TaxTMI 
TaxTMI 
2010 (4) TMI 139
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Commissioner (Appeals) as also Rajasthan Tax Board, in the facts and circumstances, no further interference is called for by this Court. The revision petition is dismissed accordingly as having no merits." 4. The Learned Counsel appearing for the appellant, Assistant Commissioner of Income Tax has argued that Order passed by the High Court does not record any reasons for dismissing the Revision Petition preferred by the Department. According to the Learned Counsel, various contentions raised as grounds in the Revision Petition and two questions of law formulated by the Department for consideration in the High Court while impugning the judgment of the Rajasthan Tax Board, Ajmer have not been reverted to by the High Court, resulting in serious prejudice caused to the present petitioner. On merits as well, challenge has been raised to the Order of the Tax Board as well as that of the Order of the High Court. 5. It may be necessary for that to refer to the basic facts giving rise to the present appeal. The respondent claimed to be a contractor who has obtained impartible contract of constructing 400 shops in JP Market, Chhota Talab, Kota. As per the contract the shops were to....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s? 7. As is evident from the facts narrated in the Revision Petition and the grounds raised besides raising the question of law, a factual controversy was also raised going to the very root of the case, that the rolling shutters & doors fixed by the respondent on the shops were not manufactured of tax paid material. Thus, question of law, mixed questions of law and facts were not examined by the High Court in some detail, but as already noticed, by one line order the Revision Petition was dismissed. During the course of hearing, we were informed that arguments were also addressed with reference to judgments of this Court which were also cited before the Board. However we find no mention thereof in the impugned Order. It was also contended that similar questions do arise in number of other cases, thus it was expected of the High Court to deal with the contentions rather than pass a cryptic order. 8. We do find that there is substance in the contention raised on behalf of the petitioner before us. It would have been desirable if the High Court would have recorded some reasons for rejecting the Revision Petition preferred by the Department. 9. The increasing institution of ca....
X X X X Extracts X X X X
X X X X Extracts X X X X
....pective and to hold whether the reasoning recorded by the Court whose order is impugned, is sustainable in law and whether it has adopted the correct legal approach. To sub-serve the purpose of justice delivery system, therefore, it is essential that the Courts should record reasons for its conclusions, whether disposing of the case at admission stage or after regular hearing. 12. At the cost of repetition, we may notice, that this Court has consistently taken the view that recording of reasons is an essential feature of dispensation of justice. A litigant who approaches the Court with any grievance in accordance with law is entitled to know the reasons for grant or rejection of his prayer. Reasons are the soul of orders. Non-recording of reasons could lead to dual infirmities; firstly, it may cause prejudice to the affected party and secondly, more particularly, hamper the proper administration of justice. These principles are not only applicable to administrative or executive actions, but they apply with equal force and, in fact, with a greater degree of precision to judicial pronouncements. A judgment without reasons causes prejudice to the person against whom it is pronounce....
X X X X Extracts X X X X
X X X X Extracts X X X X
....and mere pretence of compliance with it would not satisfy the equirement of law. ..." 14. In the case of Mc Dermott International Inc. v. Burn Standard Co. Ltd. and Ors. (2006) SLT 345, the Supreme Court clarified the rationality behind providing of reasons and stated the principle as follows:- ". . . Reason is a ground or motive for a belief or a course of action, a statement in justification or explanation of belief or action. It is in this sense that the award must state reasons for the amount awarded. The rationale of the requirement of reasons is that reasons assure that the arbitrator has not acted capriciously. Reasons reveal the grounds on which the Arbitrator reached the conclusion which adversely affects the interests of a party. The contractual stipulation of reasons means, as held in Poyser and Mills' Arbitration in Re, `proper adequate reasons'. Such reasons shall not only be intelligible but shall be a reason connected with the case which the Court can see is proper. Contradictory reasons are equal to lack of reasons. . . ." 15. In Gurdial Singh Fijji v. State of Punjab [(1979) 2 SCC 368], while dealing with the matter of selection of candidates who could ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ur Court noticed, that legality, propriety and correctness of the order was challenged on the ground that no reason was recorded by the learned Single Judge while rejecting the prayer and this has seriously prejudiced the interest of justice. After a detailed discussion on the subject, the Court held:- "The Supreme Court and different High Courts have taken the view that it is always desirable to record reasons in support of the Government actions whether administrative or quasi judicial. Even if the statutory rules do not impose an obligation upon the authorities still it is expected of the authorities concerned to act fairly and in consonance with basic rule of law. These concepts would require that any order, particularly, the order which can be subject matter of judicial review, is reasoned one. Even in the case of Chabungbambohal Singh v. Union of India and Ors. 1995 (Suppl) 2 SCC 83, the Court held as under: "His assessment was, however, recorded as "very good" whereas qua the appellant it had been stated unfit. As the appellant was being superseded by one of his juniors, we do not think if it was enough on the part of the Selection Committee to have merely stated unfit....
