Holding

Erroneous or irregular orders by a statutory authority do not, per se, constitute malice or want of good faith, and therefore the High Court's observations and cost orders against the Deputy Commissioner are unwarranted.

Summary

The appellant, Deputy Commissioner (Commercial Tax), challenged the High Court's observations and cost orders that accused him of deliberate, malafide actions in passing ex‑parte provisional assessment orders against Flipkart India Private Limited under the Uttar Pradesh Value Added Tax Act. The High Court had set aside the assessment orders, directed registration of the change of business address, and imposed costs, alleging that the department acted in haste and with unfair tactics. The Supreme Court held that errors or irregularities in statutory actions do not, by themselves, demonstrate malice or lack of good faith, and that the appellant could not be faulted for proceeding on the basis of the address on record. Consequently, the Court expunged the strictures, annulled the cost orders, and directed the respondent to deposit the amount with the State Legal Services Authority. The appeal was allowed.

Issues considered

Whether erroneous or irregular ex‑parte assessment orders by a statutory authority amount to malice or lack of good faith warranting cost imposition.
Whether observations and cost orders against a statutory officer are permissible when the officer was not personally impleaded and denied a hearing.
Whether the High Court's finding of deliberate tactics and the consequent cost award should stand.

Legislation cited

Uttar Pradesh Value Added Tax Act, 2008s. 17(14)(a), s. 40, s. 67, s. 75

Subjects

ex‑parte assessmentcommercial taxgood faithmalicedepartmental actioncost orderstatutory authoritynotice serviceUttar Pradesh VAT Actquasi‑judicial function

Judgment

876 SUPREME COURT
[2022]REPORTS
2 S.C.R. 876 [2022] 2 S.C.R.

A CHANDRA PRAKASH MISHRA
v.
FLIPKART INDIA PRIVATE LIMITED & ORS.
(Civil Appeal Nos. 2859-2861 of 2022)
B MARCH 30, 2022
[DINESH MAHESHWARI AND ANIRUDDHA BOSE, JJ.]
Strictures: Expunction of – Adverse observations and remarks
made by the High Court against the appellant-Deputy Commissioner,
Commercial Tax on ex parte orders and recovery proceedings passed
C
by him without proper service of notice against respondent No. 1 –
Issuance of directions in relation to his acts and omissions while
functioning as the Deputy Commissioner – Held: Every erroneous,
illegal or even perverse order/action, by itself, cannot be termed as
wanting in good faith or suffering from malafide – At the time of
D drawing up the assessment orders, the appellant as the Assessing
Authority had no other registered address of the respondent No. 1
on record – His actions of passing ex parte assessment orders could
not have been termed as being deliberate or wanting in good faith
– For imputing motives and drawing inference about want of good
faith in any person, particularly a statutory authority, something
E
more than mere error or fault ought to exist – Nothing concrete is
available on record to impute motives in the appellant – High Court
seems to have taken rather a sterner view of the matter, which was
not required – There was no need of stretching the matter too far
and passing further orders for imposition of costs and for
F departmental actions with other comments regarding competence
of the appellant to discharge quasi-judicial functions – Amount of
costs-Rs. 2,00,000/- to be deposited by the respondent No. 1 with
the State Legal Services Authority – Strictures and observations
against the appellant expunged.
G Allowing the appeals, the Court
HELD: 1.1 The questioned parts of the orders impugned
are annulled with appropriate order towards the amount of Rs.
2,00,000/- awarded as costs, which has been fairly given up by
the respondent No. 1. [Para 11][889-D-E]
H
876
CHANDRA PRAKASH MISHRA v. FLIPKART INDIA PRIVATE 877
LIMITED & ORS.

