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Issues: (i) whether the assessee was denied reasonable opportunity of hearing when the Tribunal decided the Revenue's appeal ex parte on the adjourned date without fresh notice; (ii) whether the Tribunal was justified in restoring the assessment without considering the additional evidence or, at least, remanding the matter for fresh decision.
Issue (i): Whether the assessee was denied reasonable opportunity of hearing when the Tribunal decided the Revenue's appeal ex parte on the adjourned date without fresh notice.
Analysis: Section 10(5) of the U.P. Sales Tax Act and rule 68 of the Sales Tax Rules require the Tribunal to afford a reasonable opportunity of hearing and to serve notice of the date fixed for hearing. Where the original hearing is adjourned, the party is entitled to notice of the adjourned date. The affidavits showed that no notice of the adjourned date was issued to the assessee or his counsel, and the Revenue did not controvert that position. An ex parte disposal in such circumstances was contrary to law and to the requirement of fair hearing.
Conclusion: The Tribunal's ex parte disposal on the adjourned date without fresh notice was invalid and unsustainable, in favour of the assessee.
Issue (ii): Whether the Tribunal was justified in restoring the assessment without considering the additional evidence or, at least, remanding the matter for fresh decision.
Analysis: Section 12-B of the U.P. Sales Tax Act regulates additional evidence in appeal and contemplates an opportunity to the Revenue to rebut such evidence when it is admitted. The record showed that the Revenue was represented before the first appellate authority and raised no objection to the evidence being taken on record. Even if there was any procedural lapse, it did not justify outright exclusion of the evidence and restoration of the assessment without examining the merits. At the highest, the defect called for curing by affording the Revenue an opportunity or by remand for fresh consideration, especially since the Tribunal did not itself decide whether the transactions were works contracts.
Conclusion: The Tribunal acted in restoring the assessment without considering the additional evidence or remanding the matter, in favour of the assessee.
Final Conclusion: The revision was allowed, the Tribunal's order was set aside, and the appeal was directed to be reheard and decided afresh after due notice to the assessee.
Ratio Decidendi: A tax appellate authority must give notice of the adjourned hearing date and afford a real opportunity of hearing; if additional evidence is admitted or relied upon, any procedural defect is ordinarily curable by giving the opposite party an opportunity or by remand, rather than by summarily restoring the assessment.
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