ITO, Erode V. Healthcare Global Senthil Multi Speciality Hospitals (P) Ltd., Bangalore

ITA 1144/CHNY/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6313 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-08-2017
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 16-08-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 27-04-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: M S NETHRAPAL J
• Assessee Lawyers: RAJESH BABU JAISWAL
• Keywords: Principle of natural justice

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI , ! ' ! # . $% & '( BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY , JUDICIAL MEMBER ./ I.T.A.NO.1144/MDS./2016 / ASSESSMENT YEAR : 2011-12 THE INCOME TAX OFFICER, WARD-1(4), ERODE. VS. M/S.HEALTH CARE GLOBAL SENTHIL MULTI SPECIALITY HOSPITAL (P) LTD., NO.3,GROUND FLOOR, TOWER BLOCK,UNITY BUILDING COMPLEX, MISSION ROAD, BANGALORE 560027. KARNATAKA [PAN AABCH 5514 J] ( )* / APPELLANT) ( +,)* /RESPONDENT) / APPELLANT BY : MR.M.S.NETHRAPAL, JCIT,DR /RESPONDENT BY : MR.RAJESH BABU JAISWAL, C.A / DATE OF HEARING : 16 - 08 - 2017 / DATE OF PRONOUNCEMENT : 24 - 08 - 2017 - / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST T HE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-3, COIMBAT ORE DATED 29.01.2016 PERTAINING TO ASSESSMENT YEAR 2011-12. ITA NO.1144/MDS./2014 :- 2 -: 2. THE GRIEVANCE OF THE REVENUE IN ITS APPEAL IS W ITH REGARD TO DELETION OF ADDITION MADE BY THE AO IN RESPECT OF S UPPRESSION OF INCOME. 3. THE FACTS OF THE ISSUE ARE THAT THE AO HAD MADE AN ADDITION OF ` 68,48,489/-. DURING THE COURSE OF APPELLATE PROCEE DINGS BEFORE THE LD.CIT(A), IT HAS BEEN EXPLAINED THAT THERE IS NO SUPPRESSION OF INCOME AND RECONCILIATION HAS BEEN DONE BETWEEN THE INCOME FROM PATIENTS UNDER VARIOUS HEALTH INSURANCE SCHEMES AND THE INCOME IS REFLECTED IN THE FORM NO.26AS OF THE ASSESSEE. ACCO RDING TO LD.CIT(A), THE ADDITION MADE BY THE AO AMOUNTING TO ` 68,48,489/- IS NOT SUSTAINABLE AND IS DELETED. AGAINST THE ORDER OF L D.CIT(A), NOW THE REVENUE/ASSESSEE IS IN APPEAL BEFORE US. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATE RIAL ON RECORD. THE MAIN CONTENTION OF LD.A.R IS THAT THE ORDER OF LD.CIT(A) IS VERY NON-SPEAKING AND HE HAS NOT RECORDED ALL THE S UBMISSIONS OF THE LD.A.R. ADMITTEDLY, THE ORDER OF LD.CIT(A) IS VERY CRYPTIC. THE LD.CIT(A) HAS NOT PASSED SPEAKING ORDER. HE HAS NOT CONSIDERED ALL THE SUBMISSIONS OF THE LD.A.R. HOWEVER, THE LD.CIT( A) IN A SUMMARY MANNER ENDORSED THE ORDER OF THE ASSESSING OFFICER WITHOUT ASCERTAINING ANY REASONS AND THE ORDER OF LD.CIT(A) CANNOT BE SUSTAINED. ITA NO.1144/MDS./2014 :- 3 -: 4.1 IN OUR OPINION, THE LD.CIT(A) BEING THE QUASI JUDICIAL AUTHORITY SHOULD HAVE PASSED A REASONED ORDER AS HELD BY SUPREME COU RT IN THE CASE OF KRANTI ASSOCIATES P.LTD VS. MASOOD AHMED KHAN [2010 ] 9 SCC 496 WHICH STATUTORILY REQUIRES RECORDING OF REASONS AND REQUI REMENT OF PASSING A REASONED ORDER BY AN AUTHORITY WHETHER ADMINISTRATI VE, QUASI-JUDICIAL OR JUDICIAL, HAD LAID DOWN AS UNDER:- (A) IN INDIA THE JUDICIAL TREND HAS ALWAYS BEEN T O RECORD REASONS, EVEN IN ADMINISTRATIVE DECISIONS, IF SUCH DECISIONS AFFECT ANYONE PREJUDICIALLY. (B) A QUASI-JUDICIAL AUTHORITY MUST RECORD REASON S IN SUPPORT OF ITS CONCLUSIONS. (C) INSISTENCE ON RECORDING OF REASONS IS MEANT TO SERVE THE WIDER PRINCIPLE OF JUSTICE THAT JUSTICE MUST NOT ONLY BE DONE IT MUST ALSO APPEAR TO BE DONE AS WELL. (D) RECORDING OF REASONS ALSO OPERATES