1.2 Even when all the findings of the High Court in the A
principal part of order dated 29.02.2016 are accepted, they would
only lead to the result that the impugned actions in drawing up
ex parte assessment orders and then seeking to enforce recovery
as also the impugned action in rejecting the application for
registration of change of place of business did not meet with the
B
approval of the High Court. Such disapproval of the High Court
had been essentially based on its interpretation of the applicable
rules as also its analysis of the factual aspects concerning the
issues involved in the writ petition. [Para 12][889-F-H]
1.3 Having examined the matter in its totality, even if the
High Court found that the impugned actions of the authorities C
concerned, particularly of the appellant, had not been strictly in
conformity with law or were irregular or were illegal or even
perverse, such findings, by themselves, were not leading to an
inference as corollary that there had been any deliberate action
or omission on the part of the Assessing Authority or the D
Registering Authority; or that any ‘tactics’ were adopted, as per
the expression employed by the High Court. Every erroneous,
illegal or even perverse order/action, by itself, cannot be termed
as wanting in good faith or suffering from malafide. [Para 13][889-
H; 890-A-B]
E
1.4 In the instant case, when admittedly the respondent
No. 1 itself had applied for registration of the change of place of
business nearly 11 months after the alleged event; and at the
time of drawing up the assessment orders, the appellant as the
Assessing Authority had no other registered address of the
respondent No. 1 on record, his actions of passing ex parte F
assessment orders could not have been termed as being
deliberate or wanting in good faith, particularly in view of the
facts that attempts were indeed made from his office to get the
notices served on the respondent No. 1 at its registered address
and even at its alleged changed address at Ghaziabad. Even if G
such attempts, of serving notices, were held to be illegal or
irregular by the High Court, its deduction that the impugned
actions were deliberate or lacking in good faith is difficult to be
endorsed. [Para 14][890-C-E]

H
878 SUPREME COURT REPORTS [2022] 2 S.C.R.

A 1.5 The appellant, while functioning as an Assessing
Authority could not have kept the assessment proceedings
pending for an indefinite length of time. The facts relating to
shortcomings on the part of the respondent No. 1 in first of all
not seeking registration of the changed business address for
nearly 11 months and then, rejection of its belatedly made prayer
B
by the competent authority (not the appellant) cannot be ignored
altogether. [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 passed
by the appellant, in his capacity as the Assessing Authority.
C Though, in the face of the order dated 29.02.2016, the appellant
could have waited for consideration of the application for change
of address, as directed by the High Court or could have taken
instructions from the Commissioner but, in any case, even such
mistakes or errors or omissions on his part cannot be considered
D as carrying the elements of malice or want of good faith. [Para
15][890-F-H]
1.7 For imputing motives and drawing inference about want
of good faith in any person, particularly a statutory authority,
something more than mere error or fault ought to exist. Nothing
E concrete is available on record to impute motives in the appellant,
even if his actions/omissions while functioning as Assessing
Authority otherwise called for disapproval. [Para 16][891-A-B]
1.8 In the questioned parts of the impugned orders, the
High Court seems to have taken rather a sterner view of the
F matter, which was not required in the given set of facts and
circumstances. Noticeably, the appellant was not impleaded
personally a party in the first two writ petitions which were decided
by the common order. The comments or remarks which were to
operate personally against the appellant were not even called for
without the appellant having been joined personally a party and
G having been extended an opportunity of hearing and explanation.
In the third writ petition, though the appellant was personally
joined as a party-respondent, when he had withdrawn the order
dated 04.05.2016 immediately after registration of changed

H
CHANDRA PRAKASH MISHRA v. FLIPKART INDIA PRIVATE 879
LIMITED & ORS.

address by the registering authority and had tendered an apology A
before the High Court, the matter could have been closed at
that; and there was no necessity of stretching the matter too far
and passing further orders for imposition of costs and for
departmental actions with other comments regarding competence
of the appellant to discharge quasi-judicial functions. Having said
B
that, it is appropriate to close this matter with annulment of
strictures and observations against the appellant in both the
impugned orders. [Para 17] [891-B-F]
1.9 As regards the amount of costs, the fair stand taken on
behalf of the respondent No. 1 is appreciated. Having regard to
the circumstances, it is deemed appropriate and hence it is C
ordered that the said amount of Rs. 2,00,000/- to be deposited by
the respondent No. 1 with the Uttar Pradesh State Legal Services
Authority. The remarks and observations against the appellant
in the impugned orders are expunged; and the questioned parts
of the impugned orders, are annulled and set aside. Any action D
taken or in contemplation pursuant to the said parts of the
impugned 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. E
Case Law Reference
[2009] 11 SCR 907 referred to Para 20
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 2859-
2861 of 2022. F
From the Judgment and Order dated 29.02.2016 of the High Court
of Judicature at Allahabad in Miscellaneous Civil Writ Petition Nos.80
and 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. G
Tarun Gulati, R. K. Raizada, Sr. Advs., Kishore Kumar, Manish
Rastogi, Rony Oommen John, Bhakti Vardhan Singh, Advs. for the
Respondents.

