CHANDRA PRAKASH MISHRA versus FLIPKART INDIA PRIVATE LIMITED & ORS. on 30 March 2022

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SUPREME COURT REPORTS

[2022] 2 S.C.R.

CHANDRA PRAKASH MISHRA

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FLIPKART INDIA PRIVATE LIMITED & ORS.

(Civil Appeal Nos. 2859-2861 of 2022)

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MARCH 30, 2022

[DINESH MAHESHWARI AND ANIRUDDHA BOSE, JJ.]

Strictures: Expunction of – Adverse observations and remarksmade by the High Court against the appellant-Deputy Commissioner,Commercial Tax on ex parte orders and recovery proceedings passedCby him without proper service of notice against respondent No. 1 –Issuance of directions in relation to his acts and omissions whilefunctioning as the Deputy Commissioner – Held: Every erroneous,illegal or even perverse order/action, by itself, cannot be termed aswanting in good faith or suffering from malafide – At the time ofDdrawing up the assessment orders, the appellant as the AssessingAuthority had no other registered address of the respondent No. 1on record – His actions of passing ex parte assessment orders couldnot have been termed as being deliberate or wanting in good faith– For imputing motives and drawing inference about want of goodfaith in any person, particularly a statutory authority, somethingEmore than mere error or fault ought to exist – Nothing concrete isavailable on record to impute motives in the appellant – High Courtseems to have taken rather a sterner view of the matter, which wasnot required – There was no need of stretching the matter too farand passing further orders for imposition of costs and forFdepartmental actions with other comments regarding competenceof the appellant to discharge quasi-judicial functions – Amount ofcosts-Rs. 2,00,000/- to be deposited by the respondent No. 1 withthe State Legal Services Authority – Strictures and observationsagainst the appellant expunged.

GAllowing the appeals, the Court

HELD: 1.1 The questioned parts of the orders impugnedare annulled with appropriate order towards the amount of Rs.2,00,000/- awarded as costs, which has been fairly given up bythe respondent No. 1. [Para 11][889-D-E]

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1.2 Even when all the findings of the High Court in theprincipal part of order dated 29.02.2016 are accepted, they wouldonly lead to the result that the impugned actions in drawing upex parte assessment orders and then seeking to enforce recoveryas also the impugned action in rejecting the application forregistration of change of place of business did not meet with theapproval of the High Court. Such disapproval of the High Courthad been essentially based on its interpretation of the applicablerules as also its analysis of the factual aspects concerning theissues involved in the writ petition. [Para 12][889-F-H]

1.3 Having examined the matter in its totality, even if theHigh Court found that the impugned actions of the authoritiesconcerned, particularly of the appellant, had not been strictly inconformity with law or were irregular or were illegal or evenperverse, such findings, by themselves, were not leading to aninference as corollary that there had been any deliberate actionor omission on the part of the Assessing Authority or theRegistering Authority; or that any ‘tactics’ were adopted, as perthe expression employed by the High Court. Every erroneous,illegal or even perverse order/action, by itself, cannot be termedas wanting in good faith or suffering from malafide. [Para 13][889-H; 890-A-B]

1.4 In the instant case, when admittedly the respondentNo. 1 itself had applied for registration of the change of place ofbusiness nearly 11 months after the alleged event; and at thetime of drawing up the assessment orders, the appellant as theAssessing Authority had no other registered address of therespondent No. 1 on record, his actions of passing ex parteassessment orders could not have been termed as beingdeliberate or wanting in good faith, particularly in view of thefacts that attempts were indeed made from his office to get thenotices served on the respondent No. 1 at its registered addressand even at its alleged changed address at Ghaziabad. Even ifsuch attempts, of serving notices, were held to be illegal orirregular by the High Court, its deduction that the impugnedactions were deliberate or lacking in good faith is difficult to beendorsed. [Para 14][890-C-E]

