Notice sent on email ID not provided by Petitioner: HC directs issue of fresh notice & Order 

Muttathara Service Co-Operative Bank Ltd Vs Central Board Of Direct Taxes (Kerala High Court)

Notice sent on email ID not provided by the Petitioner: HC directs issue of fresh notice & Order

In the case of Muttathara Service Co-Operative Bank Ltd. vs. Central Board of Direct Taxes, the Kerala High Court addressed issues of procedural fairness and the principles of natural justice in the context of an appeal under the Income Tax Act, 1961. Here’s a comprehensive summary of the case and its implications:

Case Background

Muttathara Service Co-Operative Bank Ltd. (referred to as the petitioner) filed a writ petition challenging an order (Ext.P4) passed in appeal under Section 250 of the Income Tax Act, which upheld the assessment order (Ext.P1) for the assessment year 2017-2018. The appeal had been dismissed for non-prosecution because the petitioner failed to appear, allegedly due to not receiving any notices.

Proceedings in the High Court

1. Petitioner’s Claim: The petitioner contended that they did not receive any of the notices sent by the authorities pursuant to Section 250 of the Income Tax Act. They argued that notices were not received on their primary email ID, secondary email ID, or the email ID mentioned in their Form No.35 (used for filing appeals). Therefore, they asserted that Ext.P4 was passed in violation of natural justice.
2. Respondent’s Statement: The 4th respondent (representing the tax authorities) submitted a statement acknowledging that notices had indeed been sent to an email ID (crgkitr@yahoo.in) different from the email ID (crgk1070@gmail.com) provided by the petitioner in Form No.35. The authorities’ records confirmed that notices were dispatched to the incorrect email ID, which the petitioner had not provided for communication purposes.
3. High Court’s Findings: Upon examining the submissions, the High Court agreed with the petitioner’s argument that Ext.P4 had been issued without proper notice being served to the correct email ID as per the petitioner’s Form No.35. The court noted that this constituted a violation of the principles of natural justice, which require that parties be given adequate opportunity to present their case.
4. Judgment: The High Court set aside the appellate order (Ext.P4) and directed the 4th respondent (Central Board of Direct Taxes) to reconsider the appeal (Ext.P2) after issuing fresh notices to the petitioner’s correct email ID (crgk1070@gmail.com). The court instructed that the appeal must be adjudicated within three months from the date of issuing these fresh notices. Until a decision was made on the appeal, the court ordered that no coercive steps should be taken pursuant to the original assessment order (Ext.P1).
5. Legal Principles Emphasized: The judgment underscored the importance of adherence to procedural fairness and natural justice in administrative proceedings. It highlighted that parties must receive notices at the correct communication addresses provided by them to ensure they have a fair opportunity to participate in the legal process.

FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT

This writ petition is filed against Ext.P4 order in appeal passed under Section 250 of the Income Tax Act 1961 (for short, ‘the Act’), challenging Ext.P1 assessment order for the assessment year 2017-2018. The appeal has been dismissed for non prosecution as the petitioner failed to appear pursuant to notices issued under Section 250 of the Act. According to the petitioner, they have not received any of the notices referred to in Ext.P4 either in the primary email Id or in the secondary email Id or in the email Id mentioned in Ext.P2 Form No.35. Accordingly, the petitioner prays to set aside Ext.P4 appellate order being one passed in violation of the principles of natural justice.

2. A statement has been filed on behalf of the 4^th respondent wherein it is stated that, the notices have been sent to the email Id given in Ext.P2 Form No.35 under ‘Personal Information’. A chart has also been produced showing the details of the notices sent to the petitioner. From the statement, it is seen that the notices have been sent to the email Id crgkitr@yahoo.in whereas the email Id provided by the petitioner in Ext.P2 Form No.35 is crgk1070@gmail.com. Thus, it is evident that no notice has been sent to the email Id given by the petitioner in Form No.35. I agree with the submission of the petitioner that, Ext.P4 order has been passed without any notice to the petitioner. Accordingly, Ext.P4 is set aside and there will be a direction to the 4^th respondent to consider Ext.P2 appeal after due notice to the petitioner in the email Id shown in Ext.P2. The appeal shall be disposed of within a period of three months from the date of issuance of fresh notice to the petitioner. Till such time, there shall not be any coercive steps pursuant to Ext.P1 assessment order.

The writ petition is disposed of with the above direction.