By Puloma Dalal, Jayesh Gogri, Chartered Accountants
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Facts:
The High Court of Madras and Punjab & Haryana held that Circular No.8/2006-Customs dated 17-01-2006 was beyond the powers conferred on the CBEC u/s. 151 of the Customs Act, 1961 and therefore quashed the said circular. The issue framed before the High Court was, that a question of fact is to be decided by the authorities under the Act and the appeals were filed under the contention that circular being statutory circular issued under the Statute, cannot be quashed by the High Courts.
The High Court observed that the assessing authority while adjudicating any issue, functions as a quasi judicial authority and that the powers exercised by the appellate authority or Central Government as revisional authorities, are quasi judicial powers. Reliance was placed on the ruling of the Hon’ble Supreme Court’s decision in case of Orient Paper Mills vs. Union of India 1978 (2) ELT J345 (SC), stating that the powers of the Collector were quasi judicial powers and cannot be controlled by the directions issued by CBEC. The respondents argued on the same lines that unless the quasi judicial authority was allowed to function independently and impartially, the orders passed by it cannot be said to be orders passed in accordance with the law.
Held:
The assessing authorities, appellate and revisional authorities are quasi judicial authorities and orders passed by them are also quasi judicial orders. Therefore, such orders should be passed by exercising independent mind and without being biased. The circulars guiding the authorities should be considered as evidence available before them. Accordingly, based on all the material available on record including these circulars, the assessing authority has to come to an independent finding. Therefore, the appeals were disposed off, directing the assessing authorities to consider the matter afresh in the light of the above observations without examining the merits of the case.