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A1.5 The appellant, while functioning as an AssessingAuthority could not have kept the assessment proceedingspending for an indefinite length of time. The facts relating toshortcomings on the part of the respondent No. 1 in first of allnot seeking registration of the changed business address fornearly 11 months and then, rejection of its belatedly made prayerBby the competent authority (not the appellant) cannot be ignoredaltogether. [Para 14.1][890-E-F]

1.6 What has been observed with necessary variations,would equally apply to the later order dated 04.05.2016 passedby the appellant, in his capacity as the Assessing Authority.CThough, in the face of the order dated 29.02.2016, the appellantcould have waited for consideration of the application for changeof address, as directed by the High Court or could have takeninstructions from the Commissioner but, in any case, even suchmistakes or errors or omissions on his part cannot be considered Das carrying the elements of malice or want of good faith. [Para15][890-F-H]

1.7 For imputing motives and drawing inference about wantof good faith in any person, particularly a statutory authority,something more than mere error or fault ought to exist. NothingEconcrete is available on record to impute motives in the appellant,even if his actions/omissions while functioning as AssessingAuthority otherwise called for disapproval. [Para 16][891-A-B]

1.8 In the questioned parts of the impugned orders, theHigh Court seems to have taken rather a sterner view of theFmatter, which was not required in the given set of facts andcircumstances. Noticeably, the appellant was not impleadedpersonally a party in the first two writ petitions which were decidedby the common order. The comments or remarks which were tooperate personally against the appellant were not even called forwithout the appellant having been joined personally a party andGhaving been extended an opportunity of hearing and explanation.In the third writ petition, though the appellant was personallyjoined as a party-respondent, when he had withdrawn the orderdated 04.05.2016 immediately after registration of changed address by the registering authority and had tendered an apologybefore the High Court, the matter could have been closed atthat; and there was no necessity of stretching the matter too farand passing further orders for imposition of costs and fordepartmental actions with other comments regarding competenceof the appellant to discharge quasi-judicial functions. Having saidthat, it is appropriate to close this matter with annulment ofstrictures and observations against the appellant in both theimpugned orders. [Para 17] [891-B-F]

1.9 As regards the amount of costs, the fair stand taken onbehalf of the respondent No. 1 is appreciated. Having regard tothe circumstances, it is deemed appropriate and hence it isordered that the said amount of Rs. 2,00,000/- to be deposited bythe respondent No. 1 with the Uttar Pradesh State Legal ServicesAuthority. The remarks and observations against the appellantin the impugned orders are expunged; and the questioned partsof the impugned orders, are annulled and set aside. Any actiontaken or in contemplation pursuant to the said parts of theimpugned orders are also rendered redundant. [Paras 18-20][891-F-G; 892-A-B]

V.K. Jain v. High Court of Delhi (2008) 17 SCC 538 :[2009] 11 SCR 907 – referred to.

Case Law Reference

[2009] 11 SCR 907referred toPara 20

CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 2859-2861 of 2022.

From the Judgment and Order dated 29.02.2016 of the High Courtof Judicature at Allahabad in Miscellaneous Civil Writ Petition Nos.80and 168 of 2016 and dated 02.08.2016 in Writ Tax No.546 of 2016.

Pallav Sisodia, Sr. Adv., Praveen Agrawal, Gautam Kumar Latta,Mrs. Kiran Mahato, Advs. for the Appellant.

Tarun Gulati, R. K. Raizada, Sr. Advs., Kishore Kumar, ManishRastogi, Rony Oommen John, Bhakti Vardhan Singh, Advs. for theRespondents.

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880SUPREME COURT REPORTS

AThe Judgment of the Court was delivered by DINESH MAHESHWARI, J.

1. Leave granted.

2. In these appeals, the appellant, presently working as JointBCommissioner, Commercial Tax, Moradabad, has questioned the orderdated 29.02.2016 in Writ Petition Nos. 80 of 2016 and 168 of 2016 asalso the order dated 02.08.2016 in Writ Tax No. 546 of 2016, as passedby the High Court of Judicature at Allahabad.