AS A VALID RESTRAINT ON ANY POSSIBLE ARBITRARY EXERCISE OF JUDICIAL AND QUASI JUDICIAL O R EVEN ADMINISTRATIVE POWER. (E) REASONS REASSURE THAT DISCRETION HAS BEEN EXER CISED BY THE DECISION MAKER ON RELEVANT GROUNDS AND BY DISREGARDING EXTRA NEOUS CONSIDERATIONS. (F) REASONS HAVE VIRTUALLY BECOMES AS INDISPENSABL E COMPONENT OF A DECISION MAKING PROCESS AS OBSERVING PRINCIPLES OF NATURAL JUSTICE BY JUDICIAL, QUASI-JUDICIAL AND EVEN BY ADMINISTRATIVE BODIES. (G) REASONS FACILITATE THE PROCESS OF JUDICIAL REVI EW BY SUPERIOR COURTS. (H) THE ONGOING JUDICIAL TREND IN ALL COUNTRIES CO MMITTED TO RULE OF LAW AND CONSTITUTIONAL GOVERNANCE IS I N FAVOUR OF REASONED DECISIONS BASED ON RELEVANT FACTS. THI S IS VIRTUALLY THE LIFE BLOOD OF JUDICIAL DECISION MAKING JUSTIFYING THE PR INCIPLE THAT REASON IS THE SOUL OF JUSTICE. (I) JUDICIAL OR EVEN QUASI-JUDICIAL OPINIONS THESE DAYS CAN BE AS DIFFERENT AS THE JUDGES AND AUTHORITIES WHO DELIVER THEM. ALL T HESE DECISIONS ITA NO.1144/MDS./2014 :- 4 -: SERVE ONE COMMON PURPOSE WHICH IS TO DEMONSTRATE BY REASON THAT THE RELEVANT FACTORS HAVE BEEN OBJECTIVELY CONSIDER ED. THIS IS IMPORTANT FOR SUSTAINING THE LITIGANTS FAITH IN TH E JUSTICE DELIVERY SYSTEM. (J) INSISTENCE ON REASON IS A REQUIREMENT FOR BOTH JUDICIAL ACCOUNTABILITY AND TRANSPARENCY. (K) IF A JUDGE OR A QUASI-JUDICIAL AUTHORITY IS NO T CANDID ENOUGH ABOUT HIS/HER DECISION MAKING PROCESS THEN IT IS IMPOSSIB LE TO KNOW WHETHER THE PERSON DECIDING IS FAITHFUL TO THE DOCTRINE OF PRECEDENT OR TO THE PRINCIPLES OF INCREMENTALISM. (L) REASONS IN SUPPORT OF DECISIONS MUST BE COGENT , CLEAR AND SUCCINCT. A PRETENCE OF REASONS OR RUBBER STAMP REASONS, IS N OT TO BE EQUATED WITH A VALID DECISION MAKING PROCESS. (M) IT CANNOT BE DOUBTED THAT TRANSPARENCY IS THE SINE QUA NON OF RESTRAINT ON ABUSE OF JUDICIAL POWERS. TRANSPARENCY IN DECISION MAKING NOT ONLY MAKES THE JUDGES AND DECISION MAKERS LESS PRONE TO ERRORS BUT ALSO MAKES THEM SUBJECT TO BROADER SCRUTINY.(SE E DAVID SHAPIRO IN DEFENCE OF JUDICIAL CANDOR (1987) 100 HARWARD LAW REVIEW 731-737) (N) SINCE THE REQUIREMENT TO RECORD REASONS EMANAT ES FROM THE BROAD DOCTRINE OF FAIRNESS IN DECISION MAKING, THE SAID R EQUIREMENT IS NOW VIRTUALLY A COMPONENT OF HUMAN RIGHTS AND WAS CONSI DERED PART OF STRASBOURG JURISPRUDENCE. SEE RUIZ TORIJA V. SPAIN [1994] 19 EHRR 553, AT 562 PARA 29 AND ANYA V. UNIVERSITY OF OXFOR D [2001] EWCA CIV 405(CA) WHEREIN THE COURT REFERRED TO ARICLE 6 OF THE EUROPEAN CONVENTION OF HUMAN RIGHTS WHICH REQUIRES, ADEQUAT E AND INTELLIGENT REASONS MUST BE GIVEN FOR JUDICIAL DECISIONS. (O) IN ALL COMMON LAW JURISDICTION S, JUDGMENTS PLAY A VITAL ROLE IN SETTING UP PRECEDENTS FOR THE FUTURE. THEREFORE, FOR DEVELOPMENT OF LAW, REQUIREMENT OF GIVING REASONS F OR THE DECISION IS OF THE ESSENCE AND IS VIRTUALLY A PART OF DUE PROC ESS. ITA NO.1144/MDS./2014 :- 5 -: 5. IN VIEW OF THE ABOVE DISCUSSION, WE ARE INCLINE D TO REMIT THE ISSUE IN DISPUTE TO THE FILE OF LD.CIT(A) FOR PASSING A SPE AKING ORDER ON THE ISSUES IN DISPUTE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS PA RTLY ALLOWED FOR STATISTICAL PURPOSES ORDER PRONOUNCED ON 24 TH AUGUST, 2017, AT CHENNAI. SD/ - SD/ - ! ' # . $ %& ' ( DUVVURU RL REDDY ) ) & / JUDICIAL MEMBER ( ) (CHANDRA POOJARI) / ACCOUNTANT MEMBER () / CHENNAI *+ / DATED: 24 TH AUGUST, 2017. K S SUNDARAM +,-- ./-0/ / COPY TO: - 1 . / APPELLANT 3. - 1-!' / CIT(A) 5. /23- 4 / DR 2. / RESPONDENT 4. - 1 / CIT 6. 3&-5 / GF