Odisha Hydro Power Corporation Limited, Bhubaneswar V. The Union of India and others

WP(C)/10550/2025

AI Insights

The case involves the Odisha Hydro Power Corporation Limited challenging the order of the Assessing Officer, which was initially a result of a suo motu revision by the Principal Commissioner, Bhubaneswar. The revision was limited to specific points, which the petitioner contested. The High Court found that the Assessing Officer's subsequent order was a non-speaking order, as it rejected the petitioner's claims without providing reasons, which is a fundamental requirement in both judicial and quasi-judicial processes. The court referenced several precedents emphasizing the necessity of providing reasons for decisions, which serve to inform the affected parties and facilitate higher judicial review.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 808878 (HC-MISC)
• Appeal Type: Others
• Pronouncement Date: 29-04-2025
• Assessment Year: misc
• Other Referred Cases: CCT Vrs. Shukla & Bros., (2010) 4 SCC 785, Gurdial Singh Fijji v. State of Punjab, (1979) 2 SCC 368, Steel Authority of India Ltd. Vs. Sales Tax Officer, Rourkela-I Circle and others, (2008) 9 SCC 407
• Laws Referred To: Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: AVINASH KEDIA
• Assessee Lawyers: RUDRA PRASAD KAR; DILLIP KUMAR MOHANTY
• Keywords: Assessment Order; Judicial review; Non-speaking order; Reasoned order; Revision proceeding
• Section: 143(3); 263