2.1. The appellant is aggrieved of the orders impugned, insofar asCadverse observations and remarks have been made and directions havebeen issued in relation to his acts and omissions while functioning as theDeputy Commissioner, Commercial Tax, Range-II, Sector-2, Noida, viz.,passing ex parte assessment orders and enforcing recovery proceedingsunder the Uttar Pradesh Value Added Tax Act, 2008[1], concerning thewrit petitioner (respondent No. 1 herein)[2].D

3. The impugned orders have otherwise not been challenged bythe State or by the writ petitioner. Therefore, dilation on all the factualaspects is not necessary. The aspects relevant for the present purposeare as follows:

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E3.1. By way of Writ Petition No. 80 of 2016, the writ petitionerquestioned the recovery proceedings, as taken up against it pursuant tothe ex parte provisional assessment order passed by the appellant in hiscapacity as the Assessing Authority. In response to the said writ petition,it was pointed out on behalf of the department that an application madeby the writ petitioner for registering the changed address had alreadyFbeen rejected on 02.09.2014 and, therefore, ex parte order had rightlybeen passed after taking due steps for service of notice.

3.2. The said order dated 02.09.2014, as passed by the RegisteringAuthority (not the appellant) rejecting the prayer for registering thechanged address was challenged in the other writ petition bearing No.G168 of 2016.

1 Hereinafter referred to as ‘the UP VAT Act’.

2 The impugned orders had been passed in the writ petitions filed by the respondentNo. 1. For continuity of narrations and in the given context, the respondent No. 1 hasHalso been referred to as ‘the writ petitioner’.

3.3. Thus, in sum and substance, the ex parte provisionalassessment order dated 15.12.2015 and the recovery proceedings asalso the order dated 02.09.2014 rejecting the prayer for registration ofthe changed address were in challenge before the High Court in the saidwrit petitions bearing Nos. 80 of 2016 and 168 of 2016. As noticed, theappellant had been functioning as the Deputy Commissioner, CommercialTax, Range-II, Sector-2, Noida and had passed the aforesaid ex parteorder in his capacity as the Assessing Authority. However, the aforesaidorder rejecting the prayer for registering the changed address was passedby the Registering Authority, being the Assistant Commissioner,Commercial Tax, Divison-2, Noida.

4. The issues involved in the said writ petitions were consideredand dealt with by the High Court in its common order dated 29.02.2016.

4.1. The High Court essentially found that the ex parte order waspassed against the writ petitioner without proper service of notice. Thefacts were taken note of that, according to the writ petitioner, it hadshifted its place of business from Noida to Ghaziabad, which was verymuch in the knowledge of the department in view of the applicationsmade and other communications addressed by it. There was a suggestionon behalf of the State as regards service of notice at Ghaziabad but, thatservice was also not taken as sufficient by the High Court after itsinterpretation of the requirements under the rules.

4.2. The High Court, therefore, set aside the ex parte assessmentorder dated 15.12.2015 and quashed the recovery proceedings. TheHigh Court also set aside the order dated 02.09.2014, rejecting thewrit petitioner’s application for registration of the change of place ofbusiness and directed the Registering Authority to process theapplication made by the writ petitioner on 05.12.2013 for change ofplace of business after permitting the writ petitioner to deposit therequisite fees.

4.3. The High Court found that a huge amount to the tune of Rs.49,82,01,250/- had been withdrawn by the department from the writpetitioner’s account without authority of law. Hence, the DeputyCommissioner, Commercial Taxes, Range-II, Noida was directed torefund the said amount together with interest as per Section 40 of theUP VAT Act after adjusting the admitted tax. The High Court, of course,left it open for the Assessing Authority to make fresh assessments in AB

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Aaccordance with law, after proper service of notice upon the writ petitionerand after giving them an opportunity of hearing.

