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2023 (3) TMI 45 - AT - Income TaxDeduction u/s 54B - AO had concluded that the land which was sold by the respondent-assessee was not used for agricultural purposes in 2 years immediately preceding the year of the sale of land - NFAC admitting the additional evidence and after calling for remand report, allowed the claim of the respondent-assessee u/s 54B - HELD THAT:- NFAC extracted the submissions made by the respondent-assessee, thereafter, simply jumped to the conclusion that the Assessing Officer was not justified in denying the claim for deduction u/s 54B without examining in detail the facts and the evidence brought on record by the Assessing Officer in the form of statement of Talathi and the 7/12 extracts etc, in-fact, no reasons whatsoever were given by the NFAC in support of the conclusion reached by it. The order passed by NFAC is bereft of any factual discussion of case nor met the reason given by Assessing Officer while denying claim for deduction u/s 54B of the Act. The Hon’ble Supreme Court in the case of Siemens Engg. vs. UOI [1976 (4) TMI 204 - SUPREME COURT] held that the rule requiring reasons to be given in support of an order is like the principle of audi alteram partem, a basic principle of natural justice, which must inform every quasi-judicial process and this rule must be observed in its proper spirit and mere pretence of compliance with it would not satisfy the requirement of law. In M/s Woolcombers of India Ltd. v. Woolcombers Workers Union and others [1973 (8) TMI 158 - SUPREME COURT] as well settled by now that reason is the life of law. It is an indispensable component of a decision making process. A nonspeaking and non-reasoned order smacks arbitrary exercise of judicial or quasi-judicial or even administrative power. In the present case NFAC has merely extracted the contention of the assessee and accepted without giving any independent, cogent and convincing reasons for accepting the claim of the assessee.The Hon’ble Supreme Court in the case of Pankaj Garg vs. Meenu Garg [2013 (2) TMI 924 - SUPREME COURT] reiterated the settled position of law an order which does not contain any reason is no order in the eyes of law. Therefore, the order passed by the NFAC does not meet the requirements of being a reasoned order as enunciated by the Hon’ble Supreme Court in the decisions referred to above supra and cannot be sustained in the eyes of law. However, in order to meet the ends of justice, we remit the matter to the file of the NFAC for de novo adjudication of issue in appeal in accordance with law. Thus, the grounds of appeal filed by the Revenue stand partly allowed.
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