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2013 (9) TMI 805 - HC - Income TaxWhether upholding the order of the Assessing Officer without adverting to the evidence and material brought on record by the assessee is legally correct - Additions on account of bogus purchase - The assessee was engaged in the business of manufacture and sale of hand tools and had shown gross profit on sales which worked out to 13.7% as against gross profit on sales at the rate of 13.7% of the last year – Held that:- Reliance has been placed upon the judgment in the case of M/s Kranti Associates Pvt. Ltd. and another v. Sh. Masood Ahmed Khan and others [2010 (9) TMI 886 - SUPREME COURT OF INDIA], wherein it was held that judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially - A quasi-judicial authority must record reasons in support of its conclusions - 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 - Recording of reasons also operates as a valid restraint on any possible arbitrary exercise of judicial and quasi-judicial or even administrative power - Reasons reassure that discretion has been exercised by the decision maker on relevant grounds and by disregarding extraneous considerations - Reasons have virtually become as indispensable component of a decision making process as observing principles of natural justice by judicial, quasi-judicial and even by administrative bodies - Reasons facilitate the process of judicial review by superior Courts. In the present case, A.O. in its order has not recorded its reasons properly – Therefore, decided in favor of Assessee relying upon the judgment in the abovementioned case.
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