5. In the aforesaid part of the impugned common order dated29.02.2016 i.e., upto paragraph 34, the High Court dealt with the coreissues involved in the case and contentions of the respective parties and,Bthereafter, passed the orders consequent to its findings on the materialissues that there had not been proper service of notice upon the writpetitioner and the ex parte orders were not sustainable.

6. However, before closing the matter, the High Court proceededto express its opinion that the impugned actions, leading to ex parteCorders/proceedings without proper service of notice, were of deliberateattempt on the part of the department against the interests of the writpetitioner; and the Assessing Authority adopted unfair tactics in gettingthe service effected in gross violation of the applicable rules.

6.1. The High Court, therefore, imposed costs to the tune of Rs.D2,00,000/-, to be paid by the department to the writ petitioner, and left itopen for the Commissioner, Commercial Tax, Lucknow to institute aninquiry and to fix responsibility on the erring officer for recovery of theamount of costs. The said part of the order dated 29.02.2016, which hasbeen questioned by the appellant in this appeal, reads as under: - E

“35. Before parting, we must observe the manner in which therespondents have proceeded with the assessment and recoveredthe amount from the petitioner’s Bank account in haste isdeplorable and in gross violation of the provisions of the Act. Wefind that for the assessment years 2011-12, 2013-14 and 2014-15Fex-parte assessment orders were made without adequate serviceof notices upon the petitioner. These assessment proceedings wereset aside in appeal on the short ground that the service of thesummons were sent at the address where the petitioner was nolonger carrying on its business. Inspite of this knowledge, therespondents chose deliberately to serve the notice for provisionalGassessment for the period April to October, 2015 upon the petitionerat the Noida address knowing fully well that the petitioner wasnot carrying any business from the Noida address. The respondentsknew very well that the petitioner had shifted its place of businessfrom Noida to Ghaziabad as they made a futile attempt to serveHthe notice at Ghaziabad but later for the reasons best known to them, chose deliberately to serve the notice by affixation at theNoida address. Such tactics adopted by the assessing authority ingetting the service effected upon the petitioner was in grossviolation of Rule 72 of the Rules.

36. We also find that the entire exercise of service was donewithin four days without taking recourse to the other mode ofservice, namely simultaneously service by registered post withacknowledgment due. The assessment order indicates that thefirst and last date of hearing of the assessment proceedings was10.12.2015 and that the assessment order was passed on15.12.2015. The counter affidavit reveals that the assessment orderwas served by attachment at the Noida address. This was donedeliberately by the respondents so that the respondents couldwithdraw the amount through garnishee notices by exertingpressure upon the bank authorities. The Court gets an uncannyfeeling that a deliberate attempt was made by the respondents towithdraw the money from the petitioner’s bank account throughdubious mean by passing ex-parte assessment orders and notallowing it to be served validly upon the petitioner. If in this cavalierfashion the Commercial Tax Department functions and withdrawshuge sums of money without valid service, it would be difficult forbig business houses to carry on their business. Such businesshouses would be forced to shift their business outside the State ofUttar Pradesh.

37. Consequently, the petitioners are entitled for cost. The writpetitions are allowed with cost amounting to Rs. 2,00,000/- (Rupeestwo lakhs only), which will be paid by the Commercial TaxDepartment to the petitioner within two weeks from the date offiling of a certified copy of this order. If the amount is not paid, itwould be open to the petitioner to move an appropriate applicationin this petition.

38. It would be open to the Commercial Tax Commissioner,Lucknow to institute an enquiry and fix responsibility on the erringofficer for recovery of the said amount.”

7. Even after the order so passed by the High Court, the appellant,again in his capacity as the Assessing Authority, drew up another A

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Aassessment order dated 04.05.2016 against the writ petitioner. This orderwas again questioned by the writ petitioner by way of another writ petitionin the High Court, being Writ Tax No. 546 of 2016. In this subsequentwrit petition, the present appellant was personally impleaded as respondentNo. 1.