H
880 SUPREME COURT REPORTS [2022] 2 S.C.R.

A The Judgment of the Court was delivered by
DINESH MAHESHWARI, J.
1. Leave granted.
2. In these appeals, the appellant, presently working as Joint
B Commissioner, Commercial Tax, Moradabad, has questioned the order
dated 29.02.2016 in Writ Petition Nos. 80 of 2016 and 168 of 2016 as
also the order dated 02.08.2016 in Writ Tax No. 546 of 2016, as passed
by the High Court of Judicature at Allahabad.
2.1. The appellant is aggrieved of the orders impugned, insofar as
C adverse observations and remarks have been made and directions have
been issued in relation to his acts and omissions while functioning as the
Deputy Commissioner, Commercial Tax, Range-II, Sector-2, Noida, viz.,
passing ex parte assessment orders and enforcing recovery proceedings
under the Uttar Pradesh Value Added Tax Act, 20081, concerning the
writ petitioner (respondent No. 1 herein)2.
D
3. The impugned orders have otherwise not been challenged by
the State or by the writ petitioner. Therefore, dilation on all the factual
aspects is not necessary. The aspects relevant for the present purpose
are as follows:
E 3.1. By way of Writ Petition No. 80 of 2016, the writ petitioner
questioned the recovery proceedings, as taken up against it pursuant to
the ex parte provisional assessment order passed by the appellant in his
capacity as the Assessing Authority. In response to the said writ petition,
it was pointed out on behalf of the department that an application made
by the writ petitioner for registering the changed address had already
F
been rejected on 02.09.2014 and, therefore, ex parte order had rightly
been passed after taking due steps for service of notice.
3.2. The said order dated 02.09.2014, as passed by the Registering
Authority (not the appellant) rejecting the prayer for registering the
changed address was challenged in the other writ petition bearing No.
G
168 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 respondent
No. 1. For continuity of narrations and in the given context, the respondent No. 1 has
H also been referred to as ‘the writ petitioner’.
CHANDRA PRAKASH MISHRA v. FLIPKART INDIA PRIVATE 881
LIMITED & ORS. [DINESH MAHESHWARI, J.]

3.3. Thus, in sum and substance, the ex parte provisional A
assessment order dated 15.12.2015 and the recovery proceedings as
also the order dated 02.09.2014 rejecting the prayer for registration of
the changed address were in challenge before the High Court in the said
writ petitions bearing Nos. 80 of 2016 and 168 of 2016. As noticed, the
appellant had been functioning as the Deputy Commissioner, Commercial
B
Tax, Range-II, Sector-2, Noida and had passed the aforesaid ex parte
order in his capacity as the Assessing Authority. However, the aforesaid
order rejecting the prayer for registering the changed address was passed
by the Registering Authority, being the Assistant Commissioner,
Commercial Tax, Divison-2, Noida.
C
4. The issues involved in the said writ petitions were considered
and 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 was
passed against the writ petitioner without proper service of notice. The
facts were taken note of that, according to the writ petitioner, it had D
shifted its place of business from Noida to Ghaziabad, which was very
much in the knowledge of the department in view of the applications
made and other communications addressed by it. There was a suggestion
on behalf of the State as regards service of notice at Ghaziabad but, that
service was also not taken as sufficient by the High Court after its
interpretation of the requirements under the rules. E

4.2. The High Court, therefore, set aside the ex parte assessment
order dated 15.12.2015 and quashed the recovery proceedings. The
High Court also set aside the order dated 02.09.2014, rejecting the
writ petitioner’s application for registration of the change of place of
business and directed the Registering Authority to process the F
application made by the writ petitioner on 05.12.2013 for change of
place of business after permitting the writ petitioner to deposit the
requisite fees.
4.3. The High Court found that a huge amount to the tune of Rs.
G
49,82,01,250/- had been withdrawn by the department from the writ
petitioner’s account without authority of law. Hence, the Deputy
Commissioner, Commercial Taxes, Range-II, Noida was directed to
refund the said amount together with interest as per Section 40 of the
UP VAT Act after adjusting the admitted tax. The High Court, of course,
left it open for the Assessing Authority to make fresh assessments in H
882 SUPREME COURT REPORTS [2022] 2 S.C.R.

