues:
Controversy over deemed gift due to sale of shares below market rate during assessment year 1991-92. Tribunal's unreasoned order and lack of discussion on similarity with earlier judgment. Obligation to pass reasoned order by judicial authorities.

Analysis:
The judgment pertains to appeals with identical issues regarding the assessment year 1991-92 involving the sale of shares below market rate, treated as a deemed gift. The Assessing Authority considered the transaction as a deemed gift due to the difference between the sale price and the market rate of the shares. However, this decision was reversed by the CIT (Appeal), leading to the current appeal.

The counsel for the appellant argued that the tribunal's order lacked reasoning and merely extended the benefit of an earlier judgment without discussing the similarities between the cases. Referring to a Division Bench judgment, it was highlighted that an unreasoned order amounts to an arbitrary exercise of power. The tribunal's failure to explain the similarity between the cases hindered the Revenue Authority's ability to verify the facts and findings.

Citing a Supreme Court case, it was emphasized that judicial authorities must provide reasoned orders while exercising statutory jurisdiction. The absence of reasons in an order can prejudice the affected party and impede the proper administration of justice. In this context, the tribunal was criticized for not fulfilling its obligation to discuss the evidence and material on record when extending parity to the respondent.

Consequently, the High Court decided to set aside the tribunal's order and remit the matter back for fresh adjudication. The tribunal was directed to restore the appeal to its original number and decide the controversy afresh within three months from the date of receipt of the order. The appellant was instructed to provide a copy of the order promptly. Ultimately, the appeals were allowed, emphasizing the importance of reasoned orders and thorough analysis in judicial decisions.