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B7.1. On 11.07.2016, while initially dealing with the said petition,Writ Tax No. 546 of 2016, the High Court referred to the backgroundaspects, in particular to the aforesaid order dated 29.02.2016 and then,took exception that the present appellant at all chose to pass the impugnedassessment order on 04.05.2016, which was not in conformity with whatCwas held in the order dated 29.02.2016. The High Court, while issuingnotice and staying operation of the impugned assessment order and theconsequential notice, observed as under: - “1. It is contended that petitioners’ registered office address hasbeen changed to Ghaziabad and Deputy Commissioner ofDCommercial Tax, Noida had no jurisdiction to make assessmentand this was also observed by this Court in its judgment dated29.02.2016 in Flipkart India Pvt. Ltd. Vs State of U.P. and others,reported in 2016 NTN (Vol. 60) 313 wherein Court observed thatauthority at Noida had no jurisdiction to make assessment afterchange of place of business/registered office of petitioner companyEat Ghaziabad, still respondent no. 1 has proceeded to serve noticeat the supposed address at Noida and thereafter has passedimpugned order.

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2. It is contended that the order impugned is patently illegal, withoutjurisdiction and has been passed to frustrate the judgment of thisCourt in which serious strictures had been passed against theofficer concerned and this Court had imposed cost of Rs. TwoLacs.

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3. We find it a serious matter. Let respondent 1 himself appearalong with relevant records on 02.08.2016 before this Court. HeGshall also file para-wise reply to the writ petition on the next date.

4. Until further orders, the effect and operation of impugnedassessment order dated 04.05.2016 and notice dated 07.04.2016shall remain stayed.”

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7.2. When the matter was taken up for further consideration bythe High Court on 02.08.2016, it was submitted by the learned standingcounsel for the department that the impugned assessment orders hadsince been withdrawn by the present appellant on 23.07.2016 and,therefore, the writ petition was practically rendered infructuous. It wasalso stated on behalf of the appellant, who was present in Court, thatthere had been a mistake on his part and he was tendering an apology,which could be considered by the Court.

7.3. The High Court, however, viewed the functioning of theappellant seriously questionable, particularly for his acts and omissionsafter the strictures in, and penal costs imposed by, the order dated29.02.2016. Thus, while imposing costs of Rs. 50,000/- personally on theappellant, the High Court made the observations that departmental actionbe taken and finalised at the earliest and the department would alsoconsider as to whether the appellant was a person fit to be assignedsuch important quasi-judicial functions. The relevant part of the orderdated 02.08.2016 could be usefully extracted as under:-

“13. Additional Commissioner, Commercial Tax, Noida, sought aclarification from Commissioner, Commercial Tax, vide letter dated29.06.2016 whereupon the Commissioner vide letter dated20.07.2016 directed the registering authority to pass appropriateorder in accordance with directions of this Court. The registeringauthority has passed an order on 23.07.2016 under Section17(14)(a) of the Act transferring the place of business of petitionerfrom Noida to Ghaziabad w.e.f. 20.01.2013 and consequently nowthe Deputy Commissioner, Commercial Tax, Sector 7, Ghaziabadbecomes Assessing authority of petitioner w.e.f. 20.01.2013.Pursuant thereto respondent 1 has passed an order on 23.03.2016(sic)[3] withdrawing the assessment orders dated 04.05.2016impugned in this writ petition.

14. It is admitted that application for transfer of business addresswas filed on 05.12.2013 which was rejected by respondent 1 on02.09.2014 and the said order was set aside by this Court videjudgment dated 29.02.2016.

15. Learned Standing Counsel at the outset clearly stated thatsince the assessment orders impugned in this writ petition have 3 The date ‘23.03.2016’ is of typographical error. The correct date is ‘23.07.2016’.

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now been withdrawn by respondent No. 1 by order dated23.07.2016 in substance, writ petition has rendered infructuousand be dismissed accordingly.

