TaxTMI 
TaxTMI 
2014 (8) TMI 973
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....e project of the assessee was in an area of 70.57 cents of land, therefore, the condition prescribed for claiming deduction under section 80-IB(10) of the Income-tax Act which requires a minimum of one acre land, was not satisfied. Referring to the judgment of the Bombay High Court in CIT v. Vandana Properties [2013] 353 ITR 36 (Bom), learned senior counsel submitted that section 80-IB(10) allows deduction to a housing project constructed on a plot of land having minimum area of one acre and it is immaterial that whether there exists other housing projects or not. Therefore, according to learned senior counsel, even though a part of the land was set apart for second phase of the development, the assessee is entitled for deduction under section 80-IB(10) of the Act. On a query from the Bench, the Assessing Officer has not discussed anything about the area of the land on which construction was carried out, learned senior counsel submitted that the Assessing Officer has called for all the details from the assessee and thereafter allowed the claim of the assessee. According to learned senior counsel, the Administrative Commissioner has recorded a finding that the assessee has not devel....
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.... is that such a decision is subject to the appellate jurisdiction of this court under article 136 of the Constitution as well as the supervisory jurisdiction of the High Courts under article 227 of the Constitution and that the reasons, if recorded, would enable this court or the High Courts to effectively exercise the appellate or supervisory power. But this is not the sole consideration. The other considerations which have also weighed with the court in taking this view are that the requirement of recording reasons would (i) guarantee consideration by the authority ; (ii) introduce clarity in the decisions ; and (iii) minimise chances of arbitrariness in decision making. In this regard a distinction has been drawn between ordinary courts of law and the Tribunals and authorities exercising judicial functions on the ground that a judge is trained to look at things objectively uninfluenced by considerations of policy or expediency whereas an executive officer generally looks at things from the stand point of policy and expediency. Reasons, when recorded by an administrative authority in an order passed by it while e....
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....cide on considerations of policy or expediency. They must decide the matter solely on the facts of the particular case, solely on the material before them and apart from any extraneous considerations by applying pre-existing legal norms to factual situations. Now the necessity of giving reasons is an important safeguard to ensure observance of the duty to act judicially. It introduces clarity, checks the introduction of extraneous or irrelevant considerations and excludes or, at any rate, minimises arbitrariness in the decision-making process. Another reason which compels making of such an order is based on the power of judicial review which is possessed by the High Court under article 226 and the Supreme Court under article 32 of the Constitution. These courts have the power under the said provisions to quash by certiorari a quasi-judicial order made by an administrative officer and this power of review can be effectively exercised only if the order is a speaking order. In the absence of any reasons in support of the order, the said courts cannot examine the correctness of the order under review. The H....
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.... High Court has done is to require the Assessing Officer to pass a reasoned order. The High Court was of the view that the Tribunal could not have substituted its own reasonings which were required to be recorded by the Assessing Officer. According to the assessee, all relevant aspects were placed for consideration and if the officer did not record reasons, the assessee cannot be faulted. We do not think it necessary to interfere at this stage. It goes without saying that when the matter be taken up by the Assessing Officer on remand, it shall be his duty to take into account all the relevant aspects including the materials, if any, already placed by the assessee, and pass a reasoned order." 6. We also find that the Allahabad High Court in a recent unreported judgment expressed its shock and anguish the way in which the assessment orders and the revisional orders are being passed. In fact, the assessee, M/s. Fateh Chand Charitable Trust in Writ Tax No. 1629 of 2010 (judgment dated May 27, 2013 (since reported in Fateh Chand Charitable Trust v. CIT [2013] 357 ITR 604 (All)) before the Allahabad High Court received donati....
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....ind 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 spelling out reasons for the order made ; in other words, a speaking- out. The "inscrutable face of the sphinx" is ordinarily incongruous with a judicial or quasi-judicial performance'. A feeble argument was advanced that the Commissioner of Income- tax being higher in hierarchy than the Additional Commissioner of Income-tax, the initiation of the proceedings at the instance of the Additional Commissioner of Income-tax is bad. In view of our above conclusion that the order dropping the proceeding under section 12A was not a valid action on the part of the Commissioner of Income-tax, the said argument is rejected. Having regard to what has been said above. We find that it is a case where the then Assessing Officer (Shri Bhopal Singh), the Addi tional Commissioner of Income-tax, Range-II, Muzaffarnagar and Shri Kundan Misra, the then Commissioner of Income-tax, Muzaffar nagar, who passed the order dated January 25, 2008, have abdicated their duties. The court in the exercise of supervisory jurisdicti....