Vimal Trading Vs National Faceless Assessment Centre (Bombay High Court)
Bombay High Court held that order passed without granting an opportunity of being heard is passed against the principles of natural justice and accordingly, is liable to be quashed. Thus, petition is allowed and orders are quashed.
Facts- This petition is filed by the petitioner under Article 226 of the Constitution of India, assailing the following :- (i) the assessment order dated 9 September 2022, passed under Section 143(3) of the Income Tax Act, 1961; (ii) the notice of demand dated 9 September 2022, issued under Section 156 of the IT Act; and (iii) two show cause notices dated 9 September 2022, proposing the initiation of penalty proceedings u/s. 274 read with Section 270A and Section 271AA(1) of the IT Act.
Issue involved herein is whether the final impugned assessment order is rendered a nullity in law, and non est in light of non-compliance of the principles of natural justice, which is a jurisdictional requirement intrinsic under Section 144B of the IT Act.
Conclusion- Held that notice/order under a statutory provision which would entail civil consequences causing prejudice to the person, ought to be passed in strict adherence to the principles of natural justice to include opportunity of being heard. At this juncture, we may refer to a decision of the Supreme Court in the case of UMC Technologies Private Limited v. Food Corporation of India and Another, to state that it is the first principle of civilized jurisprudence that a person against whom any action is sought to be taken or interest are being affected should be given a reasonable opportunity to defend himself to include the right to be heard, before an order entailing such consequence is passed. In light of the above, this petition must succeed.
