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2019 (4) TMI 1404 - HC - VAT and Sales TaxWhether the Commissioner, Commercial Tax recorded prior reasons as contemplated under Sub-section (1) of Section 55 and whether there was proper delegation to the Subordinate Authorities to carry out the search operation? - HELD THAT:- Close reading of Section 55(1) of the Act of 2002 reveals that, it does not confer unbridled and unguided power on the Commissioner to order for investigation. Self satisfaction on the fact available has to be arrived at first which is required to be recorded in writing. In other words, action cannot be taken simply or being satisfied without recording the reasons of satisfaction. The respondents thus have adverted to second part of Subsection (1) of Section 55 of Act of 2002 which empowers the Commissioner to direct any of the Officers referred to in Clauses (c) to (h) of Sub-section (1) of Section 3 to proceed to investigate - The contention that “no reason to inspect/search business premises is required to be given”, indicates that the Commissioner did not record any reason to believe the correctness of the information of tax, evasion received by him to form basis for investigation. This fact is further established when despite the order dated 04/08/2016, the respondent has failed to keep the original file present at the time of hearing for perusal of this Court to ensure whether any reason has been recorded by the Commissioner before issuing directions under Section 55(1) of the Act of 2002. The provisions as adverted supra being mandatory, non compliance thereof, vitiated the entire proceedings. Thus when the foundation is found to be defective, the entire superstructure must crumble. The investigation, assessment thereof, the First and Second Appellate order are quashed - Appeal allowed - decided in favor of appellant.
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