X X X X Extracts X X X X
X X X X Extracts X X X X
....re-referred cases, in the case of State of U.P. v. Battan and Ors. [(2001) 10 SCC 607], the Supreme Court held as under: "The High Court has not given any reasons for refusing to grant leave to file appeal against acquittal. The manner in which appeal against acquittal has been dealt with by the High Court leaves much to be desired. Reasons introduce clarity in an order. On plainest consideration of justice, the High Court ought to have set forth its reasons, howsoever brief, in its order. The absence of reasons has rendered the High Court order not sustainable." Similar view was also taken by the Supreme Court in the case of Raj Kishore Jha v. State of Bihar and Ors. JT 2003 (Supp.2) SC 354. In a very recent judgment, the Supreme Court in the case of State of Orissa v. Dhaniram Luhar (2004) 5 SCC 568 while dealing with the criminal appeal, insisted that the reasons in support of the decision was a cardinal principle and the High Court should record its reasons while disposing of the matter. The Court held as under: "8. Even in respect of administrative orders Lord Denning, M.R. In Breen v. Amalgamated Engg. Union observed: "The giving of reasons is one of the fundam....
X X X X Extracts X X X X
X X X X Extracts X X X X
....st at the interlocutory stages and would render the remedy of appeal purposeful and meaningful. It is a settled canon of legal jurisprudence that the Courts are vested with discretionary powers but such powers are to be exercised judiciously, equitably and in consonance with the settled principles of law. Whether or not, such judicial discretion has been exercised in accordance with the accepted norms, can only be reflected by the reasons recorded in the order impugned before the higher Court. Often it is said that absence of reasoning may ipso facto indicate whimsical exercise of judicial discretion. Patricia Wald, Chief Justice of the D.C. Circuit Court of Appeals in the Article, Blackrobed Bureaucracy or Collegiality Under Challenge, (42 MD.L. REV. 766, 782 (1983), observed as under:- "My own guiding principle is that virtually every appellate decision requires some statement of reasons. The discipline of writing even a few sentences or paragraphs explaining the basis for the judgment insures a level of thought and scrutiny by the Court that a bare signal of affirmance, dismissal, or reversal does not." The Court cannot lose sight of the fact that a losing litigant has ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....posed of easily but in either cases, reasons they must have. While speaking about purpose of the judgment, he said, "The first matter to consider is the purpose of the judgment. To my mind there are four purposes for any judgment that is written: - (1) to clarify your own thoughts; (2) to explain your decision to the parties; (3) to communicate the reasons for the decision to the public; and (4) to provide reasons for an appeal Court to consider." Clarity of thought leads to proper reasoning and proper reasoning is the foundation of a just and fair decision. In Alexander Machinery (Dudley) Ltd. v. Crabtree 1974 ICR 120, the Court went to the extent of observing that "Failure to give reasons amounts to denial of justice". Reasons are really linchpin to administration of justice. They are link between the mind of the decision taker and the controversy in question. To justify our conclusion, reasons are essential. Absence of reasoning would render the judicial order liable to interference by the higher Court. Reasons are the soul of the decision and its absence would render the order open to judicial chastism. The consistent judicial opinion is that every order de....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t and is liable to be dismissed." and the Court concluded as under:- "In view of the specific stand taken by the Department in the affidavit which we have referred to above, the cryptic order passed by the High Court cannot be sustained. The absence of reasons has rendered the High Court order not sustainable. Similar view was expressed in State of U.P. v. Battan [(2001) 10 SCC 607]. About two decades back in State of Maharashtra v. Vithal Rao Pritirao Chawan [(1981) 4 SCC 129] the desirability of a speaking order was highlighted. The requirement of indicating reasons has been judicially recognised as imperative. The view was reiterated in Jawahar Lal Singh v. Naresh Singh [(1987) 2 SCC 222]. In Raj Kishore Jha v. State of Bihar [(2003) 11 SCC 519] this Court has held that reason is the heartbeat of every conclusion and without the same, it becomes lifeless. "8. ... Right to reason is an indispensable part of a sound judicial system; reasons at least sufficient to indicate an application of mind to the matter before court. Another rationale is that the affected party can know why the decision has gone against him. One of the salutary requirements of natural justice is spellin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....well as avoids uncertainty. As a matter of fact it helps in the observance of law of precedent. Absence of reasons on the contrary essentially introduces an element of uncertainty, dis-satisfaction and give entirely different dimensions to the questions of law raised before the higher/appellate courts. In our view, the court should provide its own grounds and reasons for rejecting claim/prayer of a party whether at the very threshold i.e. at admission stage or after regular hearing, howsoever precise they may be. 21. We would reiterate the principle that when reasons are announced and can be weighed, the public can have assurance that process of correction is in place and working. It is the requirement of law that correction process of judgments should not only appear to be implemented but also seem to have been properly implemented. Reasons for an order would ensure and enhance public confidence and would provide due satisfaction to the consumer of justice under our justice dispensation system. It may not be very correct in law to say, that there is a qualified duty imposed upon the Courts to record reasons. Our procedural law and the established practice, in fact, imposes unqu....