A accordance with law, after proper service of notice upon the writ petitioner
and after giving them an opportunity of hearing.
5. In the aforesaid part of the impugned common order dated
29.02.2016 i.e., upto paragraph 34, the High Court dealt with the core
issues involved in the case and contentions of the respective parties and,
B thereafter, passed the orders consequent to its findings on the material
issues that there had not been proper service of notice upon the writ
petitioner and the ex parte orders were not sustainable.
6. However, before closing the matter, the High Court proceeded
to express its opinion that the impugned actions, leading to ex parte
C orders/proceedings without proper service of notice, were of deliberate
attempt on the part of the department against the interests of the writ
petitioner; and the Assessing Authority adopted unfair tactics in getting
the service effected in gross violation of the applicable rules.
6.1. The High Court, therefore, imposed costs to the tune of Rs.
D 2,00,000/-, to be paid by the department to the writ petitioner, and left it
open for the Commissioner, Commercial Tax, Lucknow to institute an
inquiry and to fix responsibility on the erring officer for recovery of the
amount of costs. The said part of the order dated 29.02.2016, which has
been questioned by the appellant in this appeal, reads as under: -
E
“35. Before parting, we must observe the manner in which the
respondents have proceeded with the assessment and recovered
the amount from the petitioner’s Bank account in haste is
deplorable and in gross violation of the provisions of the Act. We
find that for the assessment years 2011-12, 2013-14 and 2014-15
F ex-parte assessment orders were made without adequate service
of notices upon the petitioner. These assessment proceedings were
set aside in appeal on the short ground that the service of the
summons were sent at the address where the petitioner was no
longer carrying on its business. Inspite of this knowledge, the
respondents chose deliberately to serve the notice for provisional
G
assessment for the period April to October, 2015 upon the petitioner
at the Noida address knowing fully well that the petitioner was
not carrying any business from the Noida address. The respondents
knew very well that the petitioner had shifted its place of business
from Noida to Ghaziabad as they made a futile attempt to serve
H the notice at Ghaziabad but later for the reasons best known to
CHANDRA PRAKASH MISHRA v. FLIPKART INDIA PRIVATE 883
LIMITED & ORS. [DINESH MAHESHWARI, J.]

them, chose deliberately to serve the notice by affixation at the A
Noida address. Such tactics adopted by the assessing authority in
getting the service effected upon the petitioner was in gross
violation of Rule 72 of the Rules.
36. We also find that the entire exercise of service was done
within four days without taking recourse to the other mode of B
service, namely simultaneously service by registered post with
acknowledgment due. The assessment order indicates that the
first and last date of hearing of the assessment proceedings was
10.12.2015 and that the assessment order was passed on
15.12.2015. The counter affidavit reveals that the assessment order C
was served by attachment at the Noida address. This was done
deliberately by the respondents so that the respondents could
withdraw the amount through garnishee notices by exerting
pressure upon the bank authorities. The Court gets an uncanny
feeling that a deliberate attempt was made by the respondents to
withdraw the money from the petitioner’s bank account through D
dubious mean by passing ex-parte assessment orders and not
allowing it to be served validly upon the petitioner. If in this cavalier
fashion the Commercial Tax Department functions and withdraws
huge sums of money without valid service, it would be difficult for
big business houses to carry on their business. Such business E
houses would be forced to shift their business outside the State of
Uttar Pradesh.
37. Consequently, the petitioners are entitled for cost. The writ
petitions are allowed with cost amounting to Rs. 2,00,000/- (Rupees
two lakhs only), which will be paid by the Commercial Tax F
Department to the petitioner within two weeks from the date of
filing of a certified copy of this order. If the amount is not paid, it
would be open to the petitioner to move an appropriate application
in this petition.
38. It would be open to the Commercial Tax Commissioner, G
Lucknow to institute an enquiry and fix responsibility on the erring
officer 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
H
884 SUPREME COURT REPORTS [2022] 2 S.C.R.

