Reasoned assessment orders are mandatory when objections are filed; cryptic rejection of replies cannot stand.

An assessment order levying entertainment tax was held unsustainable because it merely stated that the assessee's objections were examined and found untenable, without disclosing the objections or reasons for rejection. The taxing authority was required to consider the reply to the proposition notice and pass a reasoned, speaking order; failure to do so amounted to non-consideration of objections and breach of natural justice. The assessment was quashed and the matter was sent back for fresh determination after considering the reply and, if necessary, granting an opportunity of hearing.

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Issues: Whether the assessment order levying entertainment tax was liable to be quashed for failure to consider the assessee's objections to the proposition notice and for not being a speaking order.

Analysis: The assessment order recorded only that the objections were gone through and found untenable, but it did not disclose what the objections were or why they were rejected. Such a cryptic disposal did not reflect application of mind to the reply filed by the assessee and amounted to non-consideration of the objections. A taxing authority must pass a reasoned order after considering the assessee's response, and where the objections are ignored, the order cannot stand.

Conclusion: The assessment order was quashed in favour of the appellant/assessee, and the Assessing Officer was directed to reconsider the reply and pass a reasoned and speaking order after granting opportunity of hearing, if necessary.

Final Conclusion: The impugned assessment was set aside for breach of the duty to consider objections and to issue a speaking order, leaving the tax liability to be redetermined afresh in accordance with law.

Ratio Decidendi: An assessment order that fails to consider the assessee's objections and does not give reasons for rejecting them is unsustainable for violation of natural justice and must be replaced by a reasoned decision.

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