2023 (4) TMI 595 - HC - VAT and Sales Tax

Violation of principles of natural justice - ex-parte order - impugned order has been passed on an ex parte basis (on the very first day of hearing) without recording any satisfaction about service upon the revisionist - HELD THAT - In view of specific assertion made by revisionist that no notice whatsoever was ever served upon revisionist, a perusal of impugned order makes it evident that although it has been indicated that notice was served upon partner of firm on 27th February, 2008, the order does not indicate anywhere as to whether and by which mode the notice was issued to revisionist-respondent. The only fact indicated in the order is that notice was served upon partner of firm on 27th February, 2008 fixing 15th April, 2008 as the first date of hearing. It is also evident from the impugned order that hearing took place on the very first day of hearing and impugned order has thereafter been passed on 26th April, 2008. Evidently the order impugned is an ex parte order. In the considered opinion of this Court, the second appellate authority has clearly erred in not recording a finding as to when and by which mode notices were issued to the revisionist-respondent and how service can be said to have been effected upon the said person. Even otherwise it would have been in the interest of justice for the second appellate authority to have fixed at least another date to permit representation of revisionist-respondent in the said proceedings prior to deciding it on an ex parte basis, which has resulted in substantial injury to the revisionist-respondent. The learned Tribunal was clearly unjustified in deciding the second appeal on ex parte basis on the very first day of hearing and as such the order impugned is clearly vitiated due to violation of principles of natural justice - Revision allowed.

Summary

Issues:
1. Trade tax revision filed against an order passed in Appeal No. 470 of 2005 for the assessment year 2002-03.
2. The assessment order was passed on an ex parte basis without proper notice to the revisionist.
3. Justifiability of the Tribunal's decision to hear the appeal ex parte on the first day without adhering to principles of natural justice.

Analysis:
1. The revisionist filed a trade tax revision against an order dated 26th April, 2008, passed in Appeal No. 470 of 2005 for the assessment year 2002-03. The revision was initially admitted on 22nd October, 2008, without framing questions of law.
2. The main contention was that the impugned order was passed ex parte without proper notice to the revisionist. The revisionist argued that they were not informed about the second appeal, leading to their absence on the hearing date. The order indicated that a notice was served on a partner of the firm but did not clarify if the revisionist was informed. The court found that the second appellate authority erred in not confirming the mode of notice issuance and failed to provide an opportunity for the revisionist to represent themselves before deciding ex parte.
3. The key issue was whether the Tribunal was justified in deciding the appeal ex parte on the first day of the hearing. The court held that the decision violated principles of natural justice, as the revisionist was not properly notified, leading to substantial injury. Consequently, the impugned order was set aside, and the matter was remanded to the Appellate Trade Tax Tribunal for a fresh decision, emphasizing the need for a fair hearing and adherence to natural justice principles. The parties were directed to appear before the Tribunal for reconsideration, ensuring a just and expeditious resolution within four months from the specified date.