A assessment order dated 04.05.2016 against the writ petitioner. This order
was again questioned by the writ petitioner by way of another writ petition
in the High Court, being Writ Tax No. 546 of 2016. In this subsequent
writ petition, the present appellant was personally impleaded as respondent
No. 1.
B 7.1. On 11.07.2016, while initially dealing with the said petition,
Writ Tax No. 546 of 2016, the High Court referred to the background
aspects, in particular to the aforesaid order dated 29.02.2016 and then,
took exception that the present appellant at all chose to pass the impugned
assessment order on 04.05.2016, which was not in conformity with what
C was held in the order dated 29.02.2016. The High Court, while issuing
notice and staying operation of the impugned assessment order and the
consequential notice, observed as under: -
“1. It is contended that petitioners’ registered office address has
been changed to Ghaziabad and Deputy Commissioner of
D Commercial Tax, Noida had no jurisdiction to make assessment
and this was also observed by this Court in its judgment dated
29.02.2016 in Flipkart India Pvt. Ltd. Vs State of U.P. and others,
reported in 2016 NTN (Vol. 60) 313 wherein Court observed that
authority at Noida had no jurisdiction to make assessment after
change of place of business/registered office of petitioner company
E at Ghaziabad, still respondent no. 1 has proceeded to serve notice
at the supposed address at Noida and thereafter has passed
impugned order.
2. It is contended that the order impugned is patently illegal, without
jurisdiction and has been passed to frustrate the judgment of this
F Court in which serious strictures had been passed against the
officer concerned and this Court had imposed cost of Rs. Two
Lacs.
3. We find it a serious matter. Let respondent 1 himself appear
along with relevant records on 02.08.2016 before this Court. He
G
shall also file para-wise reply to the writ petition on the next date.
4. Until further orders, the effect and operation of impugned
assessment order dated 04.05.2016 and notice dated 07.04.2016
shall remain stayed.”
H
CHANDRA PRAKASH MISHRA v. FLIPKART INDIA PRIVATE 885
LIMITED & ORS. [DINESH MAHESHWARI, J.]

7.2. When the matter was taken up for further consideration by A
the High Court on 02.08.2016, it was submitted by the learned standing
counsel for the department that the impugned assessment orders had
since been withdrawn by the present appellant on 23.07.2016 and,
therefore, the writ petition was practically rendered infructuous. It was
also stated on behalf of the appellant, who was present in Court, that
B
there 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 the
appellant seriously questionable, particularly for his acts and omissions
after the strictures in, and penal costs imposed by, the order dated
29.02.2016. Thus, while imposing costs of Rs. 50,000/- personally on the C
appellant, the High Court made the observations that departmental action
be taken and finalised at the earliest and the department would also
consider as to whether the appellant was a person fit to be assigned
such important quasi-judicial functions. The relevant part of the order
dated 02.08.2016 could be usefully extracted as under:- D
“13. Additional Commissioner, Commercial Tax, Noida, sought a
clarification from Commissioner, Commercial Tax, vide letter dated
29.06.2016 whereupon the Commissioner vide letter dated
20.07.2016 directed the registering authority to pass appropriate
order in accordance with directions of this Court. The registering E
authority has passed an order on 23.07.2016 under Section
17(14)(a) of the Act transferring the place of business of petitioner
from Noida to Ghaziabad w.e.f. 20.01.2013 and consequently now
the Deputy Commissioner, Commercial Tax, Sector 7, Ghaziabad
becomes Assessing authority of petitioner w.e.f. 20.01.2013.
Pursuant thereto respondent 1 has passed an order on 23.03.2016 F
(sic)3 withdrawing the assessment orders dated 04.05.2016
impugned in this writ petition.
14. It is admitted that application for transfer of business address
was filed on 05.12.2013 which was rejected by respondent 1 on
02.09.2014 and the said order was set aside by this Court vide G
judgment dated 29.02.2016.
15. Learned Standing Counsel at the outset clearly stated that
since 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’. H
886 SUPREME COURT REPORTS [2022] 2 S.C.R.

