TaxTMI 
TaxTMI 
2013 (5) TMI 30
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....iness branch premises at Coimbatore and the petitioner furnished statements for the period from April, 2003 to October, 2003 relating to the sale of SKO. According to the petitioner, the entire consignment imported and sold to various parties in Tamil Nadu is an inter-State sale covered by 'C' forms and therefore there is no element of local sales. 3. On the contrary, the first respondent took the stand that the sale had occasioned inside the State of Tamil Nadu and it is not a case of inter-State sale. In support of the same, the first respondent issued a notice dated 14.1.2004 in TNGST No.0861669/2003-04 and the petitioner-dealer filed their objections on 10.2.2004. In the notice dated 14.1.2004, the following were the charges:- "1. From the above, it is seen that the consumers in and around Coimbatore placed orders addressed to the dealers Chennai office and in most of the cases with advance payment by D.D. and in turn they were forwarded to the dealers Coimbatore Depot to monitor the delivery of SKO to the ultimate buyers. Both these orders and demand drafts have finally been handed over to the dealers Coimbatore Depot. Certain purchase orders do not contain t....
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....0 at 25% ---------------------- As the matter relating to levy of surcharge is subjudice appropriate action will be initiated after the receipt of the orders from Hon'ble High Court. As they have willingly suppressed the local sales by camouflaging it as an inter-State sales maximum penalty under Sec.12(3)(b) of the Act at 150% is proposed on the tax due on the suppressed turnover of Rs. 3,62,90,160-00. The dealer are requested to file their objections if any to the above proposals with connected records in support of their contention within 15 days of receipt of this notice failing which the proposals will be confirmed and orders and demand notices issued accordingly." 4. In the reply dated 10.2.2004, while reiterating the stand that it was a case of inter-State sale of SKO from Cochin to various purchasers in Tamil Nadu, the petitioner relied upon various documents like the purchase orders, central excise documents to show the proof of despatch of goods from Cochin to the purchasers in Tamil Nadu and the documents were annexed to the reply dated 10.2.2004. The petitioner also relied upon a Certificate issued by the Assistant Commissioner (Asses....
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....hat the order suffers from total non-application of mind as well as non-consideration of the documents and records produced by the petitioner. The authority states that she had examined the objections and copies of records and therefore the production of records is not in dispute. If the records were taken for consideration, it is not clear as to how the authority can state that no evidence was filed to show the movement of goods from other States to the local purchasers based on the covenant. This statement appears to be a fallacy, as the purchase orders had already been produced showing the origin of goods from Cochin to the purchaser at the State of Tamil Nadu. The next reason is that there was no evidence to show that the purchase orders were transmitted to the Cochin branch. For this, the petitioner has submitted the central excise records to show the delivery of goods after import and the payment of central sales tax at 4% supported by the certificate issued by the Assistant Commissioner (Assessment), Special Circle-II, Commercial Taxes Department, Ernakulam. Those records have not been taken into consideration by the authority. 8. The next finding of the authority is....
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....st paragraph of the seventh page only deals with the record of findings by the authority, which apparently do not contain any reasons. It is well established principle in law that the administrative authority exercising judicial or quasi-judicial functions is required to record the reasons for its decision. In S.N. Mukherjee v. Union of India, AIR 1990 SC 1984, the Hon'ble Supreme Court held in paragraphs 35, 38 and 39 as follows:- "35. Reasons, when recorded by an administrative authority in an order passed by it while exercising quasi-judicial functions, would no doubt facilitate the exercise of its jurisdiction by the appellate or supervisory authority. But the other considerations, referred to above, which have also weighed with this Court in holding that an administrative authority must record reasons for its decision are of no less significance. These considerations show that the recording of reasons by an administrative authority serves a salutary purpose, namely, it excludes chances of arbitrariness and ensures a degree of fairness in the process of decisions-making. The said purpose would apply equally to all decisions and its application cannot be confined to decisio....
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....he Administrative Procedure Act, 1946 of U.S.A. and the Administrative Decisions (Judicial Review) Act, 1977 of Australia whereby the orders passed by certain specified authorities are excluded from the ambit of the enactment. Such an exclusion can also arise by necessary implication from the nature of the subject matter, the scheme and the provisions of the enactment. The public interest underlying such a provision would outweigh the salutary purpose served by the requirement to record the reasons. The said requirement cannot, therefore, be insisted upon in such a case. 39. For the reasons aforesaid, it must be concluded that except in cases where the requirement has been dispensed with expressly or by necessary implication, an administrative authority exercising judicial or quasi-judicial functions is required to record the reasons for its decision." 9. In the light of the above, this Court has no hesitation to hold that the first respondent-Commercial Tax Officer has passed a non-speaking order, bereft of reasons, without application of mind to the records produced. The entire findings are in the realm of conjectures and surmises and, therefore, the petitioner wa....