High Court Of Punjab And Haryana
Dr. Avtar Singh VS. ITSC
Section : 245D
Rajive Bhalla And Dr.Bharat Bhushan Parsoon, Jj.
CWP No. 1876 Of 2013
October 28, 2013
Rajive Bhalla, J. – The petitioner challenges order dated 31.7.2012 passed by the Income Tax Settlement Commission.
2. Counsel for petitioner submits that the only point that arises for consideration is whether after conclusion of arguments in proceedings before the Settlement Commission, the statement made and affidavit sworn by Sandip Singh could be considered without confronting the petitioner while making an addition of Rs.3,91,40,000/-, based upon the statement and the affidavit.
3. Counsel for the petitioner further submits that principles of natural justice apply to proceedings before the Settlement Commission with equal vigour as they apply to any other proceedings under any other statute. The impugned order passed without confronting the petitioner with the alleged statement made and affidavit sworn by Sandip Singh, is violative of the principles of natural justice. The writ petition may be allowed, the impugned order may be set aside and the Settlement Commission may be directed to pass a fresh order after affording an opportunity to the petitioner to rebut the statement made and the affidavit sworn by Sandip Singh.
4. Counsel for the revenue submits that though the petitioner may not be entirely incorrect on facts but as order passed by the Settlement Commission is in the nature of a concession granted to an assessee, the Settlement Commission was well within its rights to consider the statement made and affidavit sworn by Sandip Singh. The petitioner has not placed any material, before this Court, to raise an inference that the statement made by Sandip Singh or affidavit sworn by him is in any manner incorrect. The mere fact that the petitioner was not confronted with the statement/affidavit is insufficient to set aside the impugned order for violation of principles of natural justice. It is further submitted that principles of natural justice do not operate in a vacuum and where their violation has not caused prejudice, an order cannot be set aside to fulfil an empty formality.
5. We have heard counsel for the parties, perused the impugned order, considered the pleadings and are of the firm opinion that principles of natural justice, which are inherent in any adjudicatory process, have been violated. The principles of natural justice are too well engrafted in our system of adjudication for us to dilate upon, except to the extent that where an order is passed in violation of principles of natural justice and serious prejudice is caused to an assessee, such an order cannot stand the test of judicial scrutiny and must fall on the touchstone of violation of principles of natural justice.
6. Admittedly, the Settlement Commission received a statement made and an affidavit sworn by Sandip Singh after conclusion of arguments. The petitioner was admittedly not confronted with the statement or the affidavit. A part of the impugned order is admittedly based upon the statement and the affidavit. The Commission having failed to confront the petitioner with the statement and the affidavit before adding Rs.3,91,40,000/-to the income of the petitioner, has violated principles of natural justice rendering the impugned order illegal and void to that extent.
7. The writ petition is, therefore, allowed to the limited extent of setting aside conclusions/findings and additions made on the basis of statement made by and the affidavit sworn by Sandip Singh but with liberty to the Settlement Commission, Delhi, to decide this matter afresh and in accordance with law after affording the assessee an opportunity to rebut contents of the statement made and affidavit sworn by Sandip Singh.
8. Parties are directed to appear before the Settlement Commission on 2.12.2013. The matter be decided within three months upon the parties putting in appearance on 18.12.2013.
[Citation : 360 ITR 588]