Open pronouncement of tribunal orders is required despite later communication under the tax procedure rules.

The Delhi High Court held that an adjudicatory tribunal must pronounce its reasoned order in open hearing on the date fixed, even though the order is later communicated under section 254(3) and rule 35. It treated "pass" and "pronounce" as substantially equivalent in this procedural setting and rejected the view that the absence of an express pronouncement word in the statute dispensed with open declaration. The Court emphasised that procedural fairness, natural justice, and the rule of law require parties to know the result when the order is signed and dated. The Tribunal was directed to follow open pronouncement of its orders.

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Issues: Whether the Income-tax Appellate Tribunal is bound to pronounce its orders on the date fixed for pronouncement and whether its practice of merely signing and later communicating orders, without open pronouncement, is consistent with the Income-tax Act, 1961 and the rules governing the Tribunal.

Analysis: Section 254(1) of the Income-tax Act, 1961 empowers the Tribunal to pass orders, while section 254(3) and rule 35 of the Income-tax (Appellate Tribunal) Rules, 1963 deal with communication of the order. The expressions "pass" and "pronounce" were treated as substantially equivalent in the procedural context, and the absence of an express phrase requiring pronouncement was held not to exclude the obligation to declare the order when it is signed and dated. The distinction sought to be drawn between passing and pronouncing orders was found to be overly technical and inconsistent with the principles of procedural fairness, natural justice, and the rule of law. The requirement that parties know the result of their case on the date the order is signed and declared was regarded as inherent in judicial administration and not prejudicial to the Tribunal's functioning.

Conclusion: The Tribunal is bound to pronounce its orders in open hearing on the date fixed, in addition to communicating them under section 254(3) and rule 35.

Final Conclusion: The challenge to the Tribunal's contrary stand succeeded, and the Tribunal was directed to adopt open pronouncement of its judgments and orders, with costs imposed for the needless controversy.

Ratio Decidendi: A tribunal exercising adjudicatory power must declare its reasoned order openly when it is signed and dated, and a statutory scheme for later communication does not dispense with the procedural obligation of pronouncement in open hearing unless the statute clearly says so.

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