1983 (4) TMI 74 - AT - Wealth-tax

Summary

Issues Involved:
1. Justification of the ex parte order by the AAC.
2. Whether the AAC considered all grounds of appeal.
3. Compliance with mandatory provisions of the Wealth-tax Act regarding hearing the Valuation Officer.
4. Adequacy of the valuation of immovable properties.

Detailed Analysis:

1. Justification of the ex parte order by the AAC:
The primary issue was whether the AAC was justified in making an ex parte order on 25-6-1981. The AAC proceeded ex parte, assuming no representation from the appellants despite their representative, Shri F. P. Sarkari, attending later on the same day. The Tribunal found that the AAC was too rigid and hyper-technical in not accommodating the slight delay caused by the representative's engagement before the Tribunal. The Tribunal emphasized that an appellate authority should provide reasonable opportunities for hearing and not give the impression of shutting out an appellant. The Tribunal noted that the AAC's refusal to hear the representative at 2.30 pm, despite the delay being put in writing and explained, was unjustified. The Tribunal vacated the ex parte order and remanded the case for fresh consideration, emphasizing the need for reasonable opportunities to be given to the parties involved.

2. Whether the AAC considered all grounds of appeal:
The Tribunal found that the AAC did not adjudicate all grounds raised by the appellants. The AAC erroneously assumed that the only contention was whether the valuation should be done by an actuary instead of the Valuation Officer, ignoring other grounds. The Tribunal noted that Ground No. 6, questioning the propriety of the valuation adopted by the WTO, was not considered. The Tribunal concluded that the AAC's order was incomplete and required reconsideration of all grounds raised by the appellants.

3. Compliance with mandatory provisions of the Wealth-tax Act regarding hearing the Valuation Officer:
The Tribunal highlighted that the AAC did not comply with Section 23(3A) of the Wealth-tax Act, which mandates giving the Valuation Officer an opportunity to be heard when the valuation by the Valuation Officer is under appeal. The Tribunal found this non-compliance to be a legal infirmity, rendering the AAC's order erroneous. The Tribunal emphasized that the mandatory provision must be followed, and the Valuation Officer should be given an opportunity to present his case.

4. Adequacy of the valuation of immovable properties:
The Tribunal noted that the AAC did not consider various contentions and expert opinions regarding the excessive valuation by the Valuation Officer. The Tribunal found that the AAC's order did not address the reasonableness of the valuation adopted by the WTO. The Tribunal concluded that the valuation issue needed thorough reconsideration, taking into account all relevant contentions and evidence presented by the appellants.

Separate Judgments:

Judgment by the Judicial Member:
The Judicial Member disagreed with the Accountant Member, holding that the AAC was justified in making an ex parte order since the representative failed to appear at the appointed time. The Judicial Member emphasized that the onus was on the assessee to prove sufficient cause for non-appearance and that the AAC followed the law and procedure. The Judicial Member also held that the ex parte order could not be set aside on the grounds of not hearing the Valuation Officer or not considering all grounds of appeal, as the AAC relied on the valuation report and followed the established procedure.

Third Member Order:
The Third Member agreed with the Accountant Member, finding that the AAC's ex parte order was unjustified due to the short notice and slight delay in appearance by the representative. The Third Member emphasized the need for reasonable opportunities and compliance with mandatory provisions regarding the Valuation Officer. The Third Member concluded that the AAC's order was erroneous both procedurally and on merits, and the appeals should be remanded for fresh consideration.

Conclusion:
The Tribunal vacated the AAC's ex parte order and remanded the appeals for fresh consideration, emphasizing the need for reasonable opportunities, compliance with mandatory provisions, and thorough consideration of all grounds and evidence. The appeals were allowed for statistical purposes, directing the AAC to decide afresh in accordance with the law.