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Judgment
D. Murugesan, J.—The Tax Case Revision is at the instance of the Revenue raising the question, viz.,
Whether the Sales Tax Appellate Tribunal would be justified in entertaining a review application and allowing the same without adverting to the
documents placed before it ?
The brief facts are as follows:-
The respondent-assessee is a dealer in iron and steel and they had reported a total taxable turnover of Rs. 10,92,88,434/- and Rs. 8,50,421/-
respectively in their monthly returns for the Assessment Year 1994-95. They also claimed exemption for difference of High Sea sales during the
months of September 1994 and February 1995. The said claim was rejected by the Assessing Officer and the matter went before the Appellate
Assistant Commissioner (CT). Before the Appellate Assistant Commissioner, the assessee filed number of documents to show that the transaction
was High Sea Sales entitling exemption. Having considered those materials, the Appellate Assistant Commissioner allowed the appeal, which was
questioned by the Revenue before the Sales Tax Appellate Tribunal. The Tribunal, by its order dated 09.02.2001, held the issue in favour of the
Revenue. After the said order was passed, the assessee had filed a review application by producing the copies of documents such as bill of lading,
foreign sellers'' invoice, high sea sale agreement, high sea sale invoice, bill of entry, etc. indicating that the goods being imported into the State were
sold to 37 parties in the Tamil Nadu before clearance to the customs Frontier. The Tribunal, in the review application, accepted the case of the
assessee and ultimately passed orders in favour of the assessee on 18.02.2002, which is questioned in this Tax Case Revision.
We have heard Mr.R.Sivaraman, learned Special Government Pleader appearing for the petitioner-Revenue and Mr.T.Pramod Kumar
Chopda, learned counsel appearing for the respondent-assessee.
It is contended by the learned counsel appearing for the petitioner-Revenue that the Tribunal should not have entertained the review application
and consequently allowed the same, as the jurisdiction to review the order is very limited to a case of an error apparent on the face of record or a
mistake. Even assuming such a review application could have been entertained, the documents produced by the assessee should have been
independently considered by the Tribunal and there is nothing to indicate in the order as to such consideration. For the said reason, the order of the
Tribunal suffers from non-application of mind.
The learned counsel appearing for the respondent would, however, submit that inasmuch as the documents which were produced before the
Tribunal along with the review application have already been filed before the Appellate Assistant Commissioner and those documents were
considered and accepted, there is nothing wrong in the Tribunal entertaining those documents in a review application when inadvertently the
assessee failed to file those documents at the time when the appeal was heard and the earlier order was passed by the Tribunal. Insofar as the
order of the Tribunal in the review application is concerned, the Tribunal had referred to those documents and had allowed the review application,
which would constitute application of mind.
As far as the first contention is concerned, it is true that the Tribunal had earlier rejected the case of the respondent-assessee and held the issue
in favour of the Revenue when it disposed the appeal by its order dated 09.02.2001. Nevertheless, having noticed that the above documents
which were already produced before the Appellate Assistant Commissioner were considered and that those documents were not filed at the time
when the appeal was heard, the Tribunal entertained the review application by allowing the assessee to produce such of those documents which
were already filed before the Appellate Assistant Commissioner and were considered. The Tribunal being a final fact-finding authority cannot be
said to have gone wrong in entertaining such documents, though, through a review application. Hence, the challenge that the review should not have
been entertained cannot be accepted.
As far as the question whether the order in the review could be sustained or not is concerned, we may point out that in the order except a
reference made on the documents produced by the assessee, there is nothing to indicate as to the application of mind by the Tribunal on those
documents to come to the conclusion in tune with the first appellate authority. In this context, we may refer to the judgment of the Apex Court in
Suga Ram @ Chhuga Ram Vs. State of Rajasthan and Others, , wherein the Apex Court has held that the requirement of indicating reasons has
been judicially recognised as imperative for the disposal of an appeal. In the said judgment, the Apex Court has also referred to the judgment of
Lord Denning M.R. in Breen vs. Amalgamated Engg. Union, (1971) 1 ALL ER 1148 (CA) wherein the Court observed that ""the giving of reasons
is one of the fundamentals of good administration"". That apart, the Apex Court has emphasized the giving of reasons in its earlier judgments in
Jawahar Lal Singh Vs. Naresh Singh and Others, and in H.H. Shri Swamiji of Shri Amar Mutt and Others Vs. Commissioner, Hindu Religious and
Charitable Endowments Department and Others, , the Apex Court had also observed with approval the legal maxim ""cessante ratione legis cessat
ipsa lex"", which means that the reason is the soul of law and when reason of any particular law ceases, so does the law. The giving of reasons is an
essential element of administration of justice, vide State of West Bengal Vs. Atul Krishna Shaw and Another,
From the above judgments, we are of the considered view that is the one of primary duty of the Tribunal to consider each of the documents, to
independently apply its mind and come to a definite finding on those documents for disposal of the appeal. As the Tribunal is the final factfinding
authority, the above compliance is absolutely necessary for the effective disposal of the appeal. In the absence of such consideration, the order
would suffer from a non-application of mind.
In the order under review, the Appellate Tribunal has observed as follows:-
We find that in S.T.A. No. 599/2000 dt. 9.2.2001 we allowed the State Appeal disputing the allowance of the high sea sales and the
consequent deletion of penalty by the Appellate Assistant Commissioner (CT) I, Chennai in A.P. No. 352/98 dt.12.3.99 for the reason that the
respondent in our endeavour to ding the question of who cleared the goods did not let in the proof for endorsement of Bill of Lading and also
payment of customs duty. It was pleaded by the learned counsel that the appellant could not let in this proof at the time of hearing. We find that
these facts were not before the Tribunal when we passed order. Now that the applicant produced the said documentary proof before us.
Therefore, we admit and allow the review application and order this on the basis of the evidences now placed before us.
Accordingly we allow the Review Application and set aside our earlier order in STA 599/2000 dt.9.2.2001.
In fine Review Application STRA 3/2001 is allowed and as a result of STA 599/2000 is dismissed and Cross Objection Petition 234/01 is
dismissed.
A reading of the above order does not show any such application of mind by the Tribunal and for that reason, the petition at the instance of the
Revenue must succeed.
Accordingly, the Tax Case Revision is allowed-inpart and the matter is remitted back to the Tribunal for fresh consideration. The Tribunal shall
now consider the documentary proof filed by the respondent-assessee at the time when the review application is filed and render the finding on
each of the documents and dispose of the appeal on merits. No costs.