2015 (9) TMI 504 - HC - Income Tax

Breach of the principles of natural justice - whether oral submissions are to be advanced as in case oral arguments are not heard it would lead to the breach of the principles of natural justice - Held that - In the present case, it is not disputed that the Appellants were not given an opportunity to advance oral arguments before the Tribunal. The letter dated 08.01.2015 has also not been examined nor placed before the Tribunal whilst passing the impugned Order dated 23.01.2015. Not giving an adequate hearing to the Appellants would itself vitiate the impugned Order for breach of the principles of natural justice. In the present case, we find that even the contentions raised in the written submissions filed by the Appellants have also not been duly noted nor considered by the Tribunal whilst passing the impugned Order. Thus The impugned Order dated 23.01.2015 passed by the Income Tax Appellate Tribunal, Panaji, is quashed and set aside. - Decided in favour of assessee.

Summary

Issues Involved:
1. Compliance with principles of natural justice in the impugned Order passed by the Income Tax Appellate Tribunal.

Analysis:
The judgment by the High Court of Bombay addressed the issue of whether the impugned Order passed by the Income Tax Appellate Tribunal stood vitiated for not complying with the principles of natural justice. The Appellant, represented by a Senior Advocate, withdrew an application to recall the Order, leading to the Appeal being heard on merits. The Court examined whether the Tribunal's Order dated 23.01.2015 breached natural justice principles without delving into the merits of the dispute. The Appellant's Counsel highlighted that the Tribunal proceeded without giving adequate hearing, neglecting written submissions and a letter explaining the absence of the Counsel. The Appellant argued for quashing the Order and a fresh hearing based on the breach of natural justice principles, citing relevant case law. On the other hand, the Respondent's Counsel contended that the Tribunal rightly examined the merits and refused further time due to the Appellant's negligence. The Court considered both arguments and emphasized the importance of oral arguments for natural justice.

The Court referenced previous judgments emphasizing the right to an adequate hearing in cases with civil consequences. It noted that denying oral arguments and not considering written submissions could vitiate the Order for breaching natural justice principles. Despite the Appellant's lack of due diligence in attending the hearing, the Court found it appropriate to quash the Order, directing a fresh hearing with costs imposed on the Appellants. The judgment highlighted the necessity of giving parties the opportunity for oral arguments and ensuring all submissions are duly noted and considered. Ultimately, the Court ordered the quashing of the impugned Order, restoration of the Appeal to the Tribunal for a fresh decision, and the payment of costs by the Appellants as a condition for further hearing, thus disposing of the Appeal accordingly.