16. We however required him to tell us as to how respondent 1could dare to pass further assessment orders, when earlier orderspassed by him were declared without jurisdiction by this Courtby referring to the similar application of petitioner for change ofbusiness address. In reply thereto a very bulky counter affidavithas been filed separately by respondent l. Despite he could notexplain as to what was the occasion for any confusion when theneeds were very clearly disclosed and decided in Courts’judgment dated 29.02.2016 and why respondent 1 was in sosuch a hurry so as to pass the impugned assessment orders on04.05.2016.

17. Sri S.D. Singh, learned Senior Counsel, representing respondent1 who is also present in person before this Court at the outsetstated that there is a mistake on the part of respondent 1 whichcannot be explained satisfactorily but respondent 1 dedicatesapology and therefore, Court may consider the same and passappropriate order.

18. In these facts and circumstances we are satisfied that here isa forced litigation by unmindful illegal act on the part of respondent1 and realizing the same he has also withdrawn the impugnedorders and also considered the fact he is an authority which wasalready adversely commenced by this Court in its order dated29.02.2016 still he did not care to such observations. It is again afit case where respondent 1 himself would be saddled with costby this litigation. Since the impugned order of assessment havealready been recalled by order dated 23.07.2016 in this regard nofurther order is required but we hold that respondent 1 being guiltyof compelling and forcing second round of litigation upon petitionermust be saddled with cost which we quantify to Rs. 50,000/-.

19. We also direct Principal Secretary, Trade Tax, U.P.Government to look into the manner in which respondent 1 hasfunctioned in this case and despite strictures and penal costimposed by this Court in earlier judgment dated 29.02.2016 andalso directing Commissioner Trade Tax to get an inquiry conducted against erring officials, respondent 1 has not cared tomend his ways to conduct but has proceeded to harass a dealerlike petitioner and appropriate disciplinary action be taken at theearliest and finalise the same. It may also be considered byPrincipal Secretary, Trade Tax, U.P. Government as to whether,respondent 1 is a person fit to be assigned such important quasi-judicial functions.

20. A copy of this order shall be communicated forthwith forcommunication and compliance of the direction.

21. Writ petition is accordingly disposed of.”

8. Seeking to question the orders aforesaid, insofar they operateagainst the appellant, Mr. Pallav Shishodia, learned senior counsel hassubmitted that the adverse observations and directions by the High Courtagainst the appellant were not called for, even if the orders passed bythe appellant in his capacity as the Assessing Authority were not approvedbecause, there had not been any malice on the part of the appellant, whoonly carried out his statutory duties of timely completing the assessmentsand taking follow up actions.

8.1. Learned senior counsel has forcefully submitted that theproposition of change of address by the writ petitioner (respondent No.1)had been suffering from several shortcomings including the fundamentalone that the application made on 05.12.2013 while alleging the changeof business address in the month of January 2013, was not in conformitywith the requirement of Section 75 of the UP VAT Act whereunder,such an application was required to be made within 30 days of the event.

8.2. Learned senior counsel for the appellant would submit thatwhen the belatedly filed application had been rejected on 02.09.2014,the appellant, acting as an Assessing Authority, could have only proceededon the basis of the registered address available on the record. Moreover,it is clear that when the respondent No. 1 was not available at theregistered address, the appellant, acting in bonafide discharge of hisduties, even attempted to get the notices served at Ghaziabad but, theHigh Court did not accept that service to be a proper service.

8.3. Learned senior counsel would submit that the appellant as anAssessing Authority only proceeded in accordance with the facts availableon record and nothing of want of good faith could be imputed on him.

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ALearned senior counsel has further referred to the subsequent facts thatthe application for change of address was ultimately granted on22.07.2016 whereby, the department accepted the change of addresswith effect from 20.01.2013; and that immediately after passing of suchan order by the Registering Authority i.e., the Assistant Commissioner,Commercial Tax, Division-2, Noida, the appellant withdrew the orderBdated 04.05.2016 passed by him because with such change of address,he ceased to be having jurisdiction in the matter. The contention of thelearned senior counsel, however, is that before passing of such an orderby the competent authority, the appellant could have only proceeded onthe basis of position obtainable on record and as such, want of bonafideCcannot be imputed on him. Thus, according to the learned counsel, thestrictures and other observations made in the orders impugned deserveto be set aside.

