Another v. Masood Ahmed Khan And Others (2010) 9 Scc 496Emphasized The Need Of Assigning Reasons In Administrative, Quasi-Judicial Andjudicial Function/Order. The Relevant

1 IN THE HIGH COURT OF MADHYA PRADESHAT JABALPURBEFORE JUSTICE SUJOY PAUL & JUSTICE ACHAL KUMAR PALIWALON THE 24[th] OF JULY, 2023 WRIT PETITION No. 17499 of 2023 BETWEEN:- M/S SHEETAL NATH COLONIZERS,PLOT NO 48, NEAR ARERA BHAWAN, MP NAGAR, ZONEII, BHOPALTHROUGH ITS PARTNER SHRI KAMALKUMAR JAIN S/O SHRI PREM CHAND JAIN, AGEDABOUT 56 YEARS, R/O H. NO. 863, KOTRA SULTANABAD,SARKARI SCHOOL KE SAMNE, HUZUR, C.T.T. NAGAR,BHOPAL (MADHYA PRADESH) .....PETITIONER (BY SHRI ANKIT AGRAWAL - ADVOCATE WITH SHRI AYUSH GUPTA -ADVOCATE) AND 1.THE PRINCIPAL CHIEF COMMISSIONER OFINCOME TAX,INCOME TAX DEPARTMENT M.P. ANDCHHATISGARH, AAYKAR BHAWAN, 48, ARERAHILLS, HOSHANGABAD ROAD, BHOPAL (MADHYAPRADESH)INCOME TAX,INCOME TAX DEPARTMENT M.P. ANDCHHATISGARH, AAYKAR BHAWAN, 48, ARERAHILLS, HOSHANGABAD ROAD, BHOPAL (MADHYAPRADESH) 2.PRINCIPAL COMMISSIONER OF INCOME TAX-1,INCOME TAX DEPARTMENT AAYAKAR BHAWAN,48, ARERA HILLS, HOSHANGABAD ROAD,BHOPAL (MADHYA PRADESH)INCOME TAX DEPARTMENT AAYAKAR BHAWAN,48, ARERA HILLS, HOSHANGABAD ROAD,BHOPAL (MADHYA PRADESH) 3.THE INCOME TAX OFFICER ITO, 1 (2), BHOPALINCOME TAX DEPARTMENT AAYAKAR BHAWAN,48, ARERA HILLS, HOSHANGABAD ROAD,BHOPAL (MADHYA PRADESH)INCOME TAX DEPARTMENT AAYAKAR BHAWAN,48, ARERA HILLS, HOSHANGABAD ROAD,BHOPAL (MADHYA PRADESH) 4.THE BRANCH MANAGER, STATE BANK OF INDIAVIDISHA ROAD, RAISEN (MADHYA PRADESH) .....RESPONDENTS (BY SHRI SIDDHARTH SHARMA - ADVOCATE) This petition coming on for admission this day, JUSTICE SUJOYPAUL passed the following: ORDER With the consent, finally heard. 1. In this writ petition filed under Article 226/227 of the Constitution thechallenge is mounted to the order dated 03.01.2023 (Annexure P/6), wherebythe application preferred by the petitioner dated 05.09.2022 (Annexure P/4) wasrejected by the respondent No.3. 2.In the said application, the petitioner apart from other reliefs also prayedfor not insisting to take 20% of the demand and grant complete stay without anydeposit. In support of such prayer, the petitioner in his detailed application(running in 16 pages) reproduced the enabling provision i.e. Section 220(6) ofthe Income Tax Act, 1961 and also cited various judgments to show themanner in which power vested under Section 220(6) of the Act can beexercised. 3.Shri Ankit Agrawal, learned counsel for the petitioner advanced singularcontention against the impugned order dated 03.1.2022 (Annexure P/6). Hesubmits that by passing an sketchy order, respondent No.3 has rejected theprayer of petitioner and directed him to deposit 20% of disputed demand ofRs.68,70,354/-. However, the respondent No.3 has not dealt with the scope andambit of enabling provision namely Section 220(6) of the Act and has notconsidered the factual backdrop mentioned by the petitioner and the judgmentscited on the said subject. Thus, an order passed without assigning any reasonmust be axed and matter may be remitted back to the respondent No.3 todecide the said prayer afresh in accordance with law. 4.Shri Siddharth Sharma, learned counsel for the respondent No.3supported the impugned order and urged that the said order is passed inconsonance with law. 5.The parties confined their arguments to the extent indicated above. 6.We have heard the parties at length and perused the record. 7.The application (Annexure P/4) shows that it is pregnant with factualmatrix of the matter, the relevant statutory provision and the judgmentsinterpreting the said provision. The impugned order shows that the argumentadvanced by Shri Ankit Agrawal has substantial force. Respondent No.3 hasnot taken pains to deal with the factual backdrop, the relevant statutoryprovision and the judgments cited by the petitioner in support of his contentionin the said application (Annexure P/4). 4.Shri Siddharth Sharma, learned counsel for the respondent No.3supported the impugned order and urged that the said order is passed inconsonance with law. 5.The parties confined their arguments to the extent indicated above. 6.We have heard the parties at length and perused the record. 7.The application (Annexure P/4) shows that it is pregnant with factualmatrix of the matter, the relevant statutory provision and the judgmentsinterpreting the said provision. The impugned order shows that the argumentadvanced by Shri Ankit Agrawal has substantial force. Respondent No.3 hasnot taken pains to deal with the factual backdrop, the relevant statutoryprovision and the judgments cited by the petitioner in support of his contentionin the said application (Annexure P/4). 8.In other words, while reaching to a 'conclusion', the respondent No.3 hasnot assigned any 'reason' as to why stand taken by the petitioner was nottreated to be trustworthy by the respondent No.3. The reasons are held to beheart beat of conclusions. In absence of reasons, conclusion cannot sustainjudicial scrutiny. 