IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE THE CHIEF JUSTICE MR.H.L.DATTU & THE HONOURABLE MR. JUSTICE K.M.JOSEPH FRIDAY, THE 15TH FEBRUARY 2008 / 26TH MAGHA 1929 O.T.A.No.3 of 2008 -------------------------------------- AGAINST THE ORDER NO.C7.28881/06/CT DATED 12-08-2006 OF THE COMMISSIONER OF COMMERCIAL TAXES, THIRUVANANTHAPURAM .................... APPELLANT/APPLICANT:- ---------------------------------- M/S.CINZAC SALES & SERVICE (P) LTD., CHITTOOR ROAD, PACHALAM, ERNAKULAM, KOCHI-12, REPRESENTED BY JOSEPH ZACHARIAS, MANAGING DIRECTOR. BY ADV. SRI.ARIKKAT VIJAYAN MENON SMT.MEERA V.MENON RESPONDENT/ RESPONDENT:- ------------------------------------------- COMMISSIONER OF COMMERCIAL TAXES, THIRUVANANTHAPURAM. BY SENIIOR GOVERNMENT PLEADER SRI.MUHAMMED RAFIQ. THIS OTHER TAX APPEAL HAVING COME UP FOR ADMISSION ON 15/02/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: H.L.DATTU, C.J. & K.M.JOSEPH, J. ------------------------------------------------------ O.T.A.No.3 of 2008 ------------------------------------------------------- Dated, this the 15th day of February, 2008 JUDGMENT H.L.Dattu, C.J. Though the matter is posted for admission, by consent of the learned counsel appearing for the parties to the lis, the matter is taken up for final hearing since the issues involved in this matter lies in a narrow compass. (2). The assessee is the dealer registered under the provisions of the Kerala Value Added Tax Act (“ Act “ for short). The assessee had approached the Commissioner of Commercial Taxes by filing an application under Section 94 of the Act read with Rule 78 of the Kerala Value Added Tax Rules to clarify the rate of tax payable under the Act on Boilers (HSN Code 8402.12.00), Thermic Fluid Heaters (HSN Code 8419.89.90) and Hot water Generators (HSN Code 8403.10.00). (3). The Commissioner of Commercial Taxes by his order dated 12-8-2006, after hearing the authorised representative of the applicant has clarified as under: “Admittedly Boilers and Hot Water Generators come under HSN Code 8402 and 8403 respectively. All commodities coming under the said HSN are classified as entry 60 (2) and 60 (3) of SRO 82/06 taxable at 12.5%. As regard to 'Thermic Fluid Heaters' admittedly coming under HSN 8419.89.90 has not been specifically mentioned in any of the schedules to KVAT Act 03. Hence it will fall under the residual entry 103 of SRO 82/03 taxable at 12.5%.” (4). Aggrieved by the clarifications so issued by the OTA 3/2008 -2- Commissioner of Commercial Taxes, the assessee is before us in this appeal. (5). Smt.Meera V.Menon learned counsel appearing for the dealer would submit that, the afore-said items on which clarification was sought by the applicant would necessarily fall under Entry 83 (59) of 3rd Schedule to the Act and secondly S.R.O.82/06 was introduced in the Statute Book only on 21-1-2006 and therefore the commodity on which clarification was sought should be taxed only under Entry 83 (59) of the 3rd Schedule to the Act. In the alternative, the learned counsel would contend that the order passed by the Commissioner of Commercial Taxes is not a speaking order in the sense that it does not contain any reasons whatsoever. In support of that contention, the learned counsel brought to our notice catena of decisions of the Apex Court which would show that orders should contain the reasons. Reference to those decisions are not necessary for disposal of this appeal. (6). We have carefully perused the order passed by the Commissioner of Commercial Taxes. In the said order, the Commissioner has observed that the authorised representative of the applicant was heard and the contentions of the applicant were examined. No where in the order the Commissioner has even referred to the contentions of the applicant nor is there any reference to consideration of those contentions. A quasi-judicial authority, when he frames an order, he is expected to notice the contentions canvassed by the parties before him and answer those contentions by assigning appropriate reasons. Since the order passed in the instant case OTA 3/2008 -3- does not have these ingredients, in our view, the impugned order is not only arbitrary but also violative of Article 14 of the Constitution of India. In view of the above, it is difficult for us to sustain the order passed by the Commissioner of Commercial Taxes. Accordingly, we pass the following: Order (i). The order passed by the Commissioner of Commercial Taxes dated 12-8-2006 is set aside and the matter is remanded to the Commissioner of Commercial Taxes to re-do the matter in accordance with law, after affording an opportunity of being heard to the applicant. (ii). The applicant is at liberty to bring to the notice of the Commissioner of Commercial Taxes contentions canvassed in this writ appeal and other contentions which are available to him. (7). With the above observations, the Tax Appeal is disposed of. Ordered accordingly. (H.L.DATTU) CHIEF JUSTICE (K.M.JOSEPH) JUDGE MS/DK.