8.4. Learned senior counsel for the appellant has also referred toSection 67 of the UP VAT Act to submit that statutory protection isDavailable to the officers like the appellant against legal proceedings inrelation to anything done in good faith in discharge of their duties andjurisdiction.

9. Mr. R. K. Raizada, learned senior counsel appearing for theState has submitted that the State has proceeded in adequate complianceEof the orders passed by the High Court; and has carried out inquiry ascontemplated by the order dated 29.02.2016 but, further proceedingsare put on hold, in view of the stay order passed by this Court in thismatter on 27.01.2017.10. Mr. Tarun Gulati, learned senior counsel appearing for theFrespondent No. 1 (writ petitioner) has submitted that the respondent No.1 had not taken up any personal lis against the present appellant nor thefirst two petitions were founded on any grounds personal to the appellant;and only the action of the State and its officers were questioned,particularly because of denial of adequate opportunity of hearing withGproper notice.

10.1. Learned senior counsel has further submitted that the HighCourt had rightly disapproved the actions as taken and the orders aspassed ex parte by the present appellant in his capacity as the AssessingAuthority. The other part of the order dated 29.02.2016, according toHthe learned counsel, had been based on the views of the High Court because of the harassment apparently faced by the respondent No. 1and because of want of appropriate and lawful action by the functionariesof the State. The learned counsel would further submit that in the laterwrit petition i.e., Writ Tax No. 546 of 2018, the appellant was personallyimpleaded as a party-respondent for the reason that he chose to passthe order dated 04.05.2016, rather at conflict with the High Court’s orderdated 29.02.2016.

10.2. Learned senior counsel has, however, frankly submittedthat the respondent No. 1 is otherwise carrying no grievance personallyagainst the appellant; and respondent No. 1 is not keen to even retainthe amount of costs awarded by the High Court and would be willingto return the same as may be directed by this Court. It has also beenpointed out that the respondent No. 1 has only received the amount ofRs. 2,00,000/- towards cost, as awarded by the order dated 29.02.2016;and the other amount of Rs. 50,000/-, as awarded by the order dated02.08.2016, has not been received in view of the stay order passed bythis Court.

11. Having given thoughtful consideration to the submissions madeand having examined the material placed on record, we are clearly ofthe view that the questioned parts of the orders impugned deserve tobe annulled with appropriate order towards the amount of Rs. 2,00,000/- awarded as costs, which has been fairly given up by the respondentNo. 1.

12. So far as the observations and findings in the impugned orderdated 29.02.2016 relating to the merits of the case are concerned, nocomments are required in that relation, for the same having not beenchallenged by the State. However, in our view, even when all the findingsof the High Court in the principal part of order dated 29.02.2016 areaccepted, they would only lead to the result that the impugned actions indrawing up ex parte assessment orders and then seeking to enforcerecovery as also the impugned action in rejecting the application forregistration of change of place of business did not meet with the approvalof the High Court. Such disapproval of the High Court had been essentiallybased on its interpretation of the applicable rules as also its analysis ofthe factual aspects concerning the issues involved in the writ petition.

13. Having examined the matter in its totality, we are of the viewthat even if the High Court found that the impugned actions of the A

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Aauthorities concerned, particularly of the appellant, had not been strictlyin conformity with law or were irregular or were illegal or even perverse,such findings, by themselves, were not leading to an inference as corollarythat there had been any deliberate action or omission on the part of theAssessing Authority or the Registering Authority; or that any ‘tactics’were adopted, as per the expression employed by the High Court. EveryBerroneous, illegal or even perverse order/action, by itself, cannot betermed as wanting in good faith or suffering from malafide.

