TaxTMI 
TaxTMI 
2016 (6) TMI 727
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....he Tribunal decided the Revision petition of the petitioners by order dated 14.7.2009 in favour of the petitioners. The Tribunal placed the matter before Commissioner of Sales Tax, who was the appellate authority, in the following manner: " The Tribunal has carefully perused the impugned common order/s 65 and u/s 67. It is based on the letter dated 19.7.04 from Additional Commissioner of (Excise) without ascertaining whether the goods purchased contained tobacco or not. No reasons are there in the order for holding it as pan-masala falling under some entry under schedule IIA to the Gujarat Sales Tax Act. Even relevant entry prevailing then is also not mentioned in the order. Notice in Form 49 dtd. 1.9.04 does nsot contain any reason for charging sales tax on sale of Gutka for the period between Dt.1.11.2000 to Dt.28.2.2001. The decision of the Hon'ble Supreme Court is very clear so are the relevant entries in schedules and notification u/s 49(2) of the Act. Nothing of the above appear to have been considered to the Joint Commissioner of Commercial Tax before passing the impugned order although prima facie there is lot of force in the arguments of the appellant. Such orders c....
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....hority. However, in the interest of justice, a fresh opportunity is being granted to the petitioners and the petitioners may remain present on 15.3.2016 alongwith supporting documents, failing which the authority shall take ex parte decision. In response to this notice, the petitioners conveyed under letter dated 14.3.2016 that the Joint Commissioner had already verified the documents and adjudicated the case finally in favour of the assessee and passed an order dated 26.2.2010 granting refund of Rs. 75,73,923/-. It was therefore, requested that the said order be implemented and refund be released. 5. The petitioners at that stage filed this petition and made the above noted prayers. 6. Learned counsel Mr. Tanvish Bhatt for the petitioners submitted that after the Tribunal decided the issue in favour of the petitioners and placed back the matter before Appellate Authority for fresh decision bearing in mind observations made by the Tribunal, the Appellate Authority had also decided to grant refund to the petitioners. The Additional Commissioner however, unauthorisedly intervened and as is borne out from the record, directed the Appellate Authority to deny refund to the petitio....
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....ng refund to the dealer, amount to be utilised for the purpose of tobacco and smoking control. Above issues may be borne in mind and necessary modifications may be made in the draft order and copy thereof be forwarded." 9. The procedure adopted by the department does not flow from any statutory scheme of the Act. Chapter V of the Act pertains to returns, payment of tax, assessment, recovery of tax and refund. Section 29 of the Act pertains to the returns to be filed by the dealer. Section 33 pertains to self assessment. Section 34 pertains to audit assessment. Section 35 pertains to turnover escaping assessment. 10. Chapter VIII of the Act pertains to Appeals, Revision and rectification. Section 73 pertains to appeals which reads as under: "73. Appeal. (1) An appeal from every original order, not being an order mentioned in section 74, passed under this Act or the rules shall lie:- (a) If the order is made by an Assistant Commissioner or Commercial Tax Officer, or any other officer sub-ordinate thereto, to the Deputy Commissioner; (b) if the order is made by a Deputy Commissioner, to the Joint Commissioner; (c) if the order is made by a Joint Commissioner, addi....
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.... mistake which is brought to his notice by person affected by the order. 12. It can thus be seen that the Act makes detailed provisions for filing of return and assessment of tax of the assessee. Once competent authority passes an order, an aggrieved person would have a right to appeal in terms of sub-section (1) of section 73, in all cases other than those which are termed as non-appealable orders specified in section 74. Under sub-section (2) of section 73, under certain circumstances, a second appeal would be available to the Tribunal against the order of the appellate authority. Against the order of the Tribunal, an appeal would be available to the High Court on substantial question of law. Section 75 grants power of revision to the Commissioner as well as to the Tribunal. 13. Having made such elaborate provisions of assessment, appeal and revision, the fundamental question is can an outside agency control the discretion of the statutory appellate authority ? In the present case, we may recall, the appellate authority i.e. Joint Commissioner upon remand of the proceedings by the Tribunal heard the petitioners and decided to grant refund. He was however under directives fr....
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....ntrary to the principles of natural justice. The procedure adopted was, to say the least, unfair and was calculated to undermine the confidence of the public in the impartial and fair administration of the Sales-tax Department concerned. We would have, simply on this ground, set aside the assessment order made by the first respondent and remanded the matter back to him for his due consideration in accordance with law; but as the matter is old and a remand would lead to unnecessary harassment of the appellants, we have preferred to deal with the appeal on merits." 16. It is well settled position that the Income-tax Officer, while deciding to re-open the assessment previously framed must record his reasons for formation of a belief that income chargeable to tax has escaped assessment. It is the opinion of the Income-tax Officer alone which in this context would prevail. It is in this background the Supreme Court in the case of Indian and Eastern Newspaper Society vs. Commissioner of Income Tax, New Delhi 119 ITR 996 opined that the opinion of the internal audit party cannot be regarded as opinion within the meaning of section1 47 of the Income Tax Act, 1961. 17. In the case of ....
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....e, is a supervisory authority. It s one thing to say that while making the orders of assessment the assessing officer shall be bound by the statutory circulars issued by CBDT but it is another thing to say that the assessing authority exercising quasi-judicial function keeping in view the scheme contained in the Act, would lose its independence to pass an independent order of assessment. 55. When a statute provides for different hierarchies providing for forums in relation to passing of an order as also appellate or original order, by no stretch of imagination a higher authority can interfere with the independence which is the basic feature of any statutory scheme involving adjudicatory process." 19. In more recent judgment in the case of Hussein Ghadially @ M.H.G.A.Shaikh and others v. State of Gujarat, reported in 2015(1) GLR 559, Supreme Court has observed as under: "18. Secondly, because exercise of the power vested in the District Superintendent of Police under Section 20A(1) would involve application of mind by the officer concerned to the material placed before him on the basis whereof, alone a decision whether or not information regarding commission of an offence u....
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.... and therefore was a person interested in tax litigations. He disapproved the draft order passed by tax appellate authority and asked him to modify his order and forward a copy of fresh order to him. This would be in grossest breach of natural justice and the order would be tainted by bias. 22. The unnatural consequence of the procedure adopted by the department is manifest when under the said communication dated 16.7.2013, besides other issues, the Additional Commissioner required the Joint Commissioner to examine applicability of the principles laid down by the Supreme Court in the case of Mafatlal Industries (Supra). As is well known, the case pertains to the implication of the principle of unjust enrichment. In the draft order, the Joint Commissioner had already given his reasons why decision of the Supreme Court in the case of Mafatlal Industries would not preclude the petitioners from getting the refund. The Additional Commissioner further insisted that issue be examined in a particular manner. 23. The Joint Commissioner had already passed a draft order which contained detailed discussion, reasons and ultimate conclusions including directions to be issued. It is true th....