M/S P.D.Agarwal, Angul vs. State Tax Officer, Angul
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Cause title — parties, addresses and appearances
ORDER 20.04.2026 01. 1. The order dated 11th March, 2026 passed in a proceeding under Section 74 of the Odisha Goods and Services Tax Act, 2017 and Central Goods and Services Tax Act, 2017 as uploaded in DRC- 07 imposing the liability towards the tax, penalty and interest is assailed in the instant writ petition, primarily on the premise that the order is bereft of any reason and in fact, the statements made in the show-cause notice are replicated in the said order. In other words, the order is sought to be challenged on the ground that the authorities have not applied their judicious mind in arriving at the conclusion but appears to have proceeded with a closed mind and, therefore, the said order is susceptible to be interfered in exercise of powers of judicial review enshrined under Article 226 of the Constitution of India.
We further notice that the petitioner had also challenged the constitutional validity of Rule-86A of the Central Goods and Service Tax Rules, 2017, so far as it relates to an unbridled power to block the Input Tax Credit when no fault can be attributed to the assessee but at the time of hearing of the instant writ petition, Mr. Bhishm Aluwalia, learned counsel appearing on behalf of the petitioner submits that his client does not intend to press the said prayer for the time being and will agitate the same in another proceedings that may be filed, if so advised. He, therefore, seeks a liberty in this regard, so that the subsequent challenge to the vires of the said provision may not be decided because this Court is disposing of the instant writ petition.
In view of the above stand, since we are not called upon to decide the constitutional validity of the said Rules, as the petitioner intends to abandon such plea, we, therefore, proceed to decide the instant writ petition on the basis of the other substantive prayer with the specific observation that in the event, the constitutional validity
of the said rule is assailed in a subsequent proceeding, the order disposing of the instant writ petition shall not stand in the way of deciding the same nor will it operate as res judicata.
We, thus, proceed to decide the instant matter on the limited contour of the law, whether the order bereft of any independent findings and/or reasons can receive any sanction of the Court. It admits no ambiguity to somewhat settled proposition of law that in an adversarial system of adjudication of the dispute, providing the reason is one of the indispensable facets of adjudication. The order bereft of any reason cannot be said to be an order in the eye of law as it can be perceived as a thing which does not have the soul and/or heart. It is one of the fundamental facets of dispensation of justice that a person must know the reason which led the cause raised by him to have been decided and/or disposed of and in the event, no reasons are provided, the said order can at best be said to be a dead letter, which should not be permitted to occupy the space in the judicial palace.
Time and again, the importance of providing the reason is highlighted and/or reminded to the authorities and in the event the order does not contain an independent finding which led to an ultimate conclusion to have been arrived at, the process by which such decision has been taken is vitiated and the High Court exercising the power of judicial review under Article 226 of the Constitution of India can step in.
In the instant case, we have been taken to the show-cause notice issued to the petitioner and the impugned order, wherefrom we find that the major portion of the facts reflected in the said order is borrowed and/or replicated from the show-cause notice. It is no gain saying that the issuance of show-cause notice is to afford an opportunity to the person against whom the proceeding is contemplated to put his defence, so that a reasonable opportunity to defend the cause as ordained under the Fundamental Right principles is ensured. The authority can thereafter proceed to decide the cause, taking into account the defence so put forth to the averments made in the show-cause notice and record its independent finding thereupon. The instant case does not appear to have been decided following such basic fundamental principles and there is no hesitation in our mind that the authority has proceeded with a closed mind and the order impugned is devoid of any independent finding in determining the issues.
Solely on the ground that the order is a non-speaking order, the same is hereby set aside. The matter is relegated to the authority to decide it afresh after affording an opportunity of hearing to the petitioner by following the principle of natural justice in accordance with law.
Since the matter remained pending before this Court, on the request of Mr. Sunil Mishra, learned Standing Counsel appearing on behalf of the Department that some alacrity must be shown in securing the disposal of the said proceedings, we, therefore, request the concerned authority to take up the matter on 7th May, 2026 at 11.30 AM. It goes without saying that the petitioner shall cooperate and assist the authority in disposing of the said proceeding and shall not unnecessarily seek for an adjournment unless necessitated by unforeseen and unavoidable circumstances.
With these observations, the instant writ petition is disposed of.
(Harish Tandon)
Chief Justice
(M.S. Raman) Judge
S. Behera
Reproduced from the public record of the Orissa High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.