Court emphasizes providing reasons in decision-making for fairness, nullifies orders without reasons.

The High Court ruled in favor of the petitioner, emphasizing the necessity of providing reasons in decision-making processes to ensure fairness and prevent unjust conclusions. The court highlighted that the absence of reasons constitutes a denial of justice and undermines the objectivity of decisions. Consequently, the court allowed the petitions, annulled the challenged orders, and instructed a fresh assessment with proper reasoning and adherence to legal principles, nullifying the demand notices issued prior to the assessment orders.

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Issues:
Violation of principles of natural justice in not assigning reasons and findings in the orders of the Assistant Commissioner of Commercial Taxes.

Analysis:
The petitioner challenged the orders of the Assistant Commissioner of Commercial Taxes, alleging a violation of natural justice due to the lack of reasons and findings in the decisions. The petitioner's counsel argued that the assessing officer failed to provide reasons for accepting or rejecting information, leading to unfair conclusions. On the other hand, the revenue's counsel acknowledged the grounds presented by the petitioner but could not point out specific reasons and findings in the orders.

The High Court emphasized the importance of recording reasons in decision-making processes, stating that reasons bridge the gap between the decision-maker's mind and the final decision. Failure to provide reasons was considered a denial of justice, as observed in previous cases like Alexander Machinery (Dudley) Ltd. v. Crabtree and M/s. Mangalore Ganesh Beedi Works v. Commissioner of Income Tax. The court highlighted that reasons ensure objectivity and prevent unconscious bias or arbitrariness in conclusions.

The court referred to various legal precedents to underscore the significance of giving reasons in judicial and quasi-judicial decisions. It was noted that public orders by authorities must be construed objectively based on the language used in the order itself. The Apex Court's observation that "reason is the heartbeat of every conclusion" further emphasized the critical role of reasons in decision-making processes.

The judgment highlighted that providing reasons encourages a thorough examination of relevant issues, prevents the influence of extraneous considerations, and ensures consistency in decision-making. Without reasons, the right to be heard loses its significance, and decisions may lack logical justification. The court emphasized that decisions must be rational, reasoned, and based on the material presented during the hearing to avoid being deemed absurd or perverse.

Ultimately, the High Court allowed the petitions, quashed the impugned orders, and remitted the proceedings for fresh consideration. The Assessing Officer was directed to reevaluate the matters, provide a reasonable opportunity for the petitioner to be heard, and issue orders strictly in accordance with the law and the court's observations. The demand notices issued before the assessment orders were also declared quashed in light of the judgment.

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