9.The Apex Court in the case of M/s. Kranti Associates Pvt. Ltd and another Vs. Masood Ahmed Khan and others (2010) 9 SCC 496emphasized the need of assigning reasons in administrative, quasi-judicial andjudicial function/order. The relevant portion reads as under:- "47. Summarizing the above discussion, this Court holds: a. In India the judicial trend has always been to record reasons, eveni n administrative decisions, if such decisions affect anyoneprejudicially. b. A quasi-judicial authority must record reasons in support of itsconclusions. c. Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not only be done it must alsoappear to be done as well. d. Recording of reasons also operates as a valid restraint on anypossible arbitrary exercise of judicial and quasi-judicial or evenadministrative power. e. Reasons reassure that discretion has been exercised by the decisionmaker on relevant grounds and by disregarding extraneousconsiderations. f. Reasons have virtually become as indispensable a component of adecision making process as observing principles of natural justice byjudicial, quasi-judicial and even by administrative bodies. g. Reasons facilitate the process of judicial review by superior Courts. h. The ongoing judicial trend in all countries committed to rule of lawand constitutional governance is in favour of reasoned decisionsbased on relevant facts. This is virtually the life blood of judicialdecision making justifying the principle that reason is the soul ofjustice. i. Judicial or even quasi-judicial opinions these days can be asdifferent as the judges and authorities who deliver them. All thesedecisions serve one common purpose which is to demonstrate byreason that the relevant factors have been objectively considered. Thisis important for sustaining the litigants' faith in the justice deliverysystem. j. Insistence on reason is a requirement for both judicialaccountability and transparency. k. If a Judge or a quasi-judicialauthority is not candid enough about his/her decision making processthen M/S Kranti Asso. Pvt. Ltd. & Anr vs Masood Ahmed Khan & Orson 8 September, 2010 it is impossible to know whether the persondeciding is faithful to the doctrine of precedent or to principles ofincrementalism. l. Reasons in support of decisions must be cogent,clear and succinct. A pretence of reasons or `rubber-stamp reasons' isnot to be equated with a valid decision making process. m. It cannot be doubted that transparency is the sine qua non ofrestraint on abuse of judicial powers. Transparency in decisionmaking not only makes the judges and decision makers less prone toerrors but also makes them subject to broader scrutiny. (See DavidShapiro in Defence of Judicial Candor (1987) 100 Harward LawReview 731-737). m. It cannot be doubted that transparency is the sine qua non ofrestraint on abuse of judicial powers. Transparency in decisionmaking not only makes the judges and decision makers less prone toerrors but also makes them subject to broader scrutiny. (See DavidShapiro in Defence of Judicial Candor (1987) 100 Harward LawReview 731-737). n. Since the requirement to record reasons emanates from the broaddoctrine of fairness in decision making, the said requirement is nowvirtually a component of human rights and was considered part ofStrasbourg Jurisprudence. See (1994) 19 EHRR 553, at 562 para 29and Anya vs. University of Oxford, 2001 EWCA Civ 405, wherein theCourt referred to Article 6 of European Convention of Human Rightswhich requires, "adequate and intelligent reasons must be given forjudicial decisions". o. In all common law jurisdictions judgments play a vital role insetting up precedents for the future. Therefore, for development oflaw, requirement of giving reasons for the decision is of the essenceand is virtually a part of "Due Process". (Emphasis supplied) 10.If impugned order is tested on the anvil of litmus test laid down by theApex Court in Kranti Associates (supra), it will be clear that the impugnedorder is devoid of any reason. Thus, it deserves to be jettisoned. Accordingly,the impugned order dated 03.01.2023 (Annexure P/6) is set aside. The matter isrestored in the fileo f respondent No.3 at the stage of consideration ofapplication (Annexure P/4). The respondent No.3 shall rehear the parties on theapplication (Annexure P/4) and pass a fresh order in accordance with lawexpeditiously. 11.At this stage, Shri Ankit Agrawal urged that for non-deposit of 20%amount, respondent No.3 subsequently directed to attach the bank account ofthe petitioner maintained in the State Bank of India. Since that order was passedbecause of non-payment of disputed amount of 20% and this Court whilesetting aside the impugned order dated 03.01.2023 is kind enough in remandingthe matter for fresh consideration, the said attachment order may also be stayedtill fresh decision on application dated 05.09.2022. 12.The prayer is opposed by Shri Siddharth Sharma. 13.The above prayer, in our opinion is reasonable. The respondent No.3 shallhear the parties on application dated 05.09.2022 Annexure P/4 and take adecision on it and thereafter decide the stay application in accordance with lawafresh. Till such time, the above order of attachment will remain in abeyance. 14.It is made clear that this Court has not expressed any opinion on themerits of the case. Petition is disposed of. (SUJOY PAUL)JUDGE (ACHAL KUMAR PALIWAL)JUDGE