Judgement Text

" Page 1 of 5 IN THE HIGH COURT OF ORISSA AT CUTTACK W.P.(C) No.10550 of 2025 Odisha Hydro Power Corporation Limited, Bhubaneswar …. Petitioner Mr. Rudra Prasad Kar, Senior Advocate assisted by Mr. Dillip Kumar Mohanty, Advocate -versus- The Union of India and others …. Opposite Parties Mr. Avinash Kedia, Junior Standing Counsel for CGST CORAM: THE HON’BLE THE CHIEF JUSTICE AND THE HON’BLE MR. JUSTICE MURAHARI SRI RAMAN Order No. ORDER 29.04.2025 01. This matter is taken up through Hybrid mode. 2. The order of the Assessing Officer after remand is assailed in the instant writ petition on a solitary ground of being a non-speaking order. 3. It is vociferously submitted by Mr. Rudra Prasad Kar, learned Senior Counsel appearing for the writ petitioner that initially the assessment order was passed after the complete scrutiny under Section 143(3) of the Income Tax Act, but the Principal Commissioner, Bhubaneswar initiated a suo motu revision proceeding of the said assessment order and remitted the matter upon formulating the points for reconsideration by the Assessing Officer. 4. Mr. Kar, learned Senior Advocate was critical on the issue that the authority exercising power of revision should not have remitted the matter on limited points, but should have remitted the matter in its entirety. Page 2 of 5 5. We do not find any impediment in this regard. In absence of any express embargo enshrined under Section 263 of the Income Tax Act, the authority can take recourse to the said provision, and make limited remand or open remand. We do not intent to express our final opinion on the above aspect. 6. We noticed from the order impugned in the instant writ petition that the Assessing Officer while completing the assessment on limited points in terms of the order of the Principal Commissioner, Bhubaneswar-Opposite Party No.4 surreptitiously rejected the claim of the assesse without assigning any reasons in support thereof. It is imperative on his part to record reasons. From the nine points, on which the matter was remitted to the Assessing Officer, two of them were found favourable to the writ petitioner, but the explanation with respect to remaining seven points have been discarded by the Revenue as such explanation or the material produced is not convincing. 7. The importance of providing the reason has always been highlighted by the Courts of the country as a right inhered in every assessee to know the reason for disallowing the claim by the Assessing Officer. It achieves twin purposes, firstly the assessee is made aware that for such reasons the claim is disallowed, so that the steps for the further course of action can be taken; secondly, the said order if challenged before the higher forum, the said higher authority would know the reasons which marked the foundation of the decision and proceed to decide the case both on fact and law; in other words, it becomes easier to the higher forum to understand the basic foundation of denial of the claims by the assessee so as to uphold or interfere on the well-recognized parameters of law. Page 3 of 5 8. By passage of time, the concept of passing reasoned order has gained momentum and has expanded its horizon not only from a judicial system but to any quasi-judicial system or in any adjudicatory process which decides the fate of claim made by a person. The order which is bereft of reasons cannot be regarded as an order in eye of law. The reasons not only inheres fairness, transparency but also propagates the decision making process and reflects the minds of an adjudicator with precision and clarity. 9. Even the Apex Court coined such unreasoned order as an order without any heart and soul or heart-beat and often remanding the matter to the authority to decide the same by providing reasons. The aforesaid proposition of law received recognition in the judgment of the Apex Court rendered in the case of CCT Vrs. Shukla & Bros., (2010) 4 SCC 785 wherein it has been observed that:- “17. In Gurdial Singh Fijji v. State of Punjab, (1979) 2 SCC 368 while dealing with the matter of selection of candidates who could be under review, if not found suitable otherwise, the Court explained the reasons being a link between the materials on which certain conclusions are based and the actual conclusions and held, that where providing reasons for proposed supersession were essential, then it could not be held to be a valid reason that the concerned officer‟s record was not such as to justify his selection was not contemplated and thus was not legal. In this context, the Court held: „18. … „Reasons‟ … „are the links between the materials on which certain conclusions are based and the actual conclusions‟. The Court accordingly held that the mandatory provisions of Regulation 5(5) were not complied with by the Selection Committee. That an officer was ‘not found suitable’ is the conclusion and not a reason in support of the decision to supersede him. True, that it is not expected that the Selection Page 4 of 5 Committee should give anything approaching the judgment of a Court, but it must at least state, as briefly as it may, why it came to the conclusion that the officer concerned was found to be not suitable for inclusion in the Select List.‟ This principle has been extended to administrative actions on the premise that it applies with greater rigour to the judgments of the courts.” 10. In a subsequent decision rendered by the Apex Court in Steel Authority of India Ltd. Vs. Sales Tax Officer, Rourkela-I Circle and others, (2008) 9 SCC 407, it has been held:- “17. 7. Reason is the heartbeat of every conclusion. It introduces clarity in an order and without the same it becomes lifeless. (See Raj Kishore Jha v. State of Bihar [(2003) 11 SCC 519 : 2004 SCC (Cri) 212] .) 8. Even in respect of administrative orders, Lord Denning, M.R. in Breen v. Amalgamated Engg. Union [(1971) 2 QB 175 : (1971) 2 WLR 742 : (1971) 1 All ER 1148 (CA)] observed (All ER p. 1154h):„The giving of reasons is one of the fundamentals of good administration.‟ In Alexander Machinery (Dudley) Ltd. v. Crabtree [1974 ICR 120 (NIRC)] it was observed: „Failure to give reasons amounts to denial of justice. Reasons are live links between the mind of the decision- taker to the controversy in question and the decision or conclusion arrived at.‟ Reasons substitute subjectivity by objectivity. The emphasis on recording reasons is that if the decision reveals the „inscrutable face of the sphinx‟, it can, by its silence, render it virtually impossible for the courts to perform their appellate function or exercise the power of judicial review in adjudging the validity of the decision. Right to reasons is an indispensable part of a sound judicial system, reasons at least sufficient to indicate an application of mind 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 Page 5 of 5 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.” 11. In view of the law enunciated hereinabove, it is beyond cavil of doubt, more particularly on a bare perusal of the impugned order that there is complete lack of the reasons in rejecting the claim or in other words deciding the seven points for which the matter was remitted to the Assessing Officer and, therefore, cannot be accepted as a valid order in the eye of law. 12. The order impugned is thus set aside and the matter is remanded to the Assessing Officer to decide the aforesaid seven points afresh after giving an opportunity of hearing to the Petitioner, if necessary, an endeavour should be shown to complete the entire exercise within three months. 13. With the aforesaid observation and direction, the writ petition stands disposed of. (Harish Tandon) Chief Justice (M.S. Raman) Judge MRS/Laxmikant Digitally Signed Signed by: LAXMIKANT MOHAPATRA Designation: Senior Stenographer Reason: Authentication Location: High Court of Orissa, Cuttack Date: 01-May-2025 18:55:44 Signature Not Verified "