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TMI Blog2012 (4) TMI 212X X X X Extracts X X X X X X X X Extracts X X X X ..... have come to its own conclusion as to whether any mistake had crept in the the order of the assessing authority or it is a debatable question - the order of the Tribunal is set aside - matter is remitted back to the ITAT to decide the issue within a period of six months - Appeal of revenue allowed. - Tax Case (Appeal) No.791 of 2004 - - - Dated:- 13-2-2012 - MR.JUSTICE D.MURUGESAN, MR.JUSTICE P.P.S.JANARTHANA RAJA, JJ. For Appellant : Mr.T.Ravikumar Standing Counsel for Income Tax Cases For respondent : Mr.K.Ravi J U D G M E N T D.MURUGESAN, J. This Tax Case Appeal is at the instance of the Revenue questioning the order passed by the Chennai 'A' Bench, Chennai, in I.T.A.No.1924/ Mds/1993 dated 18.02.2004 for the Assessment Year 1987-88, on the following questions of law:- "1. Whether in the facts and circumstances of the case, the Tribunal was right in holding that the assessing officer had in the guise of rectifying an arithmetical mistake sought to rectify a debatable question of law? 2.Whether the re-calculation of the eligible profit under Section 32AB by deleting the expected return of customs duty, which was not included in the computati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as rightly contended by the learned counsel for the assessee in the guise of rectifying an arithmetical mistake a debatable question of law was sought to be rectified by the Revenue authorities which was definitely not permissible under Section 154 of the Act in view of the decision of the Apex Court in the case of T.S.Balaram, ITO Vs. Volkart Brothers, 82 ITR 50. Hence we are inclined to allow the appeal of the assessee by setting aside the orders of the Revenue authorities. The appeal is allowed. Aggrieved by that order, the Revenue has filed the present appeal. 3.In order to consider the second substantial question of law raised in this appeal, we are inclined to consider as to whether the order of this kind passed by the Income Tax Appellate Tribunal can be justified on the ground that the Tribunal had considered the issue and applied its mind to the same for the purpose of dismissal of the appeal. The Appellate Tribunal being a final fact finding authority, is expected to give reasons supporting its finding. In the event, if there are no reasons to support the finding and the order displays a total non-application of mind, such order cannot be sustained in the eye of law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... late Tribunal, and such point or points shall be decided according to the opinion of the majority of the members of the Appellate Tribunal who have heard the case, including those who first heard it. 4. A combined reading of Sub Sections (4) and (6) of Section 255 of the Act shows that the proceedings before the Income-tax Appellate Tribunal is judicial proceedings, as the Tribunal has the powers of a Civil Court in terms of Section 131 of Income Tax Act and it has the powers of Criminal Court in terms of Sections 193 and 228 of Indian Penal Code and Section 195 of Code of Criminal Procedure. 5. In this context, we may also refer to the Income Tax Appellate Tribunal Rules, 1963. The appellate tribunal rules are comprehensive enough to include the procedure for filing, date of presentation of appeal, contents of memorandum of appeal, documents to accompany the memorandum of appeal and filing of affidavits. By these rules, the assessee or the Revenue, as the case may be, are bound to comply with the above provisions by filing necessary documents for the purpose of Tribunal to consider. The compliance of the rule is not a mere formality inasmuch as the Tribunal, by ignoring th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns Engineering and Manufacturing Co. of India Ltd. v. Union of India and Another) wherein it has been held as follows. 6. If courts of law are to be replaced by administrative authorities and tribunals, as indeed, in some kinds of cases, with the proliferation of Administrative Law, they may have to be so replaced, it is essential that administrative authorities and tribunals should accord fair and proper hearing to the persons sought to be affected by their orders and give sufficiently clear and explicit reasons in support of the orders made by them. Then alone administrative authorities and tribunals exercising quasi-judicial function will be able to justify their existence and carry credibility with the people by inspiring confidence in the adjudicatory process. The rule requiring reasons to be given in support of an order is, like the principle of audi alteram partem, a basic principle of natural justice which must inform every quasi-judicial process and this rule must be observed in its proper spirit and mere pretence of compliance with it would not satisfy the requirement of law. The distinction between passing of an order by an administrative or quasi-judicial authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ges and authorities who deliver them. All these decisions serve one common purpose which is to demonstrate by reason that the relevant factors have been objectively considered. This is important for sustaining the litigants' faith in the justice delivery system. (j) Insistence on reason is a requirement for both judicial accountability and transparency. (k) If a judge or a quasi-judicial authority is not candid enough about his/her decision-making process then it is impossible to know whether the person deciding is faithful to the doctrine of precedent or to principles of incrementalism. (l) Reasons in support of decisions must be cogent, clear and succinct. A pretence of reasons or rubber-stamp reasons is not to be equated with a valid decision-making process. (m) It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision-making not only makes the judges and decision-makers less prone to errors but also makes them subject to broader scrutiny. (See David Shapiro in Defence of Judicial Candor.) (n) Since the requirement to record reasons emanates from the broad doctrine of fairness in decision-making, the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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