A now been withdrawn by respondent No. 1 by order dated
23.07.2016 in substance, writ petition has rendered infructuous
and be dismissed accordingly.
16. We however required him to tell us as to how respondent 1
could dare to pass further assessment orders, when earlier orders
B passed by him were declared without jurisdiction by this Court
by referring to the similar application of petitioner for change of
business address. In reply thereto a very bulky counter affidavit
has been filed separately by respondent l. Despite he could not
explain as to what was the occasion for any confusion when the
needs were very clearly disclosed and decided in Courts’
C
judgment dated 29.02.2016 and why respondent 1 was in so
such a hurry so as to pass the impugned assessment orders on
04.05.2016.
17. Sri S.D. Singh, learned Senior Counsel, representing respondent
D 1 who is also present in person before this Court at the outset
stated that there is a mistake on the part of respondent 1 which
cannot be explained satisfactorily but respondent 1 dedicates
apology and therefore, Court may consider the same and pass
appropriate order.

E 18. In these facts and circumstances we are satisfied that here is
a forced litigation by unmindful illegal act on the part of respondent
1 and realizing the same he has also withdrawn the impugned
orders and also considered the fact he is an authority which was
already adversely commenced by this Court in its order dated
29.02.2016 still he did not care to such observations. It is again a
F fit case where respondent 1 himself would be saddled with cost
by this litigation. Since the impugned order of assessment have
already been recalled by order dated 23.07.2016 in this regard no
further order is required but we hold that respondent 1 being guilty
of compelling and forcing second round of litigation upon petitioner
G must 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 has
functioned in this case and despite strictures and penal cost
imposed by this Court in earlier judgment dated 29.02.2016 and
H also directing Commissioner Trade Tax to get an inquiry
CHANDRA PRAKASH MISHRA v. FLIPKART INDIA PRIVATE 887
LIMITED & ORS. [DINESH MAHESHWARI, J.]

conducted against erring officials, respondent 1 has not cared to A
mend his ways to conduct but has proceeded to harass a dealer
like petitioner and appropriate disciplinary action be taken at the
earliest and finalise the same. It may also be considered by
Principal Secretary, Trade Tax, U.P. Government as to whether,
respondent 1 is a person fit to be assigned such important quasi-
B
judicial functions.
20. A copy of this order shall be communicated forthwith for
communication and compliance of the direction.
21. Writ petition is accordingly disposed of.”
C
8. Seeking to question the orders aforesaid, insofar they operate
against the appellant, Mr. Pallav Shishodia, learned senior counsel has
submitted that the adverse observations and directions by the High Court
against the appellant were not called for, even if the orders passed by
the appellant in his capacity as the Assessing Authority were not approved
because, there had not been any malice on the part of the appellant, who D
only carried out his statutory duties of timely completing the assessments
and taking follow up actions.
8.1. Learned senior counsel has forcefully submitted that the
proposition of change of address by the writ petitioner (respondent No.1)
had been suffering from several shortcomings including the fundamental E
one that the application made on 05.12.2013 while alleging the change
of business address in the month of January 2013, was not in conformity
with 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 that F
when the belatedly filed application had been rejected on 02.09.2014,
the appellant, acting as an Assessing Authority, could have only proceeded
on the basis of the registered address available on the record. Moreover,
it is clear that when the respondent No. 1 was not available at the
registered address, the appellant, acting in bonafide discharge of his G
duties, even attempted to get the notices served at Ghaziabad but, the
High Court did not accept that service to be a proper service.
8.3. Learned senior counsel would submit that the appellant as an
Assessing Authority only proceeded in accordance with the facts available
on record and nothing of want of good faith could be imputed on him.
H
888 SUPREME COURT REPORTS [2022] 2 S.C.R.

