2019 (8) TMI 950 - HC - VAT and Sales Tax

Principles of Natural justice - non-speaking order - availability of alternative remedy - CST Act - HELD THAT - This manner of disposal of the appeal without addressing the various issues raised before the authority is not a manner in which a quasi-judicial order should be passed. The necessity for giving reasons to reach a particular conclusion is not only to make the parties concerned aware of the reasons why their appeal has been allowed or disallowed, but also gives an opportunity to the appellate authority to know the reasons which led the lower authority to reach a particular conclusion. It is only when the authorities adhere to the cardinal rule of giving reasons for their orders, would the parties have the satisfaction of having received justice at the hands of the authorities - We find that the impugned order is without any reasons, and, therefore, cannot be sustained. The Petitioner s appeal restored from the order dated 3 November 2017 of the Deputy Commissioner of State Tax to the Joint Commissioner (Appeals) Respondent No.3 for a fresh consideration and disposal after following the principles of natural justice - petition allowed by way of remand.

Summary

Issues:
Petitioner's appeal rejection under Section 9(2) of the CST Act by Joint Commissioner of State Tax (Appeals) due to lack of reasons provided in the order.

Analysis:
The petition challenged the order dated 27 November 2018, where the Petitioner's appeal under the CST Act for the period 2011-2012 was dismissed by the Joint Commissioner of State Tax (Appeals). The Petitioner contended that the order was nonspeaking as it failed to consider their submissions adequately, leaving them unaware of the reasons for disallowing the appeal. The AGP argued against entertaining the petition under Article 226, citing an alternative remedy available under the CST Act.

Upon review, the High Court found that the impugned order did record the Petitioner's submissions in detail over eight pages on various issues such as disallowance of credit, levy of tax for non-submission of forms, export sales, and more. However, the operative part of the order lacked reasoning and merely stated the disallowance without addressing the raised issues. The Court emphasized the importance of providing reasons in quasi-judicial orders to ensure transparency and fairness in decision-making.

Consequently, the High Court set aside the impugned order and directed the Joint Commissioner of Sales Tax (Appeals) to reconsider and dispose of the Petitioner's appeal from the Deputy Commissioner of State Tax's order dated 3 November 2017. The Court mandated following the principles of natural justice, including providing reasons for the conclusions reached, for a fair and just decision-making process. The Joint Commissioner was instructed to expedite the appeal's disposal, preferably within eight weeks from the judgment date.

In conclusion, the petition was allowed, and the impugned order was overturned, emphasizing the necessity of providing reasons for decisions in quasi-judicial proceedings to uphold fairness and justice in administrative actions.