14. In the present case, when admittedly the respondent No. 1itself had applied for registration of the change of place of businessCnearly 11 months after the alleged event; and at the time of drawing upthe assessment orders, the appellant as the Assessing Authority had noother registered address of the respondent No. 1 on record, his actionsof passing ex parte assessment orders could not have been termed asbeing deliberate or wanting in good faith, particularly in view of the factsthat attempts were indeed made from his office to get the notices servedDon the respondent No. 1 at its registered address and even at its allegedchanged address at Ghaziabad. Even if such attempts, of serving notices,were held to be illegal or irregular by the High Court, its deduction thatthe impugned actions were deliberate or lacking in good faith is difficultto be endorsed.

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14.1. The appellant, while functioning as an Assessing Authoritycould not have kept the assessment proceedings pending for an indefinitelength of time. In this context, the aforementioned facts relating toshortcomings on the part of the respondent No. 1 in first of all not seekingregistration of the changed business address for nearly 11 months andFthen, rejection of its belatedly made prayer by the competent authority(not the appellant) cannot be ignored altogether.

15. What has been observed hereinabove, with necessaryvariations, would equally apply to the later order dated 04.05.2016 passedby the appellant, in his capacity as the Assessing Authority. Though, inGthe face of the order dated 29.02.2016, the appellant could have waitedfor consideration of the application for change of address, as directed bythe High Court or could have taken instructions from the Commissionerbut, in any case, even such mistakes or errors or omissions on his partcannot be considered as carrying the elements of malice or want ofgood faith.H

16. In our view, for imputing motives and drawing inference aboutwant of good faith in any person, particularly a statutory authority,something more than mere error or fault ought to exist. Nothing concreteis available on record to impute motives in the appellant, even if hisactions/omissions while functioning as Assessing Authority otherwisecalled for disapproval.

17. In the questioned parts of the impugned orders, the High Courtseems to have taken rather a sterner view of the matter, which was notrequired in the given set of facts and circumstances. Noticeably, theappellant was not impleaded personally a party in the first two writ petitionswhich were decided by the common order dated 29.02.2016. Thecomments or remarks which were to operate personally against theappellant were not even called for without the appellant having beenjoined personally a party and having been extended an opportunity ofhearing and explanation. In the third writ petition decided by the orderdated 02.08.2016, though the appellant was personally joined as a party-respondent, when he had withdrawn the order dated 04.05.2016immediately after registration of changed address by the registeringauthority and had tendered an apology before the High Court, in ourview, the matter could have been closed at that; and there was nonecessity of stretching the matter too far and passing further orders forimposition of costs and for departmental actions with other commentsregarding competence of the appellant to discharge quasi-judicialfunctions[4]. Having said that, we deem it appropriate to close this matterwith annulment of strictures and observations against the appellant inboth the impugned orders dated 29.02.2016 and 02.08.2016.

18. As regards the amount of costs, we appreciate the fair standtaken on behalf of the respondent No. 1. Having regard to thecircumstances, we deem it appropriate and hence order that the saidamount of Rs. 2,00,000/- shall be deposited by the respondent No. 1with the Uttar Pradesh State Legal Services Authority.

4 The mistakes, errors or lapses, of course, need to be dealt with by the persuasivereasoning by the Court and necessary orders are also to be passed as may be requiredin the given set of circumstances but, it is not necessary to ‘crack the whip’ on everymistake [vide the observations of this Court in V.K. Jain v. High Court of Delhi: (2008)17 SCC 538].

A

B

C

D

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F

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H

A19. With the requirements aforesaid, the remarks and observationsagainst the appellant in the impugned orders are expunged; and thequestioned parts of the impugned orders, as reproduced hereinabove,are annulled and set aside.

20. Needless to observe that any action taken or in contemplationBpursuant to the aforesaid parts of the impugned orders are also renderedredundant.

21. The appeals stand allowed to the extent and in the mannerindicated above.

C

Nidhi Jain

Appeals allowed.

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E

F

G

H