A Learned senior counsel has further referred to the subsequent facts that
the application for change of address was ultimately granted on
22.07.2016 whereby, the department accepted the change of address
with effect from 20.01.2013; and that immediately after passing of such
an order by the Registering Authority i.e., the Assistant Commissioner,
Commercial Tax, Division-2, Noida, the appellant withdrew the order
B
dated 04.05.2016 passed by him because with such change of address,
he ceased to be having jurisdiction in the matter. The contention of the
learned senior counsel, however, is that before passing of such an order
by the competent authority, the appellant could have only proceeded on
the basis of position obtainable on record and as such, want of bonafide
C cannot be imputed on him. Thus, according to the learned counsel, the
strictures and other observations made in the orders impugned deserve
to be set aside.
8.4. Learned senior counsel for the appellant has also referred to
Section 67 of the UP VAT Act to submit that statutory protection is
D available to the officers like the appellant against legal proceedings in
relation to anything done in good faith in discharge of their duties and
jurisdiction.
9. Mr. R. K. Raizada, learned senior counsel appearing for the
State has submitted that the State has proceeded in adequate compliance
E of the orders passed by the High Court; and has carried out inquiry as
contemplated by the order dated 29.02.2016 but, further proceedings
are put on hold, in view of the stay order passed by this Court in this
matter on 27.01.2017.
10. Mr. Tarun Gulati, learned senior counsel appearing for the
F respondent No. 1 (writ petitioner) has submitted that the respondent No.
1 had not taken up any personal lis against the present appellant nor the
first 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 with
G proper notice.
10.1. Learned senior counsel has further submitted that the High
Court had rightly disapproved the actions as taken and the orders as
passed ex parte by the present appellant in his capacity as the Assessing
Authority. The other part of the order dated 29.02.2016, according to
H the learned counsel, had been based on the views of the High Court
CHANDRA PRAKASH MISHRA v. FLIPKART INDIA PRIVATE 889
LIMITED & ORS. [DINESH MAHESHWARI, J.]

because of the harassment apparently faced by the respondent No. 1 A
and because of want of appropriate and lawful action by the functionaries
of the State. The learned counsel would further submit that in the later
writ petition i.e., Writ Tax No. 546 of 2018, the appellant was personally
impleaded as a party-respondent for the reason that he chose to pass
the order dated 04.05.2016, rather at conflict with the High Court’s order
B
dated 29.02.2016.
10.2. Learned senior counsel has, however, frankly submitted
that the respondent No. 1 is otherwise carrying no grievance personally
against the appellant; and respondent No. 1 is not keen to even retain
the amount of costs awarded by the High Court and would be willing C
to return the same as may be directed by this Court. It has also been
pointed out that the respondent No. 1 has only received the amount of
Rs. 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 dated
02.08.2016, has not been received in view of the stay order passed by
this Court. D

11. Having given thoughtful consideration to the submissions made
and having examined the material placed on record, we are clearly of
the view that the questioned parts of the orders impugned deserve to
be annulled with appropriate order towards the amount of Rs. 2,00,000/
- awarded as costs, which has been fairly given up by the respondent E
No. 1.
12. So far as the observations and findings in the impugned order
dated 29.02.2016 relating to the merits of the case are concerned, no
comments are required in that relation, for the same having not been
challenged by the State. However, in our view, even when all the findings F
of the High Court in the principal part of order dated 29.02.2016 are
accepted, they would only lead to the result that the impugned actions in
drawing up ex parte assessment orders and then seeking to enforce
recovery as also the impugned action in rejecting the application for
registration of change of place of business did not meet with the approval G
of the High Court. Such disapproval of the High Court had been essentially
based on its interpretation of the applicable rules as also its analysis of
the factual aspects concerning the issues involved in the writ petition.
13. Having examined the matter in its totality, we are of the view
that even if the High Court found that the impugned actions of the H
890 SUPREME COURT REPORTS [2022] 2 S.C.R.

A authorities concerned, particularly of the appellant, had not been strictly
in conformity with law or were irregular or were illegal or even perverse,
such findings, by themselves, were not leading to an inference as corollary
that there had been any deliberate action or omission on the part of the
Assessing Authority or the Registering Authority; or that any ‘tactics’
were adopted, as per the expression employed by the High Court. Every
B
erroneous, illegal or even perverse order/action, by itself, cannot be
termed as wanting in good faith or suffering from malafide.
14. In the present case, when admittedly the respondent No. 1
itself had applied for registration of the change of place of business
C nearly 11 months after the alleged event; and at the time of drawing up
the assessment orders, the appellant as the Assessing Authority had no
other registered address of the respondent No. 1 on record, his actions
of passing ex parte assessment orders could not have been termed as
being deliberate or wanting in good faith, particularly in view of the facts
that attempts were indeed made from his office to get the notices served
D on the respondent No. 1 at its registered address and even at its alleged
changed address at Ghaziabad. Even if such attempts, of serving notices,
were held to be illegal or irregular by the High Court, its deduction that
the impugned actions were deliberate or lacking in good faith is difficult
to be endorsed.
E 14.1. The appellant, while functioning as an Assessing Authority
could not have kept the assessment proceedings pending for an indefinite
length of time. In this context, the aforementioned facts relating to
shortcomings on the part of the respondent No. 1 in first of all not seeking
registration of the changed business address for nearly 11 months and
F then, rejection of its belatedly made prayer by the competent authority
(not the appellant) cannot be ignored altogether.
15. What has been observed hereinabove, with necessary
variations, would equally apply to the later order dated 04.05.2016 passed
by the appellant, in his capacity as the Assessing Authority. Though, in
G the face of the order dated 29.02.2016, the appellant could have waited
for consideration of the application for change of address, as directed by
the High Court or could have taken instructions from the Commissioner
but, in any case, even such mistakes or errors or omissions on his part
cannot be considered as carrying the elements of malice or want of
good faith.
H
CHANDRA PRAKASH MISHRA v. FLIPKART INDIA PRIVATE 891
LIMITED & ORS. [DINESH MAHESHWARI, J.]

16. In our view, for imputing motives and drawing inference about A
want of good faith in any person, particularly a statutory authority,
something more than mere error or fault ought to exist. Nothing concrete
is available on record to impute motives in the appellant, even if his
actions/omissions while functioning as Assessing Authority otherwise
called for disapproval.
B
17. In the questioned parts of the impugned orders, the High Court
seems to have taken rather a sterner view of the matter, which was not
required in the given set of facts and circumstances. Noticeably, the
appellant was not impleaded personally a party in the first two writ petitions
which were decided by the common order dated 29.02.2016. The C
comments or remarks which were to operate personally against the
appellant were not even called for without the appellant having been
joined personally a party and having been extended an opportunity of
hearing and explanation. In the third writ petition decided by the order
dated 02.08.2016, though the appellant was personally joined as a party-
D
respondent, when he had withdrawn the order dated 04.05.2016
immediately after registration of changed address by the registering
authority and had tendered an apology before the High Court, in our
view, the matter could have been closed at that; and there was no
necessity of stretching the matter too far and passing further orders for
imposition of costs and for departmental actions with other comments E
regarding competence of the appellant to discharge quasi-judicial
functions4. Having said that, we deem it appropriate to close this matter
with annulment of strictures and observations against the appellant in
both the impugned orders dated 29.02.2016 and 02.08.2016.

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

4
The mistakes, errors or lapses, of course, need to be dealt with by the persuasive
reasoning by the Court and necessary orders are also to be passed as may be required
in the given set of circumstances but, it is not necessary to ‘crack the whip’ on every
mistake [vide the observations of this Court in V.K. Jain v. High Court of Delhi: (2008)
17 SCC 538]. H
892 SUPREME COURT REPORTS [2022] 2 S.C.R.

A 19. With the requirements aforesaid, the remarks and observations
against the appellant in the impugned orders are expunged; and the
questioned parts of the impugned orders, as reproduced hereinabove,
are annulled and set aside.
20. Needless to observe that any action taken or in contemplation
B pursuant to the aforesaid parts of the impugned orders are also rendered
redundant.
21. The appeals stand allowed to the extent and in the manner
indicated above.
C
Nidhi Jain Appeals allowed.

D

E

F

G

H